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<\/p>\nA global food crunch due to extreme weather would boost prices more in the euro area than in Group of Seven economies, according to Oxford Economics.<\/p>\n
A \u201csevere\u201d shock to food prices from climate events could raise food prices in countries sharing the currency by 1.6 percentage points a year, the economic adviser said in a report. That would translate into an increase in headline inflation of as much as 0.6 percentage point, economists Robert Marks and Ronan Hegarty said in the study published Thursday<\/a>.<\/p>\n Natural disasters and heat waves could cause more harvest failures, damage infrastructure and disrupt supply chains in the future as global warming continues, with nations in Europe roasted by a heat wave this week. The resulting rises in food costs would increase pressure on central banks to rein in inflation.<\/p>\n \u201cClimate change and nature-loss are increasingly contributing to food price inflation and volatility, presenting a long-term risk to economies,\u201d the authors said. \u201cRecent research has found at least 14 cases of local or regional price spikes since 2022 linked to unprecedented extreme weather events.\u201d<\/p>\n A drought in Brazil saw global coffee prices jump 55% between 2023 and 2024, while heat waves in Ghana and the Ivory Coast led to a 280% surge in cocoa prices, according to the report.<\/p>\n Europe is more sensitive to global markets than other G7 economies, according to the report. A price shock could see food prices rise 1 percentage point in the UK, but just 0.28 point in the US and 0.35 point in Japan.<\/p>\n It takes two-and-a-half years on average for global commodity prices to return to pre-shock trends, according to the report. The study comes as central banks are looking into the impact of climate change on food supplies and prices.<\/p>\n \u201cAgricultural and food price channel deserves particular attention in climate stress testing, scenario analysis, and risk management exercises,\u201d the Oxford Economics researchers wrote.<\/p>\n Photograph: An employee checks cauliflowers imported from Portugal at the D & F McCarthy Ltd. fresh fruit and vegetable wholesaler in Norwich, UK, on Tuesday, Feb. 28, 2023; photo credit: Chris Ratcliffe\/Bloomberg<\/em><\/p>\n Topics<\/span> Europe<\/a> <\/p>\n<\/p><\/div>\n Was this article valuable?<\/p>\n<\/p><\/div>\n![](\"https:\/\/www.insurancejournal.com\/app\/uploads\/2026\/06\/climate-change-affects-food-prices-bloomberg.jpg\")
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