Russia’s Wheat Crisis

Following a record heat wave, leading to droughts and wildfires, which destroyed one-fifth of the wheat crop this year; the Russian government has announced a ban on wheat exports, reports the Los Angeles Times. With the memories of the food price rise and riots of 2007-08 still fresh , there is concern over the impact on prices of bread, wheat and meat. So far, analysts claim that there is no reason to worry. U.S. farmers have already taken action to support world wheat prices. How the situation ultimately plays out will depend also on the possibility of hoarding by panicky countries and consumers and by speculative activities. The short term price rise may indeed be small but in the long run higher food prices are inevitable as are shortages.