Russia’s wheat prices hit a record high of 8,800-8,900 rubles ($273-276) per ton, which could lead to an increase in fodder and meat prices, Vedomosti business paper reported on Wednesday, citing Agrarian Market Studies Institute (IKAR) head Dmitry Rylko.
The price jump has been swift, with wheat trading at just 7,075 rubles per ton just late last week. A price growth at the start of an agricultural year has been registered only once in the past decade as a result of the 2010 drought in Russia, according to agricultural news agency Sovecon.
The recent downgrade of Russia’s grain harvest forecast from 94 million tons to 85 million tons, continued rains in the south of Russia and a drought in the United States are the three major reasons for the wheat price jump, Rylko said.
The U.S. drought has pushed up global wheat, corn and soybean prices to record highs since 2008. The prices of grain and oil-bearing crops have risen by dozens of percentage points since mid-June. Latin American countries have also suffered from the drought.
The US Department of Agriculture has said the drought could destroy about 20 percent of crops.