10 ms·

The Price of Wheat

92 points by baremetal 5y ago

sremani 5y ago
plague. war. famine. welcome to end of 'end of history.'
- sAbakumoff 5y ago
  Exactly! Covid-19 was the first one, it was literally “given a crown”. The last one to be nuclear winter.
  - DyslexicAtheist 5y ago
    there is a lot of fear mongering about nuclear holocaust wrt NATO joining the war etc., but this is incredibly far fetched even in a worst case scenario[1]. I don't say the nuclear threat is nil, but it's also not as bad as war-hawks pondering escalation scenarios or the media makes it out to be. What do you think would happen to Putins daughters in London, to the family members of oligarchs, to anyone who carries the smell (shame) of a past support of that regime. Even enemies of the West will think twice and have no choice supporting the force that is stronger. (whether that's good or bad or if they like it or not) anyway nobody knows anything about any of this even the ones who are supposed to be experts in it. so certainly don't take my word for it but do question it when they make it clean cut. [1] assume RU does launch nukes without sabotage on their systems before, and 1 or 2 cities will be lost to nuclear holocaust. There will be immediate containment of many of the missiles not fulfilling their objective. This is a lot messier than the academic idea of a neat escalation scenario that ends in total annihilation of the human race including a nuclear winter.
    - sAbakumoff 5y ago
      >> What do you think would happen to Putins daughters in London, I think he does not give a fig about anyone anymore
- marginalia_nu 5y ago
  More like 'welcome to history'. There have always been periods of peace and prosperity, sometimes hundreds of years long. Those living through these have always thought they were the exception. They have always been wrong.
  - gboss 5y ago
    The OP I’m pretty sure is being sarcastic and referring to this obnoxious book by Francis Fukuyama: https://en.m.wikipedia.org/wiki/End_of_history https://en.m.wikipedia.org/wiki/End_of_history He had this absurd premise that because the Soviet Union collapsed and free trade was surging every place everywhere would coalesce to a boring democracy.
    - DyslexicAtheist 5y ago
      they did say "the end of 'end of history'" so maybe there is more to untangle than the postmodern idea of what Fukuyama was having his night-terrors about. I fear it's even more "meta" and also a reference to this old Churchill quote about war: > "Now this is not the end of end of history. It is not even the beginning of the end of end of history. But it is, perhaps, the end of the end of the beginning."
- TheGigaChad 5y ago
protomyth 5y ago
Might not be a bad idea to monitor https://www.ers.usda.gov/publications/#!topicid=&subtopicid=&series=WHS&authorid=&page=1&sortfield=date&sortascending=false https://www.ers.usda.gov/publications/#!topicid=&subtopicid=... WHS: Wheat Outlook. Also, the February report https://www.ers.usda.gov/publications/pub-details/?pubid=103244 https://www.ers.usda.gov/publications/pub-details/?pubid=103... has a section on Russia.
PestoDiRucola 5y ago
We might have reached the highest price of wheat in history. A lot of historical things happening as of late.
- Shadonototra 5y ago
  Dark days ahead of us.. money won't be enough if everyone is fighting for the same resources.. then we'll have water issues very soon, things are changing at a very fast pace, it's scary
  - 7373737373 5y ago
    I don't get how and why water could ever be an existential problem for humanity, other than in extremely remote drought regions. Yes, desalination plants and other infrastructure investments may make it more expensive, but it doesn't seem to be a fundamentally scarce resource.
    - DyslexicAtheist 5y ago
      there is a whole Wikipedia entry dedicated to the topic: https://en.wikipedia.org/wiki/Water_scarcity https://en.wikipedia.org/wiki/Water_scarcity
    - calvinmorrison 5y ago
      at .01 cents a gallon or less, yeah it's not scarce at all...
    - bcrosby95 5y ago
      You can use desalination for drinking water, but growing food requires way too much water for it to be feasible.
      - pfdietz 5y ago
        In Israel, use of desalination made more effluent suitable for irrigation. Before that, the effluent contained too much salt. This isn't desalinating specifically for irrigation, but it is a source of water for irrigation that wouldn't exist without desalination. https://www.haaretz.com/israel-news/.premium-study-water-desalination-advances-lends-to-dramatic-boost-for-farmers-1.5848554 https://www.haaretz.com/israel-news/.premium-study-water-des... Israel is not self-sufficient though; they import 80% of the grain they consume.
alephnan 5y ago
How much of this is attributable to meme stock style momentum versus fundamentals?
- teej 5y ago
  It’s clearly a supply shock.
- adam_arthur 5y ago
