Global Food Prices Hit Highest Level in More Than Three Years

Global food prices climbed in April to their highest level in more than three years, driven largely by soaring vegetable oil prices linked to escalating geopolitical tensions and disruptions in energy markets, the Food and Agriculture Organization (FAO) said Friday.

According to the agency’s latest Food Price Index, international food commodity prices rose for a third consecutive month, averaging 130.7 points in April, a 1.6% increase from March and the highest reading since February 2023.

The sharp rise was fueled primarily by mounting pressure in vegetable oil markets following the Iran conflict and the effective disruption of shipping through the Strait of Hormuz, a critical artery for global energy supplies.

FAO Chief Economist Máximo Torero said higher energy prices have significantly increased demand for biofuels derived from oil-rich crops, contributing to the surge in edible oil costs.

“Rising energy prices are directly affecting agricultural commodity markets through stronger biofuel demand,” Torero said, while noting that global agricultural systems have so far demonstrated resilience despite the ongoing geopolitical disruptions.

Although food inflation has accelerated, grain markets have remained relatively stable compared with other commodities. The FAO reported that cereal prices rose only modestly in April, supported by ample inventories from previous harvest seasons.

The agency said its vegetable oil price index jumped 5.9% month-on-month, reaching its highest level since July 2022. Prices for soybean oil, sunflower oil, rapeseed oil, and palm oil all recorded gains, with palm oil receiving additional support from government biofuel policies in several producing countries.

The broader food index remains below the record level of 160.2 points reached in March 2022 following the outbreak of the Russian invasion of Ukraine, which severely disrupted global grain and fertilizer markets.

Meanwhile, cereal prices edged up just 0.8% from March and 0.4% year-on-year, reflecting relatively contained pressure despite concerns over adverse weather conditions, rising fertilizer costs, and increased biofuel demand.

The FAO warned that elevated fertilizer prices could lead farmers to reduce wheat cultivation in 2026 in favor of crops requiring lower input costs.

Meat prices also continued to rise, increasing 1.2% in April to reach a record high, largely because of limited cattle supplies in Brazil, one of the world’s largest beef exporters.

In contrast, sugar prices declined 4.7% amid expectations of stronger supply output from Brazil, China, and Thailand.

In a separate report, the FAO slightly raised its forecast for global cereal production in 2025 to a record 3.04 billion metric tons, representing a 6 percent increase from the previous year and signaling continued resilience in worldwide agricultural production despite mounting economic and geopolitical uncertainty.