The FAO Food Price Index averaged 168 points in April, down 1.8 per cent from March although remaining 10 per cent higher than a year earlier.

According to FAO, the Sugar Price Index led the decline, dropping 9.1 per cent on the month as large export supplies from Brazil met with continued weak global import demand.

The FAO Vegetable Oil Price Index fell 3.9 per cent on the month, pushed down by weakening demand for palm oil and expectations of bumper soy harvests and plantings in South and North America.

FAO's Food Price Index is a trade-weighted index tracking international market prices of five major food commodity groups.

The Cereal Price Index also shed 1.2 per cent in April, pushed down by sagging wheat prices even as international rice prices firmed.

The Dairy Price Index fell 3.3 per cent as production in the northern hemisphere entered peak season, allying short-term sourcing concern.

By contrast, the FAO Meat Price Index rose 1.7 per cent, as pig meat prices increased in response to strong domestic demand in the European Union and increased sales to China.

Maize on the march, wheat in retreat

FAO updated its global cereal production forecasts for 2017, which now point to a likely 0.4 per cent annual decline from 2016 even as the pace of utilization grows by around one per cent.

The net result of the new projections, released with the Cereal Supply and Demand Brief, would be a drop in the cereal stocks-to-use ratio in 2017/18 to 25.8 per cent, still a comfortably high figure in historical terms but slightly below the current season's level.

The new global cereal output forecast was raised from the April figures, as Brazil appears poised to enjoy stronger-than-expected maize yields, lifting the global output for that crop to 1,054 million tonnes. Projected global rice output remained stable at 506 million tonnes, while the forecast for wheat - 740 million tonnes - was also unchanged as expected smaller crops in Australia, Canada, the Russian Federation and the United States are offset by likely expansions in the European Union, India and Morocco.

On the consumption side in 2017/18, abundant maize and other coarse grains are expected to push up use for livestock in China and South America, while rice utilization is expected to grow 1.2 per cent due to expanding food intake.

Global inventories by the end of seasons in 2018 are forecast, as a result, to nearly match the levels at the opening of the year, although their composition is seen changing somewhat. Wheat stocks are set to expand by 3.3 per cent to reach a new high of 247.6 million tonnes, driven mostly by China, which, on the other hand, is drawing down its accumulated coarse grain reserves by almost 20.5 million tonnes.

International trade in both wheat and coarse grains is forecast to decline in volume terms, while trade in rice is increasing, driven by strong demand in the Near East and in Africa.