The UN Food and Agriculture Organisation’s (FAO) food price index hit a ten-year high at 130.0 points in September, up 1.2% from August and 32.8% higher than in September 2020.

According to the FAO, tightening supply and robust demand for staples such as wheat and palm oil drove the index higher. The dairy price index rose 1.5% in September from the month prior, averaging 117.9 points and 15.2% YOY as international quotes for all dairy products rose due to strong global import demand paired with limited export availabilities.

Limited Oceania production at this stage in the season and low stocks lifted world butter and SMP prices. WMP and cheese prices rose moderately due to a combination of constrained production, low inventories and steady European demand.