  Commodity speculators can push prices up for sure. But they are also huge markets where most buyer/sellers actually intend to use the product. On top of that, global inflation was already pushing up price of most commodities (excess goods spending due to govt stimulus, among other things, such as substitution). Oil is a much more dire situation, as demand is increasing faster than structural supply. Higher oil does push people towards renewables, but at large cost to the poor. Also acts as multiplier to pretty much all other goods production.
- tyrfing 5y ago
  It's a number of factors coming together. The market over 2021 was very tight, with China importing a huge amount of wheat, some drought/weather issues, and probably more. Coming into this year, nitrogen fertilizer, potash and other agriculture inputs are very expensive, which partly traces back to energy costs (natural gas) and sanctions (Belarus/Russia). Adding the Ukraine war to this puts a huge percent of global exports at risk, with at least some people naming it as the biggest supply shock in a lifetime: https://twitter.com/ScottIrwinUI/status/1499137998386085889 https://twitter.com/ScottIrwinUI/status/1499137998386085889 It's not just the supply shock, but everyone expecting rough conditions this year before the war started. Primed with those conditions and a commodity where not having any means millions/billions of people starve, it's easy to see how supply concerns can set off some very sharp movements. Energy and food inflation like this has a history of setting off events like the Arab Spring; it's a very inelastic market and governments don't have the option of not paying. I'm no commodities expert though. Here's an article on effects in Egypt: https://mei.edu/publications/russia-ukraine-war-has-turned-egypts-food-crisis-existential-threat-economy https://mei.edu/publications/russia-ukraine-war-has-turned-e...
- 5y ago
ck2 5y ago
Even if Putin was somehow deposed tomorrow and somehow the invasion ended, that curve is not coming back down any time soon. Kind of like gas prices during/after invasion of Iraq? Despite local production availability, it was an opportunistic hike. What's weird though is I noticed a price spike and then sudden unavailability of many wheat products just after New Years.
- School-Cotton 5y ago
  > Even if Putin was somehow deposed tomorrow and somehow the invasion ended, that curve is not coming back down any time soon. Why not? If everything normalized tomorrow, what would stop Russia and Ukraine from resuming wheat shipments?
  - deleted 5y ago
    [deleted]
  - ed25519FUUU 5y ago
    Who is to say Putin isn’t deposed by somebody even more ruthless than himself?
    - School-Cotton 5y ago
      We are talking about the hypothesis that the invasion ends and relations are normalized.
  - thesuperbigfrog 5y ago
    >> If everything normalized tomorrow, what would stop Russia and Ukraine from resuming wheat shipments? The effects of war are not magically undone when the war ends. If the war ended today, it would take Ukraine decades to recover. Pictures like these do not show the people whose lives have been shattered or lost: https://news.sky.com/story/ukraine-invasion-before-and-after-the-devastating-impact-of-russias-attack-12555679 https://news.sky.com/story/ukraine-invasion-before-and-after... Similarly, the sanctions on Russia are only a symbol of the loss of trust and willingness to cooperate that many people throughout the world feel. How many years or decades will it take to build back that trust?
fidesomnes 5y ago
h2odragon 5y ago
I dunno what kind of wheat they grow in Ukraine; specifically when do they plant and harvest? I've got the impression that planting season is a couple weeks to a month off and closes a couple weeks after that, for a late fall harvest. In the southern USA there's more winter wheat in the fields than I've seen in the 30 years I've lived here. It looks really happy so far too. They'll be bringing that in starting in another 3mo or so.
- ed25519FUUU 5y ago
  You probably know this already but the hard winter wheat and soft white spring wheat are used to make different types of food. I imagine in the US food manufacturers will start trying to swap for hard winter wheat which it sounds like we’ll have a lot of. But you’re right about planting season. It’s coming up fast and that window will close with no way to rewind if tensions die down.
- downrightmike 5y ago
  It isn't so much production as transport. We may have a lot of wheat, but getting it shipped is way more expensive and ship into long beach are only on time about 10% of the time, pre covid, they were 90% on time. And it is a lot easier to get goods into smaller towns and farms etc, than it will be to pick up a bunch of shipments from rural areas.
  - derbOac 5y ago
