Global food prices have increased for the second consecutive month, as rising energy and fertiliser costs linked to tensions in the Middle East begin to weigh on agricultural production, according to new data from the United Nations.
The latest figures from the Food and Agriculture Organization show that its benchmark food price index edged higher and is now about 1% above its level a year ago. The index tracks monthly changes in the international prices of a basket of widely traded food commodities.
While current supplies remain stable, experts warn that the main risks lie ahead, particularly in the cost of producing future crops. “The main issue we have right now is actually the impact of the conflict on energy and on fertilisers,” said David Laborde, director of agrifood economics at the FAO. “So, actually, the cost of producing the next harvest, not the food we have today, but the food we need tomorrow and after tomorrow.”
Energy prices have climbed amid disruptions to global supply routes, including through the Strait of Hormuz, a key corridor for fuel and fertiliser shipments. Laborde noted that up to one-third of globally traded fertilisers and about 20% of natural gas pass through the waterway. Natural gas is a critical input in fertiliser production, meaning any disruption can quickly raise costs for farmers worldwide.
If the conflict persists, analysts say farmers may be forced to reduce planting or cut back on fertiliser use, which could lead to lower crop yields. “The more farmers will be impacted, the less they are going to plant or they are going to use less fertiliser,” Laborde said. “In this case they may have lower yield, and that’s what can really start to increase food prices.”
Despite these concerns, global food markets have so far avoided the sharp price spikes seen in 2022 following the outbreak of the war in Ukraine. Strong harvests in major producing regions, including the United States and parts of Asia, have helped keep supplies well stocked, limiting immediate price pressures.
“Before the crisis, we were expecting declining commodity prices due to very good harvests and high stock levels,” Laborde said, explaining why prices have not surged more dramatically in recent months.
However, uncertainty remains high. Analysts warn that prolonged disruptions to energy and fertiliser supplies, combined with potential weather risks such as El Niño, could place additional strain on global food production.
As a result, while consumers have so far been shielded from sharp increases, the outlook for food prices will depend heavily on how the conflict evolves and whether supply chains for critical agricultural inputs remain intact in the months ahead.
