The Food and Agriculture Organization of the United Nation (FAO)’s monthly food price index has hit its lowest value since May 2016. The index, which is measured relative to average prices between 2002 and 2004, was 160.8 points last month, which is 1.3% below October levels and 8.5% below its level in November 2017.
The drop was led by vegetable oils, with a 5.7% drop month-to-month and almost 30% drop since this time last year, hitting a twelve-year low. Palm oil supplies are high, the agency noted, and production of soy and sunflower oils are also high, driving prices down.
Dairy products were down 3.3% from October and reached around 13.9% below November 2017 levels.
Meat and cereals were more or less stable, though meat was down 7.4% compared to November 2017. Prices for pork have fallen for the last three months, due to a mixture of high supply and African swine fever-related trade restrictions.
Sugar was the only food category that rose in price this month: it gained 4.4% compared to October, thanks in part to production decreases in Brazil and a redirection of sugar cane harvests for use in automotive biofuel.
It may take time before these commodity prices ripple through the food system to reach consumers, however, since there are many layers and buffers that control the prices of all four categories. In the U.S. that includes a series of Depression-era policies that continue to shape food commodity prices, often costing consumers while favoring producers.