    This is related to something on my mind since I read about the impact of the Ukraine conflict on wheat: will the economic impacts of wheat deficits be equally spread worldwide? I wondered about it because I am lucky I suppose to live in an area with a fair amount of local wheat production. During the pandemic I noticed that the locally produced wheat never really disappeared even though it was more expensive to begin with; the bigger brands totally disappeared from the shelves. I could see this as making a bigger impact though, because it's affecting worldwide stock to a bigger extent, at the more basic level of production rather than supply chains per se. But if the local wheat isn't really going anywhere anyway, maybe it doesn't matter. Between this and the pandemic it seems like smaller, local production is being rewarded more, at least where I am. Chains struggled but smaller local shops thrived.
hamiltonians 5y ago
wont take much for this to fall again.increase prices means increased supply
- ed25519FUUU 5y ago
  Ukraine is one of the world’s bread baskets and produces roughly 12% of supply. If they miss the planting season because of war it’s going to have a long lasting effect, and you can’t plant again until next spring.
  - jelliclesfarm 5y ago
    they have to plant within the next 30-60 days. the planting window is fast approaching. i think they will miss it.
- khuey 5y ago
  Yeah that's not how commodities with fixed production cycles work in the short term.
- BoiledCabbage 5y ago
  > wont take much for this to fall again Yes it will, as crops have a growing season. If it gets missed there is simply less wheat for everyone in the world for roughly a full year until the following growing season.
- hugh-avherald 5y ago
  Why hasn't supply increased already?
- futhey 5y ago
  If futures markets do their job, and incentivize other growers to expand their production ahead of planting season, it might partially resolve itself. Not my area of expertise though. Are their North American farmers holding out waiting for better prices?
Azsy 5y ago
Wheat is not the only problem, fertilizer prices are also disrupted and it might get worse. Next to the deaths in Ukraine, we might thank Putin for 100 million plus deaths by famine within the 3 years.
- warner_of_doom 5y ago
  We could simply not sanction agriculture-related exports. That would be moral, IMO.
  - Azsy 5y ago
    We are well past sanction stories and moved into national security by banning export: https://tradingeconomics.com/china/exports-of-fertilizers https://tradingeconomics.com/china/exports-of-fertilizers The only real solution i see is to stop feeding the animals with stuff humans could eat and make a point of global solidarity. I say this as a avid meat eater, but I'm not holding my breath.
    - warner_of_doom 5y ago
      Why is the media here in the US not reporting on the fact that grain prices are going to quadruple if sanctions on agricultural products and inputs are not lifted? Do they want to see the whole world destabilized by a famine? This is ridiculous.
      - giantg2 5y ago
        The restrictions aren't necessarily on the import side. Even if they are, it's irrelevant since Putin has placed restrictions on the export side.
        warner_of_doom 5y ago
        We need to open up negotiations on this point immediately. Arab Spring x 10k is about to hit the entire world, and the result will be 10k times as nasty.
riedel 5y ago
This page has a pricing page [1] without prices. How I hate such things. [1] https://tradingeconomics.com/analytics/pricing.aspx https://tradingeconomics.com/analytics/pricing.aspx
- FredPret 5y ago
  You mean you don't like to contact Sales to "learn more"?!
Borrible 5y ago
https://www.wsj.com/market-data/quotes/futures/W00/advanced-chart https://www.wsj.com/market-data/quotes/futures/W00/advanced-... Filter to 'All' Those tops between 2010 and 2013 is the 'Arab Spring'. Now you know what is coming. I mentioned that eight days ago, it was a sure thing ten days ago. The moment they crossed the border. https://news.ycombinator.com/item?id=30457490&goto=item%3Fid%3D30457490%2330458314#30458314 https://news.ycombinator.com/item?id=30457490&goto=item%3Fid... Oh, and it was talked about for months. It's that Ukraine Breadbasket thing. We Germans had a tour back then, just for that. It's not widely known, but we sometimes even stole the pure soil literally, Chernozem. History and geostrategics, quite interesting. Uh, by the way, the Ukrainians had a land reform last year. As a primer: https://www.oaklandinstitute.org/blog/who-really-benefits-creation-land-market-ukraine https://www.oaklandinstitute.org/blog/who-really-benefits-cr... ---------------------------------------------------------- And now to something completely different, the Serbians and the Balkan...
- deleted 5y ago
  [deleted]
- beebeepka 5y ago
  What about the Balkans? We don't need another war, thanks. I don't know for sure who is funding all these "nationalistic" organisations around these parts but I do know nationalism is more often than not used as a tool to divide people, not unite them. These people seem to "care" and "love" their countries to the extent of beating and harassing brown people. Sorry, got carried away
  - baq 5y ago
    There are reports something's brewing in Serbia/Kosovo, more than usual. Same in Moldova/Transnistria - the latter in particular could provide a western angle of attack on Ukraine.
  - Borrible 5y ago
