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Tensions in Ukraine have caused wheat prices to rise, which have jumped 6% since Tuesday, February 22. The Russia ranks second among wheat exporting countries, and Ukraine fourth.
The price of wheat has increased by 12% in three weeks. Near Toulouse (Upper Garonne)Jean-Pierre Feuillet, baker, will have to increase the price of his baguette by 5 cents. “We know for a fact that Ukraine is a major producer of wheat and cereals. We here, when we buy flour from our miller, he may be from Occitania, the price of wheat is fixed on a world price”he explains.
More than just a producing country, Ukraine is Europe’s breadbasket. It represents 12% of cereal exports in the world, and Russia, 17%. In the event of an armed conflict, production could be reduced and the Ukrainian breadbasket empty. “If the supply decreases in the coming months while the demand will remain real and maintained, you can have significant consequences”analyzes Sébastien Abisclub manager Demeter and researcher at the Institute of International and Strategic Relations. The consequences on the price could be lasting, especially if the conflict extends to the Black Sea, in the south of Ukraine, from where cereals are exported by boat.