By Benadeta Mwaura - Reporter
Kenya, January 09, 2026 - Global food prices fell for the fourth consecutive month in December 2025, according to the United Nations Food and Agriculture Organization (FAO), but remain higher than levels seen in 2024, reflecting ongoing volatility in key food markets.
The FAO’s Food Price Index (FPI), which tracks international prices of a basket of cereals, oils, dairy, meat, and sugar, averaged 138.7 points in December, down 0.9% from November 2025 but still 3.8% above December 2024.
Why Prices Fell in December
Dairy Products: International dairy prices declined in December 2025, driven by improved supply from major producing regions, including Europe and Oceania. This increased availability helped ease global market pressures and contributed to the overall decline in the FAO Food Price Index.
Meat: Prices for meat also eased as pork and beef supplies from leading producers increased. The higher availability of these key protein sources helped stabilize markets that had faced tighter supply conditions earlier in the year. Vegetable Oils: Global prices for vegetable oils fell due to larger production of palm, soybean, and sunflower oils.
This surge in output helped offset earlier supply concerns and contributed to the moderation in food price inflation observed in December.
FAO Chief Economist Maximo Torero noted in a statement: "While the short-term decline in food prices is encouraging, global markets remain exposed to ongoing risks, including climate shocks, geopolitical tensions, and energy price fluctuations, which can quickly reverse these gains."
Cereals and Sugar: Mixed Trends
Cereals: Cereal prices remained relatively stable in December 2025, as record harvests in the United States, India, and Russia helped balance tight supplies in certain regions. The abundant output from these major producers eased global market pressures and prevented significant price spikes.
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Sugar: In contrast, sugar prices increased slightly due to lower production forecasts in Brazil and Thailand. This reduction in expected output highlights the persistent volatility in certain commodity markets, even as overall food prices eased.
Implications for Developing Nations
The persistent high food prices continue to strain household budgets in low- and middle- income countries, particularly in Africa and parts of Asia. Analysts warn that even temporary relief may not offset longer-term inflationary pressures, as energy costs, supply chain disruptions, and climate events affect production.
FAO projects that food prices may remain volatile in 2026 due to:
Climate Extremes: Global food markets continue to face pressure from ongoing climate extremes that affect crop yields across multiple regions. Droughts, floods, and unusual weather patterns have disrupted production cycles, creating uncertainty for both producers and consumers.
Energy and Fertilizer Costs: Rising energy and fertilizer prices are also driving up production costs, placing additional strain on farmers worldwide. Higher input costs can limit planting decisions and reduce yields, further influencing food prices on international markets.
Geopolitical Disruptions: Potential geopolitical disruptions, including conflicts in key exporting countries, continue to threaten global food supply chains. Such tensions can lead to export restrictions, shipping delays, and market uncertainty, exacerbating price volatility for essential commodities.
FAO urges governments to support market transparency, food reserves, and social protection programs to shield vulnerable populations from price shocks. "Monitoring food price trends closely is critical to preventing hunger crises and stabilizing markets, " Torero added.
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