Consumers need to set aside more money for bread, warns economist
An economist says with wheat prices shooting up to double the cost in 2021, we'll need to put aside more money for a loaf of bread soon.
Paul Makube says the Russia-Ukraine war has sent shockwaves through the global economy, especially in energy and food markets.
Both nations are top exporters of wheat, maize, and sunflower oil, while Moscow is the world's top supplier of key fertilizers and gas.
Meanwhile, India - the world's second-largest wheat producer - has stopped exports to help boost food security.
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Makube, who is an FNB Agriculture Economist, says wheat costs are now close to R8 000 a tonne - double last year's price.
"With the 80 percent of global exports coming from Russia and Ukraine, it creates a shortage on global markets and the rush from immediate supplies and prices skyrocket.
"It grows with prices that are traded on the exchange. Spot prices are now closer to R8 000, that's almost 100 percent up on last year. That will definitely at some stage going to flitter through to the consumer."
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