Reduced demand resulted in the cattle price index falling on an international scale according to the latest Food Price Index report from the Food and Agriculture Organisation (FAO) of the United Nations.

In December, the FAO Food Price Index (FFPI) which tracks the monthly changes in international prices of a basket of food commodities dropped by 1.2% from November.

More worrying, the FAO Meat Price Index averaged 113.8 points in December, down 1.4 points from November – the sixth month in a row a decline has been recorded.

According to the FAO, international prices of bovine meat fell in December as a result of increased supplies of slaughter cattle in several large producing countries and ‘lacklustre global demand for medium-term supplies’.

Poultry meat prices also fell back as supplies remained steady despite production issues because of the impact of bird flu outbreaks.

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In contrast, increased demand for pigmeat pre-Christmas resulted in a global rise in pork values especially in Europe.

For the 12 months of 2022, the FAO Meat Price Index averaged 118.9 points, up 11.2 points from 2021, which was the highest annual average since 1990.

Demand for milk products faired better, with the FAO report revealing the Index increased 1.2% in December after five months of consecutive declines.

The report stated: ‘Higher international cheese prices, reflecting tightening market conditions, drove the monthly increase in the index, while international quotations for butter and milk powder declined.’

International cheese prices also rose in December, reflecting a strong global import demand and also high internal retail and services sector sales, especially in western Europe.

The FAO Dairy Price Index averaged 139.1 points in December – up 1.5 points from November.

There was some negativity however, with international butter prices falling for the sixth consecutive month primarily due to ‘continued sluggish global import demand.

Meanwhile, international milk powder prices also decreased slightly because of lower prices in western Europe.

Overall, the FAO Dairy Price Index for 2022 averaged 142.5 points, up 23.3 points from 2021, and recorded the highest annual average on record since 1990.

The FAO Cereal Price Index also dropped in December by 1.9% from November as ongoing harvests in the southern hemisphere boosted wheat exportable supplies and strong competition from Brazil drove down world maize prices.

Over 2022 as a whole, the FAO Cereal Price Index hit a new record high of 154.7 points, which was an increase of 23.5 points on 2021.

The FAO report highlighted that the price index soared due to significant market disruptions, increased uncertainties, higher energy and input costs, adverse weather in a few key suppliers, and continued strong global food demand.

According to FAO chief economist Maximo Torero, although the index of world food prices declined for the ninth month in a row during December, the overall index for 2022 showed a rise in international prices of commonly traded food commodities.

“Calmer food commodity prices are welcome after two very volatile years,” the chief economist said.

“It is important to keep a strong focus on mitigating global food insecurity given that world food prices remain at elevated levels, with many staples near record highs, and with prices of rice increasing, and many risks associated with future supplies.”