Onome Amuge
Global food prices continued their downward drift in November, easing for a third consecutive month and nearing their lowest levels in almost four years. However, this apparent relief conceals a more complex reality for Africa’s food-importing nations. Wheat and maize, the commodities the continent depends on most, are the very ones that have refused to decline.
Fresh data released Friday by the United Nations Food and Agriculture Organization (FAO) shows its benchmark Food Price Index falling to 125.1 points, down from 126.6 in October, 2.1 percent below its level a year ago, and 21.9 per cent below the March 2022 peak, when the Russia–Ukraine war sent global markets into a panic.
Nearly all major food commodity categories posted declines, as sugar plunged to a four-year low, dairy prices continued their slide, vegetable oils weakened further, and meat prices softened yet again.
But cereals, the backbone of African diets and one of the biggest drivers of Nigeria’s food import bill, rose 1.8 percent, marking a divergence from the global trend.
This split between falling soft-commodity prices and rising grain prices signals a consequential turn for African governments already battling inflation, currency pressure, fiscal strain, and a deepening food security crisis.
A global reprieve that Africa may not benefit from
Across the world, cooling inflation and improving supply chains are helping temper food costs. Many Asian and Latin American economies now see food prices retreating toward pre-pandemic norms.
But in African markets; from Lagos to Luanda and Nairobi to Niamey, food inflation remains stubbornly high even as global benchmarks fall. Local factors play a role, with weak currencies, logistics breakdowns, insecurity, climate shocks, high transport costs, and persistent structural deficits in agriculture.
A deeper issue emerged in the second most populous continent. Africa’s food import dependence is concentrated in the very commodities that are becoming more expensive globally, as the continent imports between 45 and 55 per cent of its wheat, 30 to 35 per cent of its maize, a large share of its rice, substantial quantities of vegetable oil such as palm and sunflower oil, and high volumes of dairy products in powder form.
In contrast, commodities experiencing significant global price declines sugar, dairy, meat, make up a smaller portion of Africa’s external food bill.
Thus, for many African economies, the November FAO report is less a sign of relief than a signal of renewed exposure.
The FAO Cereal Price Index rose 1.8 percent in November, driven by a 2.5 percent increase in wheat prices due to concerns over potential Chinese purchases of U.S. supplies, persistent Black Sea tensions that threaten shipping lanes, and lower Russian planting intentions for the next season. Maize prices also strengthened, supported by strong Brazilian export demand and weather-related delays in Argentina and Brazil, while barley and sorghum rose in line with wheat and maize. Although rice prices fell, the decline was not enough to offset the increases in other cereals.
For Africa, the rise in wheat and maize prices carries outsized consequences. Both grains are considered significant staples. Wheat is central to bread, pasta, noodles, and baked goods, urban consumption habits that are among the fastest-growing on the continent. Maize is also critical for food and feed markets across the continent. Nigeria alone spent nearly N2 trillion on wheat imports in 2024, according to customs data reviewed by Business A.M, even as the naira suffered one of its most notable annual declines on record.
Because wheat is mostly imported, and priced in dollars, any upward movement in global wheat prices immediately translates to domestic inflation.
In a separate report, the FAO raised its forecast for global cereal production in 2025 to an unprecedented 3.003 billion tonnes, the first time world output will cross the 3-billion-tonne threshold.
Cereal stocks are projected to reach an all-time high of 925.5 million tonnes by the end of the 2025/26 season. Wheat stocks alone are rising sharply in China and India, which now dominate global grain reserves. Yet, ironically, cereals are still getting more expensive.
Analysts say this paradox reflects how grain markets have become geopolitically charged, especially since the war in Ukraine reconfigured the world’s wheat trade. Russia remains the world’s largest wheat exporter, but risks around sanctions, maritime security, export corridor politics, and fertiliser flows have injected persistent risk premiums into grain prices.
Beyond cereals, every major food category declined in November. Sugar recorded its deepest fall since 2020, with prices dropping 5.9 per cent to their lowest level in almost four years. This correction reflects strong Brazilian output, optimistic harvest expectations in India and Thailand, and easing concerns about weather-related supply disruptions.
This is welcome news for consumers globally, but its impact on African economies is limited. Sugar is a major household staple, but Nigeria, South Africa, Egypt, and Kenya still rely heavily on imports. Nonetheless, there are projections that local sugar refining industries, especially in Nigeria may benefit from lower input costs.
Vegetable oil prices fell 2.6 per cent in November, driven by increased Malaysian palm oil production, larger Black Sea sunflower oil supplies, and weak buying from China and India. The only exception was soyoil, which remained supported by strong biodiesel demand in Brazil. For West Africa, where palm oil is a dietary and industrial staple, the decline is seen as positive, although analysts warn that currency weakness in Nigeria and Ghana will erode much of the benefit.
The Dairy Price Index fell 3.1 per cent, with butter and whole milk powder particularly affected. Europe and Oceania, major exporters, have increased milk output, adding downward pressure.
According to analysts, African dairies that rely on imported powders for reconstitution should see lower import costs. But local dairy producers may face stiffer competition from cheaper imports, potentially undermining domestic value-addition efforts.
Meanwhile, meat prices fell 0.8 per cent, with pork and poultry driving the drop. Brazil’s abundance of exportable poultry and fierce competition among global suppliers continue to pressure prices.
African importers of poultry products, especially Ghana, Congo, Angola, and South Africa, are projected to see cheaper import options. But local poultry farmers, already squeezed by high feed costs, remain at risk.
Why falling global prices are not translating into local relief in Africa
Despite global price declines, food inflation across Africa remains persistently high, with countries such as Nigeria, Ghana, Kenya, Ethiopia, and Zambia all recording double-digit increases over the past year. This disconnect stems from three main factors: first, widespread currency weakness, seen in the naira, cedi, kwacha, Egyptian pound, and Kenyan shilling, has made dollar-priced imports like wheat, maize, rice, and vegetable oil more expensive even as global prices fall. Moreso, domestic transport, logistics, and distribution costs remain elevated due to poor road networks, insecurity, border delays, and reliance on diesel-powered transport, all of which inflate food prices independently of international trends. In addition, structural production deficits, including too little wheat, inconsistent maize surpluses, insufficient vegetable oils, and limited dairy output, leave the continent chronically exposed to global price volatility.
A striking feature of the FAO data is how concentrated global cereal stocks have become. China and India hold more than half the world’s wheat reserves. These stocks exist primarily for domestic buffer purposes, not for global redistribution. Thus, record stocks do not automatically translate into lower prices for African consumers.
The FAO notes that coarse grain stocks are rising in exporting countries like Brazil, the U.S., and Argentina, but these also fluctuate based on currency movements, export policies, and weather.
The latest FAO developments highlight the fact that Africa’s vulnerability to external food shocks is increasing rather than decreasing. This vulnerability is considered structural. Population growth is driving demand faster than domestic production can keep up. Climate change is reducing yields in East and Southern Africa. Insurgency and banditry continue to disrupt farming in Nigeria, Mozambique, and the Sahel. Input costs, including fertiliser, mechanisation, and improved seeds, remain prohibitively high. Agricultural financing is seen as weak and inconsistent. Irrigation coverage is among the lowest of any region globally. Analysts observe that in this context, even marginal increases in global wheat and maize prices have amplified consequences for African economies.
