El Niño's Impact on Groceries: Coffee, Chocolate Prices to Soar

A record-strength El Niño is looming, and it may bring higher prices to your dinner table. The weather phenomenon can cause droughts in some areas and severe flooding in others, which can damage crops and livestock, leading to reduced food production.

This reduction in supply can drive up prices, making groceries less affordable. Several foods are expected to be affected by the El Niño:

Coffee: The US Department of Agriculture (USDA) predicts a challenging coffee harvest for 2026/27 due to potential weather disruptions during the flowering period.

Chocolate: Africa provides over 70% of the world's cocoa, and producers there face threats from El Niño. The Ivory Coast, the top producer, expects a 20% drop in output.

Bananas: Colombia relies on rainfall for banana production, which may be reduced by El Niño, resulting in smaller bunches of fruit.

Sugar: Brazil, India, and Thailand account for approximately 70% of global sugar exports. El Niño can lead to droughts in these regions, affecting sugar crops.

Palm oil: Indonesia, a major producer, may see production drop by 1-2 million tons due to dry weather related to El Niño.

Rice: More than half the world's population depends on rice. Global production is set to decline for the first time in a decade, and prices have already begun to rise due to limited exporters.

Wheat: Wheat production is forecasted to be down by 23% in Brazil, 8% in Europe, and at its lowest levels in the US since 1970. Severe water scarcity contributes to 74% of annual wheat price fluctuations.