Conflicts and extreme weather pushing global food prices higher, warns UN

Global food rates have hit a four-year high, the United Nations has cautioned.

Key points

• The UN's Food and Agriculture Organization (FAO) documented on Friday that its Food Rate Index climbed for a third straight month to 133.3 points in August.
• Wheat and maize both became more expensive as military strikes disrupted shipping through the Black Sea, a major route for Russian and Ukrainian grain exports.
• Fertiliser supplies faced separate strain from the conflict between the United States, Israel and Iran.
• As wars and weather impact supplies, the agency remarked, that pushed the measure to its highest level since late 2022.
• While El Nino threatens production in Asia, the heatwaves that gripped Europe this summer led to a drop in crop yields.

Notably, the UN's Food and Agriculture Organization (FAO) documented on Friday that its Food Rate Index climbed for a third straight month to 133.3 points in August.

Every category on the index – cereals, vegetable oils, sugar, meat and dairy – rose over the month.

FAO chief economist, Maximo Torero, remarked the rise is being driven by a number of factors.

"Climate shocks, geopolitical tensions and disrupted trade logistics are converging to tighten supply expectations, " he remarked in an official note.

That risk was clearest in sugar. It rose fastest of all the categories tracked, up almost 12 percent from July to its highest point in a year.

Cereal rates climbed more than two percent to their highest level in over two years.

Fertiliser supplies faced separate strain from the conflict between the United States, Israel and Iran. The Strait of Hormuz, the narrow waterway off Iran's coast that is being blockaded by both the US and Iran, carries much of the world's fertiliser trade.

Since higher wholesale food costs tend to filter through to consumer rates in the months that follow, those increases matter well beyond supermarket shelves.

As well as the return of El Nino, the naturally occurring Pacific Ocean warming pattern that disrupts weather worldwide, the risk is heightened by global warming.

In practice, the World Food Programme, the UN agency that coordinates emergency food aid, has cautioned that the weather phenomenon could push another 50 million residents into acute hunger by the end of next year.

Taken together, the developments around conflicts and extreme weather pushing global food prices higher, warns UN point to a situation that is still moving, and the coming days should bring more clarity.