Global food inflation is set to worsen in the coming months, driven by supply disruptions and El Niño-induced droughts. Muhamad Yasin, a parking attendant in Jakarta, illustrates the strain, noting that his weekly earnings of 200,000 to 300,000 rupiah can no longer cover basic food staples like rice, which has doubled in price to 15,000 rupiah.
The United Nations’ Food and Agriculture Organization (FAO) warns that food prices will remain high well into 2027, with the FAO Food Price Index averaging 136 points in September, the highest since November 2022. The world’s poorest consumers are disproportionately affected, as food prices in low- and middle-income countries outpace headline inflation in 22% of the 150 countries analyzed by the World Bank.
Multiple supply shocks are exacerbating the crisis. Attacks on Black Sea grain infrastructure have disrupted wheat shipments, while the U.S.-Israeli war on Iran has raised fuel prices and disrupted fertilizer exports. El Niño weather has reduced crop yields in India and Southeast Asia, pushing wheat prices up over 30% in 2026 and rice prices up 10% to 13% in key Asian exporting countries.
Food processors and bakeries are also facing higher costs. In Egypt, unsubsidized bread prices have risen to 5 Egyptian pounds from 4 pounds in July, while in Indonesia, vegetable oil prices have jumped 7% this year. The weakening of local currencies, such as the Indonesian rupiah, is further amplifying these costs.