FAO: Vegetable Oil Prices Surge 5.9% Amid Hormuz Tensions

Global Food Prices Rise for Third Consecutive Month

World food prices rose for a third consecutive month in April 2026, driven by a near-6 percent jump in vegetable oils as rising crude costs and biofuel demand squeezed cooking oil markets, according to the UN Food and Agriculture Organization (FAO). The FAO price index was up 1.6 percent from March and 2 percent higher than a year earlier, with the agency pointing to higher energy costs linked to the impasse in the Strait of Hormuz.

Vegetable Oils Hit Highest Level Since July 2022

Vegetable oils recorded the sharpest increase among the commodities tracked by the FAO, rising 5.9 percent month on month to their highest level since July 2022. Palm, soy and rapeseed oils are used widely across the food system but are also increasingly being diverted into biodiesel production as crude prices remain elevated.

Hormuz Disruption Threatens Fertilizer Supply

Shipping disruption in the Hormuz region matters significantly for agriculture because the Gulf is a major supplier of crop nutrients. The region provides one-third of global urea and up to 30 percent of ammonia, key components in nitrogen fertilisers used to grow wheat, maize and rice.

The FAO has previously warned a food supply shock could spread across the developing world if disruption in the Gulf lasts longer than three months. However, the Rome-based body said global agri-food systems had so far shown resilience because of relatively strong stocks and adequate supplies from previous seasons.

Cereal, Maize, and Meat Prices Rise

Cereal prices rose 0.8 percent in April, with wheat supported by concerns over US drought, expectations of below-average rainfall in Australia and reduced plantings as farmers shift away from fertiliser-intensive crops amid high input costs due to the Iran war.

Maize prices increased by 0.7 percent because of tighter seasonal supplies, weather concerns in Brazil and the US, and stronger ethanol demand linked to higher crude prices.

Meat prices reached a record high, rising 1.2 percent from March and 6.4 percent year on year.

Sugar and Dairy Prices Decline

Sugar prices fell 4.7 percent on expectations of ample supplies and improved production prospects in China and Thailand, while dairy prices slipped 1.1 percent because of abundant EU milk supplies and strong late-season output in Oceania.

FAO Economist: Vegetable Oils Face Strongest Pressure

“Despite the disruptions linked to the crisis in the Strait of Hormuz, global agrifood systems continue to show resilience,” said the FAO’s chief economist Máximo Torero.

“Cereal prices have increased only moderately so far, supported by relatively strong stocks and adequate supplies from previous seasons,” Torero added.

“Vegetable oils, however, are experiencing stronger price increases, driven largely by higher oil prices, which are increasing demand for biofuels and putting additional pressure on vegetable oil markets.”

FAQ

What is the FAO price index and how much did it rise in April 2026? The FAO price index tracks global food commodity prices across multiple categories. In April 2026, the index was up 1.6 percent from March and 2 percent higher than a year earlier, according to the UN Food and Agriculture Organization.

Why are vegetable oil prices rising so sharply? Vegetable oil prices rose 5.9 percent month-on-month in April, driven by higher crude oil costs and increased biofuel demand. Palm, soy and rapeseed oils are being diverted into biodiesel production as crude prices remain elevated, according to the FAO.

How long could a food supply shock last if Hormuz disruption continues? The FAO warned that a food supply shock could spread across the developing world if disruption in the Gulf lasts longer than three months, as the region supplies one-third of global urea and up to 30 percent of ammonia used in nitrogen fertilisers.