    >We don't need another war, thanks. Some people think it's the best. At the moment the strongest proponents of this line of thought sit in the Kreml. It's just a question of who it's best for. And they don't care if you want it or not. The Republika Srpska cultivates close ties to their Russian brother, nurtures strong ethnic/nationalist ambitions and is a possible attack vector for Russian PsyOps to stirr things up. Don't you think a possible Civil War or some such in the Federation of Bosnia and Herzegovina would come in handy? For Russia and the Republika Srpska? Oh, and please don't shoot the messenger, I'm just looking for an exit. By, the way that Balkan thing is much older. In 1888 Bismarck is quoted as saying "One day the great European War will come out of some damned foolish thing in the Balkans." He was right.
giantg2 5y ago
I guess it's good I bought 5 pounds of wheat seeds earlier this year. Now to grow it, malt it, brew it.
leke 5y ago
So we need to make up 30% of grain in the world. Surely 30 countries can produce 1% more grain than they usually do to make up the deficit.
- athinggoingon 5y ago
  The problem is that Russia and Ukraine make up significant amounts of nitrogen fertilizer production.
- ggus 5y ago
  Percent math doesn't work that way. Every country should produce an additional 1% of the whole world total. Very different from 1% of what they usually do, which is a fragment of the total.
- sulZ 5y ago
  They'd need to produce 1% more grain as compared to the world's output, not their own output. This could be a significant increase.
- freemint 5y ago
  That's not how math works. They wouldn't need to produce 1% more 30 countires would need to produce 1% of world production in addition to their current produce. In other words the countries producing the other 70% each would need to 42+% more to make up the missing 30%.
daxfohl 5y ago
I guess I'll never hear the end of my parents saying it's all Bill Gates and the WEF's plan to kill us all.
- jgod 5y ago
  Good thing Bill Gates isn't the single biggest private owner of farmland in the US, so he would have nothing to gain from rise in food prices. Wait...
qalmakka 5y ago
Luckily, I prefer rice to bread /s Jokes aside, I honestly think that the modern Western diet would benefit a lot from some diversification on what cereals we eat. We eat way too much wheat nowadays. For instance, I like in Italy and we import most of our wheat, while we produce large amounts of rice, exporting more than 50% of it. People in Northern Italy have always eaten bread, but they ate way less pasta and way more rice and cornmeal in the past. Since the 1950s pasta has become incredibly ubiquitous and people have lost knowledge and the taste for rice dishes - lots of boomers I know don't even have rice in their homes.
Jerry2 5y ago
Given the dire situation and prospects for the future, doubling of the wheat prices is completely rational. Some countries are now also imposing export bans. [1] That won't stop price increases but at least they'll still have wheat and will be able to use it. Another crisis to keep an eye on is the global fertilizer shortage [2]. Near future looks pretty bleak. [1] https://uk.finance.yahoo.com/news/hungary-ban-grain-exports-effective-182644540.html https://uk.finance.yahoo.com/news/hungary-ban-grain-exports-... [2] https://www.wthitv.com/news/global-nitrogen-fertilizer-shortage-causing-farmer-frenzy/article_6cc16d5a-73e4-11ec-82ad-f742785e986f.html https://www.wthitv.com/news/global-nitrogen-fertilizer-short...
onecommentman 5y ago
A worthwhile resource on the topic, Ohio State Ag Economists discuss (important to US ag industries for obvious reasons)… https://ocj.com/2022/03/ukraine-russia-and-crop-production/ https://ocj.com/2022/03/ukraine-russia-and-crop-production/ Agricultural economists as a discipline deal with these and other policy/trade issues all the time. At agricultural colleges and universities, they provide farmers with insights so the right crops are grown in the right time and place at the right level. No political or financial agenda worthy of note. If you’re in the US and care enough, you might want to contact your local land grant school and talk to an ag economist who specializes in grain production about these concerns, or sponsor an on-line forum with them for others who are interested. If I remember correctly, most wheat in Ukraine/Russia is/has been planted in the fall/winter for summer harvest. But active regional conflict right next to your breadbasket generally sounds like a dumb and dangerous idea to pursue. You can’t harvest if your harvesting equipment is disabled. You can’t get the grain to market if your transportation systems are disrupted. Seems silly. Slavs may need to gen up some culturally appropriate recipes using maize and soybeans.
NoMoreBro 5y ago
This reminds me of “The Death of Grass”, a really interesting (and now scaring) post-apocalyptic science fiction novel (1959) https://en.m.wikipedia.org/wiki/The_Death_of_Grass https://en.m.wikipedia.org/wiki/The_Death_of_Grass

