‘Through the roof’: Wheat prices could surge 50pc due to Ukraine crisis

While farmers are bracing for volatility ahead, wheat price rises will likely manifest in earnest around June if the Russia-Ukraine crisis remains unresolved or worsens.

“The real crunch will be in four months,” ANZ Bank head of agribusiness insights Michael Whitehead told the Sydney Morning Herald and The Age. Russia and Ukraine’s wheat is yet to be harvested, but will be ready to be exported four months from now, he explained.

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“If it’s blocked from world markets, and it looks like that’s going to happen – that’s when prices will really go up.”

Echoing Mr Whitehead’s sentiments, Rural Bank’s Mr Maxwell said prices would go “through the roof” if the conflict lasted through to July. “We’d expect 50 per cent increases or even more, which is saying something because we’re already pretty close to record prices.”

Domestically, Mr Whitehead believes Australian consumers won’t wear any of the higher costs. Grain that will go into products such as Australian bread and pasta will have already been purchased from the previous harvest, he said.

But Mr Maxwell noted that farmers were grappling with a raft of mounting input costs, including fuel, fertiliser, and farm equipment, which would then ripple out to Australian shoppers.

“When you factor in inflation, rising cost of fuel, and things like that, it does end up in higher prices on supermarket shelves.”

Brett Hosking, who is the chair of GrainGrowers, an industry body that represents Australian grain farmers, said there was a “little window of opportunity to take advantage of higher prices” but that Australian farmers were not rejoicing at the circumstances for the price rises.

“Not every country in the world that buys grain has the ability to pay the higher prices. The last thing we want to see is people go without food or not have the access to food that they need,” he said.