High global wheat prices through 2023 — IFPRI analysts
There are no overnight replacements for Ukraine and Russia in global wheat production, said five IFPRI analysts on Monday. “Even under the most optimistic assumptions, global wheat prices will remain high throughout 2022 and the trend is likely to persist through 2023, given limits on expanding production.”
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Tight supplies resulting from Russia’s invasion of Ukraine jeopardize food security in regions, such as the Middle East and northern Africa, that rely heavily on wheat from the Black Sea region, said the IFPRI blog.
Egypt, the world’s largest wheat importer, was particularly at risk because of its bread subsidy program, which feeds millions of its citizens. The spike in prices could nearly double the cost of wheat imports, to $5.7 billion.
“Overall, it will be difficult to expand the global wheat supply in the short term,” said the IFPRI blog.
Europe and the United States grow mostly winter wheat, which was planted last fall, so there is little room for expansion soon. High prices for corn and soybeans may limit land for spring-planted wheat.
Argentina and Australia, major exporters in the Southern Hemisphere, have large crops and usually ship during the late fall and early winter. Canada and Kazakhstan grow spring wheat for harvest in the fall.
“Over the coming year and beyond, their exports may be able to make up for the deficit created by the loss from Ukraine production — but at a higher cost due to longer shipping routes and increased shipping costs triggered by high oil prices,” said the IFPRI analysts, referring to Canada and Kazakhstan.