Global food prices accelerated again in March as the energy shock spilled over into agricultural markets.
🌍 The FAO Food Price Index averaged 128.5 points in March 2026, up 2.4% from the previous month, marking the second straight monthly increase and the highest level since September 2025. This suggests global food inflation pressure is starting to build again after the earlier cooling phase.
⚡ This latest move was driven more by energy and input costs than by a broad supply shortage. Rising Middle East tensions pushed up oil, fertilizer, transport, and biofuel demand, which in turn lifted vegetable oils, sugar, and wheat.
🌾 Vegetable oils rose 5.1%, sugar climbed 7.2%, and wheat gained 4.3%, while rice fell 3.0% amid harvest pressure and weak import demand. Notably, FAO still raised its 2025 global cereal production forecast to a record 3.036 billion tons, showing that overall supply conditions have not truly deteriorated yet.
📌 In the short term, food markets remain highly sensitive to oil prices and developments around the Strait of Hormuz. If fertilizer costs stay elevated for weeks, the bigger risk will shift to the next crop cycle, when farmers may cut planting or switch to less input-intensive crops.