Andrew Stuttaford of National Review Online reports on one potential consequence of Russia’s invasion of Ukraine.

The impact of potential interruptions in commodity flows from Russia and Ukraine doesn’t stop there. Take a look at what has been happening to the wheat price. Wheat futures had shot through $12 a bushel as of Friday’s close, well over double where they were before the pandemic, and are up again today.  Wheat prices had been rising for quite some time before the Ukrainian crisis, but this is yet another turn of the ratchet, and it seems reasonable to think that they will rise further.

And timing is about to get tricky.

Oleg Ustenko, an adviser to Ukraine’s president, writing in the Financial Times today:

“Ukraine is the world’s fifth-largest exporter of wheat, but farmers cannot now start what is called their spring sowing campaign. The regular window for starting field work is the first 10 days of March, and planting needs to be fully completed in the last week of April. We have highly productive soil, but also a climate that sets the rules. There is already no way that Ukrainians will be able to sow this year based on a normal schedule.”

“Those parts of Ukraine which are most productive in terms of agricultural production are now consistently under aerial attack and artillery bombardment. Working the fields in regions such as Chernihiv, Poltava, Kharkiv, Sumy, and Zhitomir has become practically impossible. …”

“If this war is not stopped immediately, the world will experience a drop of global supply between 10 per cent to 50 per cent of major agrarian products including wheat, barley, corn, rapeseed, and sunflower oil. In recent decades, because of smart investments, increased productivity, and overall efficiency, Ukrainian agriculture provided a major buffer for the food security of billions of people around the world.” …

… [T]he facts are the facts, however unwelcome they may be.