The Price of Wheat

92 points by baremetal 5y ago

sremani 5y ago

plague. war. famine. welcome to end of 'end of history.'

sAbakumoff 5y ago
Exactly! Covid-19 was the first one, it was literally “given a crown”. The last one to be nuclear winter.
- DyslexicAtheist 5y ago
  there is a lot of fear mongering about nuclear holocaust wrt NATO joining the war etc., but this is incredibly far fetched even in a worst case scenario[1]. I don't say the nuclear threat is nil, but it's also not as bad as war-hawks pondering escalation scenarios or the media makes it out to be. What do you think would happen to Putins daughters in London, to the family members of oligarchs, to anyone who carries the smell (shame) of a past support of that regime. Even enemies of the West will think twice and have no choice supporting the force that is stronger. (whether that's good or bad or if they like it or not) anyway nobody knows anything about any of this even the ones who are supposed to be experts in it. so certainly don't take my word for it but do question it when they make it clean cut. [1] assume RU does launch nukes without sabotage on their systems before, and 1 or 2 cities will be lost to nuclear holocaust. There will be immediate containment of many of the missiles not fulfilling their objective. This is a lot messier than the academic idea of a neat escalation scenario that ends in total annihilation of the human race including a nuclear winter.
  - sAbakumoff 5y ago
    >> What do you think would happen to Putins daughters in London, I think he does not give a fig about anyone anymore
marginalia_nu 5y ago
More like 'welcome to history'. There have always been periods of peace and prosperity, sometimes hundreds of years long. Those living through these have always thought they were the exception. They have always been wrong.
- gboss 5y ago
  The OP I’m pretty sure is being sarcastic and referring to this obnoxious book by Francis Fukuyama: https://en.m.wikipedia.org/wiki/End_of_history https://en.m.wikipedia.org/wiki/End_of_history He had this absurd premise that because the Soviet Union collapsed and free trade was surging every place everywhere would coalesce to a boring democracy.
  - DyslexicAtheist 5y ago
    they did say "the end of 'end of history'" so maybe there is more to untangle than the postmodern idea of what Fukuyama was having his night-terrors about. I fear it's even more "meta" and also a reference to this old Churchill quote about war: > "Now this is not the end of end of history. It is not even the beginning of the end of end of history. But it is, perhaps, the end of the end of the beginning."
TheGigaChad 5y ago

protomyth 5y ago

Might not be a bad idea to monitor https://www.ers.usda.gov/publications/#!topicid=&subtopicid=&series=WHS&authorid=&page=1&sortfield=date&sortascending=false https://www.ers.usda.gov/publications/#!topicid=&subtopicid=... WHS: Wheat Outlook. Also, the February report https://www.ers.usda.gov/publications/pub-details/?pubid=103244 https://www.ers.usda.gov/publications/pub-details/?pubid=103... has a section on Russia.

PestoDiRucola 5y ago

We might have reached the highest price of wheat in history. A lot of historical things happening as of late.

Shadonototra 5y ago
Dark days ahead of us.. money won't be enough if everyone is fighting for the same resources.. then we'll have water issues very soon, things are changing at a very fast pace, it's scary
- 7373737373 5y ago
  I don't get how and why water could ever be an existential problem for humanity, other than in extremely remote drought regions. Yes, desalination plants and other infrastructure investments may make it more expensive, but it doesn't seem to be a fundamentally scarce resource.
  - DyslexicAtheist 5y ago
    there is a whole Wikipedia entry dedicated to the topic: https://en.wikipedia.org/wiki/Water_scarcity https://en.wikipedia.org/wiki/Water_scarcity
  - calvinmorrison 5y ago
    at .01 cents a gallon or less, yeah it's not scarce at all...
  - bcrosby95 5y ago
    You can use desalination for drinking water, but growing food requires way too much water for it to be feasible.
    - pfdietz 5y ago
      In Israel, use of desalination made more effluent suitable for irrigation. Before that, the effluent contained too much salt. This isn't desalinating specifically for irrigation, but it is a source of water for irrigation that wouldn't exist without desalination. https://www.haaretz.com/israel-news/.premium-study-water-desalination-advances-lends-to-dramatic-boost-for-farmers-1.5848554 https://www.haaretz.com/israel-news/.premium-study-water-des... Israel is not self-sufficient though; they import 80% of the grain they consume.

alephnan 5y ago

How much of this is attributable to meme stock style momentum versus fundamentals?

