The Food and Agriculture Organisation of the United Nations (FAO) has warned that India’s 20 July prohibition of non-parboiled Indica exports has fostered expectations of greater sales in other origins, amplifying upward pressure already exerted on prices by seasonally tighter supplies and Asian purchases.
The Un Agency in its July edition of its Food Price Index, added that this upward pressure of rice prices raises substantial food security concerns for a large swathe of the world population, especially those that are poorest and who dedicate a larger share of their incomes to purchase food.
It also warned that export restrictions can bear adverse consequences on production, consumption and prices that last beyond the duration of their implementation and risk exacerbating high food domestic inflation in many countries.
The report revealed that global food commodity prices rose in July, influenced by the termination of the Black Sea Grain Initiative and new trade restrictions on rice.
The report which tracks monthly changes in the international prices of globally-traded food commodities, said food prices averaged 123.9 points in July, up 1.3% from the previous month while 11.8% below its July 2022 level.
It states that the increase was driven by a sharp jump in the FAO Vegetable Oil Price Index, which rose 12.1% from June after seven months of consecutive declines. International sunflower oil prices rebounded by more than 15% in the month, due mostly to renewed uncertainties surrounding the exportable supplies after the Russian Federation’s decision to end implementation of the Black Sea Grain Initiative. World prices for palm, soy and rapeseed oils increased on concerns over output prospects in leading producing countries.
The FAO Cereal Price Index declined by 0.5% from June, driven by a 4.8% drop in international coarse grain quotations due to increased seasonal supplies of maize from ongoing harvests in Argentina and Brazil and potentially higher-than-anticipated production in the United States of America. However, international wheat prices rose by 1.6%, their first monthly increase in nine months, due to uncertainty over exports from Ukraine as well as continued dry conditions in North America.
The FAO All Rice Price Index increased by 2.8% on the month and 19.7% on the year to reach its highest nominal level since September 2011.
