June marked the second successive month of increase in the value of the FFPI. The rise was driven by relatively large increases in dairy and cereal prices. Meat quotations also firmed, while those of sugar and vegetable oils dropped.
The FAO Cereal Price Index averaged 154.3 points in June, 6.2 points (4.2 percent) above its May level and representing a one-year high. Wheat quotations increased the most, while strong import demand exerted upward pressure on international rice prices. By contrast, record harvests in South America kept maize prices under downward pressure.
The FAO Vegetable Oil Price Index averaged 162.1 points in June, down 6.5 points (or 3.9 percent) from May, when prices experienced a short-lived rebound. The slide in the index mainly reflects falling palm and soy oil values. International palm oil quotations dropped by a full 7 percent (marking a 10-month low). Soy oil values dropped, while forecasts point to a near-record global output in 2017/18. Rapeseed and sunflower oil values also dropped, contributing to the overall fall in the index.
The FAO Sugar Price Index averaged 197.3 points in June, down nearly 31 points (13.4 percent) from May and marking a 16-month low. International sugar prices have fallen steadily since February, with the continued decline reflecting large export availabilities. Weak import demand has exerted further downward pressure on quotations.
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