Business · Economy · 6 hrs ago
El Niño could raise UK food prices from early 2027, Bank of England warns
The Bank of England warns El Niño could raise food prices in the UK.
El Niño can bring extreme weather that damages some crops while improving yields elsewhere.
Price rises could start in early 2027, first affecting fresh foods such as fruit and vegetables, then spreading over several quarters.
The bank estimates that this summer’s European droughts and heatwaves, combined with El Niño, could push food prices up by around two percentage points at their peak in 2028.
That could add 0.3 percentage points to UK inflation, which measures changes in the cost of goods and services.
Around a quarter of UK food imports, equal to about 10% of the country’s total food supply, comes from regions exposed to El Niño.
The bank also says the weather pattern could put pressure on global energy markets and disrupt transport, but it expects the effects on UK food prices to emerge gradually.
The Bank of England warns that El Niño could raise food prices in the UK from early 2027.
The effects are expected to emerge gradually, first affecting fresh products such as fruit and vegetables.
The combined effects of El Niño and this summer’s European droughts and heatwaves could add around two percentage points to UK food prices at their peak in 2028.
The Bank says the increase could add 0.3 percentage points to CPI inflation.
Around a quarter of UK food imports, equal to about 10% of total food supply, comes from regions exposed to El Niño.
- Who
- The Bank of England issued the warning.
- What
- El Niño could push up UK food prices. The combined effects of El Niño and recent European droughts and heatwaves could raise them by around two percentage points at their peak.
- When
- Effects could begin in early 2027 and peak in 2028.
- Where
- The UK, with weather-related effects also affecting agricultural commodity prices globally.
- Why
- El Niño can affect crop yields, energy markets and transport. The Bank also cites this summer’s European droughts and heatwaves.
This story does not have two clearly opposing sides.
Droughts and heatwaves affected parts of Europe, with some summer crop yields more significantly affected.
The Bank’s agents expect El Niño could begin affecting UK food price inflation, initially through fresh products such as fruit and vegetables.
Modelling suggests the combined effects could raise UK food prices by around two percentage points at their peak.
- First expected effects
- Early 2027
- Potential peak food-price increase
- Around 2 percentage points in 2028
- Potential CPI inflation increase
- 0.3 percentage points
- UK food imports from El Niño-exposed regions
- Around a quarter of imports; about 10% of total food supply
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What people are saying
The current El Niño event is expected to place upward pressure on UK food price inflation
Around a quarter of UK food imports, equivalent to around 10% of total food supply, comes from El Niño-exposed regions
The effects on UK food price inflation are likely to emerge gradually
potentially by around 2 percentage points at its peak in 2028