A recent report by Citi Research warns that global food inflation could surge due to potential disruptions in the Strait of Hormuz and worsening El Nino conditions. With agricultural prices already rising, the report predicts significant upward pressure on food prices over the next 6-12 months due to supply risks linked to energy costs and adverse weather.

• 01Agricultural commodity prices have increased by 13% year-to-date through mid-May 2023.
• 02A prolonged closure of the Strait of Hormuz could sharply raise agricultural production costs due to higher energy and fertilizer prices.
• 03Commodities like sugar, cocoa, and coffee are particularly vulnerable to El Nino's weather-related risks.
• 04Food indices rose by 5% through April 2023, indicating a growing trend in food price inflation.
• 05El Nino may lead to hotter temperatures and reduced rainfall in parts of Asia, negatively impacting crop yields.

Rising food prices could affect consumers globally, leading to increased costs for basic necessities.