Following Russia’s withdrawal from the grain export agreement, wheat and corn prices significantly increased in the world commodities market.
The agreement permitted grain exports from Ukraine to reach other nations via the Black Sea. Despite the ongoing dispute between Russia and Ukraine, it kept going. Russia, however, abruptly reneged on the agreement, disrupting Ukraine’s crucial grain and wheat exports.
The Chicago Board of Trade estimates that the price of wheat could rise by 5.5% to $8.74 per bushel. Corn’s price per bushel could increase by 2.3% to $6.96. Malaysia might also experience the new arrangement’s effects, including a potential rise in palm oil prices.
“Taking into account the act of terrorism committed by the Kyiv regime with the participation of British experts on October 29 this year against the ships of the Black Sea Fleet and civil vessels involved in the security of the ‘grain corridor,’ the Russian side suspends its participation in the implementation of the agreements on the export of agricultural products from the Ukrainian ports,” said the Russian defense ministry.
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The international community comes in
Stephane Dujarric, the UN spokesman, said, “We’ve seen the reports from the Russian Federation regarding the suspension of their participation in the Black Sea Grain Initiative following an attack on the Russian Black Sea Fleet. We are in touch with the Russian authorities on this matter.”
The World Food Programme predicted that the crisis would result in widespread hunger. The group claims that if Russia continues to use food as a weapon in its invasion, many people will suffer. Senior officials from the West quickly expressed their disapproval of how Russia conducts its conflict with Ukraine.
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Grain supply affected
Over a third of all wheat exported worldwide comes from Russia and Ukraine, according to agricultural data company Gro Intelligence. In the meantime, these two nations lead the world in the export of barley, rapeseed oil, sunflower oil, and maize. Therefore, leaving the two nations out of the picture means denying the global market access to these goods, ultimately impacting the supply chain.
After an alleged drone attack by Ukraine on its Black Sea Fleet, Russia canceled the agreement. On the other hand, Ukraine refuted the assertion and claimed that Russia harmed its own forces to find a justification for ending the agreement. And additionally exerting pressure on the nearby Ukrainian forces.
According to the International Rescue Committee, Russia’s withdrawal from the grain agreement would be disastrous for underdeveloped nations. In addition, the condition makes the already severe hunger even worse in these nations.
“We underline the urgency of doing so to contribute to food security across the world and to cushion the suffering that this global cost-of-living crisis is inflicting on billions of people,” said UN Secretary-General Antonio Guterres.
Photo Credit: Elena Larina
Source: CNN
