The price index for vegetable oil, which is calculated by the Food and Agriculture Organization of the United Nations (FAO), increased by 2.4% in June and reached the highest level in a year and a half. This increase is driven by high demand for soybean oil in the biofuels sector and unfavorable forecasts for sunflower and rapeseed oil harvests in several major producing countries, FAO said.

At the same time, FAO notes that world prices for palm, soybean, sunflower and rapeseed oil have increased significantly. Overall, food prices remained stable in July for the second month in a row. The growth of international quotations for vegetable oils, meat products and sugar compensated for the decrease in grain prices.

The FAO food price index, which tracks monthly changes in international food prices, averaged 120.8 points in July. This is slightly lower than June's revised reading of 121.0 points and down 3.1% from the corresponding figure last year.

As for meat prices, they rose by 1.2% in July due to significant import demand for sheep, cattle and poultry meat. However, pork prices have fallen due to oversupply in Western Europe.

Sugar prices increased by 0.7% compared to June. This was due to lower-than-expected production in Brazil, which was outweighed by the impact of increased monsoon rains in India and favorable weather conditions in Thailand.

The dairy price index remained unchanged in July, as lower milk powder prices offset higher butter and cheese prices. On the other hand, the grain price index decreased by 3.8% compared to June. This happened due to a decrease in world export prices for the main grain crops, which decreased for the second month in a row.

Wheat prices eased due to increased seasonal availability due to the ongoing harvesting of winter crops in the Northern Hemisphere and favorable conditions in Canada and the US, supporting expectations of large spring wheat harvests. Corn export prices also declined due to record harvests in Argentina and Brazil, while crop conditions in the US remained stable. The rice price index was down 2.4% on a calm trading backdrop for both Indica and Japonica varieties.