Since peaking earlier this year, international food prices have returned to levels last seen prior to the Ukraine war. However, prices of most foodstuffs remain high and continue to be under upward pressure from a range of factors, including low stock-to-use ratios for some commodities, high energy and fertilizer costs, poor weather in several key producing countries, and risks associated to the unresolved conflict in Ukraine. With a majority of countries experiencing food price increases between 10 and 30 percent over the previous year, domestic food price inflation is particularly worrisome, especially for the poor who spend a higher share of their disposable income on food.

The wheat harvest is underway in the northern hemisphere, with hot and dry conditions impeding winter wheat yields in several major producing regions, which further confirm an expected decline in global wheat production in 2022. While maize production prospects improved this month, global maize output is also forecast to fall below last year's level. Against this background, and with exports from Ukraine still largely constrained, international wheat and maize markets are expected to stay tight. This means prices will remain volatile and continue to be highly sensitive to daily news on crop development, weather conditions and policy changes. By contrast, global rice production prospects appear strong despite high input prices while soybean output could hit a new record.