Sep 8, 2025
FAO reports significant increases in meat and vegetable oil prices
In August, global meat prices reached an unprecedented high, contributing to a sustained elevation in world food prices, according to the United Nations' Food and Agriculture Organization (FAO). The FAO Food Price Index, which tracks international prices of a basket of food commodities, recorded a value of 130.1 points in August. This figure represents a 6.9% increase from the previous year and marks the highest level since February 2023.
Background and Context
The recent surge in meat prices is part of a broader trend of rising global food prices. The FAO index, despite its recent high, remains 18.8% below the peak observed in March 2022, following geopolitical disruptions such as Russia's invasion of Ukraine. The increase in meat prices was primarily driven by robust demand for beef in major markets like the United States and China. While ovine meat prices also saw an increase, pig meat prices remained stable, and poultry prices declined due to plentiful supplies from Brazil.
Market Implications
The record-high meat prices have several implications for the global food market. The rise in beef demand, particularly in the U.S. and China, has been a significant factor in driving up the meat price index by 0.6%. Meanwhile, other food commodities showed mixed trends. Vegetable oil prices climbed 1.4%, reaching their highest levels in over three years, fuelled by Indonesia's efforts to increase palm oil content in biodiesel to reduce fossil fuel dependency. Conversely, cereal prices fell for the fifth consecutive month, with wheat prices declining due to large harvests in the EU and Russia, although maize prices rose on increased U.S. demand.
Looking Ahead
The FAO has projected a record global cereal production of 2.961 billion tonnes for 2025, which is expected to be 3.5% higher than the previous year. This increase is largely attributed to improved maize yields in the United States, Brazil, and Mexico. However, the EU may face challenges due to adverse weather conditions affecting yields. As the global market adapts to these changes, stakeholders in the meat and food logistics industry will need to closely monitor these developments to navigate the evolving landscape.