The latest FAO Food Price Index, released last week, fell nearly four points from July and nearly 11 points from August 2012. This was the fourth consecutive month in which global food prices dropped.

The Cereals Price Index declined by 16.4 points from July, and fell a whopping 49.4 points from August of last year. Strong growth in global cereal production, along with a significant recovery of global maize supplies, is behind this substantial drop. The Oils/Fats Price Index also fell by 5.7 points from July, the third consecutive drop.

The Dairy, Meat, and Sugar Indices all rose slightly in August, but these increases were not enough to override the substantial decreases seen in the Cereals and Fats Indices.

The latest AMIS Market Monitor was also released recently. The September report cites generally improved supplies for wheat, maize, rice and soybeans. In fact, AMIS expects global harvests for these crops to be historically large in 2013-2014, resulting in much higher world inventories.

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