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The FAO Food Price Index remained virtually unchanged month-to-month in September and almost 24 percent lower than the peak reached in March 2022.

On July 20, India banned exports of non-basmati price (covered in our blog post of July 25)—aiming to cool rising domestic prices—a move many feared would drive rising global prices higher. Since then, that trend has continued: The benchmark Thai rice price has risen 14%, Viet Nam rice prices are up 22%, and India white rice prices are up 12% (Figure 1). In August, in an effort to prevent exporters from undermining the ban, India put a surcharge of 20% on exports of parboiled rice and instituted a minimum sales price for basmati rice.

Figure 1

The Global Report on Food Crises (GRFC) 2023 Midyear Update finds that while some countries have seen improvements in hunger and malnutrition in the first half of 2023, high levels of acute food insecurity remain worldwide. As in previous years, conflict, climate change, and economic shocks continue to be the main drivers of food crisis, with conflict playing the predominant role from January through August 2023.

India’s import demand for edible oils has been significant over the past decade, with imports averaging $11.6 billion annually. In 2021, prior to the Russia-Ukraine conflict, India imported a staggering $17.1 billion of edible oils (Figure 1), dominated by palm oil ($9.6 billion), soybean oil ($4.8 billion), and sunflower/safflower oils ($2.4 billion).

The FAO Food Price Index fell by around 2 percent in August, driven by declines in cereal, vegetable oil, dairy, and meat indices. This decline placed the Index 24 percent below the peak seen in March 2022. The major exception was rice prices, which saw a significant increase in August.