In its November food outlook report, the Food and Agriculture Organisation (FAO) of the United Nations (UN) estimates that global agricultural input costs increased by 50% in 2022 to $424bn (€408bn). This is more than double 2020 levels.

The FAO is suggesting that markets for basic foodstuffs are easing, but this comes with several caveats attached, all of which could cause instability.

It lists climate variability at the top of the list, followed by conflict and geopolitical tensions, bleak economic outlook globally, rising agricultural input costs and export restrictions as factors that are a threat to global food commodity market stability.

Wheat and coarse grains

The FAO is forecasting that wheat inventories will grow in 2022/23 on the expectation of record production and lower utilisation growth.

Increase is expected to be concentrated in a few countries and because of export disruptions and reduced import demand, world wheat trade is forecast to fall below 2021/22 levels.

On the other hand, a fall in production of coarse grains is expected with tightening in markets in 2022/23. Global trade is expected to decline by over 3%, reflecting weaker import demand and tighter export supply.


World beef, including buffalo production, is forecast to increase by 1.1% in 2022 to 73.9m tonnes carcase weight equivalent (CWE).

This is a 1.1m tonnes increase on 2021 levels and 2m tonnes more than 2020 and trade has increased by 5.2% to 12.7m tonnes, 1m tonnes more than in 2020.

The FAO estimates that pigmeat production has increased by 2.2m tonnes in 2022 compared with 2021, yet globally traded pigmeat has dropped by 11.3% year on year to 11.3m tonnes.

This is because the growth in production has primarily occurred in China, as it recovered from African swine fever and its demand for imports reduced correspondingly.

There has been a small increase in sheepmeat production in 2022, up 0.9% to 16.5m tonnes, although international trade has remained broadly consistent at 1.1m tonnes.


The FAO estimates that global dairy production this year will grow by 0.6% to 930m tonnes, the lowest level of annual growth for the past two decades.

While growth is expected in India and Pakistan, declines are forecast for major producers including New Zealand, the EU, Australia, Ukraine and Turkey. These are explained by the effect of war, extreme weather events and labour shortages, combined with high input costs.

The FAO expects that this will lead to a 3.4% drop in dairy products traded in 2022 to 85m tonnes, the first decline in almost 20 years.

Reduced demand in China is a key factor in this due to high stocks combined with increased domestic production, while demand is frustrated by ongoing issues with COVID-19 restrictions. This has been reflected in dairy product values in recent months, which despite tight supplies have been in decline.

With the world population passing 8bn people recently, global demand for all agri-food products will keep rising as forecast by the FAO 10-year outlook report to 2031.

It is against this backdrop that this year’s number should be considered.

It is clear that weather events are having a significant impact on production and dramatic increase in production costs have caused higher consumer prices.

These may be affordable in developed countries, but are literally a matter of life and death in the world’s poorest countries, where concern is growing about food supply.

The demand for agri food has never been greater and will continue to grow - the challenge is to produce it in the most sustainable way and minimise the impact on climate.