International food prices soared to around two-year highs during June, fueled by higher prices for wheat, meats and dairy products such as butter.
In fact, global meat prices have risen every month so far this year, and the gains have outpaced most other major food commodity groups, according to data released Thursday by a United Nations agency.
U.S. wholesale prices for chicken breast meat were elevated in June. Also, there were reports of large poultry producers in some international markets, including India, raising prices during the month.
Similarly, pork prices have been particularly strong, with U.S. lean hog futures closing out June at 2-1/2 year highs. Some experts were looking for the hog market to peak soon.
Global dairy prices also are finding support, leading to the FAO's Dairy Price Index soaring 8 percent in June alone. It is up more than 50 percent from a year ago and butter's continued resurgence is helping it stay elevated.
Global wheat price increases in June were due to yield concerns from a worsening drought in U.S. and Canadian regions growing high-protein spring wheat crop. The drought is in the Dakotas, Montana as well as Canada's prairie provinces of Alberta and Saskatchewan.
The Chicago-traded December winter wheat futures settled at $5.612 a bushel Thursday, down 18.2 cents. Cordier believes the winter wheat has more downside, predicting the Chicago variety will go back down to $5.40 to $5.50 per bushel in the short term.
On the Minneapolis Grain Exchange, the September contract for hard red spring wheat closed down 6.2 percent.