Posted on 03/01/2022 6:13:03 AM PST by blam
Ukraine has earned the nickname "breadbasket of Europe" for its rich dark soil, vast wheat fields, and other farm goods. The Russian invasion has cut off the world from cheap and abundant wheat supplies.
Ukraine and Russia are vital to the global food supply, accounting for more than a quarter of global wheat trade, about a fifth of corn, and 12% of all calories traded globally, according to Bloomberg.
Reuters reports Ukrainian ports will remain closed until the Russian invasion ends and maritime security is restored for commercial ships.
This means all shipments of farm goods from Ukraine have ceased, and commodity traders will have to search elsewhere.
Activity at Ukrainian ports has been halted since Russia invaded its neighbor last week, and grains trade from Russia is also effectively on pause. Sanctions have been ratcheted up to further isolate commodity-rich Russia from global finance by sanctioning its central bank and cutting off various leaders from the critical SWIFT financial messaging system.
Restricting grain supplies from the Black Sea region threatens to further boost global food prices that are near a record high, at a time when supplies are already strained with adverse weather in many growing regions. - Bloomberg
"If the conflict is prolonged -- three months, four months from now -- I feel the consequences could be really serious," Andree Defois, president of consultant Strategie Grains, told Bloomberg. "Wheat will need to be rationed."
Michael Magdovitz, a senior analyst at Rabobank, said Ukraine and Russia had increased harvests and exports in the last decade at a far lower cost than western farmers, which helped keep wheat prices low. However, that's not the case today as the Russian invasion sends wheat futures trading in Chicago to a six-year high.
"I'm not going to put a lid on what might happen," Arlan Suderman, chief commodities economist at StoneX, told Bloomberg. "We could easily be looking at record prices."
Kyiv-based researcher UkrAgroConsult warned, "the chain of product creation, from cultivation to port shipments, is paralyzed."
This brings us back to Goldman's Global Head of Commodities Research Jeffrey Currie, who told Bloomberg TV earlier this month that he's never seen commodity markets pricing in the shortages they are right now.
"I've been doing this 30 years and I've never seen markets like this," Currie told Bloomberg TV in an interview on Monday. "This is a molecule crisis. We're out of everything, I don't care if it's oil, gas, coal, copper, aluminum, you name it we're out of it."
As supplies tighen, the Bloomberg Agriculture Spot Index soars to new record highs.
The disruption comes as global food prices are already nearing record-highs and could soon be catapulted into unknown territory.
And, it’s only the beginning.
Rising prices will the cost of supporting the war effort and defeating Putin.
So that’s what they’re calling money laundering now?
Bread basket..
I like it.
Lots of bread made in Ukraine for people like Hunter Biden.
The best of the best bread to be made
It is Winter in the Northern Hemisphere. Last year’s crop is in, next year’s hasn’t been planted yet. This is blatant propaganda.
THERE is the real issue.
First line of article
Ukraine has earned the nickname "breadbasket of Europe" for its rich dark soil, vast wheat fields, and other farm goods.
Immediately, the press lies
I believe the United States is the Breadbasket of the World.
Yeah because they don’t have grain elevators over there right?
I think many folks raise prices just because they can raise prices and get away with it. Retail gasoline prices fluctuate daily, so why not bread or for that matter everything else?
And, it’s only the beginning.
—————-
Huge costs now, that turns to shortages and unavailability then hunger in geographic areas…. Throw in hostile weather and storms, famine. Stay tuned. Unintended consequences, just like the financial sanctions, SWIFT etc… USD dethroned. Thanks Joe.
I think you best do some research on that...
The farmers have nothing to do with the oil oligarchs
“gluten-free” advocates everywhere rejoice. 🤣
Perhaps this is another reason Putin wants Ukraine back?
An army runs on it’s stomach.
Post before you think, like 90% of FReepers...
At least you can grow your own garden and raise your own chickens. :-)
I’ll believe it’s an issue when the U.S. gubment quits paying farmers to avoid growing crops.
Yep.
The alarm bells have been ringing on this crisis for at least two years.
Shameful that some people snooze through it.
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