In the last two months, the world has witnessed two neighboring countries, Russia and Ukraine, engaged in a fierce battle. The war’s outcome is still very much unknown, and there’s no doubt that people worldwide are highly concerned about the number of lives lost every day. Therefore, the international community has called for the two countries to stop the current battle.
Negative Impacts of the Ukraine-Russia War
Essentially, the war has had several negative impacts on the world. One of the most significant ones is the increasing price of grain. The main reason is that a large part of Ukraine’s territory is used for agricultural purposes. And due to the ongoing war, the country has not been able to plant or harvest crops in those areas. This means that there are some significant impacts that the world will have to contend with in the coming months.
Russia as a Global Corn Producer
Russia is the world’s leading producer of corn. The country typically exports a large part of its corn harvest to other countries in Europe and Asia. However, due to the current situation, Russia has been forced to stop all exports of corn. This is because the Russian government wants to ensure its people have enough food to eat. While this may seem reasonable, it’s hurting the global corn market.
The current situation is also causing problems for Russia’s neighbors. For example, Kazakhstan is one of the world’s leading wheat producers and exports a large part of its wheat harvest to Russia. However, Russia has closed its borders to Kazakhstan due to the current conflict. This is causing a lot of problems for the Kazakh government.
Ukraine as a Global Wheat Producer
Ukraine is known for being one of the world’s leading wheat producers. The country typically exports a large part of its wheat harvest to other countries in Europe and Asia. Ukraine has been forced to stop all wheat exports because, like Russia, the Ukrainian government also wants to ensure that its people have enough food. All of this impacts the global wheat market.
Drastic Increase in Global Grain Prices
Today, the price of wheat is at an all-time high because there’s a decrease in the supply of wheat globally. And as we all know, when the supply decreases, the prices go up. The current situation in Ukraine is also having a significant impact on the cost of corn. This is because Russia has stopped exporting corn to other countries.
The current global grain shortage market trends are affected by the Ukraine war. The decrease in supply is causing prices to rise. This significantly impacts countries that import wheat and corn from Ukraine. In the coming months, the world will have to contend with higher prices for wheat and corn in the grain trade industry. Contact M.B. McKee Company, Inc. to learn more.
Categorised in: Grains
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