The FAO Food Price Index declined by 2.6 percent in May. Compared to May 2022 levels, the Index is 22.1 percent below its all-time high.

FAO’s Food Price Index edged up slightly in April 2023, the first increase following 12 consecutive months of decline. The increase in this index for internationally traded food commodities was caused by a sharp rise in sugar prices and a moderate rise in meat prices. International prices for cereals, dairy and vegetable oils continued their prolonged decline after peaking in March 2022. Among cereals, only rice prices were up, but this rise was outweighed by further declines in the prices for wheat and maize.

Agricultural markets—particularly trade in cereals such as wheat and maize—have seen significant volatility over the past year as impacts of the Russia-Ukraine war, combined with tight global stocks, drove prices to record (nominal) highs. The rice market, by contrast, has been generally tranquil (Figure 1). Large global supplies and the lack of any direct trade connection to the Ukraine conflict left rice relatively immune to the price spikes seen with other commodities. But recently there have been signs of trouble.

The world reached a stark milestone in 2022, with over a quarter of a billion people in 58 countries/territories experiencing acute food insecurity (defined as IPC Phase 3 (Crisis) or higher), according to the 2023 Global Report on Food Crises (GRFC).[1] This number represents the fourth consecutive year of increasing food insecurity rates and the highest level seen in the seven-year publication history of the report. An additional 253 million people in 41 countries/territories experienced lower levels of food insecurity (IPC Phase 2 (Stressed)).

The FAO Food Price Index rose slightly in April; but remains almost 20 percent below its April 2022 level. Sharp increases in the price of sugar drove the majority of the month-to-month increase.

Following fierce farm protests over gluts of Ukrainian grain and other food items in their domestic markets, four European Union countries—Poland, Slovakia, Bulgaria, and Hungary—have temporarily imposed import restrictions on key agricultural products from Ukraine. Restrictions in Bulgaria entered into force on April 24, and Romania, another EU member, has considered similar measures. The countries’ governments have stressed that these bans are temporary and imposed out of concern for their own farmers, who are seeing prices and incomes fall.

Over the past decade, the world’s food systems have faced multiple significant shocks, from the COVID-19 pandemic and the impacts of the Russia-Ukraine conflict to numerous climate change-driven natural disasters and instances of civil unrest and political instability. These challenges have disrupted markets, driven up food and fertilizer prices and price volatility, reduced food availability and accessibility, and pushed millions of people into hunger.

The Russia-Ukraine war has focused global attention on the key economic roles that those countries play as major exporters of agricultural commodities. Over 2019-2021, they accounted for 12% of global agricultural trade on a kilocalorie basis, with a combined market share of 34% for wheat, 26% for barley, 17% for maize, and 75% for sunflower oil. The war has scrambled this picture, with Ukraine’s exports falling dramatically, and Russia’s falling, then recovering.