December 1, 2009

French October farm prices fall on month overall but cereals rise

French agricultural prices fell overall in October on the month earlier, although prices for cereals alone rose slightly, the State statistics office Insee reported Monday (November 30).

The agency said the country's overall farm prices fell 0.1 percent in October from September and were down 9.4 percent from a year earlier. Prices of fruits and vegetables and animal-derived products led overall price declines.

However, cereals prices jumped 2.9 percent in the latest reporting period from the month earlier, although they were down 15.7 percent on the year-earlier period.

Insee attributed the higher monthly prices for cereals to bad weather in the US, which would have affected global demand. It also cited economic factors, such as a weaker dollar and higher petroleum prices.

The lower dollar made it more attractive for investment funds to take out dollar-denominated US purchase contracts, while the higher petroleum price engendered higher volumes of cereals set aside for use in making biofuels, Insee said.

Soft wheat prices rose 3.2 percent on the month in October, but were down 15.5 percent on the year.

France is Europe's largest producer of wheat.