The withdrawal of Russia from the agreement for the export of Ukrainian grain shoots up the price of food on international markets on Monday. Moscow announced its withdrawal from the pact after accusing Kyiv of an attack on its fleet in Sevastopol. The uncertainty is reflected in the contracts, although Bloomberg points out that there are still ships leaving Ukrainian ports thanks to the support of the UN and Turkey.
No ship crossed the humanitarian maritime corridor agreed on Sunday, but the forecast is that 14 loaded out of Ukraine this Monday. In the midst of doubts, the main affected is wheat, whose futures shot up to 8% today in its price in Chicago, the reference market. Ukraine is one of the world’s leading suppliers. After the outbreak of the war, its price jumped to an all-time high, although now it was around half.
There were also increases in other cereals such as corn (3%) and soybeans (1%). “The market does not like uncertainty, risk,” Sébastien Poncelet, from the firm Agritel, told AFP in response to the rise in prices.
“It spreads like wildfire (the Russian withdrawal). There is a rise in cereal prices in a context in which food was already rising,” said Santiago Carbó, director of Financial Studies, at Funcas. “With this strangulation it will be quickly transmitted to the cereal markets,” he insisted in statements in La Hora de La 1.
Grain markets have been highly sensitive to developments from the Russian invasion of Ukraine eight months ago, as the two countries are among the world’s largest grain suppliers. Since July, more than 9.5 million tons of corn, wheat, sunflower products, barley, rapeseed and soybeans have been exported under the agreement.
