Rome: The overall FAO Food Price Index experienced a decrease of 0.8 percent in May, primarily driven by significant drops in global prices for vegetable oils and sugar, as reported by the Food and Agriculture Organization (FAO) of the United Nations on Friday.

According to Namibia Press Agency, the index's largest component, grains and cereals, saw a decline of 1.8 percent in May. This decrease was attributed to favorable corn harvests in Argentina and Brazil, alongside reduced global demand for wheat. Despite a rise in rice prices due to increased demand for Indica rice and a weakening U.S. dollar, it was insufficient to counterbalance the other components of the index.

Meat and dairy prices saw an upward trend in May. Meat prices increased by 1.3 percent, influenced by heightened demand for beef, pork, and sheep meat, effectively offsetting the lower prices of poultry. The resurgence of German pork producers in the market, following the lifting of foot-and-mouth disease restrictions, contributed to the rise in pork prices. Conversely, chicken prices declined due to avian flu concerns, which affected global demand.

Dairy prices rose by 0.8 percent, fueled by strong demand from Asia, which kept international butter prices at historically high levels and led to increased prices for cheese and whole milk powder.

The most significant changes in the index were seen in vegetable oils and sugar. Vegetable oil prices fell by 3.7 percent, although they remained 19.1 percent above their levels from the previous year. The decline was attributed to strong production and anticipated output of palm, rapeseed, soy, and sunflower oils, along with reduced demand in the United States.

Sugar prices decreased by 2.6 percent, influenced by lower demand from the beverage and food processing industries amid an uncertain global trade outlook.