Grain prices jump 9% in third quarter amid shipping disruption and drought in exporting regions

Key Facts

Global grain prices jumped 9% in the third quarter of 2026 from the previous quarter, as shipping and port traffic in the Black Sea came under attack and drought intensified in major grain-exporting countries. The World Bank also attributed the increase to the early effects of a very strong El Niño, among a range of pressures on supply and grain transport costs. The bank said prices “rose 9%” during the quarter, reflecting the convergence of weather risks and disruption to export routes. Wheat rose faster than corn over the period, according to the bank’s figures. The increase comes as the institution expects food and grain prices to continue rising in 2026 and 2027.

Wheat prices rose 13% in the third quarter from the previous quarter, compared with an 8% gain for corn, according to the World Bank. The gap between the two crops highlights the greater pressure on wheat during the period, while forecasts point to a further decline in global wheat production ahead. The bank said higher grain prices were linked to attacks on shipping and ports in the Black Sea, dry weather in major exporting countries, and the early effects of an exceptionally strong El Niño. The bank did not attribute an actual decline in exporting countries’ production during the quarter to El Niño, but included its early effects among the drivers of higher prices. Weather and conflict risks remain relevant to supply expectations for the next season.

Price pressures also affected food indicators: the World Bank Group’s food price index fell in October after reaching a three-year high in September. Despite the monthly decline, the index remained 15% above its level a year earlier in October, according to the bank. In the third quarter, prices for oils and meals edged down but remained 17% higher year on year, supported by demand for biofuels. The bank identifies rising biofuel demand among the risks that could push prices higher, alongside increased energy costs. It also cited export restrictions and continued hostilities in the Black Sea as factors threatening trade flows.

Food price pressures accelerated in emerging market and developing economies: median annual food price inflation rose to 3.9% in the third quarter of 2026, from 3.5% in the second quarter. Inflation reached 7.4% in the Middle East, North Africa, Afghanistan and Pakistan region, according to the World Bank’s regional classification. In a separate measure, the Food and Agriculture Organization’s cereal price index rose 5.1% in September from August, reaching 17.2% above its level in September 2025. The organization’s chief economist said disruptions in the Strait of Hormuz and the Black Sea, along with climate shocks, were putting pressure on energy, transport and key food commodities. He warned that if these pressures persist, they could soon feed through to consumer prices, particularly in countries dependent on food and energy imports.

On trade, the Food and Agriculture Organization forecast global grain trade would fall 3.5% from its record level in 2025-2026 to 505.8 million tonnes in 2026. It said shipping route restrictions in the Black Sea and a lack of transport alternatives were weighing on wheat and corn exports. In November estimates cited by the World Bank from the U.S. Department of Agriculture, global grain supplies, including production and beginning stocks, are expected to fall by about 20 million metric tons in 2026-2027. Supplies will nevertheless remain at the second-highest level on record. The estimate measures total supplies for the season, while indicators for some crops point to tighter levels.

Wheat forecasts appear more exposed to contraction in the 2026-2027 season: the World Bank forecast a 2% decline in global production, with U.S. production falling 23% to its lowest level since the 1970-1971 season. Ukraine’s exports are also expected to fall 18% during the season. For corn, the bank forecast the stocks-to-use ratio would fall to 21.5%, its lowest level since 2012-2013, while remaining above the low of 13.2% in 2010-2011. These forecasts link a decline in relative stocks to supply risks, but describe the coming season and do not measure stock levels during the third quarter of 2026. In September, U.S. wheat export offers rose over the month: hard red winter wheat increased $33 per ton to $354, and soft red winter wheat rose $45 to $313. The U.S. Department of Agriculture linked the increases to concerns about disruption to Black Sea trade.

The World Bank expects its food price index to rise 10% in 2026 and 7% in 2027, before falling 5% in 2028. For grains, the bank estimates prices will rise 14% in 2026 and 9% in 2027, while oils and meals prices are expected to increase 17% and 8% in the two years, respectively. The World Bank Group said food commodity prices could rise about 10% in 2026 and another 7% in 2027, a cumulative increase of 18%, attributing the pressure to disruption to grain shipments, El Niño risks and higher fuel and fertilizer costs. Ayhan Kose, the World Bank’s deputy chief economist, warned that rising energy costs and trade disruptions were lifting prices across a wide range of goods and threatening to exacerbate inflation and food insecurity and slow growth. If conflicts persist and El Niño effects intensify, the food price index could exceed its 2027 baseline by 12% and could also surpass its 2022 level.

The bank’s estimates point to an earlier improvement in acute food insecurity: the number of people facing it fell from 837 million in 2021 to 779 million in 2025, alongside a 21% decline in global food commodity prices over the period. But the bank expects a cumulative 18% rise in prices in 2026-2027, bringing price pressures back to the forefront of risks facing consumers and importing countries. The risks identified by the bank include El Niño effects becoming stronger than expected, continued hostilities in the Black Sea, export restrictions, higher energy prices and increased biofuel demand. In November forecasts for the El Niño intensity index, the probability of the index reaching 2 degrees Celsius or more was 96% for the November-January average and 81% for December-February. These are probabilities for the phenomenon’s intensity; its effects on weather and production will depend on how conditions develop during the season.