Wheat prices are at a three-year low, largely because of Russia’s big harvest this year. This increased supply from Russia has lowered food costs worldwide.
However, it also raises questions about relying too much on one country for food. Prices have fallen 60% from their highest point earlier this year.
The drop happened after tensions between Russia and Ukraine cooled down.
Global demand for wheat has grown a lot over the past 20 years. Much of this growth comes from developing countries.
Now, Russia’s share of the world wheat market is almost one-fourth. This is a big increase from last year.
This rise in Russian wheat has helped make up for lower supplies from other countries, like Ukraine and Australia.
Russian wheat is cheaper than American wheat, mostly because of a strong U.S. dollar. This price difference makes it easier for Russia to sell its produce.
Russia wants to export as much as possible to avoid having too much of the grain at home. Still, geopolitical tensions make the future uncertain.
Reports say that Russia will export less wheat next month. Experts say this is because of lower demand and new government rules.
This change will likely make global supplies tighter. Other countries like Kazakhstan are also growing less wheat due to bad weather.
U.S. and Brazil are Adding
The U.S. and Brazil add other crops like corn and soybeans to the global supply. Even so, upcoming reports might show smaller-than-expected harvests for these crops.
In response to these changes, international agencies are talking with countries to make sure that the global food supply stays diverse.
Analysts are watching how politics and supply affect future prices for essential foods like wheat.