As the western world continues to process the events that are going on, the unintended consequences are already being felt on the markets. Wheat which I talked about in an earlier article will heavily impact the global markets as the war continues.
To put things into perspective, Russia and Ukraine own over 25% of the world’s wheat, about a fifth of the world’s corn, and 12% of all calories traded globally.
At the moment of this writing, all of the supplies of agricultural goods from Ukraine have stopped, which means commodity traders will have to look elsewhere. It’s a total disaster if the leaders don’t get this right.
Bloomberg is already sounding the alarms on the implications of this. “If the conflict drags on – in three months, in four months – I feel that the consequences could be really very serious,” Andre Defoy, president of Strategie Grains, told Bloomberg. “Wheat will need to be rationed.”
Below are two charts that can give you an idea of what is happening.
Inflation is already eating away money from the average working-class pockets due to the impact of Covid, which seems to be a thing of the past from the looks of it from mainstream media. Adding this to it will lead to a very volatile situation around the world.
If things don’t change quickly, things might get harder before it gets easier as commodity shortage might seem so distant anymore.
