The World Bank’s food price index is projected to fall by 7 per cent in 2025 on a year-on-year basis and edge down in 2026 on declining prices of grains such as rice and wheat amidst ample supplies and weaker demand for grains such as maize as energy feed stocks.
In its latest Commodity Markets Outlook, the World Bank said all three components of the food price index are expected to decline in 2025 – grains by 11 per cent, oils and meal by 7 per cent and other foods by 5 per cent. Food prices are projected to decline by 7 per cent in 2025 over the previous year, driven by weaker demand for grains as energy feedstocks and ample supplies, before stabilising in 2026.
The projected downturn in grains for 2025 is primarily driven by an expected 29 per cent plunge in rice prices, reflecting ample supplies and also the relaxation of export restrictions by India, which accounts for about 40 per cent of the global exports. The global rice output in 2024-25 is expected to increase by 2 per cent, with production in India forecast to rise by 5 per cent, it said.
Further, rice prices are projected to be stable in 2026 as preliminary estimates for the 2025-26 season from the International Grains Council indicate that a small increase in global supply will be matched by a similar increase in consumption, the Bank said.
The wheat stocks are forecast to edge down in 2025-26, as downward demand pressure related to trade tensions is partially offset by tight supply conditions. Near record wheat production is expected to be narrowly outpaced by consumption, resulting in a decline in global stocks, the Bank said.
Maize prices are expected to fall by 2 per cent in both 2025 and 2026 due to lower crude oil prices — which reduce demand for ethanol and thus maize — and higher US-China trade tariffs. Recent price advantages over soyabeans and wheat may lead to more maize planting, boosting production in 2025-26. However, the drop in prices may be capped by tight inventories, the lowest in over a decade.
Further, the Bank said the oils and meals price index is forecast to decline by 7 per cent in 2025, driven by favourable global food oil supplies, before stabilising in 2026. The decrease in 2025 mainly reflects reductions in soyabean and soyameal prices. Soyabean prices are projected to tumble 17 per cent in 2025, as global production is expected to rise by 6 per cent to a new record in the 2024-25 season. Also, the weaker imports of US soyabeans in China, amid heightened trade tensions, are expected to weigh on the US benchmark price, as China accounts for over half of US soyabean exports.
Soyabean oil prices are forecast to ease by 3 per cent in 2025 and 2 per cent in 2026, largely due to lower crude oil prices dampening biofuel demand. However, the downward pressure is partially offset by strong demand resulting from reduced supplies of closer substitutes such as palm oil, sunflower oil, and rapeseed oil. Soyameal prices are projected to decline by 16 per cent in 2025, reflecting robust soyabean production. Soyameal prices are expected to stabilise in 2026 as production of alternative oils recovers.
Palm oil prices are projected to rise by 6 per cent in 2025, as a moderate pick-up in production is insufficient to replenish low global stocks. Additionally, Indonesia’s plan to increase its biodiesel mixture — from 35 per cent in 2024 to 40 per cent in 2025 and to 50 per cent in 2026 — will support palm oil prices. However, the substitution of palm oil with soyabean oil is likely to curb sharp price gains. At the same time, structural challenges in palm oil production, including declining yields and a slowdown in new plantings, will sustain global supply tightness and support prices. As a result, palm oil prices are forecast to increase by 2 per cent in 2026.
Further, the Bank said the risks to the price forecasts for food commodities are tilted to the downside. The main downside risks stem from a weaker-than-expected global growth, whereas the main upside risks are extreme weather events. Trade barriers affecting trade in specific commodities and biofuel policies pose two-sided risks to prices. Further, the heat waves are becoming more frequent, intense, and prolonged, exerting upward pressure on agricultural prices by negatively affecting crop yields, it said.
Published on April 30, 2025
The World Bank’s food price index is projected to fall by 7 per cent in 2025 on a year-on-year basis and edge down in 2026 on declining prices of grains such as rice and wheat amidst ample supplies and weaker demand for grains such as maize as energy feed stocks.
In its latest Commodity Markets Outlook, the World Bank said all three components of the food price index are expected to decline in 2025 – grains by 11 per cent, oils and meal by 7 per cent and other foods by 5 per cent. Food prices are projected to decline by 7 per cent in 2025 over the previous year, driven by weaker demand for grains as energy feedstocks and ample supplies, before stabilising in 2026.
