By 2028, With US LNG Export Terminals Operating Near Full Capacity And The İncreasing Share Of South America And Ukraine İn Global Food Trade, A Structural İncrease İn Energy-driven Food Production Costs Will Occur, Putting Upward Pressure Particularly On Grain-based Food Prices.

Structural Transformation Of Energy Costs İn Food Production

As 2028 approaches, the global food system will face unprecedented structural pressure. US LNG export terminals operating near full capacity will create a permanent floor under natural gas prices, leading to cost increases at every stage of the agricultural production chain. Energy inputs will be directly affected across a wide spectrum, from fertilizer production to cold chain logistics.

Reflection Of Natural Gas Prices On Food Economy

According to sources, US natural gas prices are expected to range between 2.08 and 4.00 USD/MMBtu in 2028. S&P Global Ratings' forecast of 3.50 USD points to a stable high-price period in energy markets. Since natural gas is the primary raw material for nitrogen fertilizer production, these price levels will directly drive up fertilizer costs and increase farmers' production expenses.

Shifts İn Global Trade Flows

USDA analyses show that South America (Brazil and Argentina), Ukraine, and to a lesser extent Russia are increasingly capturing shares in global corn trade. This trade shift creates new supply chains requiring long-distance transportation and raises energy-intensive logistics costs. The continuation of this trend through 2028 will increase shipping-related cost pressure in food trade.

Domino Effect Of LNG Infrastructure

The operation of new US LNG terminals near full capacity in 2028 will structurally increase domestic natural gas demand. This will affect not only the energy sector but also food processing facilities, cold storage warehouses, and agricultural irrigation systems. Energy-intensive food production processes will be directly exposed to rising gas prices.

Income Growth And Food Expenditure Paradox

According to food sector analysis reports, per capita food expenditures are increasing across all income groups alongside global economic development. However, the share of food in total expenditure decreases in parallel with income growth. When this paradox combines with increased demand for higher-value products (vegetable oils, livestock products, fish), the price elasticity of grain-based staple foods will decrease.

Growth Dynamics Of The Agricultural Food Market

The global agricultural food market has grown from 8.3 trillion USD in 2021 to an estimated 9.1 trillion USD in 2024. When this growth trend, continuing through 2029, combines with rising energy costs, it will create structural upward pressure on food prices. Grain-based products in particular will be disproportionately affected by increases in both fertilizer and logistics costs.

2028 And Beyond: Search For A New Equilibrium

2028 will be a critical turning point where the global food system attempts to adapt to structural changes in energy costs. LNG infrastructure reaching full capacity and shifts in trade flows indicate a permanent increase in food production costs. This situation will deepen food security concerns, especially in low-income countries, and necessitate new equilibrium searches in global food policies.