Impact of El Niño on Global Food Prices

El Niño’s Role in Rising Food Prices

One of the strongest El Niño events recorded is exacerbating global food insecurity, driving up agricultural commodity prices worldwide. According to the United Nations Food and Agriculture Organization, global food prices reached their peak since 2022 in August. This escalation is attributed to many leading crop-producing nations grappling with the effects of the unprecedented El Niño climate phenomenon that commenced earlier this year.

Michael Greenstone, a co-founder of the Climate Impact Lab and professor at the University of Chicago, warned that heat-related deaths could exceed 450,000. The climate pattern poses a threat to supplies in numerous regions, impacting those reliant on these resources.

Affected Regions and Food Groups

El Niño-related weather extremes are projected to severely impact agricultural production in South and Southeast Asia and Western Africa.

Professor Matin Qaim from the University of Bonn expressed concerns, particularly for impoverished populations, who allocate significant portions of their income to food. With rising prices, their ability to afford basic needs diminishes. Experts have identified several food categories from affected areas that might experience shortages soon, predominantly in the Global South.

Chocolate, olive oil, and coffee are anticipated to become scarce, increasing costs for U.S. consumers. Kamiar Mohaddes from Cambridge University noted that chocolate and sugar are first to be affected due to low global reserves, quickly driving prices upward. Bread prices follow due to wheat shortages, while coffee and palm-oil-based products lag months behind the climate signal, potentially extending impacts into 2027.

Wheat production is nearing a 56-year low, and rice imports face drought risks in India, Thailand, and Vietnam. Climate scientist Amanda Maycock from the University of Leeds mentioned that El Niño has caused a 10 to 15 percent reduction in rainfall during India’s monsoon season, threatening rice production. Other tropical crops like coffee and cocoa are also predicted to suffer from both heavy rainfall destruction and poor yields due to drought.

Duration of the Crisis

The U.S. is likely to escape the worst of El Niño in terms of food shortages. Nelson Villoria from Kansas State University explained that potential corn yield declines would be offset by other state productions. Despite possible import slowdowns, significant food shortages in the U.S. are unlikeIy.

Professor Qaim stated that many impoverished countries in Africa and Asia rely heavily on grain imports for food security. These regions might face increased hunger. He also noted that blocked shipping routes in the Middle East could worsen existing supply shortages, with prices possibly rising for six to twelve months.

Mohaddes predicted a global food price increase between mid-teens percentages, lasting up to two years, as the event peaks around December 2026. Analysis by Goldman Sachs revealed a projected 16 percent rise in global food commodity prices, with full impacts unfolding by the latter half of 2028.