A new report from CoBank says Russia’s invasion of Ukraine is expected to result in tight grain stocks and price volatility for at least two years.

The report says the Black Sea region is a major producer and exporter of wheat, as well as an important hub for global farm trade.

The CoBank report says the conflict will negatively affect global grain flows for least two crop years, and likely longer.

Farm supply economist Ken Zuckerberg anticipates a significant tightening in available stocks to use ratios for both corn and wheat.

He says grain prices will remain elevated and volatile for the forseeable future.

Russia and Ukraine account for 14 percent of global wheat production and 29 percent of global wheat exports based on five year average.

The two nations produce only 4 percent of global corn supplies but account for 17 percent of corn exports.

Reduced current year plantings of corn and wheat in Ukraine, combined with a smaller harvest expected in July and August, are expected to tighten stocks for both commodities.

In the near-term, he says India, Europe and Australia should be able to backfill some of the shortfalls in Ukraine wheat exports to the Middle East and North Africa.

The U.S., Brazil and Argentina will likely have the ability to fill the gaps in corn export demand.

The war in Ukraine could serve as a food security wake up call to Middle East and Africa, which depend on grain imports from Russia and Ukraine.

If the Middle East and Africa diversify grain export partners, the report says North and South America, Europe and Australia stand to benefit.
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