Expert on the consequences of drought in Europe and grain prices

Immediately after the statements of the Russian authorities about the termination of the grain deal, futures for wheat on the exchanges rose by 3-4 percent. “The threat of crop failure is getting closer due to the widespread drought that has affected even the United States,” said deputy of the House of Representatives of the National Sergei Kravtsov, the Director General of the Scientific and Practical Centre for Agriculture at the National Academy of Sciences of Belarus.

“This year, Europe is threatened with at least minus 5 percent of the gross grain harvest, while already last year’s harvest was the lowest in recent years,” the expert continues. “The Balts are very feverish in this regard, they even banned sales outside these countries.”

At the same time, Russia has already set up sales of its own grain to other markets during the deal. For example, Egypt has hastened to reassure that the termination of the deal will not affect the country’s economy. Adviser to Egypt’s Supply and Internal Trade Minister Nuamani Nasr Nuamani said that his country is diversifying supplies and is the largest importer of Russian wheat.

“This demanded product is also bought by the countries of the Middle East and Asia, Kazakhstan and China,” Sergei Kravtsov underlined. “Thanks to close co-operation with our allies, if necessary, it is also available to our country. It is not for nothing that Aleksandr Lukashenko pointed out during his working trip to the Orsha District that the market is developing a good price environment for purchasing grain, and therefore it is necessary to act in this direction. “As long as it’s cheap, we have to buy it. Even if the purchased grain is somewhere close to the cost price, if there is capacity, it’s necessary to buy it. This is the gold reserve. Grain will always prove useful.”

Sergei Kravtsov is confident that Russians are monitoring the situation today and see a shortage of crops in the world, which means that prices will go up.

“The increase in prices due to restrictions on the supply of Ukrainian grain is beneficial for exporters,” he continues. “Already now Russia – as the largest producer – feels differently. Vladimir Putin simply waited for time to establish sales routes. And even if Russian grain leaves at a lower price, but for real money, the Chinese Yuan for example, it is profitable. It’s not blocked on European accounts. Volumes have decreased, but trade is developing with more reliable partners, including the SCO countries, India and China, as well as Brazil. And we need to work in this direction. While times are tough, we should also stick to strong allies. Food security is no less important than military security.”