Russia, Ukraine, and the global wheat supply
More than a quarter of the world`s wheat exports come from Russia and Ukraine. Russia is the world’s largest exporter of wheat, accounting for more than 18 percent of international exports. In 2019, Russia and Ukraine together exported more than a quarter (25.4 percent) of the world’s wheat, according to the Observatory of Economic Complexity (OEC).
Wheat is the second most-produced grain in the world after corn. For centuries, it has been cultivated by humans and is essential for making bread, pasta, and other food staples.
In recent months, the United States and its allies have warned that Russia – which has 100,000 soldiers massed on the border with Ukraine –
could invade at any moment.
Russia has denied that and opposes NATO bases near its borders.
In the event of outright aggression, the flow of wheat and grain could be disrupted. Economic sanctions or military action could have a significant effect on the cost of food as importers seek to find alternatives.
In 2019, Egypt, Turkey, and Bangladesh bought more than half of Russia’s wheat. Egypt is the largest wheat importer in the world. We spend more than $ 4 billion annually to feed more than 100 million inhabitants. Together, Russia and Ukraine cover more than 70 percent of Egypt’s imported wheat demand. Turkey also spends large amounts on Russian and Ukrainian wheat, with 74% of its imports as of December 30, 2021, representing 1.6 billion tonnes. Egypt purchased 3.2 million tonnes from Russia during the same period. Russia: World’s Largest Wheat Exporter In the early 1980s, two-thirds of US exports to the Soviet Union were corn and wheat. In 1985, the Soviet Union imported a whopping 55 million tonnes of wheat. Russia is currently the largest wheat exporter in the world. In 2001, it accounted for only 1 percent of the world’s wheat exports. That increased to its highest of 26.4 percent in 2018. Following the collapse of the USSR, the government removed barriers to business allowing farmers to penetrate the global market as well as to invest in agricultural technology. The creation of ports and the devaluation of the rouble has also contributed to Russia gaining the lion’s share on wheat sales.
Today, Russia ships more than 18 percent of the world’s supply, followed by the US (16 percent), Canada (14 percent), France (10 percent), and Ukraine (seven percent). Ukraine: Worlds fifth-largest wheat exporter
Ukraine is the fifth largest exporter of wheat, accounting for seven percent of sales globally in 2019.
71% of Ukraine’s land is considered the breadbasket of Europe and is used for agriculture. It also has a quarter of the world’s “black soil” or Chernozem and is very fertile.
Wheat is associated with the painful history of Ukraine.
In 1932, the hungry Holodomor, the Great Famine, was the result of Joseph Stalin’s deadly political decision to group agriculture and confiscate peasant lands.
Ukrainian interactive arable land
Russia and Ukraine’s main exports
Russia exported $ 407 billion worth of products in 2019, and Ukraine exported $ 49 billion.
While Russia is the world’s biggest exporter of wheat, among other products, Ukraine is the biggest exporter of seed oils. Russias bilateral trade with Ukraine has tanked from its peak of almost $50bn in 2011 to $11bn in 2019.
Russia remains one of Ukraine’s biggest trade partners
Ukraine Russia main exports Major ports and the Black Sea is a key geoeconomic region for Russia and Ukraine, which rely heavily on the ports for agricultural and industrial exports. For Ukraine, Odesa, Kherson, and Mykolaiv are key ports for international trade flows
In the event of war, wheat and grain flows could be affected, as 95 percent of Ukraine’s wheat exports were transported via the Black Sea in 2020. With the price of food already high due to inflation, importers may seek to find alternatives.
The Black Sea is a key region for Moscow. According to Carnegie Endowment for International Peace, a Washington-based think tank focused on geopolitics, it would allow Russia to protect trade links with European markets as well as up the dependency of southern Europe on Russian oil and gas and act as a security buffer zone.
SOURCE: AL JAZEERA AND NEWS AGENCIES