January Global Food Prices Fall by 1.6%, Continuing Declining Trend for Two Consecutive Months

Sugar, Oils, and Meat Prices Lead the Decline, While Dairy Prices Increase

The global food prices saw a continued decline in January 2025, marking the second consecutive month of falling prices, driven by decreases in sugar, oil, and meat prices. According to the Ministry of Agriculture, Food and Rural Affairs, the United Nations Food and Agriculture Organization (FAO) reported a 1.6% drop in the Food Price Index, which stood at 124.9 for January 2025, compared to 127.0 in December 2024.

The Food Price Index is based on a comparison of current prices to the average prices from 2014 to 2016, which are set as a baseline index value of 100. In November 2024, the index peaked at 127.7, signaling an upward trend in food prices. However, the following months saw a reversal of this trend, with prices continuing to decrease.

Key contributing factors to the overall drop in global food prices include a significant reduction in the prices of sugar, edible oils, and meat. For instance, sugar prices fell by 6.8% to an index of 111.2. This drop is attributed to an improvement in sugar production forecasts in Brazil and a decision by the Indian government to resume sugar exports, which had been restricted since October 2023.

Similarly, the price index for edible oils declined by 5.6%, reaching 153.0. The prices of palm oil and canola oil dropped, while soybean oil and sunflower oil prices remained relatively stable. Meat prices also saw a decrease, with the meat price index falling by 1.4% to 117.7. Demand reduction led to a drop in lamb prices, while an outbreak of foot-and-mouth disease in Germany led to supply restrictions and lower pork prices. Poultry prices decreased as well due to abundant supply, but beef prices rose due to ongoing demand for imports.

While some categories saw price decreases, certain products saw a price increase. The grain price index rose by 0.3% to 111.7. The price of corn surged due to a shortage in supply, with production and stock estimates being adjusted downward. Meanwhile, wheat prices dropped because of poor export performance, and rice prices fell as competition among exporting countries increased.

The dairy product price index, which stood at 142.9, saw a 2.4% increase. The global demand for imports led to a rise in cheese prices, though butter and whole milk powder prices decreased.

Overall, the food price trends indicate that while certain categories are experiencing price reductions, others, particularly dairy and grain products, are witnessing price hikes. This dynamic underscores the complexities of the global food market and the interrelated factors influencing food prices, including supply chain issues, weather patterns, and international trade policies.

The FAO's findings highlight ongoing fluctuations in food prices, which have significant implications for global food security, trade, and the livelihoods of those dependent on agricultural production.