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The world has just 10 weeks' worth of wheat stockpiled after Vladimir Putin's invasion of Ukraine disrupted supplies from the "breadbasket of Europe".
The UN has been warned that global wheat inventories have fallen to their lowest level since 2008 as food supplies are rocked by a “one-in-a-generation occurrence”.
Official government estimates put world wheat inventories at 33pc of annual consumption, but stocks may have slumped to as low as 20pc, according to agricultural data firm Gro Intelligence. It estimates that there are only 10 weeks of global wheat supply left in stockpiles.
Russia and Ukraine account for around a quarter of the world’s wheat exports and the West fears Mr Putin is trying to weaponise food supplies. Russia is on track for a strong wheat harvest this year, cementing Mr Putin’s control over the staple grain as bad weather spoils production in Europe and the US.
Gro Intelligence chief executive Sara Menker warned global food supplies are being hit by a number of “extraordinary” challenges, including fertiliser shortages, climate disruptions and record low inventories of cooking oils and grains.
She told the UN’s Security Council: “Without substantial immediate and aggressive coordinated global actions, we stand the risk of an extraordinary amount of both human suffering and economic damage.
“This isn’t cyclical, this is seismic. It’s a once-in-a-generation occurrence that can dramatically reshape the geopolitical era.”
The war has disrupted agricultural production in the region and sent global food prices soaring to a record high, stoking fears of unrest in developing countries. The crisis in wheat has been worsened by India, the world’s second largest producer, banning exports of the cereal and higher costs for farmers from fertiliser, feed and fuel.
Western officials also fear the Russian president is deliberately trying to damage global food supplies by destroying equipment and stealing grain in Ukraine.
Earlier this week, Bank of England Governor Andrew Bailey warned of “apocalyptic” food price rises as Ukraine struggles to export products.
“Ukraine does have food in store but it can’t get it out at the moment,” he told MPs on the Treasury Committee.
“That is a major worry. It is not just a major worry for this country, it is a major worry for the developing world.”
US Secretary of State Antony Blinken said on Thursday that Mr Putin is “using food as a weapon”.
“The food supply for millions of Ukrainians and millions more around the world has quite literally been held hostage.”
He added: “Some 20m tons of grain sit unused in Ukrainian silos as global food supply dwindle (and) prices skyrocket.”
Meanwhile, the Kremlin is tightening its grip on wheat supplies after a stronger harvest. Carlos Mera, head of agri commodities research at Rabobank, said mild conditions in Russia – which accounts for about a fifth of global wheat exports – had put it on track to produce 84.9m metric tonnes of the staple grain this year.
Conditions for Western growers have been poor due to dry conditions.
America’s southern plains region, as the bottom of the "Wheat Belt" that runs through the middle of the country, has been experiencing sustained drought conditions.
In a report earlier this month, the US Department of Agriculture forecast a major decline in wheat stocks, saying they will drop 6pc to a nine-year low of 16.8 million tonnes by the end of 2022/23.
~ Via Telegraph |
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