① Due to bad weather in Eastern Europe, the main producer of wheat, US wheat futures prices recorded the biggest monthly increase since the Russian-Ukrainian conflict broke out, which once again raised concerns about food inflation; ② Russia and Ukraine are both major global food exporters, and the two countries together account for nearly one-third of global wheat exports.
Finance Association, June 1 (Editor Xia Junxiong) Due to bad weather in Eastern Europe, the main producer of wheat, US wheat futures prices recorded the biggest monthly increase since the Russian-Ukrainian conflict broke out. This has once again raised concerns about food inflation.
Both Russia and Ukraine are major global grain exporters. Together, the two countries account for nearly one-third of global wheat exports, but in May, which is critical to the wheat harvest, both countries were hit by extreme weather at the same time, putting wheat production at risk of cutting.
Russia's main wheat producing regions have experienced droughts and unseasonal frosts. Now that harvest is only a few weeks away, the possibility of significant improvements is becoming less and less likely. Meanwhile, Ukraine also experienced one of the driest Mayes in the country's history.
As of press release, Chicago wheat futures surged more than 12% in May, the biggest monthly increase since the Russian-Ukrainian conflict fully broke out in February 2022.
According to local Russian media reports, Russia may have declared a state of emergency throughout the country as frosts in early May destroyed hundreds of thousands of hectares of crops. Russia is the world's largest exporter, and analysts have lowered the country's production forecast for May by more than 10%.
Russian agricultural company Grainrus estimates that 40% of its winter wheat cultivation area in the Rostov region was damaged by the severe cold weather. The company's analyst Mikhail Bebin said wheat production in southern Russia is expected to be 20% lower than previously estimated.
The Ukrainian Grain Association predicts that wheat production will be 19.1 million tons this year, the lowest level in more than a decade. However, early spring rainfall helped reduce further losses, and the country's meteorological center predicts more rainfall across the country in the next few weeks.
Among other major wheat producing countries, Australia and India are also dealing with dry weather, and India is likely to relinquish wheat imports in June.
According to the US Department of Agriculture, global wheat stocks are expected to fall to their lowest level in 9 years next fiscal year.