International food costs experienced a minor decline in May compared to the previous month, though prices continue hovering near three-year peaks, according to data released Friday by the United Nations Food and Agriculture Organization.
The organization’s Food Price Index, which tracks price movements in a collection of internationally traded food products, reached 130.8 points during May. This represents a 0.2% decrease from April’s adjusted figure of 131.0 points, while showing a 2.9% increase compared to the same period last year.
Even with the slight downward adjustment to April’s numbers, the index stayed close to its peak level since January 2023 and remained 18.4% under its March 2022 high point.
Grain costs increased by more than 2.6% during the month, with wheat prices climbing for the fourth consecutive month due to reduced export harvest expectations, including in the United States, and rising fuel and fertilizer expenses connected to the Iran conflict.
The agency reported that corn prices also received support from increased import demand and reduced supply availability in Brazil and the U.S.
Meanwhile, vegetable oil costs dropped 4.6% from the previous month, marking their first monthly decrease this year, as declining palm and soy oil prices exceeded increases in rapeseed and sunflower oil. Following five months of consecutive growth, international palm oil prices fell, reflecting expectations of reduced global import demand and uncertainty in crude oil markets.
However, vegetable oil prices remained more than 20% higher than last year on average, as increased energy costs following the effective closure of the Strait of Hormuz boosted demand for biofuels produced from organic materials, such as oil-rich plants.
Sugar costs surged 7.5% from the previous month to 95.1 points, though they stayed 13.1% below their level from a year ago. The rise was primarily caused by worries over an expected tightening of global sugar supplies in upcoming months.
In a separate report on cereal supply, the organization stated it anticipates world cereal production — including rice in milled equivalent — to contract 2% in 2026/27 to 2.98 billion tons.
Output of all major cereals is expected to decrease, though for many from record levels achieved in 2025, with the largest year-over-year reduction in percentage terms projected for wheat and the smallest for corn and barley.
