Wheat Prices Jump by 7.62% to Trade at Ksh. 1,924 Per Bushel

By Soko Directory Team / Published March 7, 2022 | 1:27 pm

KEY POINTS

The increase in the price of the commodity threatens higher purchasing bills which risks worsening global hunger, which is already being experienced in some nations.

KEY TAKEAWAYS

Meanwhile, the price of corn which is also a major agricultural product of Russia and Ukraine features at 774 shillings per bushel. This is a settlement 5.07 percent increase.

Wheat prices have climbed up to the highest level in more than a decade with a bushel trading at 1,924 shillings, up by 7.62 percent – the highest level since 26 March 2008 when it traded at 1,244 shillings.

This has raised traders’ concern about global supply as the war between the top suppliers of the commodity, Russia and Ukraine continues to further rapidly.

Russia is the largest exporter of wheat as Ukraine is among the top four suppliers of wheat. According to the Bank of America, International wheat trade 17 percent comes from Russia while 12 percent comes from Ukraine.

The wheat trade is a “limit up” during the day meaning the price of the commodity is allowed to rise up in a single day. The increase in the price of the commodity threatens higher purchasing bills which risks worsening global hunger, which is already being experienced in some nations.

ALSO READ: Gas Prices Surge 11%, Highest Since 2008 Amid Russia-Ukraine Conflict

“Wheat and corn are the most exposed agricultural markets to any potential escalation in tensions,” said JPMorgan’s Marko Kolanovic chief global markets strategist in a note.

Currently, the annual national consumption of wheat is 24 million bags and 2 million bags per month. Data from Agriculture and Food Authority show that 90 percent of food consumed in Kenya comes from Russia and Ukraine.

Meanwhile, the price of corn which is also a major agricultural product of Russia and Ukraine features at 774 shillings per bushel. This is a settlement 5.07 percent increase.

With the ongoing conflict between Ukraine and Russia likely to continue, prices of commodities will continue to the summit. The price of basic commodities has been going up at a high rate than it has ever been experienced in history. The rising cost of corn will lead to an increase in the price of maize flour which is already at a high price. This will put more pressure on the cost of living.

Article by Natasha Nthenya

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