Onome Amuge
Global food commodity prices eased in September for the fifth straight month, but the continued rise in meat costs to record highs has raised questions about how far consumers and policymakers can count on falling prices to tame food inflation.
The UN Food and Agriculture Organization (FAO) said its Food Price Index, which tracks the international prices of the most globally traded food commodities, slipped by 0.7 per cent to 128.8 points in September 2025, its lowest level in three months. The fall was driven by declines in cereals, sugar, dairy, and vegetable oils. But in a reminder of the pressures facing the global food system, meat prices bucked the trend, climbing to their highest level on record.
Taken together, the figures point to an uneven recovery. The headline index indicates relief from recent supply shocks, but soaring meat prices in key consumer markets underline that food inflationary pressures are far from uniform.
Cereal prices fell for the fifth consecutive month, dropping to their lowest level since September 2020. Wheat led the decline, pressured by large harvests in Russia, Europe and North America. Maize also softened on forecasts of abundant crops in Brazil and the US, while Argentina’s temporary suspension of grain export taxes helped ease global prices.
The easing offers some relief to import-dependent countries in Africa and Asia, where cereals are a dietary mainstay and foreign currency reserves have been strained by high import bills since 2021.
Rice, a key staple for billions, edged down by 0.5 per cent. Ample exportable supplies, combined with reduced demand from African and Southeast Asian buyers, weighed on the market. Yet trade restrictions remain a live risk after several Asian exporters imposed curbs in recent years to protect domestic supply.
The heaviest drop in September came from sugar, down 4.1 per cent to its lowest level since March 2021. The fall was largely due to higher-than-expected production in Brazil, the world’s largest exporter, where favourable weather and strong cane harvests boosted supply. Improved prospects in India and Thailand also helped ease pressure.
Still, sugar remains volatile. Brazil’s decision to increase the share of cane used for sugar rather than ethanol has temporarily boosted supply, but a reversal could quickly tighten markets again. Analysts warn that extreme weather linked to El Niño could also disrupt harvests.
Dairy prices fell for a third consecutive month, down 2.6 per cent. Butter prices led the decline, dropping by 7 per cent, as demand for ice cream in the northern hemisphere faded and New Zealand’s seasonal production picked up. Milk powder prices also softened amid weaker import demand, while cheese fell marginally.
For consumers in Europe, where dairy is a core household staple, the declines may feed into inflation data over the coming months. But despite the recent drop, dairy prices remain almost 9 per cent higher than a year ago.
Vegetable oils declined by 1.2 per cent overall, reflecting weaker palm and soybean oil prices. Malaysia’s palm oil inventories reached a 20-month high, offsetting strong demand from South Asia. Soy oil was also weighed down by Argentina’s suspension of export taxes, which unlocked supply.
By contrast, sunflower and rapeseed oils rose, reflecting tightness in the Black Sea and Europe. Analysts say this divergence highlights the sensitivity of oil markets to geopolitical and climatic risks, with production heavily concentrated in a few regions.
In contrast to falling commodity prices, meat prices rose 0.7 per cent, hitting a new record. Bovine and ovine meat led the increase, supported by strong demand in the US, where limited supplies have forced importers to seek beef from Australia and South America.
In Oceania, export availability has been constrained, pushing lamb and mutton prices higher. Meanwhile, Brazilian beef remained in demand globally despite reduced access to the US following new tariffs. Pig and poultry meat stayed stable, although new Chinese tariffs on EU pork exports had limited impact on global prices.
The increase in meat costs underlines the structural imbalance between supply and demand. Rising incomes in emerging markets are fuelling appetite for protein, while climate shocks and disease outbreaks have constrained supply.
For global policymakers, the FAO data presents a mixed outcome. The index is now 19.6 per cent below its peak in March 2022, when Russia’s invasion of Ukraine upended grain and oil markets. Yet compared to a year ago, prices remain 3.4 per cent higher.
In Africa, where food imports account for a large share of consumption, falling cereals offer some breathing room. But dependence on meat imports, particularly in urban middle-class markets, is a growing challenge. Rising bovine prices have already strained Nigeria’s foreign reserves, while Kenya has been forced to consider new trade deals to secure beef supplies.
In Asia, China’s reduced purchases of pork and rice highlight shifting consumption trends as domestic production recovers. But India, a major sugar and rice producer, remains exposed to monsoon variability, making its role as a stabiliser for global markets uncertain.
