According to a research report by the FSDH Merchant Bank, a spike in the prices of food products moderated in June as compared with May 2017. The monthly Food Price Index (FPI) released by the United Nations Food and Agriculture Organization (FAO) showed that the index registered an increase in June 2017. The average of the index was 175.2 points, which was 6.89% higher than the June last year and 1.43% greater than the revised value for May this year.

The movement in the food prices was not uniform across all segments. For instance, while cereals, dairy, and meat products were majorly responsible for the hike in the value of the index, prices of oil and sugar depreciated. Particularly, prices of all dairy items, including cheese, butter, and milk power recorded a significant increase. The FAO Indices for meat, cereal, and dairy price appreciated by 1.85%, 4.21%, and 8.26%, respectively in June this year.

Good Production Prospects Led to Decline in Vegetable Oil Prices

The FAO Index for vegetable oil price depreciated by 3.88%, driven by falling quotations for both soy and palm oils. The fall in prices can be attributed to the remarkable production prospects and bumper harvests. The Index for Sugar Price was down by 13.45% in June 2017, owing to the low import demand worldwide and enhanced supply conditions in the primary sugar producing regions in Brazil. Besides this, the prices of rice, Irish potatoes, vegetable oil, palm oil, sweet potatoes, Garri, tomatoes, yam, and onions went up by 2.69%, 2.96%, 3.03%, 4.62%, 4.76%, 6.67%, 11.11%, 24.6%, and 33.89%, respectively.

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