Throughout the Mediterranean, reduced yields and higher input costs for olive producers have pushed up prices to 20-year highs this year. The production problems are only going to get worse as the effects of climate become more acute, predicts Divita.
For millennia, food production and pricing have been disrupted by the weather, with one-off events such as heatwaves, droughts, flooding or frosts cutting harvests and raising prices. War and disease are also factors, as the world saw recently after Russia’s invasion of Ukraine, and the swine fever that swept through China’s pig population.
But another, more sustained thread has run through many sharp increases in food prices. From oranges in Brazil to cocoa in west Africa; olives in southern Europe to coffee in Vietnam, permanently shifting weather patterns as a result of climate change are reducing crop yields, squeezing supplies and driving up prices.
Adam Davis, co-founder of global agricultural hedge fund Farrer Capital, says climate change has helped drive up prices for a long list of food commodities trading at higher levels this year. “Wheat is up 17 per cent, palm oil 23 per cent . . . sugar 9 per cent and pork 21 per cent,” he says. For the consumer, the “lag effect of those high commodity prices is not going away”.
A third of the food price increases in the UK in 2023 was down to climate change, according to the Energy and Climate Intelligence Unit think-tank. “There’s a material impact from climate change on global food prices,” says Frederic Neumann, chief Asia economist at HSBC. “It’s easy to shrug off individual events as being isolated, but we’ve just seen such a sequence of abnormal events and disruptions that, of course, add up to climate change impact.”
