Heatwaves push global food prices higher as grain, sugar costs surge

Heatwaves and abnormal weather sweeping major crop-producing regions have pushed global food prices higher again. Concerns over harvests in key producing countries drove up wheat and corn prices, while sugar also climbed — sending the world food price index back into positive territory last month after a brief decline.

The Ministry of Agriculture, Food and Rural Affairs said Saturday that the Food and Agriculture Organization's (FAO) World Food Price Index rose 0.6 percent in July to 131.1 points, up from 130.3 points the previous month. The index climbed from 128.7 points in March to 131.0 points in April, held flat in May, edged down to 130.3 points in June, then rebounded in July.

The latest increase was driven largely by sharp rises in grain and sugar prices, as heatwaves and hot, dry conditions weighed on production of major agricultural commodities.

The grain price index rose 3.4 percent from the previous month to 113.8 points. Wheat prices surged 5.8 percent in a month, as fears of export disruptions from the Black Sea region combined with forecasts of worsening harvests due to heatwaves in major producing countries. Wheat prices stood 9.9 percent higher than in the same month last year.

The FAO World Food Price Index for July 2026 rose 0.6 percent from the previous month, driven by heatwaves and hot, dry weather in major grain-producing countries. [Ministry of Agriculture, Food and Rural Affairs]

Corn prices also rose 3.6 percent from the previous month, as hot, dry weather in parts of the US Corn Belt raised fears of reduced production and elevated energy prices stemming from geopolitical tensions added further pressure. Barley, by contrast, fell 1.9 percent on favorable harvest outlooks in Australia and the Black Sea region, while rice prices remained broadly stable.

Sugar prices also reflected the impact of abnormal weather. The sugar price index rose 5.6 percent from the previous month to 95.0 points. Concerns grew that hot, dry conditions across the EU could affect sugarcane and sugar beet harvests, while El Niño-related weather in major Asian producing countries clouded the production outlook. Brazil's decision to raise its mandatory ethanol blending ratio also added to expectations of tighter sugar supplies, pushing prices higher.

The vegetable oil price index rose 2.0 percent to 195.7 points. Palm oil prices climbed on expanding biodiesel demand in Indonesia and rising international oil prices, while strong US feedstock demand and growing global import demand pushed soybean oil prices higher.

Meat and dairy prices, however, fell. The meat price index dropped 2.8 percent from the previous month to 127.7 points, marking its first decline this year. Lower poultry prices following expanded supplies from Brazil, increased pork supplies in the EU, and slowing beef import demand in Asia all contributed to the drop.

The dairy price index also slipped 0.7 percent from the previous month to 116.2 points, pulled down by declines in butter and milk powder prices.

Despite the rise in global food prices, domestic farm and livestock prices remained relatively stable. Consumer prices for agricultural and livestock products rose just 0.5 percent in July from a year earlier, well below the overall consumer price inflation rate of 2.8 percent over the same period.

The Ministry of Agriculture, Food and Rural Affairs said it plans to continuously monitor supply and demand conditions for individual commodities and take preemptive action to prevent disruptions caused by summer weather conditions such as heatwaves and drought.

adastra@heraldcorp.com