Global food prices could increase between 10% and 18% by next summer as geopolitical tensions and a strengthening El Ni\u00f1o combine to disrupt agricultural supply chains, according to a new analysis by Eurasia Group. The forecast highlights growing risks for wheat, corn, and rice markets after recent years of relatively stable harvests.<\/p>\n
The warning, reported by Marketplace, follows a similar assessment issued by JPMorgan. According to Reuters, the bank estimates there is an 81% probability that the current El Ni\u00f1o event will develop into a very strong or “super” El Ni\u00f1o by the end of the year. It also sees a 97% chance that these weather conditions will persist through 2027, increasing pressure on global food production.<\/p>\n
Nick Kraft, an analyst at Eurasia Group, said previous fears of severe food shortages following the closure of the Strait of Hormuz after military action involving the United States, Israel, and Iran in February were softened by exceptionally large grain harvests in 2025. Those abundant supplies helped stabilize agricultural markets despite heightened geopolitical risks.<\/p>\n
Kraft warned that those buffers are now shrinking. As inventories decline, the combination of extreme weather and persistent geopolitical instability creates a far more uncertain outlook for food security and commodity markets.<\/p>\n
JPMorgan estimates that a super El Ni\u00f1o alone could add about 0.7 percentage points to global food inflation at its peak. When combined with higher energy costs linked to conflict, including rising diesel, fertilizer, and food packaging prices, the total impact could reach between 1.3 and 1.5 percentage points.<\/p>\n
Market indicators already reflect growing concerns. European wheat futures declined on Friday as traders locked in profits after prices gained more than 10% during July. September milling wheat on Euronext closed at \u20ac222.75 per metric ton after starting the month near \u20ac202.<\/p>\n
The European Commission has also reduced its forecast for EU wheat production in the 2026-27 marketing season. Output is now expected to fall by about 8%, while ending stocks are projected to tighten to 12.9 million metric tons, suggesting a less comfortable supply situation.<\/p>\n
In the Black Sea region, shipping disruptions continue to influence grain trade. Turkish corn prices have risen ahead of the domestic harvest as maritime transport constraints limit supplies. Turkey imported around 5.3 million metric tons of Ukrainian corn during the 2025-26 marketing year, according to S&P Global, making the country particularly exposed to logistical disruptions.<\/p>\n
While consumers may face higher grocery bills, some farmers could benefit from stronger commodity prices. Grant Gardner of the University of Kentucky said producers who have struggled with weak crop prices in recent years would likely welcome improved market conditions. However, he noted that higher agricultural prices ultimately increase costs for households already facing inflationary pressures.<\/p>\n","protected":false},"excerpt":{"rendered":"
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