JPMorgan projects global food inflation could reach roughly 5% annualized in the first half of 2027, nearly double the 2.8% pace it expects for the first half of 2026. The bank blames a fertilizer supply crunch tied to the Iran conflict and a forming super El Niño, with emerging markets set to feel the sharpest impact.
According to Crypto Briefing, JPMorgan is warning of what it calls a "compounding storm" for global food prices. In a report published July 24 titled "Food Security is National Security," the bank says annualized global food inflation could climb to about 5% in the first half of 2027, up from an estimated 2.8% in the first half of 2026.
Fertilizer and weather compound the pressure
Together, the two forces could add an extra 1.3 to 1.5 percentage points to peak global food inflation and 0.3 to 0.6 percentage points to overall headline inflation worldwide. The first driver is nitrogen fertilizer: the conflict in Iran and closures around the Strait of Hormuz have disrupted a key artery for global fertilizer trade. The Middle East accounts for about 42% of global urea exports and roughly 27% of ammonia exports. Separately, roughly a third of the world's nitrogen fertilizer transits the Strait of Hormuz.
The second driver is meteorological. JPMorgan analyst Nora Szentivanyi puts the probability of a super El Niño forming by late 2026 at 81%. She adds a 97% chance the conditions persist into 2027. A super El Niño alone could add roughly 0.7 percentage points to peak food inflation.
Emerging markets face the sharpest hit
The impact won't land evenly. JPMorgan's analysis flags emerging markets in Asia and Latin America as most exposed, pointing to India, Indonesia, Brazil, and Colombia — countries with heavy food weighting in their inflation baskets, reliance on fertilizer imports, and agriculture sectors sensitive to weather. In many of these economies, food represents 30% to 50% of the CPI basket, compared with a much smaller share in the US.
For context, the USDA's July 2026 Food Price Outlook projects a more modest 2.9% rise in US food-at-home prices for 2027, though it flags beef as a category that could run hotter than that baseline.
Source: Crypto Briefing
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