Global Food Prices Becoming Less Volatile

Global food prices are becoming less volatile compared to recent years, according to a new FAO report. The November 2013 Food Outlook credits the more balanced markets to the recovery of global cereal inventories. 2013 has seen a significant increase in cereal production, largely based on increased maize crops in the US and record wheat crops in CIS countries.

Highlights for other crops include:

• Rice: International rice prices plunged in September, and slowing import demand is likely to continue to weigh on the market in 2014. Global rice inventories are also expected to increase in 2014, as production is expected to outweigh use.
• Oilseeds: 2013 has seen record global oilcrop production and only moderate consumption growth. This means that inventories will be replenished, easing the tightness seen in the market in recent years.
• Sugar: World sugar production is expected to increase only slightly from last year, but it will still be enough to outweigh consumption and build up global stocks. World sugar trade is also expected to increase significantly in 2013-2014, as falling prices boost demand.
• Meat: World meat production is expected to grow in 2013. However, despite reduced feed prices, there is no sign of the recent historically high meat prices decreasing.