Global prices of key staple food commodities rose in April, marking its third consecutive monthly increase after four years of decline.
The FAO Food Price Index averaged 151.8 points in April, a 0.7 per cent increase from March. That is about 10 per cent below its level of a year ago and more than a third off its 2011 highs.
The gradual increase is far from even across the board. April's increase was driven by palm oil prices and, in a minor key, cereals, while sugar prices tapered down after a strong increase in March.
The FAO Food Price Index is a trade-weighted index tracking international market prices for five key commodity groups: major cereals, vegetable oils, dairy, meat and sugar. Its decline over the past year reflects ample food supplies, a slowing global economy and a stronger US dollar.
The FAO Vegetable Oil Price index rose 4.1 per cent, due largely to a grim 2016 production outlook for palm oil coupled with a growing worldwide demand.
The FAO Cereal Price Index rose 1.5 per cent on the month, due primarily to international maize quotations, themselves influenced by a weaker US dollar and spillover from the oilseeds complex. However, rice prices declined marginally, while wheat markets posted limited gains amid expectations of large supplies in the new season for the crop.
The FAO Dairy Price Index dropped 2.2 per cent as stocks of butter and cheese in major exporters continued to grow.
The FAO Meat Price Index rose 0.8 per cent, pushed up by strengthening US demand for Australian beef.
The FAO Sugar Price index, meanwhile, dropped 1.7 per cent in April after a dramatic 17 per cent increase the previous month. While concerns about global sugar production remain, Brazil - by far the main exporter - has had its second-highest crop ever and the country's use of sugarcane for ethanol is expected to decline.
Sugar and vegetable oils are the only sub-indexes currently at levels higher than those of April 2015.