teej 5y ago
It’s clearly a supply shock.
adam_arthur 5y ago
Commodity speculators can push prices up for sure. But they are also huge markets where most buyer/sellers actually intend to use the product. On top of that, global inflation was already pushing up price of most commodities (excess goods spending due to govt stimulus, among other things, such as substitution). Oil is a much more dire situation, as demand is increasing faster than structural supply. Higher oil does push people towards renewables, but at large cost to the poor. Also acts as multiplier to pretty much all other goods production.
tyrfing 5y ago
It's a number of factors coming together. The market over 2021 was very tight, with China importing a huge amount of wheat, some drought/weather issues, and probably more. Coming into this year, nitrogen fertilizer, potash and other agriculture inputs are very expensive, which partly traces back to energy costs (natural gas) and sanctions (Belarus/Russia). Adding the Ukraine war to this puts a huge percent of global exports at risk, with at least some people naming it as the biggest supply shock in a lifetime: https://twitter.com/ScottIrwinUI/status/1499137998386085889 https://twitter.com/ScottIrwinUI/status/1499137998386085889 It's not just the supply shock, but everyone expecting rough conditions this year before the war started. Primed with those conditions and a commodity where not having any means millions/billions of people starve, it's easy to see how supply concerns can set off some very sharp movements. Energy and food inflation like this has a history of setting off events like the Arab Spring; it's a very inelastic market and governments don't have the option of not paying. I'm no commodities expert though. Here's an article on effects in Egypt: https://mei.edu/publications/russia-ukraine-war-has-turned-egypts-food-crisis-existential-threat-economy https://mei.edu/publications/russia-ukraine-war-has-turned-e...
5y ago

ck2 5y ago

Even if Putin was somehow deposed tomorrow and somehow the invasion ended, that curve is not coming back down any time soon. Kind of like gas prices during/after invasion of Iraq? Despite local production availability, it was an opportunistic hike. What's weird though is I noticed a price spike and then sudden unavailability of many wheat products just after New Years.

School-Cotton 5y ago
> Even if Putin was somehow deposed tomorrow and somehow the invasion ended, that curve is not coming back down any time soon. Why not? If everything normalized tomorrow, what would stop Russia and Ukraine from resuming wheat shipments?
- deleted 5y ago
  [deleted]
- ed25519FUUU 5y ago
  Who is to say Putin isn’t deposed by somebody even more ruthless than himself?
  - School-Cotton 5y ago
    We are talking about the hypothesis that the invasion ends and relations are normalized.
- thesuperbigfrog 5y ago
  >> If everything normalized tomorrow, what would stop Russia and Ukraine from resuming wheat shipments? The effects of war are not magically undone when the war ends. If the war ended today, it would take Ukraine decades to recover. Pictures like these do not show the people whose lives have been shattered or lost: https://news.sky.com/story/ukraine-invasion-before-and-after-the-devastating-impact-of-russias-attack-12555679 https://news.sky.com/story/ukraine-invasion-before-and-after... Similarly, the sanctions on Russia are only a symbol of the loss of trust and willingness to cooperate that many people throughout the world feel. How many years or decades will it take to build back that trust?

fidesomnes 5y ago

h2odragon 5y ago

I dunno what kind of wheat they grow in Ukraine; specifically when do they plant and harvest? I've got the impression that planting season is a couple weeks to a month off and closes a couple weeks after that, for a late fall harvest. In the southern USA there's more winter wheat in the fields than I've seen in the 30 years I've lived here. It looks really happy so far too. They'll be bringing that in starting in another 3mo or so.

ed25519FUUU 5y ago
You probably know this already but the hard winter wheat and soft white spring wheat are used to make different types of food. I imagine in the US food manufacturers will start trying to swap for hard winter wheat which it sounds like we’ll have a lot of. But you’re right about planting season. It’s coming up fast and that window will close with no way to rewind if tensions die down.
downrightmike 5y ago
It isn't so much production as transport. We may have a lot of wheat, but getting it shipped is way more expensive and ship into long beach are only on time about 10% of the time, pre covid, they were 90% on time. And it is a lot easier to get goods into smaller towns and farms etc, than it will be to pick up a bunch of shipments from rural areas.
- derbOac 5y ago
  This is related to something on my mind since I read about the impact of the Ukraine conflict on wheat: will the economic impacts of wheat deficits be equally spread worldwide? I wondered about it because I am lucky I suppose to live in an area with a fair amount of local wheat production. During the pandemic I noticed that the locally produced wheat never really disappeared even though it was more expensive to begin with; the bigger brands totally disappeared from the shelves. I could see this as making a bigger impact though, because it's affecting worldwide stock to a bigger extent, at the more basic level of production rather than supply chains per se. But if the local wheat isn't really going anywhere anyway, maybe it doesn't matter. Between this and the pandemic it seems like smaller, local production is being rewarded more, at least where I am. Chains struggled but smaller local shops thrived.

