Russia wheat export ban causes prices to skyrocket

The United Nations Food and Agriculture Organization (FAO) announced that the price of wheat has increased by 50 percent since June due to the drop in the production of wheat in Russia and Ukraine and a number of other major producing countries.

Egypt’s Cabinet of Ministers' Information and Decision Support Center (IDSC) also said the price of wheat has increased by more than 13 percent on international markets in the last week.

In a report published on the internet, the FAO called for the adoption of mechanisms to increase wheat production.

However, the report states that the current situation is not as bleak as it could be. “Despite production problems in some leading exporting countries, the world wheat market remains far more balanced than at the time of the world food crisis in 2007/2008 and fears of a new global food crisis are not justified at this point,” the report states.

The IDSC’s weekly report on the prices of commodities stated that the prices of rice, cotton and sugar have also increased.

The price of wheat soared after the Russian president announced a ban on the export of grain and other related agricultural products two days ago. Russia has been affected by a severe drought that has caused the fall in production.

Ayman Farid Abu Hadid, head of the Agricultural Research Center, said Egypt is not currently affected by the drought in Russia and Ukraine; however he added that its impact will be felt next year.

Abu Hadid urged the government to provide the necessary funding for research projects to help raise the productivity of one feddan (1.04 acres) of wheat by 33 percent.

He warned that if this issue is not addressed, Egypt could face serious difficulties in satisfying its needs for wheat–estimated at 14 million tons a year.

He further added that there is a need to rationalize the consumption of wheat and avoid using it as animal fodder. He further called for removing price controls on the cost of bread to curb the use of wheat in feeding animals or in making desserts and pasta.

Ismail Abdel Gelil, former president of the Desert Research Center, said the entire world is witnessing climate change that could affect the productivity of agricultural crops, including wheat. These changes could cause productivity to drop by 30 percent.

The ban on Russian grain exports will come into effect on 15 August and has already caused the price of American wheat to increase.

Translated from the Arabic Edition.

Related Articles

Back to top button