- Global food inflation risks rise due to disruptions in grain shipments from Russia and Ukraine
- Repeated attacks on Black Sea ports hinder movement of agricultural commodities and increase costs
- Higher fertiliser, diesel, and labour costs pressure farmers and impact crop yields globally
Global food inflation risks are rising as multiple factors, including disruptions to grain shipments from Russia and Ukraine, soaring fertiliser and fuel costs, extreme weather and transport bottlenecks, put fresh pressure on agricultural supply chains.
Russia and Ukraine together account for roughly a quarter of global grain exports. They reportedly exported nearly 100 million metric tonnes of grain in the year through June, but repeated attacks on Black Sea ports and vessels are increasingly disrupting the movement of agricultural commodities.
The security risks have also made it increasingly difficult and expensive for shipping companies to obtain insurance, prompting some operators to avoid the region.
Alternative routes for Ukrainian grain face their own challenges, including low water levels on the Danube and rail maintenance disruptions in Eastern Europe.
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The problems extend beyond the Black Sea. Disruptions around the Strait of Hormuz and declining water levels on key European waterways such as the Rhine are affecting the movement of agricultural commodities and fertilisers.
Higher fertiliser, diesel and labour costs are adding to pressure on farmers, potentially affecting planting decisions and crop yields.
Global economies, including India, have already felt the adverse impact of oil and gas flow disruptions, due to the conflict in the Middle East. Rising crude oil prices could put fresh pressure on India's inflation outlook, with the impact potentially extending to the local economy through higher transport, freight, diesel and farm input costs.
India's retail inflation rose to 4.45% in July 2026, while food inflation climbed to 5.52%. A sustained rise in crude prices could increase the cost of transporting farm produce and raise expenses for fertiliser, irrigation and other agricultural inputs. This may eventually push up prices of vegetables, cereals, pulses and processed food.
While inflation remains under watch, prolonged oil-price pressure could squeeze household budgets, raise business costs and weaken consumer spending, particularly in price-sensitive local markets.
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CoBank economist Jacqui Fatka reportedly said that higher fertiliser prices have become increasingly structural, while analysts warned that strained farm finances could make it difficult for growers to secure adequate supplies ahead of the next planting season.
Weather risks too are compounding the pressure, with heat damaging European crops and concerns over US corn yields following a wet spring and lower fertiliser use.
Analysts also expect El Niño to increase weather volatility, adding another layer of uncertainty to global food supplies.
The combination of supply disruptions, rising input costs, geopolitical tensions and extreme weather could create a fresh inflationary shock, with food prices emerging as another major risk for the global economy.
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