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Wheat prices: Why is wheat expensive now?

Wheat prices rose nearly 6% on Monday to $8.77 a bushel Chicago Mercantile Exchange. This happened after Russia indefinitely suspended the Black Sea grain agreement with the United Nations, which allowed food exports through Ukrainian ports.

What is the Black Sea Grain Initiative?

In July, the UN concluded a peace agreement which allows Ukrainian grain exports to pass through the Black Sea amid the ongoing war between Russia and Ukraine. The deal also allows Russian grain and fertilizer to be exported around the world.

The agreement was concluded between the UN, Ukraine, Turkey and the Russian Federation. The ships transported goods along the agreed route through the Black Sea to world waters.

UN struck the deal in hopes of “helping stabilize spiraling food prices around the world and prevent hunger affecting millions” and lower global food prices.

In accordance with Grow Intelligence, exports from Russia and Ukraine account for about a third of world wheat exports. About 25% of the shipments went to low-income countries, including food aid to Yemen and the Horn of Africa, according to UN.

“By ending this arrangement, Russia is once again weaponizing food in the war it started, directly affecting low- and middle-income countries and global food prices, and exacerbating already dire humanitarian crises and food insecurity.” State Secretary Anthony Blinken said in a statement. statement.

Why did Russia withdraw from the Black Sea grain initiative?

Russia suspended participation in the Black Sea Initiative on Saturday after the Russian Defense Ministry said Ukrainian drones had attacked Russian ships in the Black Sea protecting agreed shipping lanes. This is reported by NPR.

The President of Ukraine, Volodymyr Zelensky, called Russia’s move “quite predictable” and said in a statement“This is Russia’s absolutely transparent intention to return the threat of large-scale famine to Africa and Asia.”

Impact

Global hunger has increased dramatically over the past few years. Food insecurity increased from 135 million in 2019 to 345 million in 2022. Approximately 828 million people go to bed hungry, This is reported by the World Food Program.

WFP reports that conflict and violence are the biggest drivers of food crises – 60% of the world’s hungry areas have been affected by war and violence.

“Civilian cargo ships cannot be a military target or hostage under any circumstances. The food must come,” — Amir Abdullah, UN coordinator for the Black Sea Grain Initiative, tweeted on Monday.

The initiative moved 9 million tons of grain and lowered food prices around the world, according to Blinken’s statement.

The UN calls on the countries involved to fully comply with the agreements.

“We emphasize the need to do this in order to contribute to food security around the world and to alleviate the suffering that this global cost-of-living crisis is causing to billions of people,” said a spokesman for UN Secretary-General Antonio Guterres in a statement.



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Wheat prices: Why is wheat expensive now?

Wheat prices rose nearly 6% on Monday to $8.77 a bushel Chicago Mercantile Exchange. This happened after Russia indefinitely suspended the Black Sea grain agreement with the United Nations, which allowed food exports through Ukrainian ports.

What is the Black Sea Grain Initiative?

In July, the UN concluded a peace agreement which allows Ukrainian grain exports to pass through the Black Sea amid the ongoing war between Russia and Ukraine. The deal also allows Russian grain and fertilizer to be exported around the world.

The agreement was concluded between the UN, Ukraine, Turkey and the Russian Federation. The ships transported goods along the agreed route through the Black Sea to world waters.

UN struck the deal in hopes of “helping stabilize spiraling food prices around the world and prevent hunger affecting millions” and lower global food prices.

In accordance with Grow Intelligence, exports from Russia and Ukraine account for about a third of world wheat exports. About 25% of the shipments went to low-income countries, including food aid to Yemen and the Horn of Africa, according to UN.

“By ending this arrangement, Russia is once again weaponizing food in the war it started, directly affecting low- and middle-income countries and global food prices, and exacerbating already dire humanitarian crises and food insecurity.” State Secretary Anthony Blinken said in a statement. statement.

Why did Russia withdraw from the Black Sea grain initiative?

Russia suspended participation in the Black Sea Initiative on Saturday after the Russian Defense Ministry said Ukrainian drones had attacked Russian ships in the Black Sea protecting agreed shipping lanes. This is reported by NPR.

The President of Ukraine, Volodymyr Zelensky, called Russia’s move “quite predictable” and said in a statement“This is Russia’s absolutely transparent intention to return the threat of large-scale famine to Africa and Asia.”

Impact

Global hunger has increased dramatically over the past few years. Food insecurity increased from 135 million in 2019 to 345 million in 2022. Approximately 828 million people go to bed hungry, This is reported by the World Food Program.

WFP reports that conflict and violence are the biggest drivers of food crises – 60% of the world’s hungry areas have been affected by war and violence.

“Civilian cargo ships cannot be a military target or hostage under any circumstances. The food must come,” — Amir Abdullah, UN coordinator for the Black Sea Grain Initiative, tweeted on Monday.

The initiative moved 9 million tons of grain and lowered food prices around the world, according to Blinken’s statement.

The UN calls on the countries involved to fully comply with the agreements.

“We emphasize the need to do this in order to contribute to food security around the world and to alleviate the suffering that this global cost-of-living crisis is causing to billions of people,” said a spokesman for UN Secretary-General Antonio Guterres in a statement.



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