Economy
Global Food Prices Decline for Another Month
By Adedapo Adesanya
Last month, prices of food around the world fell for the second consecutive month as the Food Price Index averaged 157.4 points in May 2022, down 0.9 points (0.6 per cent) from April.
The index, recorded by the Food and Agriculture Organisation (FAO), despite the decline, was still 29.2 points (22.8 per cent) above its value in the corresponding month last year.
The drop in May was led by declines in the vegetable oil and dairy price indices, while the sugar price index also fell to a lesser extent.
Meanwhile, cereal and meat price indices increased.
The FAO Cereal Price Index averaged 173.4 points in May, up 3.7 points (2.2 per cent) from April and as much as 39.7 points (29.7 per cent) above its May 2021 value.
International wheat prices rose for a fourth consecutive month, up 5.6 per cent in May, to an average of 56.2 per cent above their value last year and only 11 per cent below the record high reached in March 2008.
The steep increase in wheat prices was in response to an export ban announced by India amidst concerns over crop conditions in several leading exporting countries, as well as reduced production prospects in Ukraine because of the war. By contrast, international coarse grain prices declined by 2.1 per cent in May but remained 18.1 per cent above their value a year ago.
Slightly improved crop conditions in the United States of America, seasonal supplies in Argentina and the imminent start of Brazil’s main maize harvest led maize prices to decline by 3.0 per cent; however, they remained 12.9 per cent above their level of May 2021.
Similarly, international sorghum prices also fell in May by 3.1 per cent, while spillover from the strength in wheat markets and concerns over crop conditions in the European Union (EU) boosted barley prices by 1.9 per cent.
International rice prices increased for the fifth successive month in May. Quotations strengthened in all the major market segments, but monthly increases were least pronounced (2.6 per cent) for the most widely traded Indica varieties, amid ample supplies, especially in India.
The FAO Vegetable Oil Price Index averaged 229.3 points in May, down 8.3 points (3.5 per cent) month-on-month, yet remaining markedly above its year-earlier level.
The monthly decline mainly reflects lower prices across palm, sunflower, soy, and rapeseed oils. International palm oil prices weakened moderately in May.
Apart from demand rationing, the removal of Indonesia’s short-lived export ban on palm oil exerted additional downward pressure on prices, although a further price drop was contained by lingering uncertainties over the country’s export prospects.
Meanwhile, world price quotations for sunflower oil fell from recent record highs, with stocks continuing to accumulate in Ukraine owing to logistical bottlenecks.
International soy and rapeseed oil prices also declined somewhat in May, chiefly weighed by sluggish import demand in view of elevated costs in recent months.
The FAO Dairy Price Index averaged 141.6 points in May, down 5.1 points (3.5 per cent) from April, marking the first decline after eight consecutive monthly increases, but still 20.5 points (16.9 per cent) higher than its level in May of last year. World prices of all milk products fell, with milk powders declining the most, underpinned by lower buying interests on market uncertainties stemming from the continued lockdown in China, despite the persistent global supply tightness.
Butter prices also dropped significantly due to weaker import demand in tandem with some improvements to supplies from Oceania and limited internal sales in Europe.
Meanwhile, robust retail sales and high demand from restaurants ahead of the summer holidays in the Northern Hemisphere prevented cheese prices from falling significantly, despite weakened global import demand.
The FAO Meat Price Index averaged 122.0 points in May, up 0.6 points (0.5 per cent) from April, setting a new all-time high, driven by a steep rise in world poultry meat prices, more than offsetting declines in pig and ovine meat values.
In May, poultry meat prices rose, reflecting the continued supply chain disruptions in Ukraine and recent cases of avian influenza amid a surge in demand in Europe and the Middle East.
Meanwhile, international bovine meat prices remained stable, as increased supplies from Brazil and Oceania were adequate to meet persistently high global demand.
By contrast, world pig meat prices fell on high export availabilities, especially in Western Europe, amid lacklustre internal demand and expectations for releasing pig meat from the EU Commission’s Private Storage Aid scheme. International prices of ovine meat also dropped, reflecting the impact of currency movements.
The FAO Sugar Price Index averaged 120.3 points in May, down 1.3 points (1.1 per cent) from April, marking the first decline after sharp increases registered in the previous two months.
The recent monthly decline in international sugar price quotations was triggered by limited global import demand and good global availability prospects, mostly stemming from a bumper crop in India.
The weakening of the Brazilian Real against the US dollar and lower ethanol prices resulted in further downward pressure on world sugar prices.
However, uncertainties over the current season’s outturn in Brazil, the world’s largest sugar exporter, prevented more substantial price declines.
By Dipo Olowookere
The Nigerian Exchange (NGX) Limited suffered a 0.11 per cent loss on Thursday after the bears made a comeback after being chased away by the bulls a day earlier.
The local bourse was under attack despite a positive market breadth index and strong investor sentiment after it ended with 29 appreciating stocks and 23 depreciating stocks.
Business Post observed that profit-taking in some mid-equities plunged Customs Street during the trading session, with Fidson shedding 9.60 per cent to trade at N17.90.
Ecobank Nigeria depreciated by 9.51 per cent to sell for N31.40, Guinea Insurance lost 8.33 per cent to quote at 66 Kobo, Prestige Assurance slipped by 7.50 per cent to N1.11, and Sunu Assurances crashed by 6.44 per cent to N5.52.
On the flip side, PZ Cussons gained 10.00 per cent to settle at N32.45, Oando improved by 10.00 per cent to N52.80, Honeywell Flour appreciated by 9.96 per cent to N13.03, Caverton jumped by 9.80 per cent to N2.69, and Livestock Feeds rose by 9.35 per cent to N6.90.
