As wheat prices rise, we may see food shortages and even civil unrest

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  • The world benchmark price for wheat hits a new all-time high
  • A sample of the political history of wheat
  • Russia and Ukraine export a third of the world’s wheat
  • High prices and shortages could cause famine, revolution
  • Climate in other growing regions never more important

In late March 2022, farmers in the northern hemisphere will begin planting seeds that will grow into crops that will feed an ever-growing world population. Approximately 6 billion people inhabited our planet at the beginning of this century. Now the world population is more than 7.885 billion, an increase of more than 31% in 22 years. Every quarter, it grows by around 20 million, which means that the demand for food is constantly increasing.

Wheat is the main ingredient in bread, a staple food. Wheat is more than a food ingredient; it is an essential good for governments, since feeding the people is crucial to staying in power and controlling the masses. In 2022, market price action reflects the war in Ukraine and a turbulent geopolitical landscape. The price of wheat is a warning sign that world famine and revolutions could only exacerbate the problems caused by the war in Ukraine.

The world benchmark price for wheat hits a new all-time high

While several wheat contracts are traded on futures exchanges in the US and around the world, the CBOT Soft Red Winter Wheat futures contract is a global benchmark for prices. In March 2020, the CBOT wheat futures price spiked to a new all-time high.

Long term wheat chart.

Long term wheat chart.

Source: CQG

As the quarterly chart illustrates, CBOT wheat futures hit $13.40 per bushel in March, eclipsing the all-time high of $13.3450 from 2008.

Wheat daily chart.

Wheat daily chart.

Source: CQG

The daily chart for the active month of May CBOT Wheat futures shows that the price rose to $13.6350 per bushel before correcting just above the $11.15 level on March 23. CBOT wheat futures had not traded above $10 since 2008.

A sample of the political history of wheat

Wheat has a long history as a commodity with significant political ramifications when prices rise and availability becomes scarce. Wheat is the main ingredient in bread, an essential nutritional element.

The last queen of France, Marie Antoinette, was executed by guillotine on October 16, 1793. Her insensitivity to the plight of her subjects during the bread shortage was one of the reasons for her beheading. The subsequent revolution in France in 1848, the so-called Third French Revolution, began due to social and political unrest when workers lost their jobs, bread prices rose and people accused the government of corruption.

During the US Civil War, in March and April 1863, the bread riots were civil unrest events in the Confederacy. There were flour, bread, and food riots in New York City in 1837 and 1917. Feeding the people is a critical function of government, and when leaders fail, they often lose power.

The latest example comes from the Arab Spring that began as a series of bread riots in Tunisia and Egypt in 2010 after world wheat prices hit their last all-time high in 2008. Bread shortages and high prices caused a change of government in North Africa and the Middle East. East. History could repeat itself in 2022 and for years to come as the world faces food shortages due to the war in Ukraine.

Russia and Ukraine export a third of the world’s wheat

Russia and Ukraine are the breadbasket of Europe.


The graph shows that Russia and Ukraine accounted for 32.83% of annual world wheat exports in recent years.

The war in Ukraine has turned fertile soil into battlefields just as harvest year 2022 begins. Meanwhile, Black Sea ports are important logistics locations for wheat exports. The conflict will cause interruptions or work stoppages, causing shortages of wheat and other agricultural products in the region that also produces corn, barley and other crops.

The war is not only affecting Russian and Ukrainian exports, but also world production. Sanctions and retaliation led Russia to “temporarilystop exporting fertilizers, just as the 2022 campaign begins in the northern hemisphere.


Russia exports approximately 12.6% of the world’s fertilizers. The suspension will drive prices up and availability down for all global grain and oilseed production.

High prices and shortages could cause famine, revolution

The war in Ukraine has far-reaching global consequences that could leave people in many countries hungry in 2022 and for years to come. The areas most at risk are in Africa and emerging markets, where poverty and hunger are likely to spread and increase. China and India, the two most populous countries, could experience shortages along with the rest of the world. However, China and India have not sanctioned Russia, which will keep the supply chain operational.

In the US and Europe, prices are likely to soar, fueling inflation that was already at its highest level in four decades before the start of the war in Ukraine.

Wheat and are the commodities at the heart of the war and Russia’s isolation from the Western world. Russian President Vladimir Putin can use grain, oil and oil as pawns in the geopolitical chess game. China’s support only increases its powerful position as a leading provider of basic goods.

Climate in other growing regions never more important

April showers bring May flowers. Across the fertile plains of the US, farmers will plant corn, soybeans, wheat and other crops in the coming weeks, with prices at or near record highs. However, farmers are paying more and more for land, financing, labour, fertilizers, farm equipment, energy and all other inputs, making high prices for agricultural products a mirage. Inflation is causing the cost of production to skyrocket.

Meanwhile, each year, the weather dictates whether harvests are sufficient to meet growing global demand. A drought or flood in any of the world’s critical producing regions causing agricultural production to decline in the coming months would be a disaster, given the situation in Europe.

Wheat shortages have a long history of triggering political turmoil. Russia can use world wheat supplies as a political and retaliatory tool. At over $11 a bushel, with the potential to go higher, shortages are on the horizon and civil unrest may follow for years to come.

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