FAO registers a drop in food prices

In January, for the first time in three months, the price rate of most of the food products dropped. According to the Food and Agriculture Organization of the United Nations, although dairy value rose well, the price on cereals, sugars, oil and meat dropped even more and provoked this decrease in the rate.

The rate, elaborated accordingly to a food products basket, dropped 1.3% in comparison with December, and a 4.4% below last January’s rate. Abdolreza Abbassian, an economist in FAO, pointed out that prices are lower due to the wealth on supplies, but that a stronger upturn in the demand (for example, an increase in the import rhythm from Asia) would limit this drop.

Sugar and vegetable oils dropped 5.6% and 3.8% respectively. Moreover, the record-hitting cereal harvests were a reason for the food prices dropping a 23% in comparison with January 2013. The price of the meat, which had hardened during the last months, has slightly decreased in January.

The registered exception was the increase on dairy products, which reached 1.3% in January mainly due to the high demand, especially from China, north of Africa, Middle East and Russia Federation in Michael Griffin opinion, a FAO expert.

The National Institute of Statistics and Geography of Mexico published today the inflation rate reached during January. This rate could be altered by the effects of the upcoming Tax Reform. The taxes that came into force in 2014 led to a 0.68% increase in the inflation rate during the first half of January to reach a 4.63% annual rate, the highest in eight months. Beverages and loaf has been the most affected products during the first half of January.