Global butter and oil prices hit record highs: UN names key reasons
Photos: Butter prices surge to record highs (freepik.com)
Global prices for vegetable oil and butter continue to rise. The reason is a decrease in production and high demand, the United Nations Food and Agriculture Organization (FAO) reports.
The FAO Food Price Index averaged 127.1 points in March 2025, remaining virtually unchanged compared to February. The decline in cereal and sugar price indices offset the increase in meat and vegetable oil prices.
Overall, the index value is 6.9% higher than the corresponding level a year ago but remains 20.7% below its peak reached in March 2022 after Russia's invasion of Ukraine.
The FAO Vegetable Oil Price Index averaged 161.8 points in March, which is 3.7% higher than the previous month and remains significantly higher (23.9%) than its level a year earlier.
International prices for rapeseed and sunflower oil have risen since February, reflecting reduced supplies from major exporters, which coincides with steady global import demand.
The FAO Dairy Price Index in March stood at 148.7 points, unchanged compared to February 2025, but still 19.9% higher than its value a year ago.
International butter prices increased for the third consecutive month, up 3.9% compared to February, driven by high retail sales and rising international demand amid seasonal supply declines in Oceania and sluggish production in Europe.
The FAO Cereal Price Index in March averaged 109.7 points, which is 2.6% lower than the previous month and 1.1% lower than in March 2024. Global wheat prices declined in March as concerns about crop conditions eased in some major exporters in the Northern Hemisphere.
The FAO Meat Price Index in March averaged 118.0 points, 0.9% higher than the revised February value and 2.7% higher than a year earlier. The increase was mainly due to higher pig meat prices, primarily driven by rising quotations in the European Union.
The average FAO Sugar Price Index in March stood at 116.9 points, which is 1.4% lower than in February and 16.5 points (12.3%) lower than a year ago. The decrease was largely due to signs of weakening global demand.
The global butter prices reached a new record high in the fall of 2024 due to strong domestic and international demand amid limited supplies, especially in Western Europe.
