Global Food Prices Hit a 10-Year High in November 2021

The Food and Agriculture Organization (FAO) noted that global food prices increased in November 2021. This is reflected in the food price index, which reached 134.4 points, 1.2% higher than the previous month's 132.8 points (month-to-month/m-to-m). The November 2021 food price index recorded its highest increase in the last 10 years, since 2011.

Compared to the same period last year, which stood at 105.6 points, the November food price index increased by 27.3% (year-on-year/yoy). The most significant price increases occurred in cereals, dairy products, and sugar. The FAO cereal price jumped 3.1% (m-to-m) and 23.2% year-on-year (yoy), with wheat prices reaching their highest level since May 2011.

Dairy prices rose by 3.4% month-on-month (m-to-m) and 19.1% (yoy). According to the FAO, global import demand is quite high, especially for butter and milk powder, as buyers seek to secure supplies in anticipation of market tightening.

Sugar prices increased by 1.4% (m-to-m) and surged by 40% (yoy). This increase in sugar prices is mainly supported by higher ethanol prices.

Meanwhile, meat prices fell by 0.9% (m-to-m). Global vegetable oil prices also fell by 0.2% (m-to-m), but the FAO noted that palm oil prices remained strong.

The FAO Food Price Index is a measure of the monthly change in international prices of the most globally traded food commodities. This food price index consists of five sub-indices comprising cereal, vegetable oil, dairy, meat, and sugar sub-indices.