October Edition of FPMA Bulletin Sees Mixed Global Prices
Updated at 1508939644
Photo Credit: ©IFPRI/Farha Khan

The October edition of the FAO GIEWS Food Price Monitoring and Analysis (FPMA) Bulletin finds mixed trends in international cereal prices. The global price of wheat rose by 6 percent in September, due in large part to weather-related concerns in the US, Australia, and Argentina. This places wheat prices 14 percent above their September 2016 levels; however, abundant global supplies and strong export competition have worked to limit the price increase.

Global maize prices fell in September to 1 percent below their August levels; prices are also marginally lower than their September 2016 levels. An anticipated bumper harvest in the US, combined with large global supplies and low export demand, played a large role in the price reduction.

Global rice prices remained relatively steady from their August levels. While prices rose in some regions (notably the US, India, and Thailand), they fell in others (including Pakistan and Vietnam); these mixed movements kept overall global prices stable.
The FPMA report also provides early warnings for high country-level food prices that may negatively affect food security. This month’s report included several domestic price warnings.

Rice prices reached record highs in Bangladesh in September, rising by more than 30 percent from their September 2016 levels. Lower production and imports in 2016 combined with a reduced harvest early in 2017 have driven much of this price increase; in addition, there remains concern about the second-season harvest, due to begin in November, as a result of flooding in July and August. The Government of Bangladesh recently launched an Open Market Sale on rice in an effort to slow the price increase and has also increased rice imports to support domestic demand. In reaction to rising rice prices, many households have slowed consumption of rice in favor of cheaper wheat flour; this increased demand has resulted in an increase in the price of wheat flour as well.

Grain prices also remained at record highs in Ethiopia in September. Fall Armyworm infestation and concern over the second-season harvest contributed to keeping prices high. Fall Armyworm is estimated to have infected up to 23 percent of the total area planted to maize. The Government of Ethiopia has engaged in numerous monitoring and control measures to stop the spread of the infestation.

In Niger, the price of coarse grains fell in September from their peak in August. However, civil insecurity continues to threaten normal market functioning in some areas. In addition, localized production shortfalls in 2016 and reduced imports from neighboring Nigeria have kept prices well above their September 2016 levels.

Staple food prices remain high in Nigeria as a result of depreciation of the local currency, trade restrictions, and civil conflict in the northeastern regions of the country. Annual food inflation remains at 20.3 percent. However, ongoing early harvests and some recent stability in the exchange rate have put some downward pressure on prices.

By: Sara Gustafson, IFPRI