Mubasher: Global food prices recorded in October the first increase in five months, led by surges in quotations for sugar and cereals, the Food and Agriculture Organization (FAO) said.

The FAO’s index, which tracks monthly price movements for a basket of cereals, oilseeds, dairy products, meat and sugar, hit an average of 172.7 points last October, rising by 1.7% month-on-month and 6% on last year.

Sugar prices climbed by 5.8% from September, due projections of lower supplies in the coming year, with expectations of steep drops in sugar production in India and Thailand.

The United Nations (UN) food agency’s cereal index rose by 4.2% last month, owing to surges in the export prices of wheat and maize, which came as a result of lower prospects of crops in key producing nations and a “robust trade activity.”

In addition, the vegetable oil price gauge edged up by 0.5% to hit its highest level since over a year, while meat prices rallied by 0.9% led by higher demand, most specifically from China, the FAO said.

On the other hand, prices of dairy products bucked the trend, with a 0.7% drop last October, as lower cheese quotations muted gains in skimmed and whole milk powders.

The organisation slashed its outlook for world cereal output this year, projecting around 2 million tonnes, while it remained still 1.8% higher, compared with last year’s levels.

Wheat production was expected to total to 765 million tonnes, falling almost by 1 million tonnes compared from the last forecast.

Global rice output was seen at 513.4 million tonnes, barely changed from the previous outlook and slightly below 2018 levels.