Global Food Prices Face Perfect Storm of War and Super El Niño

Oxford Economics projects global food prices will climb by 12% in 2026 and another 5% in 2027. This upward pressure stems largely from two primary sources: the ongoing war in Ukraine, which disrupts grain markets that typically account for 30% of global wheat exports, and the closure of the Strait of Hormuz. The latter, following the U.S. conflict with Iran, has severed a vital shipping lane, leading to a projected 22% surge in fertilizer costs this year.

Beyond the impact of these conflicts, weather patterns are reaching a dangerous threshold. The UK’s Met Office reports that the current El Niño is tracking to be the most intense since the 19th century, with sea temperatures expected to rise 3ºC above their long-term average. Experts describe the heat accumulating in the eastern Pacific as an unprecedented signal that will likely trigger severe droughts in Australia and the Amazon, while simultaneously causing catastrophic flooding in California.

Agricultural analyst Noel Fryer notes that North America and Europe have already suffered through summer heatwaves that decimated crop yields and reduced grazing resources. Because these losses occurred before the full effects of the El Niño cycle have taken hold, analysts suggest the agricultural sector is entering a period of extreme volatility. With multiple supply chain shocks occurring simultaneously, the outlook for food security remains highly uncertain.