Global food prices hit highest level since 2022 amid super El Nino fears

A rapidly intensifying El Niño event — now widely described as a potential "super" El Niño — is converging with war-driven supply disruptions to threaten a sharp rise in global food costs, prompting urgent warnings from major investment banks and international organizations.

Goldman Sachs The Goldman Sachs Group, Inc. ↘ 6.97% has projected that a very strong El Niño could drive global food commodity prices up by as much as 15.8%, with the full effects not expected to be "fully realized" until the second half of 2028, according to analysis first cited by The Guardian in July. Separately, JPMorgan ↘ 3.29% warned in an August report titled "Food Security is National Security: A Compounding Storm" that global food inflation could accelerate from 2.8% in the first half of 2026 to 5% in the first half of 2027.newsweek+3

The World Meteorological Organization said in its August update that there is a "nearly 100% probability" El Niño will persist through February 2027 and is forecast to reach very strong intensity before peaking toward the end of this year. The U.S. Climate Prediction Center has said there is a 69% chance that the event will exceed the strength of all previous El Niño episodes dating back to 1950.newsweek+1

Food Prices Already Climbing

The UN Food and Agriculture Organization reported on September 4 that its Food Price Index averaged 133.3 points in August, up 1.9% from July, marking its highest level since November 2022. Bloomberg's Agriculture Spot Index posted cumulative gains of over 13% in August — the largest monthly increase since July 2012 — while CBOT wheat and corn futures hit multi-year highs.moomoo+2

The USDA's August supply and demand report projected a global corn supply-demand gap of roughly 19.4 million tonnes for the 2026/27 marketing year, with wheat production forecast to fall 2.9% to 819 million tonnes. U.S. crop conditions have deteriorated, with the corn good-to-excellent rating falling to 60%, down 11 percentage points year over year.moomoo

Compounding Risks Beyond Weather

Oxford Economics warned in a study published last week that the damage "will extend beyond countries directly hit by El Niño-related extreme weather through the impact on food, energy, logistics, and trade," projecting global food prices will rise by 12% in 2026. The ongoing blockade in the Strait of Hormuz has severely curtailed global fertilizer supplies, with urea exports from Gulf suppliers down 83% in April compared to a year prior, according to the International Trade Centre. Meanwhile, renewed attacks on shipping infrastructure in the Black Sea have pushed wheat futures up roughly 40% over the past 12 months.thefulcrum+1

In China's A-share market, grain-themed ETFs surged more than 4% on Tuesday, dominating the rankings for a second time in a week. Since August, grain-related ETFs have attracted net inflows of RMB 818 million. "Global agricultural markets are poised to enter a sustained upward phase," said Liu Tingyu, fund manager of the Yongying Grain ETF.moomoo

WMO Secretary-General Celeste Saulo offered a stark summary: "We are already seeing disruption and devastation from droughts and floods and we expect these impacts to increase as El Niño intensifies".newsweek