World Food Commodity Prices Ease in December; Down on the Year

World food commodity prices backed off in December, ending slightly lower on the year. 

The Food and Agriculture Organization (FAO) of the United Nations on Friday reported that its food price index averaged 127 points last month. That was down 0.5% from November following three consecutive monthly increases, although still 6.7% higher than the same month a year earlier. 

For 2024 as a whole, the overall food price index averaged 122 points, 2.1% lower than the previous year as major price declines for cereals and sugar offset smaller ‘but not insignificant’ gains in prices for vegetable oils, dairy and meats. 

The FAO food price index tracks monthly changes in the international prices of a set of globally traded food commodities. The index hit its peak in March 2022, following the Russian invasion of Ukraine (see graph below). 

The cereal price index was relatively unchanged in December versus November, but 9.3% below its year-earlier level, as a marginal uptick in corn values offset a drop in in wheat. The cereal index averaged 113.5 points in 2024, down 13.3% from 2023 and marking the second annual decline from the 2022 record level. 

The vegetable oil index eased 0.5% in December compared to a month earlier but was still roughly one-third higher than December 2023. For the entire year, the index averaged 9.4% higher than in 2023 amid ‘tightening global supplies.’