The price of wheat in Europe has hit a new record high, with an export ban on the product in India prompting further shortage fears.
The price of wheat on the Euronext stock exchange hit a record high on Monday morning, with the most recent rise being put down to a ban on most wheat exports from India.
While the Ukraine war has already seen the price of wheat surge to eye-watering heights, fallout from droughts in India have now forced authorities in the country to ban most exports of the crop.
According to a report by Der Spiegel, the price for a ton of wheat hit €435 (~$454) on Monday morning, as supplies from Ukraine, India, and even parts of Europe which are also suffering from drought, dry up.
This has prompted those within the EU to express concern regarding various nations, including India, implementing export bans on various in-demand products.
“That’s something which is very much of concern,” CNBC reports EU trade chief Valdis Dombrovskis as saying regarding the increase in export bans, with the bloc now working with the United States to ensure food security.
“We agreed with the United States to cooperate and coordinate our approaches in this area, because … as a response to Russia’s aggression against Ukraine and a corresponding increase in food prices and concerns about food security, countries are starting to take export restrictive measures,” he continued.
“And we think that this is a tendency which can only actually aggravate the problem,” specifically giving a forthcoming ban on the export of palm oil from Indonesia as something which would only “make matters worse”.
Global Food Crisis: Cut EU Red Tape to Bump Wheat Production – Agri Ministerhttps://t.co/1xsROCtKi4
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While the bloc attempts to get to grips with the fact that the supply of food to Europe is set to become even more unstable over the coming months, the European Commission has officially revised its official growth predictions downwards.
According to POLITICO, the EU’s bigwigs now expect that the bloc’s overall growth will be limited to 2.7 per cent this year, while Eurozone inflation looks set to hit dizzying highs of 6.9 per cent this quarter.
Despite this dire outlook however, the union’s economy tsar, Paolo Gentiloni, has insisted that the term “stagflation” shouldn’t be used to describe the current situation, and that the European economy was still indeed growing.
“We have very high level of inflation, and we have one of the deepest downward [revisions] for growth in our seasonal forecast. But this is not until now bringing growth in negative territory,” the publication reports the commissioner as saying.
“I’m not a strong supporter of the stagflation word because it was used in previous and very different circumstances, but indeed we have very high inflation and quite low growth,” he also emphasised.
While these numbers are not all negative, this published prediction however reportedly doesn’t take into account the possibility of Russia deciding to cut off the continent from its supply of gas, something the country has already done to both Poland and Bulgaria.
If such a measure did materialise however, POLITICO reports that the bloc would see inflation rise to around nine per cent, while countries heavily reliant on Moscow’s supply — such as Germany — would fall into recession.