JP Morgan warns of possible global food crisis due to Hormuz Strait disruptions, El Nino

HotTV

JP Morgan warns of possible global food crisis due to Hormuz Strait disruptions, El Nino

2026-08-17 21:32 Last Updated At：08-18 12:02

Global food production could take a severe hit from the twin shocks of shipping disruptions in the Strait of Hormuz and a potentially historic Super El Nino, raising the risk of a worldwide food crisis, a senior JP Morgan economist warned.

In a report titled "Food Security Is National Security: A Compounding Storm," Nora Szentivanyi, JP Morgan's London-based senior global economist, said the combination could cut crop yields, constrain farming, and keep food inflation elevated through the first half of 2027. This year's global energy supply shock, she added, could magnify the inflationary impact of a super El Nino.

Global food inflation is expected to climb from 2.8 percent in the first half of 2026 to 5 percent in the first half of 2027, lifting overall inflation by 0.6 percentage points, she noted in the report published by JPMorgan.

The impact is likely to be deeply uneven, with emerging economies in parts of Asia, Africa, and Latin America bearing the brunt because their agricultural sectors are more sensitive to weather shifts and food makes up a larger share of household spending, according to the report.

The report calls for more help for vulnerable groups already facing food shortages. It cites data showing that some 645 million people worldwide were going hungry last year, while about 2.1 billion people experienced moderate or severe food insecurity, equating to roughly 25.8 percent of the global population.

Other major institutions have sounded similar alarms. Research teams at Goldman Sachs and HSBC have flagged rising global food inflation risks, and a recent UN Food and Agriculture Organization report showed the Global Food Price Index rose month-on-month in July at its fastest pace since January 2023.

Summer travel, service demand push August CPI higher in China

A surge in summer holiday travel and the growing demand for high-quality services helped push China's consumer prices higher in August, with the consumer price index (CPI) rising 0.8 percent year on year, experts said Wednesday following the release of key economic data.

The National Bureau of Statistics reported that the CPI in August increase accelerated by 0.3 percentage points from July, with both consumer goods and service prices rising 0.8 percent.

"Since the beginning of this year, new domestic consumption scenarios in areas such as cultural tourism have become increasingly diverse. In particular, during the summer peak season in August, residents' travel demand was released intensively, driving up prices for tourism services, hotel accommodations, and related sectors. In addition, as residents' demand for high-quality service consumption continues to grow, prices for household services such as housekeeping have also risen," said Liu Nancun, an economist at the Analysis and Forecasting Division of the Price Monitoring Center of the National Development and Reform Commission.

On a month-on-month basis, the national CPI turned from a 0.1 percent decline in the previous month to a 0.4 percent increase. This was mainly driven by rising international crude oil prices, which led to higher domestic refined oil product prices and pushed up transportation fuel costs. In addition, driven by factors such as the rapidly growing demand for computing power, prices of products including tablet computers, computers, and mobile phones also rose.