Wheat prices gain as Ukraine conflict squeezes supply

Wheat prices have soared 6.6% to 422.5p per ounce as the Russian invasion of Ukraine saw 29% of global wheat supplies in the “breadbasket of Europe” put at risk.

The price of the grain has risen to a new record of £281.90 per tonne with expectations prices will move higher as the conflict continues.

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Russia is the world’s largest wheat producer and any disruption could to their exports will have a significant impact on supply.

The skyrocketing prices will add further pressure on households as UK inflation rates, which hit 5.5% in January this year and are predicted to rise to 7% for 2022.

An emergency G7 meeting is scheduled to be hosted by Germany on Friday for agriculture ministers to discuss a solution to the spiking prices.

The increase in wheat costs is set to see household staples including pasta, bread and cereal increase to levels already rising due to the Covid-19 pandemic and global supply chain obstacles.

“Nerves of steel will be needed amid the extreme volatility,” said analyst Daniel Briesemann at Commerzbank in Frankfurt.

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