Food & Climate
The vegetable oil price index jumped to a three-year high in July, driven by expected strong demand in the Americas from the biofuel industry, which in turn pushed the FAO food price index up marginally.
The FAO Vegetable Oil Price Index averaged 166.8 points in July, marking a sharp rise of 7.1% from the previous month, reaching a three-year high, according to the statement that “Food & Climate” platform received today.
The increase reflected higher quotations for palm, soy and sunflower oils. Palm oil prices rose on robust global demand and improved competitiveness, while soy oil was supported by expectations of firm biofuel sector demand in the Americas.
Sunflower oil prices also climbed due to tightening export supplies in the Black Sea region. In contrast, rapeseed oil prices declined with the arrival of new crop supplies in Europe.
The United States Biodiesel Market Research Report 2025-2033 shoed EPA and DOE Push Biodiesel and SAF as Key Drivers in America’s Clean Energy Future.
In the United States, biodiesel is also extensively applied in transportation, agriculture, and the industrial sector.
It fuels trucks, buses, and marine vessels, lowering greenhouse gas emissions as well as fossil fuel dependence.
The agricultural industry is also helped by biodiesel through powering farm machinery, while fleets of government and the commercial sector use it to achieve sustainability targets.
Biodiesel is also employed in home heating systems (bioheat) and as a substitute fuel in power production. With renewable energy policies and federal incentives encouraging its use, biodiesel remains a key player in the clean energy revolution in the U.S.
The vegetable oil price pushed FAO food index
The FAO Food Price Index, a benchmark for world food commodity prices, averaged 130.1 points in July 2025, up 1.6% from June, driven primarily by rising international prices of meat and vegetable oils. Despite this monthly increase, the index remains 18.8% below its peak in March 2022, although 7.6% higher than its level in July 2024.
The index tracks monthly changes in the international prices of a set of globally traded food commodities. In July, price increases in the meat and vegetable oil price indices more than offset declines in the cereal, dairy and sugar indices.
The vegetable oil price index lead the FAO Food Index in July due to the expectation of biofuel in U.S.
The United States biodiesel market is expected to expand at a large scale, reaching US$ 20.29 billion in 2033 from US$ 12.23 billion in 2024, with a CAGR of 5.79% from 2025 to 2033. This expansion is based on growing demand for renewable energy, government incentives for biofuels, and a move towards sustainable fuel options. Growing environmental issues and technology advancements also help drive market growth, according to “The United States Biodiesel Market Research Report 2025-2033″ that was issued in May.
The U.S. government is a major driver of biodiesel market growth through policies such as the Renewable Fuel Standard (RFS). This law requires refiners of fuel to mix a portion of renewable fuels, such as biodiesel, into their fuel supply. Federal and state incentives, such as tax credits and grants, also promote the use of biodiesel. Initiatives like the Biodiesel Tax Credit (BTC) make biodiesel more cost-effective, further increasing consumption and production, according to the report.
Cereal, meat, dairy, and sugar prices
The FAO Cereal Price Index averaged 106.5 points, down 0.8% from June. Declining wheat and sorghum prices outweighed increases in maize and barley. Fresh seasonal wheat harvests in the northern hemisphere put downward pressure, though adverse conditions of spring wheat in parts of northern America provided some price support. The FAO All Rice Price Index dropped 1.8 percent, driven by ample export supplies and weak import demand.
The FAO Meat Price Index averaged 127.3 points, up 1.2% from June, reaching a new all-time high. The increase was led by higher prices for bovine and ovine meat, supported by strong import demand, particularly from China and the United States of America.
Poultry meat prices also edged up slightly amid resumed imports from key partners following Brazil’s regaining of its avian influenza-free status.
Conversely, pig meat prices declined due to ample supplies and reduced global demand, especially in the European Union.
The FAO Dairy Price Index edged down by 0.1% from June to 155.3 points, marking the first decline since April 2024.
Prices for butter and milk powders decreased, reflecting abundant export supplies and subdued import demand, particularly from Asia. However, international cheese prices continued to rise, driven by strong demand in Asian and Near East markets and tighter export availability in the European Union.
The FAO Sugar Price Index averaged 103.3 points, down 0.2% from the previous month, continuing its downward trend for a fifth consecutive month. Expectations of a global production recovery in 2025/26, notably in Brazil, India, and Thailand, weighed on prices, although signs of a rebound in global sugar import moderated the decline.