FAO Food Price Index Hits Nearly Four-Year High

Global food prices have reached their highest level in nearly four years, according to the Food and Agriculture Organization of the United Nations (FAO). The FAO Food Price Index rose to 136 points in September, a 1.5% increase from August and 5.8% higher than September 2022.

The main drivers behind this rise were weather risks, disruptions in global logistics, and increasing prices for crop products. Trade restrictions in the Black Sea region and shipping problems through the Strait of Hormuz are having a particular impact on the market.

Grain prices saw the largest increase, with the FAO Cereal Price Index jumping 5.1% in September and standing 17.2% higher than last year. Global wheat prices rose by 6.3%, while corn prices increased by 5.6% due to concerns about yields in the U.S., reduced export supply from Brazil, and disruptions in Black Sea trade.

The FAO warns that pressure on global food markets is becoming increasingly widespread, with climate risks, higher logistics costs, and geopolitical issues contributing to rising consumer prices in countries dependent on food and energy imports. The organization's chief economist, Máximo Torero, noted that the combined impact of these factors could lead to rising consumer prices.

Despite this, the FAO has revised downward its forecast for global grain production, predicting a decline of 2.1% in 2026. Global wheat production is projected at 813.9 million metric tons, coarse grains at 1.612 billion metric tons, and rice at 552.5 million metric tons.