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The latest United Nations' Food and Agriculture Organization data shows global food prices have just recorded the biggest annual decline since 2015. This is terrific news for emerging market countries whose governments have been battling high food inflation with mounting risks of social instability.  

The FAO Food Price Index, which tracks monthly changes in the international prices of globally traded food commodities, averaged around 118.51 at the end of 2023, down 10% from the previous year. 

Although the index tracks the costs of raw commodities rather than consumer retail prices, the declines offer hints of easing supermarket prices in 2024. The jump in the index derives from many issues, such as Russia's invasion of Ukraine, global supply chain snarls, soaring inflation, and El Niño-related weather disruptions, which ignited a global cost-of-living crisis. 

Bloomberg noted, "Corn and wheat futures prices saw their biggest annual declines in a decade last year, as supply concerns faded. Futures prices for hogs and palm oil also posted big declines." 

Even though the global food index has dropped a quarter since peaking in March 2022, the index remains just below levels responsible for anti-government protests, uprisings, and armed rebellions in the 2010 Arab Spring. 

As we noted in November, the world is not out of the woods yet.

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