Richardcyoung.com

The Online Home of Author and Investor, Dick Young

  • Home
  • How We Are Different
  • Debbie Young
  • About Us
    • Foundation Principles
    • Contributors
  • Investing
    • You’ve Read The Last Issue of Intelligence Report, Now What?
  • Your Survival Guy
  • The Great Reset
  • The Swiss Way
  • My Rifles
  • Dividends and Compounding
  • Your Security
  • COVID-19
  • Dick Young
  • Key West
  • Paris
  • Dick’s R&B Top 100
  • Liberty & Freedom Map
  • Bank Credit & Money
  • Your Survival Guy’s Super States
  • NNT & Cholesterol
  • Work to Make Money/Invest to Save Money
  • Your Health
  • Ron Paul
  • US Treasury Yield Curve: My Favorite Investor Tool

Has the Potential Wheat Shortage Been Overblown?

April 14, 2022 By The Editors

Transshipment of grain products from a bulk carrier to a barge in an Odessa, Ukraine anchorage during sunset. By Ievgen Postovyk @ Shutterstock.com

News outlets have been replete with stories of how the war in Ukraine could affect the world’s supply of wheat. No doubt, Ukraine and Russia are responsible for growing a big part of the world’s wheat crop, but suggests Sarah Taber in Foreign Policy, there’s no need for alarm. She writes:

You might have seen some shocking numbers about how the Russian invasion of Ukraine has affected the global food supply—about how, for instance, Ukrainian and Russian wheat makes up a combined 20-30 percent of the world’s wheat exports. Yet the truth is there’s plenty to go around. We’re not facing a shortage; rather, we simply have enough wheat when we’re used to silo-busting gluts. The situation calls for math and common sense. But instead, wealthy countries have panicked. The fallout has landed on poor countries dependent on food imports, concentrated in the Middle East and North Africa. These countries now face hunger and political instability—not because there’s not enough food in the world but because wealthy countries lost their cool.

The export shortfall from the 2021-2022 Black Sea wheat crop, between Russia and Ukraine, is forecast at only 7 million metric tons. While that’s 20-30 percent of global exports, it’s just 0.9 percent of global wheat production (around 700-800 million metric tons per market year). More often wheat is eaten in the countries it’s grown in, sometimes by the people who grow it. And producers can read the news like anyone else. As early as last November, farmers around the world started planting more wheat in their fall-planted crops due to the Russian military buildup on Ukraine’s borders.

There’s also lots of wheat in global stockpiles. China, India, the United States, and many other nations have enough wheat stored to last their large populations six to 12 months or more. These countries can tap into their stores to dodge high prices, putting slack into the global supply.

India has been growing its wheat exports rapidly for three years. In the 2021-2022 wheat export year, India added 5.75 million metric tons to the global wheat trade that didn’t exist the previous year, nearly covering the shortfall from Ukraine and Russia single-handedly. Australia also had a record-breaking 2021 wheat crop, which is still being exported, and so far is set for a solid 2022 wheat export crop as well thanks to good weather conditions in early 2022. About 27.5 million metric tons of wheat exports are expected from Australia’s 2022 crop at this time—5-10 million metric tons more than their 2015-2020 crops.

Other wheat exporters such as the United States, Canada, Argentina, and South Africa have already increased their wheat acreage in response to Russia’s war in Ukraine. Of course, droughts may affect yields. Due to how wheat grows (usually planted in fall and harvested in late spring), it’s a favorite cash crop for areas prone to summer droughts. Thus, managing drought risk is already baked in to the global wheat supply. That’s why there are so many wheat-exporting regions. In any given year, some wheat regions are hit by drought. Collectively, they manage to churn out enough wheat anyway. That’s not to say it’s impossible for droughts to impact global supply—it’s just a caution to keep drought in one or two wheat regions in perspective. That’s normal. The planet has lots of wheat-exporting regions for a reason.

Thanks to growing wheat production outside Ukraine, the 2022 world wheat crop is actually expected to exceed consumption for the first time in two years. Worldwide wheat gluts in 2020 led nations to slowly work their way through stockpiles rather than plant large crops. Like droughts, occasional gluts followed by a few years of lower production are a normal part of the global grain trade. The Russian invasion occurred when production was already at a post-glut low and headed for an upswing. And, it’s not just wheat. Similar adjustments in crop acreages are already underway around the world to make up for shortfalls in sunflower and other Ukrainian export crops.

