Wheat prices jumped 6.6% worldwide in a single day with a decisive turnaround under the pressure of the resumption of dialogue between the US and China which seems interested in buying foreign wheat and corn, which marked an increase of 4.6%.
This is what emerged from the analysis of the Italian farmers’ association – Coldiretti at the weekly closing of the Chicago Board of Trade, the international reference point of the future market of cereals with wheat which rose to $8.91 US dollars per bushel and corn at $6.23 per bushel after a downturn.
A shock for the markets after the long stalemate on the unblocking of Ukrainian products in transport which is one of the main producers and exporters of wheat, exporting roughly 10% of the common wheat destined for bread making in the world for a total of over 18 million tons, but also 15% of corn for over 27 million tons.
The jump in food commodity prices worldwide is causing severe famine and hunger in poor countries, inflation, and increased food poverty in rich countries.
The trend in prices also reflects the downsizing of production forecasts at a global level where world production of wheat for 2022/23 is estimated to decrease to 769 million, due to the reduction in Ukraine with an estimated quantity of 19.4 million tons, about 40% less than the 33 million tons expected for this season but also in the United States (46.8 million) and India (105 million), according to Coldiretti’s analysis of the latest International Grains data Council which also highlights that, in contrast to the trend, the wheat harvest grows by 2.6% in Russia, reaching 84.
Even the European Commission, continues Coldiretti, has revised downward the short-term prospects of the agricultural market with the total production of cereals in the 27 countries which should reach 286.4 million tons, 2.5% less than the season 2021/22.
Wheat production in Italy is estimated to drop sharply in 2022, with an average cut of more than 15% due to the increase in production costs and the drought that has cut yields from the north to the south, according to Coldiretti who highlights how in some of the most productive areas of the country the collapse exceeds 30%.
1 Inflazione: volano prezzi grano, +6,5% in un giorno – Coldiretti – July 9, 2022
Featured image credit: Beyond coal and gas
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