hamiltonians 5y ago

wont take much for this to fall again.increase prices means increased supply

ed25519FUUU 5y ago
Ukraine is one of the world’s bread baskets and produces roughly 12% of supply. If they miss the planting season because of war it’s going to have a long lasting effect, and you can’t plant again until next spring.
- jelliclesfarm 5y ago
  they have to plant within the next 30-60 days. the planting window is fast approaching. i think they will miss it.
khuey 5y ago
Yeah that's not how commodities with fixed production cycles work in the short term.
BoiledCabbage 5y ago
> wont take much for this to fall again Yes it will, as crops have a growing season. If it gets missed there is simply less wheat for everyone in the world for roughly a full year until the following growing season.
hugh-avherald 5y ago
Why hasn't supply increased already?
futhey 5y ago
If futures markets do their job, and incentivize other growers to expand their production ahead of planting season, it might partially resolve itself. Not my area of expertise though. Are their North American farmers holding out waiting for better prices?

Azsy 5y ago

Wheat is not the only problem, fertilizer prices are also disrupted and it might get worse. Next to the deaths in Ukraine, we might thank Putin for 100 million plus deaths by famine within the 3 years.

warner_of_doom 5y ago
We could simply not sanction agriculture-related exports. That would be moral, IMO.
- Azsy 5y ago
  We are well past sanction stories and moved into national security by banning export: https://tradingeconomics.com/china/exports-of-fertilizers https://tradingeconomics.com/china/exports-of-fertilizers The only real solution i see is to stop feeding the animals with stuff humans could eat and make a point of global solidarity. I say this as a avid meat eater, but I'm not holding my breath.
  - warner_of_doom 5y ago
    Why is the media here in the US not reporting on the fact that grain prices are going to quadruple if sanctions on agricultural products and inputs are not lifted? Do they want to see the whole world destabilized by a famine? This is ridiculous.
    - giantg2 5y ago
      The restrictions aren't necessarily on the import side. Even if they are, it's irrelevant since Putin has placed restrictions on the export side.
      - warner_of_doom 5y ago
        We need to open up negotiations on this point immediately. Arab Spring x 10k is about to hit the entire world, and the result will be 10k times as nasty.

riedel 5y ago

This page has a pricing page [1] without prices. How I hate such things. [1] https://tradingeconomics.com/analytics/pricing.aspx https://tradingeconomics.com/analytics/pricing.aspx

FredPret 5y ago
You mean you don't like to contact Sales to "learn more"?!

Borrible 5y ago

https://www.wsj.com/market-data/quotes/futures/W00/advanced-chart https://www.wsj.com/market-data/quotes/futures/W00/advanced-... Filter to 'All' Those tops between 2010 and 2013 is the 'Arab Spring'. Now you know what is coming. I mentioned that eight days ago, it was a sure thing ten days ago. The moment they crossed the border. https://news.ycombinator.com/item?id=30457490&goto=item%3Fid%3D30457490%2330458314#30458314 https://news.ycombinator.com/item?id=30457490&goto=item%3Fid... Oh, and it was talked about for months. It's that Ukraine Breadbasket thing. We Germans had a tour back then, just for that. It's not widely known, but we sometimes even stole the pure soil literally, Chernozem. History and geostrategics, quite interesting. Uh, by the way, the Ukrainians had a land reform last year. As a primer: https://www.oaklandinstitute.org/blog/who-really-benefits-creation-land-market-ukraine https://www.oaklandinstitute.org/blog/who-really-benefits-cr... ---------------------------------------------------------- And now to something completely different, the Serbians and the Balkan...

