Global Food Prices Creep Up Amid Middle East Escalation

By Felix Richter – Statista

Largely driven by the ongoing conflict in Iran and its effect on energy prices, global food commodity prices increased in March. According to the Food and Agriculture Organization of the United Nations (FAO), the FAO Food Price Index climbed to 128.5 points last month, indicating a 28.5-percent increase in food prices compared to the 2014-2016 base period. While that’s far below the peak of 160.2 in March 2022, shortly after Russia’s invasion of Ukraine, it’s up 8 percent from March 2024 and roughly 35 percent from the 2019, i.e. pre-pandemic average. As opposed to the war in Ukraine, which directly affect global cereal supplies, the conflict in the Middle East is having a more indirect effect on food commodity prices, mainly through higher energy and fertilizer costs.

“Price rises since the conflict began have been modest, driven mainly by higher oil prices and cushioned by ample global cereal supplies,” FAO Chief Economist Máximo Torero said. “But if the conflict stretches beyond 40 days with high input costs with current low margins, farmers will have to choose: farm the same with fewer inputs, plant less, or switch to less intensive fertilizer crops. Those choices will hit future yields and shape our food supply and commodity prices for the rest of this year and all of the next.”