World food prices dip 0.2% in May, remain near three-year high

World food prices experienced a slight decrease of 0.2% in May, with the FAO Food Price Index averaging 130.8 points, down from a revised 131.0 in April. Despite this marginal dip, prices remain close to their highest levels in three years, specifically 18.4% below the March 2022 peak. Cereal prices saw a significant increase of 2.6% in May, driven by higher wheat and maize prices due to smaller harvest prospects and increased fuel and fertilizer costs linked to the Iran conflict. Conversely, vegetable oil prices fell by 4.6%, marking their first monthly decline this year, influenced by lower palm and soy oil prices. Sugar prices jumped 7.5% amid concerns over tightening global supplies. The FAO also projected a 2% year-on-year decrease in global cereal production for the 2026/27 period, reaching 2.98 billion tons.