Blog Post

Commodity Prices Continue to Fall in February

The FAO Food Price Index continued its decline in February, falling marginally due to declines in cereal and vegetable oil prices. The February Index was down 10.5 percent from its 2023 level.

The Cereal Price Index fell by 5 percent from January and 22.4 percent from February 2023. Expected ample harvests from Argentina and Brazil contributed to declining maize prices, while stronger exports from Russia drove wheat prices down. Rice prices also declined in February for the first time in several months as import demand remained relatively slow and harvests began in some producing countries; however, rice prices remain significantly higher than their 2023 levels.

The Vegetable Oil Price Index fell by 1.3 percent in February to reach 11 percent below its February 2023 level. Slight increases in palm oil prices were offset by lower soy, sunflower, and rapeseed oil prices. Soy prices dropped most significantly in February due to strong harvests in South America.  

The Dairy, Meat, and Sugar Price Indices all rose slightly in February, at 1.1, 1.8, and 3.2 percent, respectively. The Dairy and Sugar Price Indices remain significantly higher than their 2023 levels (13.4 and 12.5 percent, respectively).

The latest AMIS Market Monitor also reports continued stability in global commodity markets, with cereal prices declining across the board and crop development accelerating in many regions due to warming temperatures. The February edition of the Monitor also emphasized the need for continued inclusive transformation of global agrifood systems to continue to meet the challenges of food security for a growing world population, protection of livelihoods across the agricultural value chain, and climate change adaptation and mitigation.

Global 2023 wheat production is estimated to be 2.3 below its 2022 level. Global utilization prospects for 2023-2024 also declined in February, but overall utilization is expected to be 1.8 percent above its previous year’s level due to increased feed use. Wheat trade forecasts remained unchanged, with trade expected to fall by 1.2 percent. Global wheat ending stocks for 2024 are expected to be 1.3 percent below their opening levels.

Global maize production prospects for 2023 increased in February due to higher estimates from Ukraine; total production is expected to be 5.3 percent above 2022 levels. Maize utilization forecasts also rose slightly based on increased feed use to reach 1.4 percent above their previous year’s levels. Trade for 2023-2024 is expected to increase by 3.3 percent, driven by increased demand from China and exports from Ukraine. Global maize ending stocks are forecast to be 1.1 percent above their opening levels.

Rice production prospects for 2023-2024 increased in February, as did utilization expectations. However, total utilization for 2023-2024 is still expected to be at or slightly below its 2022-2023 levels. Rice trade expectations remained stable in February. Total rice ending stocks are anticipated to reach a record high; however, the Monitor points out that the majority of these stocks will be held in India and other exporting countries, while importers’ reserves are forecast to fall.

Soybean production prospects for 2023-2024 declined slightly in February. Utilization expectations also fell due to reduced supplies from several countries; however, total soybean utilization is still expected to increase by 5.5 percent from 2022 levels. Soybean trade forecasts fell marginally in February due to lowered expected exports from Brazil and the U.S. and reduced import forecasts for China and Russia. Global soybean ending stock prospects remained unchanged in February.

Natural gas prices continued to decline in February. Overall fertilizer supplies are expected to be sufficient, although shipping disruptions in the Red Sea could increase prices and cause supply disruptions in the coming months. Urea prices rose in most markets, with expected continued increases throughout the spring due to seasonal import demand. China also currently has export limitations on nitrogen fertilizers, which could further drive prices. Ammonia prices remained stable in February, with seasonal demand in the U.S. balancing lower demand in other regions. Demand for potash also remains low due to declining crop prices.


Sara Gustafson is a freelance communications consultant.