Geopolitical Risk and Global Food Prices: Evidence from 1990-2025

Geopolitical factors have, in recent years, been increasingly recognised as important in shaping macroeconomic outcomes. The potential impact that international tensions may have on global food prices is among the key concerns in both political and academic circles. The rapid rise in the prices of key food commodities immediately following the Russian invasion of Ukraine provides good reason for this. Nevertheless, our understanding of the relationship between global food prices and geopolitical shocks, excluding the case of the most recent Russian aggression, remains surprisingly limited. Indeed, most relevant studies focus on local conflicts and prices. In this paper, we undertake a further investigation of this issue by analysing the relationship between a recently developed index of geopolitical risk and global food prices over the past three decades. Interestingly, we do not find any systematic correlation between the two. We offer several potential explanations for this finding. In addition, using cluster analysis, we identify groups of countries for which the relationship varies in intensity, being negative for some, close to zero for others, and positive for the rest.