El Niño Sets Stage for Global Food Price Surge
The El Niño phenomenon has entered a concerning phase, with the Oceanic Niño Index (ONI) exceeding +2°C. The Niño 3.4 index reached +2.7°C on September 2, 2026, setting a record since 1950 and expected to strengthen further.
El Niños impact various regions differently, causing droughts or floods in some areas while intensifying dry conditions or heavy rainfall in others. For Southeast Asia, the most significant effects are anticipated at the end of 2026 and beginning of 2027, coinciding with the dry season's end and the start of the rainy season.
The Super El Niño of 1997-1998 resulted in severe droughts in Indonesia and Papua New Guinea, as well as a 30% decrease in global rice production due to Southeast Asian droughts. This year, the FAO food price index rose significantly, reaching 133.3 in August from 130.8 in July, with cereals increasing for three consecutive months.
Rice is the most sensitive cereal to El Niño, and its prices are expected to rise by 15-25% if the phenomenon occurs strongly. Wheat prices may increase by 5-12%, while corn prices could rise by 12-22%. If El Niño becomes very strong, rice prices might surge by 30-45%, wheat by 10-20%, and corn by 20-35%.