Commodities Buzz: FAO food price index rises 1% on year, sugar prices rising

The FAO Food Price Index (FFPI) averaged 131.1 points in July 2026, up 0.7 points (0.6 percent) from its June level. Increases in the price indices for cereals, sugar and vegetable oils were partially offset by declines in those for meat and dairy products. Compared to a year earlier, the FFPI stood 1.3 points (1.0 percent) higher but remained 29.1 points (18.2 percent) below its peak reached in March 2022.

The FAO Cereal Price Index averaged 113.8 points in July, up 3.8 points (3.4 percent) from June and 7.3 points (6.9 percent) above its July 2025 level. Global wheat prices surged by 5.8 percent, standing 9.9 percent above their year-earlier level, amid heightened concerns over continued disruptions to Black Sea export flows and damage to export infrastructure, further compounded by the impact of recent heatwaves on crop yields in several key producing countries.

The FAO Vegetable Oil Price Index averaged 195.7 points in July, up 3.7 points (2.0 percent) month on month and marking its highest level since June 2022. The continued increase in the index reflected higher palm and soy oil prices, which more than offset lower sunflower and rapeseed oil quotations. International palm oil prices rose for the second consecutive month, following a brief decline in May, largely underpinned by firm demand from Indonesia’s biodiesel sector and higher crude oil prices, which outweighed downward pressure from seasonally higher production in Southeast Asia.

The FAO Dairy Price Index averaged 116.2 points in July, down 0.8 points (0.7 percent) from June and 38.4 points (24.8 percent) below its level in July 2025, extending the decline observed since April. The decline reflected lower quotations for butter and milk powders, which more than offset a modest recovery in cheese prices.

The FAO Sugar Price Index averaged 95.0 points in July, up 5.1 points (5.6 percent) from June, but still down 8.3 points (8.0 percent) from its level a year ago. The increase was mainly driven by concerns about the potential impacts of persistent hot and dry weather on crop yields in the European Union and of El Niño-related weather conditions on production prospects in key producing countries in Asia.

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