Wheat prices soar as Russia bans exports

6 August 2010

7 August 2010 | Lindsay Clark

Buyers around the world are being forced to secure new sources of wheat following a decision by Russia – one of the world's largest producers – to ban exports.

Prolonged drought and forest fires across Russia have devastated the country’s grain harvest, prompting prime minister Vladimir Putin to ban exports to secure domestic supply, according to national news agency Interfax.

The decision has caused prices of wheat and other grains, which are used in the manufacture of bread, beer and other products, to soar around the world. Barley was nearly double the price compared with the start of the year, while wheat has risen around 30 per cent over three months.

These are the sharpest rises in food prices since the crisis of 2007-08, when Northern Foods, Premier Foods and Robert Wiseman Dairies were all forced to increase prices to offset commodity procurement costs.

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