Trade

The FAO Food Price Index rose for the second month in a row in March, up by 2.4 percent from February. As the conflict escalates in the Near East, global energy prices have surged, with varying impacts on commodity prices. The Index reached 1 percent above its March 2025 level but remains nearly 20 percent below the peak of March 2022. The Cereal Price Index increased by 1.5 percent in March, with all major cereals except rise seeing a rise in prices. Wheat prices rose by 4.3 percent due to concerns over drought in the U.S.

The FAO Food Price Index rose in February for the first time in five months, driven by increasing cereal, meat, and vegetable oil prices. Despite the increase, however, the Index remains nearly 35 percent below the record high reached in March 2022.The Cereal Price Index rose slightly more than 1 percent in February but remained 3.5 percent below its February 2025 level. Wheat prices increased due to concerns about cold weather in Europe and the United States, as well as transportation disruptions in Russia and the Black Sea region.

On February 2, 2026, the United States and India finalized a trade deal in which the U.S. will reduce its tariffs from 50% to 18% on merchandise imports from India. Earlier, on August 1, 2025, U.S. imposed 25% tariff on such imports (comprising a 10% baseline tariff + 15% reciprocal component). These tariffs cover around 70% of India’s exports to the U.S. Further, on August 27, 2025, an additional 25% tariff was implemented, as a penalty for Russian oil purchases, bringing the tariff rate to 50%. The measure was among the highest U.S.

The FAO Food Price Index fell in January for the fifth straight month, to nearly 23 percent below the record high seen in March 2022. Sugar, meat, and dairy prices drove the decline. The Cereal Price Index rose marginally in January but is still nearly 4 percent below its January 2025 level. Wheat prices fell 0.4 percent, with strong global supplies balancing growing demand and concerns about weather in several major producing regions. Strong supplies drove maize prices down slightly as well.

The FAO Food Price Index declined marginally in December, with prices reaching 2.3 percent below December 2024. Overall prices for 2025 remained 4.3 percent higher than 2024, however.