World food price index rises for 3rd month running in Aug -FAO

ROME, Sept 3- World food prices rose for a third month running in August, led by coarse grains, vegetable oils and sugar, the United Nations food agency said on Thursday. Maize also climbed strongly, pushed up by concerns over U.S. production prospects following recent crop damage in Iowa. Average sugar prices rose 6.7% from July, reflecting forecasts of a reduction…

ROME, Sept 3 (Reuters) – World food prices rose for a third

month running in August, led by coarse grains, vegetable oils

and sugar, the United Nations food agency said on Thursday.

The Food and Agriculture Organization’s food price index,which measures monthly changes for a basket of cereals,oilseeds, dairy products, meat and sugar, averaged 96.1 pointslast month versus 94.3 in July.

The Rome-based FAO also said in a statement that worldwidecereal harvests remained on course to hit an annual record in2020.

The agency’s cereal price index rose 1.9% in August from themonth before and 7% above its value a year earlier.

Among the major cereals, sorghum, barley and rice pricesrose the most, FAO said. Maize also climbed strongly, pushed upby concerns over U.S. production prospects following recent cropdamage in Iowa.

The vegetable oil price index climbed 5.9% month-on-month,returning to around the levels registered when the coronaviruscrisis hit the world at the start of the year.

Palm oil was buoyed by expected output slowdowns in majorproducing countries, which, combined with firm global importdemand, were expected to result in lower inventory levels.

Average sugar prices rose 6.7% from July, reflectingforecasts of a reduction in production due to unfavourableweather conditions in the European Union and Thailand. Strongimport demand in China also helped push prices higher.

By contrast, the dairy index was little changed on themonth, with falls in cheese and whole milk powder offset bystronger butter and skim milk quotations.

The meat index was also largely steady, with bovine andpoultry prices in retreat while pig meat prices rose after fourconsecutive months of declines, as Chinese imports jumped.

FAO revised down its forecast for the 2020 cereal season by25 million tonnes, largely due to expectations of a lower maizeproduction in the United States.

However, despite this reduction, the agency still expected arecord harvest this year of almost 2.765 billion tonnes, up 3%on 2019 levels.

“Record maize harvests are forecast for Argentina andBrazil, while global sorghum production is expected to grow by6% from the previous year. Worldwide rice production in 2020 isalso expected to reach a new record of 509 million tonnes,” FAOsaid.

The forecast for world cereal utilisation in 2020/21 hit2.746 billion tonnes, up 2% on the 2019/20 level. The estimatefor world cereal stocks by the close of seasons in 2021 was895.5 million tonnes, down 33.4 million tonnes since July.

(Reporting by Crispian Balmer)

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