FAO food price index rises 2.4% in March as oil surges and Middle East tensions escalate
The FAO food price index rose 2.4% in March 2026, driven by higher energy costs and Middle East tensions, with gains across cereals, meat, dairy, oils and sugar.
The United Nations Food and Agriculture Organisation’s Food Price Index (FFPI), which tracks monthly changes in international food commodity prices, averaged 128.5 points in March 2026, up 3.0 points, or 2.4%, from February. That marked the second straight monthly increase. The index is based on five commodity groups — cereals, meat, dairy, vegetable oils and sugar — weighted by their average export shares in 2014-2016.
FAO said prices rose across all five commodity groups, though to varying degrees, reflecting both underlying market fundamentals and the impact of higher energy prices linked to the escalating conflict in the Middle East. Even so, the March reading remained 31.7 points, or 19.8%, below the peak reached in March 2022.
The FAO Cereal Price Index averaged 110.4 points in March, up 1.7 points or 1.5% from February. The increase reflected higher prices for all major cereals except rice. Global wheat prices rose 4.3%, supported by worsening crop conditions in the United States amid drought concerns and expectations of reduced planting in Australia because of anticipated higher fertiliser costs. By contrast, the FAO all-rice price index fell 3.0%, reflecting lower prices across major market segments amid harvest pressure, weaker import demand and currency depreciation against the US dollar.
The FAO Vegetable Oil Price Index averaged 183.1 points, up 8.9 points or 5.1%, marking a third consecutive monthly rise. It was also 13.2% higher than a year earlier. The increase was driven by higher prices for palm, soyabean, sunflower and rapeseed oils. International palm oil prices climbed to their highest level since mid-2022 and moved above soyabean oil, largely because of the sharp rise in crude oil prices, with lower-than-expected production estimates in Malaysia providing added support.
The FAO Meat Price Index averaged 127.7 points, up 1.2 points or 1.0% from February and 8.0% above its level a year earlier. The increase was led mainly by higher pig meat prices, along with a modest rise in bovine meat prices, while ovine and poultry prices eased. FAO said world poultry prices edged lower, partly reflecting weaker quotations in Brazil, even as shipments to key Middle East destinations were rerouted through the Red Sea.
The FAO Dairy Price Index averaged 120.9 points, up 1.5 points or 1.2% in March, although still 18.7% below its level a year earlier. This was the first increase since July 2025, driven mainly by higher prices for skimmed milk powder, butter and whole milk powder, while lower cheese prices limited the overall rise. FAO said firm global import demand and seasonally lower milk supplies in Oceania helped support the increase.
FAO also said the Sugar Price Index averaged 92.4 points in March, up 6.2 points or 7.2% from February, reaching its highest level since November 2025. The rise was influenced mainly by higher crude oil prices, which raised expectations that Brazil would divert more sugarcane towards ethanol production, while the conflict in the Middle East also added concern over sugar trade flows.
