Economists predict that the 'super' El Niño weather cycle could lead to significant global food price increases, compounding existing inflationary pressures.
New Delhi, India Jul 12, 2026 ALN: Economists are warning that a “super” El Niño weather cycle this year could cause a severe shock to global food prices lasting into 2028. As the ongoing conflict in Iran pushes up world food prices to the highest levels seen in three years, analysts are highlighting that supply chains are facing “two shocks at once,” both driven by extreme weather patterns linked to global heating. The implications of such changes could be far-reaching, affecting food availability, prices, and overall economic stability across various regions.
El Niño is a naturally occurring climate phenomenon characterized by the periodic warming of sea surface temperatures in the central and eastern equatorial Pacific Ocean. This phenomenon can have significant impacts on weather patterns around the world, often leading to extreme weather events such as droughts, floods, and storms. Scientists have indicated that the upcoming 2026-27 El Niño has a historically unprecedented chance of developing into a “very strong” event, which could exacerbate heatwaves and flooding globally.
The term “super” or “Godzilla” El Niño has been used informally to describe particularly intense occurrences of this weather pattern. The U.S. National Oceanic and Atmospheric Administration (NOAA) confirmed last month that warming conditions are indeed taking hold in the Pacific, with a 63% chance of sea surface temperatures exceeding 2°C above normal later this year. This warming trend is particularly concerning as it could lead to significant disruptions in agricultural production and food supply chains.
At a time when households around the world are already feeling the financial strain from soaring living costs, experts warn that an extreme El Niño could further intensify these pressures. The possibility of a renewed inflation shock is causing jitters among central banks, which may lead to prolonged periods of elevated interest rates. This situation raises concerns not only for consumers but also for economic growth, as higher interest rates can dampen investment and spending.
“El Niño puts ‘climateflation’ back on the agenda,” analysts at the Italian bank UniCredit noted in a recent research report. They emphasized that Europe’s recent heatwaves serve as a stark reminder that the climate baseline is already shifting. The anticipated El Niño could add a new layer of pressure later this year, amplifying the effects of global warming and impacting food supply chains.
The historical context of El Niño events is critical to understanding their potential impact on food security. More than a century ago, an El Niño event that is considered one of the most severe on record triggered catastrophic droughts across various regions, including China, southern Africa, Brazil, Egypt, and India. These conditions led to famine, exacerbated by colonial rule, resulting in the deaths of millions, including more than 6 million people in India during the 1876-78 famine.
Recent El Niño events, specifically those in 1981-82, 1996-97, 2015-16, and the ongoing 2023-24 cycle, have been among the strongest recorded. However, NOAA projections suggest that the upcoming 2026-27 cycle could be even more severe, increasing the risk of droughts and flooding that could significantly impact harvests and global food supply.
Analysts at Goldman Sachs have projected that the strength of this El Niño could lead to a 15.8% surge in global food commodity prices. This anticipated increase would have a ripple effect worldwide, with predictions that food prices in Europe could rise by 1.3% across the eurozone. Such increases would further strain consumers already grappling with rising costs of living.
However, the full impact of these price increases may take time to materialize due to the complexities of the global food supply chain. Goldman Sachs indicated that the consequences of this El Niño could take until the second half of 2028 to be “fully realized.” The delay is largely attributed to the timing of extreme weather events impacting food production, as different crops have varying planting, growing, and harvesting cycles. Additionally, logistical challenges, including water levels in canals and rivers that are crucial for shipping agricultural goods, will also influence how quickly these price changes are felt.
“El Niño does not affect agriculture uniformly. It reshapes global rainfall and temperature patterns, creating regional winners and losers,” analysts at UBS noted. While some regions may benefit from warmer weather conditions, others could face significant challenges. For instance, typically, El Niño events lead to increased risks of drought in southern Africa and northern parts of South America, while causing flooding in southern Brazil, Argentina, Paraguay, and Uruguay. Lower-income countries, which are already feeling the adverse effects of the Iran conflict, are likely to suffer the most from these disruptions.
In particular, regions such as India have already begun to experience the effects of El Niño, with reports indicating a drier monsoon season. Some areas have recorded only 25% of their usual rainfall, while parts of central India have seen only 50% of typical precipitation. This could severely impact the supply of crucial crops like wheat, rice, and sugar cane, further straining food availability.
The global impact of these agricultural disruptions is expected to be widespread. Droughts in Southeast Asia could affect palm oil supply, a significant ingredient in processed foods, while harvests of coffee and cocoa may also be at risk. Furthermore, warmer and wetter conditions could facilitate the spread of crop diseases, negatively impacting yields in subsequent years.
In North America, the influence of El Niño is typically most pronounced during the winter months. While conditions in Europe can also be affected by this weather phenomenon, analysts suggest that the primary impacts will be felt through fluctuations in global food prices rather than direct weather changes.
Three years ago, the European Central Bank estimated that a strong El Niño could drive up global food commodity prices by as much as 9%, with crops like soya beans, corn, and rice experiencing the most significant price spikes. The extent to which these price changes are reflected on supermarket shelves will depend on various factors, including mitigation strategies and domestic policies, as well as consumer demand and retail pricing practices.
According to UniCredit, the potential for an extreme El Niño scenario remains high. They estimate that this could lead to a 14.3% reduction in global agricultural production, translating to an estimated loss of $342 billion (£254 billion) in agricultural output. “Price shocks could reach 10% to 50% across core commodities, while the most exposed crops – including rice, palm oil, sugar, and coffee – could see price increases of 50% to 100% or more,” the bank reported. “The food system enters the second half of 2026 with buffers but with little margin for error.”
Overall, the prospect of a super El Niño presents a complex challenge for global food security, with far-reaching implications for economies, consumers, and agricultural systems worldwide. As the world grapples with the dual pressures of climate change and geopolitical conflicts, the ability to adapt to these challenges will be crucial in mitigating their impact on food prices and availability in the coming years.
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