World food prices increase by 1.9%, says UN agency; highest since 2022 amid weather and war disruptions

Global food prices rose to their highest level since late 2022 in August as extreme weather, geopolitical tensions and disruptions to trade routes raised concerns about the supply of key agricultural products, the United Nations Food and Agriculture Organization (FAO) said on Friday.The FAO Food Price Index, which tracks monthly changes in a basket of internationally traded food products, averaged 133.3 points in August, down from a revised 130.8 in July. The reading was the highest since November 2022, although it remained almost 17 percent below the record reached in March 2022 following Russia’s large-scale invasion of Ukraine, Reuters reported.Prices of cereals, vegetable oils, sugar, meat and dairy increased during the month. Grain prices hit their highest level in three years, while sugar prices hit their highest level in more than a year.“The rise in global food prices in August is a warning that the risk premium is returning to food markets: climate shocks, geopolitical tensions and disruption to trade logistics are converging to tighten supply expectations,” said FAO chief economist Máximo Torero.

Climate and wars raise supply concerns

Extreme heat and drought in Europe have raised concerns about corn and sugar beet crops and livestock production. At the same time, the predicted El Niño weather pattern has fueled fears of lower palm oil and sugar production in Asia.The ongoing war between Russia and Ukraine has also disrupted agricultural trade, with intensified attacks in the Black Sea restricting grain shipments from the two major exporters. Meanwhile, the conflict between the United States and Iran has put additional pressure on fertilizer flows, which could affect agricultural production.The FAO Cereal Price Index rose 2.2 percent in August from the previous month, reaching its highest level since May 2024. The Vegetable Oils Index rose 0.6 percent to its highest level since June 2022.Sugar posted the sharpest rise among major food categories, with its benchmark jumping 11.9% to the highest level since June 2025. Lower production in Brazil’s key south-central region, along with climate concerns in Europe and Asia, contributed to the rise.

Cut global cereal production forecast

In a separate report, the FAO cut its forecast for global cereal production in 2026 by 3.4 million metric tons from its July estimate to 2.98 billion tons.The revised forecast is 2% below 2025 production, marking the biggest annual drop since 2018. However, production would still be the second highest on record.The agency also lowered its forecast for global cereal stocks at the end of the 2026/27 season by 1.1% to 947.2 million tonnes. The revised stock level is only marginally higher than the previous season.A reduction in coarse grain stocks offset an upward revision in wheat stocks. The FAO said the higher wheat estimate reflected expectations of stockpiling in Russia and Ukraine as shipping disruptions hamper exports.