The index averaged 127.1 points in March, reflecting a 6.9% increase from the previous year, but remaining 20.7% below its peak in March 2022.
The cereal price index declined by 2.6% in March and was down 1.1% from March 2024. Global wheat prices dropped as concerns over crop conditions in some major Northern Hemisphere exporters eased, though currency movements tempered the decline.
World maize prices also decreased from February, as did those for sorghum and barley. The all-rice price index declined by 1.7% amid weak import demand and ample exportable supplies.
In contrast, the vegetable oil price index increased by 3.7% from February to average 23.9 percent higher than its year-earlier level. Quotations for palm, soy, rapeseed and sunflower oils all rose, driven by robust global import demand.
The meat price index also rose, increasing by 0.9% in the month and 2.7% in the year, primarily due to higher pig meat prices in Europe after Germany regained foot-and-mouth-disease-free status and the strengthening of the euro against the United States dollar.
World poultry meat prices remained largely stable in March despite the continued challenges posed by widespread avian influenza outbreaks in some major producing countries.
The dairy price index was unchanged from February, with lower international cheese prices offset by higher quotations for butter and milk powders.
The sugar price index dropped by 1.6% in March, mainly driven by signs of weaker global demand. Recent rainfall in key sugarcane-growing areas of southern Brazil further contributed to the decline, while deteriorating production prospects in India and continuing concerns about the overall outlook for the crop in Brazil limited the price drop.
Updated forecasts for cereal supply and demand
The FAO also released a new Cereal Supply and Demand Brief, with revised estimates for 2024 and fresh insights on cropping and crop prospects for 2025.
The estimate for global cereal production in 2024 stood at 2,849 million tonnes, representing a 0.3% year-on-year drop but higher than previous estimates due to larger-than-expected wheat outputs in Australia and Kazakhstan. FAO’s world rice production forecast for 2024/25 remains steady at 543.3 million tonnes, implying a 1.6% yearly increase mostly due to expanded plantings.
FAO’s forecast for global wheat production in 2025 remains unchanged from last month at 895 million tonnes, matching the revised estimate for 2024. Wheat output in the European Union is expected to expand by 12 percent following weather-induced declines in 2024. Increases are also anticipated in Argentina, Egypt and India, while declines are projected for Australia, the United States of America, and parts of Near East Asia.
Maize harvests in the Southern Hemisphere are set to vary, with increases expected in Brazil and South Africa but a decline in Argentina.
Cereal utilisation and stock changes
The new FAO forecast for world cereal utilisation in 2024/25 stands at 2,868 million tonnes, representing a 0.9% increase from 2023/24. This growth is led primarily by a new record-high level of rice utilisation.
World cereal stocks are predicted to decline by 1.5% to 873.3 million tonnes by the close of seasons in 2025, driven mainly by a significant contraction in coarse grain stocks. By contrast, global wheat and rice inventories are expected to increase.
The updated forecasts place the world cereal stocks-to-use ratio in 2024/25 at 30.1%, slightly down from the previous year but still indicating an overall comfortable level, FAO said.
FAO has further lowered its forecast for world cereal trade in 2024/25 by 5.3 million tonnes to 478.9 million tonnes, marking a 6.7% contraction from 2023/24 and the lowest level since 2019/20. Lower expected purchases by China are a primary driver of the reduced trade forecasts for coarse grains and wheat.
Call for dialogue on food commodity trade
The Agricultural Market Information System (AMIS), hosted by FAO, also released its monthly Market Monitor.
In addition to regular market analysis, the report’s feature article calls for dialogue on food commodity trade to safeguard global food security, noting that the average applied tariff on agricultural goods fell by more than half between 2005 and 2022.
