Amid clashes between Ukrainian and Russian force, wheat price reaches $444 per ton after a fire outbreaks at Ukraine’s Zaporizhzhia Nuclear Power Plant.
At 07:30 GMT, the price of wheat reached $444 per ton and $12.09 per bushel. Wheat prices neared the level of $500 per ton in US future contracts.
At the beginning of February, the price of wheat had been around $270 per ton. The fire at Ukraine’s nuclear power plant has not affected essential equipment so far, according to the International Atomic Energy Agency.
Other commodity prices also posted increases related to the recent developments in the Russia-Ukraine war.
The price of Brent oil, which neared $120 level on Thursday, is now at around $112, it hovered around $70 in the first week of February.
The ounce price of gold also hit $1,950 level on Thursday and balanced at around $1,937 on Friday morning.
Trade data provided by the Observatory of Economic Complexity (OEC) showed the world traded $44.1 billion worth of wheat in 2019.It further showed that Russia exported $8.14 billion worth of wheat and thus emerged as the largest wheat exporter in 2019.
The United States exported $6.94 billion worth of wheat while Canada exported $5.97 billion worth of wheat to occupy the second and third positions respectively. And France with $4.54 billion wheat exports, and Ukraine with $3.11 billion, completed the list of the top five wheat exporters across the world in 2019.
Egypt topped at $4.67 billion as highest importer of wheat. Other African countries that imported wheat from Russia in 2019 were Sudan, 2.5 percent; Kenya and Tanzania, 1.3 percent each respectively.
With the escalation in the Russia-Ukraine crisis, commodities such as wheat and maize will face supply disruptions just like crude oil.
According to Nigeria’s data agency, the National Bureau of Statistics (NBS), Nigeria imported N898.2 billion worth of wheat in nine months that ended September 2021. The top origins of wheat into Nigeria in 2021 included USA, N194.2 billion; Canada, N136.4 billion, Russia, N124 billion, Lithuania, N122.3 billion and Latvia, N115.9 billion.
Wheat-based products such as the popular pre-packed wheat flour and bread have witnessed steady price increase across the country.
The ripple effect will be faced by Nigerian firms operating in the food industry that are currently facing an uptick in production costs from exchange range volatility, petrol scarcity and other supply chain disruptions.