January sees fifth consecutive drop in food prices, FAO reports

World food commodity prices fell for the fifth consecutive month in January, driven by lower dairy, sugar, and meat prices, according to the latest Food and Agriculture Organization (FAO) report. Meanwhile, global cereal production is forecast to hit record levels, pushing the stocks-to-use ratio to its highest since 2001.

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The FAO Food Price Index averaged 123.9 points in January, down 0.4% from December and 0.6% lower than a year ago.

• Cereal prices rose slightly by 0.2%, supported by ample wheat and maize stocks that offset adverse weather in key regions. Rice prices climbed 1.8%, led by strong demand for fragrant varieties.
• Vegetable oils gained 2.1%, with palm, soy, and sunflower oils firming due to production slowdowns, tight supplies, and biofuel demand. Rapeseed oil prices fell slightly in the EU amid ample availability.
• Meat prices fell 0.4%, as pig meat prices softened amid ample supply, while poultry, ovine, and bovine prices remained broadly stable.
• Dairy prices dropped 5.0%, mainly due to lower butter and cheese prices, despite firmer skim milk powder demand in the Near East, North Africa, and Asia.
• Sugar prices fell 1.0%, reflecting expectations of higher output in India, Brazil, and Thailand.

Record cereal harvests and rising stocks

FAO forecasts global cereal production in 2025 at 3.023 million tonnes, with record harvests for wheat, coarse grains, and rice. Key drivers include:

• Higher wheat yields in Argentina, Canada, and the EU
• Expanded maize planting and yield improvements in China and the USA
• Rice output gains led by India, Bangladesh, Brazil, China, and Indonesia

Global cereal use is projected to rise 2.2% in 2025/26, while stocks are expected to increase 7.8%, pushing the global cereal stocks-to-use ratio to 31.8%—the highest since 2001. World cereal trade is forecast to grow 3.6% over the marketing year.

Market stability and outlook

FAO’s Agricultural Market Information System (AMIS) notes that international food markets have remained relatively stable, supported by ample harvests, functioning supply chains, and sufficient fertiliser availability. However, the agency warns that current stability should not be interpreted as long-term immunity to shocks in global food markets.