Goldman Sachs warned that a strong 2026-27 El Niño could push El Niño–southern Oscillation pressures into a severe global food price shock, with the effects not fully realised until the second half of 2028. UniCredit said the cycle has put “climateflation” back on the agenda as NOAA said warming conditions were already taking hold in the Pacific.
The bank projected a 15.8% surge in global food commodity prices and a 1.3% rise in eurozone food prices. That lands while world food prices are already at their highest level in three years, after the Iran war helped drive them up.
NOAA and the 63% signal
NOAA said last month that warming conditions were taking hold in the Pacific and that there was a 63% chance of sea surface temperatures exceeding 2C above normal later this year. That forecast is the piece that turns a seasonal weather pattern into a pricing problem for households and importers that buy ahead, hedge late, or absorb the bill directly.
Scientists said the 2026-27 El Niño had a historically unprecedented chance of developing into a very strong event. Goldman Sachs said the consequences could take until the second half of 2028 to be fully realised, which means the price effect is not confined to the year of the weather event itself.
UniCredit and Goldman Sachs
UniCredit analysts wrote that “El Niño puts ‘climateflation’ back on the agenda” and added: “Europe’s recent heatwaves are a reminder that the climate baseline is already shifting. El Niño could add a new layer of pressure later this year, as it amplifies the effects of global warming.”
UBS said El Niño reshapes global rainfall and temperature patterns, creating regional winners and losers. That leaves room for some regions to benefit from warmer weather conditions even as the overall risk is described as a severe global food shock, because rainfall changes do not hit every growing area in the same way.
China, southern Africa, Brazil, Egypt and India
The historical warning runs through an El Niño that contributed to catastrophic droughts across China, southern Africa, Brazil, Egypt and India in 1876-78, when more than 6 million people in India died. Economists are not saying a repeat is guaranteed; they are saying a strong 2026-27 El Niño could still move global food markets sharply enough to matter for consumers long after the weather itself fades.
For households, the practical issue is timing. A shock that builds through 2026-27 and is fully realised only in the second half of 2028 gives retailers, food importers and consumers a long runway of higher costs, not a single price spike that comes and goes in one season.