deleted 5y ago
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beebeepka 5y ago
What about the Balkans? We don't need another war, thanks. I don't know for sure who is funding all these "nationalistic" organisations around these parts but I do know nationalism is more often than not used as a tool to divide people, not unite them. These people seem to "care" and "love" their countries to the extent of beating and harassing brown people. Sorry, got carried away
- baq 5y ago
  There are reports something's brewing in Serbia/Kosovo, more than usual. Same in Moldova/Transnistria - the latter in particular could provide a western angle of attack on Ukraine.
- Borrible 5y ago
  >We don't need another war, thanks. Some people think it's the best. At the moment the strongest proponents of this line of thought sit in the Kreml. It's just a question of who it's best for. And they don't care if you want it or not. The Republika Srpska cultivates close ties to their Russian brother, nurtures strong ethnic/nationalist ambitions and is a possible attack vector for Russian PsyOps to stirr things up. Don't you think a possible Civil War or some such in the Federation of Bosnia and Herzegovina would come in handy? For Russia and the Republika Srpska? Oh, and please don't shoot the messenger, I'm just looking for an exit. By, the way that Balkan thing is much older. In 1888 Bismarck is quoted as saying "One day the great European War will come out of some damned foolish thing in the Balkans." He was right.

giantg2 5y ago

I guess it's good I bought 5 pounds of wheat seeds earlier this year. Now to grow it, malt it, brew it.

leke 5y ago

So we need to make up 30% of grain in the world. Surely 30 countries can produce 1% more grain than they usually do to make up the deficit.

athinggoingon 5y ago
The problem is that Russia and Ukraine make up significant amounts of nitrogen fertilizer production.
ggus 5y ago
Percent math doesn't work that way. Every country should produce an additional 1% of the whole world total. Very different from 1% of what they usually do, which is a fragment of the total.
sulZ 5y ago
They'd need to produce 1% more grain as compared to the world's output, not their own output. This could be a significant increase.
freemint 5y ago
That's not how math works. They wouldn't need to produce 1% more 30 countires would need to produce 1% of world production in addition to their current produce. In other words the countries producing the other 70% each would need to 42+% more to make up the missing 30%.

daxfohl 5y ago

I guess I'll never hear the end of my parents saying it's all Bill Gates and the WEF's plan to kill us all.

jgod 5y ago
Good thing Bill Gates isn't the single biggest private owner of farmland in the US, so he would have nothing to gain from rise in food prices. Wait...

qalmakka 5y ago

Luckily, I prefer rice to bread /s Jokes aside, I honestly think that the modern Western diet would benefit a lot from some diversification on what cereals we eat. We eat way too much wheat nowadays. For instance, I like in Italy and we import most of our wheat, while we produce large amounts of rice, exporting more than 50% of it. People in Northern Italy have always eaten bread, but they ate way less pasta and way more rice and cornmeal in the past. Since the 1950s pasta has become incredibly ubiquitous and people have lost knowledge and the taste for rice dishes - lots of boomers I know don't even have rice in their homes.

Jerry2 5y ago

Given the dire situation and prospects for the future, doubling of the wheat prices is completely rational. Some countries are now also imposing export bans. [1] That won't stop price increases but at least they'll still have wheat and will be able to use it. Another crisis to keep an eye on is the global fertilizer shortage [2]. Near future looks pretty bleak. [1] https://uk.finance.yahoo.com/news/hungary-ban-grain-exports-effective-182644540.html https://uk.finance.yahoo.com/news/hungary-ban-grain-exports-... [2] https://www.wthitv.com/news/global-nitrogen-fertilizer-shortage-causing-farmer-frenzy/article_6cc16d5a-73e4-11ec-82ad-f742785e986f.html https://www.wthitv.com/news/global-nitrogen-fertilizer-short...

onecommentman 5y ago

A worthwhile resource on the topic, Ohio State Ag Economists discuss (important to US ag industries for obvious reasons)… https://ocj.com/2022/03/ukraine-russia-and-crop-production/ https://ocj.com/2022/03/ukraine-russia-and-crop-production/ Agricultural economists as a discipline deal with these and other policy/trade issues all the time. At agricultural colleges and universities, they provide farmers with insights so the right crops are grown in the right time and place at the right level. No political or financial agenda worthy of note. If you’re in the US and care enough, you might want to contact your local land grant school and talk to an ag economist who specializes in grain production about these concerns, or sponsor an on-line forum with them for others who are interested. If I remember correctly, most wheat in Ukraine/Russia is/has been planted in the fall/winter for summer harvest. But active regional conflict right next to your breadbasket generally sounds like a dumb and dangerous idea to pursue. You can’t harvest if your harvesting equipment is disabled. You can’t get the grain to market if your transportation systems are disrupted. Seems silly. Slavs may need to gen up some culturally appropriate recipes using maize and soybeans.

NoMoreBro 5y ago

This reminds me of “The Death of Grass”, a really interesting (and now scaring) post-apocalyptic science fiction novel (1959) https://en.m.wikipedia.org/wiki/The_Death_of_Grass https://en.m.wikipedia.org/wiki/The_Death_of_Grass