Food Prices Highest Since 2014
Higher grain, sugar and dairy values have pushed a Food and Agriculture Organization (FAO) food price index to its highest value since 2014, according to a report on agrimoney.com. The index has recovered 20% from an early 2016 low.
According to the report, dairy prices gained 3.6% to reach the highest level in three years. FAO says this is due mostly to tighter exports that have pushed butter prices to historic highs and brought other dairy product values up as well.
The rise in prices is in contrast to a recent drop in values at the latest Global Dairy Trade auction, where the price index dropped 1.6%. That includes a 4.9% drop for butter. Other markets have followed suit, with Class III milk and butter futures declining this week on the Chicago Mercantile Exchange markets. Prices are expected to rebound as consumers head into the fall and the early holiday season, tightening supplies.
The report shows that in addition to dairy, sugar prices rose by 5.2% and grains rose 5.1% month-over-month, which is a two-year high.