From BigGo Finance · BigGo Finance · · 1m 40s
UN Food Agency Warns Global Food Inflation Could Persist Through 2027
Global food inflation may last through 2027 as supply shocks mount.
In brief
Global food inflation may last through 2027 as supply shocks mount. Global food inflation could persist through 2027 due to Black Sea shipping disruptions, Red Sea diversions, and El Nino droughts. Originally reported by BigGo Finance.
Global food inflation accelerating
Global food inflation is expected to accelerate in the coming months and persist into 2027 as Black Sea shipping disruptions, Red Sea diversions, conflict-related fertiliser and fuel costs, and El Nino drought squeeze supplies.
FAO food price index at 136 points
The FAO food price index hit 136 points in September, the highest since November 2022.
Food prices outpace inflation in 22% of countries
World Bank data show food prices rose faster than headline inflation in 22% of 150 countries it analysed.
Wheat and rice prices rising
Wheat prices have climbed more than 30% this year, while rice prices in key Asian exporters rose 10% to 13%.
Freight rates increasing
Freight rates on key routes have risen about 50% due to Black Sea to Southeast Asia shipping disruptions.
Rising costs in Indonesia and Egypt
Rice prices in Indonesia have reached record highs, while Egyptian bread costs increased by a quarter since July.
Supply shocks intensifying
Attacks on Black Sea grain infrastructure, Red Sea security risks, and Iran conflict have raised fuel and fertiliser costs.
Companies absorbing higher costs
Nestle India and PT Indofood report rising inflation and higher freight expenses due to weaker rupiah.
Importers returning to markets
Importers in the Middle East and Africa may return to world markets as domestic supplies run low.
In short
Global food inflation could persist through 2027 due to Black Sea shipping disruptions, Red Sea diversions, and El Nino droughts.