Yesterday, the energy counter appreciated by 0.88 per cent and was the only gainer among the key sectors of the market.
The insurance sector went down by 0.92 per cent, the banking index depreciated by 0.75 per cent, the industrial goods space crumbled by 0.43 per cent, and the consumer goods sector lost 0.17 per cent, while the commodity counter closed flat.
Consequently, the All-Share Index (ASI) decreased by 123.53 points to 107,675.46 points from 107,798.99 points and the market capitalisation retreated by N77 billion to N67.102 trillion from N67.179 trillion.
A total of 423.4 million equities worth N9.6 billion were traded in 11,112 deals on Thursday compared with the 245.5 million equities valued at N8.4 billion transacted in 10,098 deals on Wednesday, representing a rise in the trading volume, value, and number of deals by 72.46 per cent, 14.29 per cent and 10.04 per cent, apiece.
The activity chart was topped by FCMB with 102.3 million stocks valued at N1.1 billion, Zenith Bank transacted 33.3 million equities worth N1.6 billion, Access Holdings exchanged 31.2 million shares for N801.9 million, Jaiz Bank traded 24.4 million equities worth N82.0 million, and Caverton sold 20.9 million stocks valued at N54.6 million.
By Adedapo Adesanya
The federal government, the 36 states, and the 774 local government areas of the federation have shared a total of N1.703 trillion in revenue generated in January 2025.
This amount represents an increase of 19.6 per cent or N279 billion from the N1.424 trillion generated in December 2024.
This is according to a press release by the Director (Press and Public Relations) at the Office of the Accountant General of the Federation, Mr Bawa Mokwa, on Thursday,
The N1.703 trillion total distributable revenue comprises N749.727 billion in statutory revenue, N718.781 billion in Value Added Tax revenue, N20.548 billion from the Electronic Money Transfer Levy, and N214 billion in augmentation.
The statement was based on a communique issued by the Federation Account Allocation Committee (FAAC) after its monthly meeting for February 2025.
It noted that the total gross revenue amounted to N2.641 trillion, which was slightly higher than the N2.310 trillion recorded in the previous month.
The total deduction for cost of collection was N107.786 billion while total transfers, interventions, refunds and savings was N830.663 billion.
It was disclosed that the federal government received N552.591 billion, state governments were allocated N590.614 billion, and the Local Government Councils received N434.567 billion, while an additional N125.284 billion was shared with benefiting states as derivation revenue as 13 per cent of mineral revenue.
The statement further noted that the gross statutory revenue for the month under review stood at N1.848 trillion, an increase of N622.125 billion from the N1.226 trillion recorded a month earlier.
Gross VAT revenue for the month was N771.886 billion, rising by N122.325 billion from N649.561 billion in December.
From the N749.727 billion statutory revenue, the federal government got N343.612bn, the state governments were given N174.285 billion, and the councils received N134.366 billion, while N97.464 billion was also allocated to states benefiting from derivation revenue.
Further, from the N718.781 billion VAT revenue, the federal government received N107.817 billion, state governments were got N359.391 billion, and Local Government Councils shared N251.573 billion.
For the N20.548 billion Electronic Money Transfer Levy (EMTL), the federal government received N3.082 billion, state governments received N7.192 billion, and Local Government Councils received N10.274 billion.
The N214 billion augmentation was shared with the federal government receiving N98.080 billion, state governments receiving N49.747 billion, and Local Government Councils receiving N38.353 billion, while N27.820 billion was shared among the benefiting states as derivation revenue.
The communique also highlighted increases in collections from VAT, Petroleum Profit Tax, Companies Income Tax, Excise Duty, Import Duty, and CET Levies, while there was a significant decrease in EMTL and Oil and Gas Royalty receipts.
By Adedapo Adesanya
Oil prices rose more than 2 per cent on Thursday amid supply concerns after the US President, Mr Donald Trump, revoked a licence granted to US oil major, Chevron, to operate in Venezuela.
The news led Brent crude oil futures to spike by $1.53 or 2.1 per cent to $74.06 a barrel while the US West Texas Intermediate (WTI) crude oil futures increased by $1.64 or 2.4 per cent to $70.26.
The Chevron licence revocation means the company will no longer be able to export Venezuelan crude.
However, if Venezuelan state oil company, PDVSA, exports oil previously exported by Chevron, US refineries will be unable to buy it because of U.S. sanctions.
President Trump said this was due to the lack of electoral reform in the South American country alongside with insufficient action on migration.
Chevron has been exporting around 240,000 barrels of Venezuelan crude to the US daily after former US President Joe Biden granted them a waiver.
The amount constitutes around 25 per cent of the country’s total oil production and generates substantial revenues that stay in the Venezuelan economy.
Meanwhile, market analysts noted that the move could also lead to the negotiation of a fresh agreement between the Chevron and PDVSA to export crude to destinations other than the US.
This development could also impact the Organisation of the Petroleum Exporting Countries and its allies, OPEC+, to which Venezuela is a member.
Chevron’s exit could reduce Venezuela oil’s production, giving OPEC+ capacity to increase output.
However, investors were still keeping an eye on signs of a potential peace deal in Ukraine, which could result in higher Russian oil flows.
President Trump said Ukrainian President Volodymyr Zelenskiy will visit the US on Friday to sign an agreement on rare earth minerals.
However, the Ukrainian leader said the success of talks would hinge on continued US aid.
The market was pressured by news that US economic growth slowed in the fourth quarter amid cold weather and concerns that tariffs will hurt spending through higher prices.
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