Food Prices

In July 2023, the Indian government announced export restrictions on non-basmati white rice. Coming after earlier export limits on other types of rice, the action was taken in part due to a strengthening El Niño that threatened to limit rice production and fuel rising food inflation—a potential political liability for the Modi government as it faced upcoming general elections in spring 2024.

After three consecutive months of increasing prices, the FAO Food Price Index remained steady in June, with rising vegetable oil, sugar, and dairy prices balancing falling cereal prices. The Index remained 2.1 percent below its June 2023 level and almost 25 percent below the peak seen in March 2022.

Spiking food prices have made headlines around the world this year, from eggs in the US to vegetables in India.

The UN Food and Agriculture Organization’s Food Price Index has been slowly increasing over the past six months following declines over much of 2023.

For example, the price of orange juice concentrate in the US was 42% higher in April than it was a year ago, while the price of fresh orange juice in the UK has risen 25% over the last year.

Recent shocks from the COVID-19 pandemic to the ongoing Russia-Ukraine war have disrupted global food and fertilizer supply chains—causing price spikes and increased price volatility—a disastrous combination for many vulnerable consumers around the world.

The FAO Food Price Index rose by nearly 1 percent in May due to increased cereal and dairy prices. It remained 3.4 percent below its May 2023 levels and nearly 25 percent below the peak seen in March 2022.