The price of wheat has already fallen to pre-war levels – however, the food price crisis has not yet been resolved, say researchers

Now the situation looks a little brighter. During the summer, the stock market price of wheat has already dropped to the pre-war level. This is explained by the Research Manager of the Natural Resources Center Hanna Karikallion according to worldwide good crop prospects.

– Of course there is regional variation, but the supply of grain will be good this year.

Last week, Ukraine and Russia made an agreement on the continuation of grain deliveries in the Black Sea. This also lowered the wheat exchange price. Together, Ukraine and Russia are responsible for about a third of the wheat coming to the world market, but due to the war, the grain has not been able to be transported across the Black Sea.

The positive news raises the question of whether the global food crisis has now been solved?

According to Hanna Karikallio, such an interpretation cannot yet be made, even though the worst threats do not seem to have come true. The problems are still big, he says. There is a lot of uncertainty, especially regarding the continuation of grain deliveries in the Black Sea. Russia has carried out airstrikes on, for example, the port of Odessa twice already just a few days after the signing of the agreement.

– It is unclear whether grain can be moved to those countries that are dependent on grain imports. The price level of food will also be high. Low-income people in poor countries in particular will have difficulty buying food at this price level.

Also the research director of Pellervo’s economic research Sari Forsman-Hugg emphasizes that it is premature to state that the food crisis has disappeared.

– It is of course a good thing that the agreement on grain deliveries has been reached. We are still talking about a country where a war is going on, so the export of grain will certainly be slower than under normal circumstances.

In particular, many African countries have been dependent on grain deliveries across the Black Sea. Forsman-Hugg says that even in these countries, the biggest challenge has not been directly the availability of grain, but its high price.

– Although the price of wheat has come down, it is still high. The situation is still serious when thinking about global food security.

However, Forsman-Hugg says that the drop in the stock market price will not directly affect food prices in Finland in the short term. The changes are taking place with a delay, and food price pressures are still so strong that the bill may not end up in consumer products at all.

– In many products, the proportion of raw materials is quite small when we talk about further processed products. We also have to remember that there are now many factors that increase food price pressure.

– I don’t think that, for example, the price of pasta would now go down as a result.

The biggest upward pressures come from rising energy prices and the ongoing energy crisis. The price of fertilizers, which already rose last autumn, has become even more expensive since the start of the war, which is also reflected in the consumer prices of food.

According to Forsman-Hugg, food prices will probably remain higher than usual for an even longer period of time, at least for this year and next year. Pellervo’s Taloustutkimus has assessed in its June situation review that the uncertainty caused by the Russian war of aggression may continue in the food market for several years.

You can discuss the topic on 28.7. until 11 p.m.