So, if there’s enough wheat, why are Middle Eastern and North African (MENA) countries at a very real risk of famine? The reason is a familiar one: supply chains. While the Ukrainian and Russian shortfall is a small part of the global trade, it’s a big part of the supply for countries heavily dependent on imports.

If you’re willing to fight for Main Street America, click here to sign up for the Richardcyoung.com free weekly email.

Related Posts

  • Potential Huge Breakthrough with the Taliban
  • VIDEO: Overblown Fears over a Government Shutdown
  • Surviving the Ammo Shortage
  • A Sickening Shortage
  • Author
  • Recent Posts
The Editors
Latest posts by The Editors (see all)
  • Who Paid Indian Hackers to Infiltrate the Rockefeller Family Fund? - March 30, 2023
  • BIDEN’S BORDER: Massive Caravan of Illegal Immigrants Enters El Paso - March 30, 2023
  • Are Banks Now a Bargain? - March 28, 2023

Dick Young’s Must Reads

  • Progressive Liberalism Has Dragged America near Ruination
  • The Common Ground of Democracy is Sinking Beneath Americans’ Feet
  • Joel Salatin and Alfie Oakes, America’s Food Kings
  • For Whom Is Your Portfolio Serving?
  • Is It All Coming Apart in the Government’s Face?
  • The Forgotten America
  • Tom Brady Is Proof You Shouldn’t Retire if You Still Love Your Work
  • The Simple, Elegant Power of the Retirement Compounders
  • “I’ve Got Guys Buying Guns/Ammo for Me All Through the Night.”
  • Your Odds with Statins: 500 to 1?

Our Most Popular Posts

  • Freefalling at Stanford
  • Is Vanguard Voting Against Your Political Beliefs?
  • The Forgotten America
  • Does Anyone Still Think Ron Paul Was Wrong?
  • Rand Paul Surprises Moderna CEO with Inside Information about Myocarditis Risk
  • Biden's Fake Democracy Summit: Hungary and Turkey Snubbed
  • “You Just Have to Be Willing to Move Defensively”
  • Your Survival Guy’s #1 Habit of Fairly Successful People
  • Dick & Debbie: Over Three Decades in Key West
  • What’s John Kerry Doing in Mexico?

Disclosure

RSS Youngresearch.com

  • BEWARE: The Road to Digital Currencies
  • Another Habit of Highly Successful and Fairly Wealthy People
  • The Greatest Threats to the American Economy
  • Your Survival Guy’s #1 Habit of Fairly Successful People
  • New Regulation Coming for CDS Market?
  • “You Just Have to Be Willing to Move Defensively”
  • Americans Are Fleeing Bank Deposits
  • If You’re a Highly Effective Person, We Should Talk
  • Trouble Now Brewing at Deutsche Bank
  • Is Vanguard Voting Against Your Political Beliefs?

RSS Yoursurvivalguy.com

  • BEWARE: The Road to Digital Currencies
  • Bad Guys Have Guns, Targets Must be Hardened
  • Another Habit of Highly Successful and Fairly Wealthy People
  • The Greatest Threats to the American Economy
  • Is America about to Deploy Star Wars-like X-Wings on the Battlefield?
  • Your Survival Guy’s #1 Habit of Fairly Successful People
  • Western Real Estate: From Zoom to Bust
  • “You Just Have to Be Willing to Move Defensively”
  • Did SVB Fail Because of Climate Change?
  • If You’re a Highly Effective Person, We Should Talk

In Chicago, Education Connects the Dots

BEWARE: The Road to Digital Currencies

Sen. Ted Cruz Has a Plan to Stop Biden’s Supreme Court Packing Scheme

Who Paid Indian Hackers to Infiltrate the Rockefeller Family Fund?

BIDEN’S BORDER: Massive Caravan of Illegal Immigrants Enters El Paso

Bad Guys Have Guns, Targets Must be Hardened

Copyright © 2023 | Terms & Conditions | About Us | Dick Young | Archives