The projected downturn in grains for 2025 is primarily driven by an expected 29 per cent plunge in rice prices, reflecting ample supplies and also the relaxation of export restrictions by India, which accounts for about 40 per cent of the global exports. The global rice output in 2024-25 is expected to increase by 2 per cent, with production in India forecast to rise by 5 per cent, it said.
Further, rice prices are projected to be stable in 2026 as preliminary estimates for the 2025-26 season from the International Grains Council indicate that a small increase in global supply will be matched by a similar increase in consumption, the Bank said.
The wheat stocks are forecast to edge down in 2025-26, as downward demand pressure related to trade tensions is partially offset by tight supply conditions. Near record wheat production is expected to be narrowly outpaced by consumption, resulting in a decline in global stocks, the Bank said.
Maize prices are expected to fall by 2 per cent in both 2025 and 2026 due to lower crude oil prices — which reduce demand for ethanol and thus maize — and higher US-China trade tariffs. Recent price advantages over soyabeans and wheat may lead to more maize planting, boosting production in 2025-26. However, the drop in prices may be capped by tight inventories, the lowest in over a decade.
Further, the Bank said the oils and meals price index is forecast to decline by 7 per cent in 2025, driven by favourable global food oil supplies, before stabilising in 2026. The decrease in 2025 mainly reflects reductions in soyabean and soyameal prices. Soyabean prices are projected to tumble 17 per cent in 2025, as global production is expected to rise by 6 per cent to a new record in the 2024-25 season. Also, the weaker imports of US soyabeans in China, amid heightened trade tensions, are expected to weigh on the US benchmark price, as China accounts for over half of US soyabean exports.
Soyabean oil prices are forecast to ease by 3 per cent in 2025 and 2 per cent in 2026, largely due to lower crude oil prices dampening biofuel demand. However, the downward pressure is partially offset by strong demand resulting from reduced supplies of closer substitutes such as palm oil, sunflower oil, and rapeseed oil. Soyameal prices are projected to decline by 16 per cent in 2025, reflecting robust soyabean production. Soyameal prices are expected to stabilise in 2026 as production of alternative oils recovers.
Palm oil prices are projected to rise by 6 per cent in 2025, as a moderate pick-up in production is insufficient to replenish low global stocks. Additionally, Indonesia’s plan to increase its biodiesel mixture — from 35 per cent in 2024 to 40 per cent in 2025 and to 50 per cent in 2026 — will support palm oil prices. However, the substitution of palm oil with soyabean oil is likely to curb sharp price gains. At the same time, structural challenges in palm oil production, including declining yields and a slowdown in new plantings, will sustain global supply tightness and support prices. As a result, palm oil prices are forecast to increase by 2 per cent in 2026.
Further, the Bank said the risks to the price forecasts for food commodities are tilted to the downside. The main downside risks stem from a weaker-than-expected global growth, whereas the main upside risks are extreme weather events. Trade barriers affecting trade in specific commodities and biofuel policies pose two-sided risks to prices. Further, the heat waves are becoming more frequent, intense, and prolonged, exerting upward pressure on agricultural prices by negatively affecting crop yields, it said.
Published on April 30, 2025
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It is a long established fact that a reader will be distracted by the readable content of a page when looking at its layout. The point of using Lorem Ipsum is that it has a more-or-less normal distribution of letters, as opposed to using ‘Content here, content here’, making it look like readable English. Many desktop publishing packages and web page editors now use Lorem Ipsum as their default model text, and a search for ‘lorem ipsum’ will uncover many web sites still in their infancy.
The point of using Lorem Ipsum is that it has a more-or-less normal distribution of letters, as opposed to using ‘Content here, content here’, making
The point of using Lorem Ipsum is that it has a more-or-less normal distribution of letters, as opposed to using ‘Content here, content here’, making it look like readable English. Many desktop publishing packages and web page editors now use Lorem Ipsum as their default model text, and a search for ‘lorem ipsum’ will uncover many web sites still in their infancy.
It is a long established fact that a reader will be distracted by the readable content of a page when looking at its layout. The point of using Lorem Ipsum is that it has a more-or-less normal distribution
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