Volatile markets remain a risk to agricul­ture

Global agricultural production is expected to continue growing over the next decade, but the outlook remains fragile. According to the OECD-FAO Agricultural Outlook 2026-2035, higher productivity and stable agricultural prices are expected to drive rising farm incomes. At the same time, energy prices, conflicts, and other disruptions could quickly put that progress under pressure. This makes the outlook relevant for companies across the food industry as well.

Shocks put pressure on agriculture

The OECD and FAO expect global agricultural and fisheries production to grow by 13 percent by 2035. Productivity improvements are expected to remain the main driver of that growth. Even so, the outlook remains uncertain. According to the report, if the series of shocks seen in recent years continues, there is a 25 percent chance that farm incomes in 2035 will fall below current levels.

The short term also carries significant risks. If the sharp increase in energy prices seen during the first half of 2026 continues, global grain production is expected to decline by 0.9 percent in 2027. In low-income countries, that decline could reach 1.7 percent. Higher food prices and lower incomes will further increase pressure on food security.

Productivity remains the main driver

According to the report, global grain production is projected to reach 3.22 billion tonnes by 2035. Almost all of that growth will come from higher yields per hectare. Expansion of agricultural land is expected to remain limited.

In high-income countries, growth in meat consumption is expected to slow. Consumers are increasingly shifting from beef to poultry. High prices, health concerns, and efforts to reduce environmental impact all play a role. Direct greenhouse gas emissions from agriculture are projected to increase by 6.5 percent over the same period. Growth in livestock herds and increased use of synthetic fertilizers are expected to account for most of that increase.

According to OECD Secretary-General Mathias Cormann, agrifood systems are under pressure. "Our agrifood systems are under pressure, and our farmers are on the front line of rising energy and fertilizer costs. Their resilience is our food security."

Fao.org