World food prices hit highest level since 2022 as supply risks mount: FAO

World food prices rose to their highest level since late 2022 in August, with extreme weather, war and trade disruptions raising concerns over supplies of key staples, the United Nations’ Food and Agriculture Organization (FAO) said on Friday.

The FAO Food Price Index, which tracks monthly changes in a basket of internationally traded food commodities, averaged 133.3 points in August, up from a revised 130.8 in July.

The reading was the highest since November 2022, although it remained nearly 17% below the record peak reached in March 2022 following Russia’s full-scale invasion of Ukraine.

“August’s increase in global food prices is a warning that the risk premium is returning to food markets: climate shocks, geopolitical tensions and disrupted trade logistics are converging to tighten supply expectations,” FAO Chief Economist Maximo Torero said in a statement.

The FAO said extreme heat and drought in Europe, the threat of a severe El Nino weather pattern and trade upheaval linked to the Ukraine and Iran wars had unsettled agricultural markets, pushing grain prices to three-year highs and sugar to a one-year peak.

The agency’s benchmarks for cereals, vegetable oils, sugar, meat and dairy all rose in August.

Extreme weather in Europe affected prospects for maize and sugar beet harvests as well as livestock output, while the anticipated El Nino phenomenon fuelled concerns over palm oil and sugar production in Asia, the FAO said.

Escalating attacks in the Black Sea have curtailed grain shipments from Russia and Ukraine during their 4-1/2-year-old war, while the US-Iran conflict has strained flows of fertiliser for crops.

The cereals price index rose 2.2% month-on-month to its highest level since May 2024, while the vegetable oil index edged up 0.6% to its highest since June 2022.

The sugar benchmark jumped 11.9% to its highest level since June 2025, with lower production in Brazil’s crucial centre-south region adding to weather concerns in Europe and Asia.

In a separate report, the FAO cut its 2026 global cereal production forecast by 3.4 million metric tons from its July estimate to 2.980 billion tons.

The revised forecast is 2.0% below 2025, marking the largest annual decline since 2018. Projected output would still be the second-largest on record.

Forecast world cereal stocks at the close of 2026/2027 were revised down 1.1% to 947.2 million tons, leaving them only marginally above the previous season.

The FAO said a reduced estimate of coarse grain stocks outweighed an upward revision for wheat, which reflected an anticipated build-up in Russian and Ukrainian stocks due to shipping disruption.