Bread, pasta and dairy products at risk of price increases: forecast for 2026–2027

The world could face a new wave of food inflation. Wheat prices are under increasing pressure due to drought, weather anomalies, disruptions to grain supplies and rising input costs for farmers.

According to Oxford Economics, global food prices could rise by 11.8% in 2026 and another 4.8% in 2027. The greatest price pressure is expected for cereals, fruits, vegetables and dairy products.

Why food prices are rising

Several factors are creating an unfavorable situation for the global agricultural market.

Severe heat and drought have already damaged crops in Europe. Trade association Coceral has lowered its forecast for the cereal harvest in the EU and the UK from 295.5 million to 286.6 million tonnes. In comparison, in 2025, about 310 million tons were harvested.

An additional risk remains El Niño, which can intensify extreme weather events and negatively affect yields in different regions of the world. The FAO also warned of the risk of accelerating food inflation against the background of a combination of wars, high costs and El Niño.

Fertilizers and fuel add to the cost of production

Another factor was the rise in the cost of resources needed by farmers. Due to the US war with Iran and disruptions in the Strait of Hormuz, energy and fertilizer costs have increased.

According to Oxford Economics, global diesel prices in July were 36% higher than a year earlier, and fertilizers are also forecast to increase significantly. This directly increases the costs of agricultural producers.

Wheat remains particularly sensitive to the cost of fertilizers. Oxford Economics expects significant price pressure on this crop.

Bread, pasta and dairy products under attack

The increase in the cost of raw materials may gradually pass into the prices of finished products.

The greatest risk concerns grain products, and therefore bread and pasta. Cheese, oil and other processed products may also be under price pressure. At the same time, meat, according to economists’ forecasts, may feel less of an impact.

It is important that the projected increase in the global food index by 11.8% does not automatically mean that the prices of products in stores will increase by the same percentage. Retail prices also depend on logistics, exchange rates, energy costs, taxes and the situation on the domestic market.

The Black Sea adds risks

The situation is worsened by disruptions to shipping in the Black Sea and risks to grain exports from Ukraine and Russia. Against the background of attacks on port infrastructure, wheat prices have already responded by rising.

As a result, the global food market is facing several challenges at the same time – extreme weather, more expensive energy and fertilizers, wars and logistical problems.

If these factors persist, 2026 could bring another significant jump in global food prices, primarily for basic daily consumption products.