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Rabobank Warns Rising Grain Prices Will Worsen
USAgNet - 05/20/2022

Russia's war over Ukraine will push grain and food prices up for at least a year, Rabobank has warned, with dire outcomes for the world's hungriest nations.

Rabobank's report on the Russia-Ukraine war said higher energy prices and disrupted trade would be felt well beyond this year.

Australia and New Zealand food and agribusiness research general manager Stefan Vogel said it would result in a big shortage of grain this year and next, which could be exacerbated over the next few months when the northern hemisphere harvest would normally be completed.

He said Ukrainian farmers would struggle to harvest crops this year, ship grain out of ports like Odesa, or grow next year's crop.

"Last year, Ukraine exported 70 million tonnes of grain, which is twice the amount that comes out of Australia … but this year it will be a fraction of that," Vogel said.

"Volumes will be reduced by at least 45 per cent and probably more."

Russia could also also struggle to sell its grain or transport it out of the country due to the conflict, as bulk handling grain vessels could be reluctant to ferry Russian grain because of the war.

Vogel pointed out that most shipping companies were not covered by insurance.

He also noted that globally supplies were likely to be tight, as the two grain powerhouses of France and Germany were experiencing dry conditions and drought was still affecting the United States grain belt.

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