India’s Food Security Faces 2027 Test Amid Weather And Fertiliser Risks: JP Morgan
Summarized by AI; it may make mistakes. Check important info
Summarized by AI; it may make mistakes. Check important info
The world could face a major food supply crisis in 2027, with countries including India, Brazil and Indonesia expected to be among those facing the most serious impact, according to a warning attributed to global financial institution J.P. Morgan.
The warning points to several factors that could put pressure on food production and prices, including geopolitical tensions, fertiliser shortages, rising agricultural costs and changing weather patterns linked to El Niño.
Global food inflation could rise sharply
According to the report, global inflation could reach nearly 5% in the first six months of 2027, compared with 2.8% during the same period in 2026.
The expected crisis is not limited to a possible shortage of food grains. Rising production costs and unpredictable weather could also make it harder for farmers to maintain crop production.
If food prices rise sharply, households in developing countries could be forced to spend a larger share of their income on essential food items.
Fertiliser shortages raise concerns
Fertiliser supply is expected to be a major factor in the potential crisis.
The report said the Middle East accounts for 42% of global urea exports and 27% of ammonia exports. Tensions around the Strait of Hormuz, along with rising natural gas prices, have disrupted supply chains.
The report outlined a chain of events in which conflict could trigger an energy crisis, followed by fertiliser shortages, higher agricultural costs, lower production and, eventually, rising food prices.
Restoring the disrupted system and production could take between one and four years, according to the report.
El Niño could worsen crop production
Changing weather patterns linked to El Niño could add to the pressure on global agriculture.
The report said El Niño increases the risk of droughts, floods and other adverse weather events. Historically, the phenomenon has resulted in an average 3.5% decline in crop production in tropical regions.
A “Super El Niño” could increase global food inflation by around 0.7%. When combined with rising energy prices, the impact could reach between 1.3 % and 1.5%, according to the report.
India faces pressure on agriculture
India could face a direct impact if monsoon conditions become weak or erratic.
Rain-fed crops including paddy, pulses, oilseeds, cotton and sugarcane could be affected by changes in rainfall patterns.
The report said India’s challenge is not only ensuring adequate grain supplies but also maintaining agricultural production at affordable costs for farmers amid volatility in fertiliser and energy markets.
A decline in farm output could reduce domestic supplies and put further pressure on retail food inflation.
Brazil and Indonesia also among countries at risk
The warning also highlights Brazil and Indonesia among countries that could experience serious effects from the potential food crisis.
The combination of rising agricultural costs, lower crop production, fertiliser shortages and adverse weather could put additional pressure on food supplies and prices in these countries.
The developments will depend on how geopolitical tensions, fertiliser availability, energy prices and weather conditions evolve through 2027.
