An aerial view of the Turkish-flagged ship “Polarnet” carrying grain from Ukraine is seen at the Derince Port, Kocaeli, Turkiye on August 08, 2022.
Omer Faruk Cebeci | Anadolu Agency | Getty Images
Russia’s ongoing invasion of Ukraine is causing a global shift in the trading of grains — which feed billions of people every day — and Ukraine’s harvest this year could plummet by as much as 50% compared to before the war.
Both Ukraine and Russia were among the world’s top producers of commodities such as wheat and barley before the war broke out in February 2022. But the conflict saw the price of U.S. wheat and corn futures hit decade highs (with one benchmark wheat contract hitting an all-time high) and sparked volatility in global wheat prices throughout the year. Prices stabilized in 2023, dropping around 13% in the year to date.
“Trade flows change and fluctuate, they always have,” said Andrew Whitelaw, co-founder and director of Episode 3, an agricultural analysis firm. “Bearing in mind that 20-odd years ago, Russia wasn’t an important exporter of grains … It’s grown in the last 20 years [and] Ukraine and Russia have now become the top exporters.”
And while last year’s yield and export of grains such as wheat from Ukraine were still significant despite the war and closure of ports in the Black Sea, the quantities harvested and shipped this year are likely to reduce.
The Black Sea Grain Initiative, a deal brokered by the U.N. in Turkey to guide ships safely out of Ukrainian ports, was only extended by 60 days in March — a reduction on the previous 120-day period.
Whitelaw described last year’s wheat crop as “pretty good” in Ukraine and “absolutely fantastic” in Russia, but said Ukraine’s harvest is likely to be down around 20% in 2023 because farmers have sown fewer crops.
“This year, there’s things like — in Ukraine — lack of access to finance, lack of access to fertilizers, fuel, labor, but also the price of grain in Ukraine is really low. So, the…
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