The most recent index for April 2021 is at 120.9 points, a 1.75-point increase on the previous month and the 11th consecutive month for food price increases and it brings the index to its highest point since May 2014.
The top performers in April were sugar, oils meat, dairy and cereals.
After stalling in March, cereals resumed the upward trend with the 1.5-point increase to 125.1, representing a 25.8-point, or 26%, gain since April last year.
This reflects the futures grain markets – are all trending much higher than a year ago – are driven by doubts about the volumes planted as demand continues to increase.
The dairy sector posted a 1.4-point increase to 118.9 points, a 24% increase on its level from a year ago.
The only main commodity to decline was whole milk powder, while butter, cheese and skimmed milk powder all showed an increase.
Meat is on its seventh consecutive month of increases, posting a 1.7-point increase though over the past year it posts a lower increase than dairy or cereals at just 5%. Ongoing Asian demand, particularly for pigmeat but also beef is combining with reduced Australian supplies to drive prices upwards.
Prices have been increasing aggressively over the past year in both cereals and dairy.
Increasing grain prices will in turn filter through to increasing meat prices particularly in the intensive sectors of pig meat and poultry meat. It will also impact on the beef producing regions that use a lot of grain for cattle feed, in particular North America and Australia.
The combination of growing Asian demand means that the meat industry should be able to pass the higher cost of production on through the supply chain.
In the meantime, the Irish dairy industry with its strong grass base will be well positioned to take advantage of strengthening markets while keeping a handle on production costs.
It is the same for the Irish beef sector. While it remains locked out of China, it continues to progress in Japan and approval for South Korea is getting closer.
Both these markets are dominated by the US but there is no reason that Ireland cannot make inroads to any Asian markets once we have access.