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here's what can get more expensive


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Global food prices recently rose to an 18-month high, with some food baskets expected to continue rising, according to market watchers.

in October global food prices were the highest since April 2023according to the latest data collected by the Food and Agriculture Organization of the United Nations.

The FAO food price index, which tracks the prices of five food baskets: cereals, meat, dairy products, vegetable oils and sugar, rose 2% in October, driven mainly by a jump in vegetable oil prices.

From January to October, the vegetable oils category had the biggest price jump, jumping 24% on the back of higher prices for palm, soybean, sunflower and canola oils. This was followed by the FAO dairy category, which rose 17% year-to-date, led by cheese and butter prices. The meter's meat category is up 10% year-to-date.

Conversely, the cereal category which largely composed of wheat and ricefell 4.5%, while sugar fell almost 5% year-on-year. Supply-side factors ranging from weather conditions to transportation challenges are the main drivers, analysts agree.

The index measures commodity prices, not retail spending, but the increase suggests higher food prices may continue to weigh on consumers.

Here are some key food products that could see more gains globally in the coming year, according to industry experts who spoke to CNBC.

1. Palm oil and other vegetable oils

Vegetable oil prices are expected to rise significantly next year, with palm oil in focus as higher global demand meets supply constraints, said Cheang Kang Wei, a physical agriculture broker at the firm financial services StoneX.

The latest El NiƱo weather phenomenon has affected palm fruit cultivation in Indonesia, which is the largest producer of palm oil and accounts for more than half of the world's supply, Fitch Solutions BMI research unit said in a report.

According to national palm oil associationdomestic production in the first eight months of 2024. saw a nearly 5% drop compared to the same period last year.

“This is compounded by Indonesia's drive to use more palm oil to make biodiesel, further limiting supplies,” Cheang told CNBC.

Other vegetable oils, such as canola oil, could also become more expensive as a result of similar supply challenges, broker StoneX added.

2. Beef

Beef prices have jumped as a result of drought in the US southern plains that has “severely reduced” cattle herds, said Stephen Nicholson, strategist at agribusiness bank Rabobank.

Beef cattle operations that depend on rainfall to produce feed for their herds are susceptible to drought. During dry spells, when forage production and feed availability for cattle declines, producers often have to purchase additional feed or reduce their herd size – resulting in higher costs.

The United States is the largest producer of beef in the world and among the leading exporters.

Angus beef steaks and sirloin top loins for sale at Sprouts Farmers Market grocery store in Redondo Beach, California on February 23, 2024.

Patrick T. Fallon | AFP | Getty Images

Cattle futures traded on the Chicago Mercantile Exchange rose 16 percent to $2.59 a pound since the start of the year, FactSet data showed. Feeder cattle are young cattle that are mature enough to be fattened for slaughter.

Rabobank and UK Agriculture and Horticulture Development Council both expect a general decline in global beef production to keep prices high in 2025.

“Herd contractions in the world's four largest beef-producing countries will lead to the first global reductions in beef supplies since the Covid-19 pandemic,” Rabobank analysts write in a recent report.

3. Coffee and cocoa

Sugar, coffee and cocoa markets face more price uncertainty than other commodities, said BMI commodity analyst Matthew Biggin.

While coffee and cocoa prices are not reflected in the FAO index, the prices of the two commodities face “the greatest risk,” Biggin said. Adverse weather in key coffee producer Brazil led to bullish market sentiment, a BMI report noted.

Coffee futures, traded on the ICE, jumped almost 70% since the start of the year to $3.18 a pound.

Chocolate tray.

Cindy Ord | Getty Images Entertainment | Getty Images

4. Fruits and vegetables

One category that will be “heavily impacted” by policies proposed by US President-elect Trump will be fruits and vegetables, said Bradley Rickard, professor of food and agricultural economics at the Charles H. Dyson.

“And that would be further complicated if other policy changes affect the supply of agricultural labor in the United States,” Rickard said.

Trump recently said he would impose additional 10% tariff on goods from China and 25% duty on Canada and Mexico.

The US in particular will be hit harder.

In 2022 Mexico accounts for 69% of US vegetable imports and 51% of US fresh fruit imports, according to the latest figures from the US Department of Agriculture.

Mexico is a key range supplier products for the United States, including avocados, tomatoes, raspberries, peppers and strawberries, according to data from the University of California, Davis.

“The food items that will see the biggest price increase are those that are not produced domestically,” Rickard added.

When Trump takes office in January, there could be a “renewed trade war” with China that could be very disruptive to agricultural trade, said Joseph Glauber, senior fellow at the International Food Policy Research Institute.

Soybean, poultry and meat prices could be volatile if China retaliates, he added.



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