Soaring Due to Prolonged War... Oksu Corn Prices Reach Highest in 9 Years

Concerns Over Eggflation Accelerate
Energy Prices Surge, U.S. Natural Gas Hits 13-Year High

[Asia Economy New York=Special Correspondent Joselgina] As Russia's invasion of Ukraine prolongs, food and energy prices are soaring sharply. Corn prices hit their highest level in nine years, fueling concerns over so-called 'agflation,' while U.S. natural gas prices surged to their highest level since 2008.

On the 18th (local time) at the New York Mercantile Exchange (NYMEX), May delivery natural gas futures closed at $7.82 per million BTU (British Thermal Units), up 57 cents (7.12%) from the previous session. During the session, prices briefly surpassed $8, marking the highest level since September 2008, when the global financial crisis occurred.

This is analyzed as a result of a sharp increase in European demand for U.S. natural gas to replace Russian natural gas following the Ukraine war. David Givens of Argus Media predicted, "The impact of the conflict between Ukraine and Russia on the North American natural gas market could be long-lasting." Current reserves remain about 18% below the average level. On the same day, May West Texas Intermediate (WTI) crude oil prices closed at $108.21 per barrel, up $1.26 (1.2%).

Prices of major grains such as corn and wheat are also soaring without signs of slowing down. At the Chicago Board of Trade (CBOT), July delivery corn futures rose 2.6% to $8.04 per bushel (approximately 25.4 kg) on the day. This is the first time corn futures have surpassed the $8 per bushel mark since September 2012. Corn futures, which were around $6 at the beginning of this year, are now approaching the all-time high of $8.49 recorded in 2012.

The sharp rise in grain prices is largely due to the shock from the Ukraine war compounding the price increases caused by supply chain disruptions following the COVID-19 pandemic. Ukraine and Russia account for nearly 20% of global corn exports. Wheat, for which Russia is the top exporter, also jumped as much as 3.5% during the session on the same day.

The United Nations Food and Agriculture Organization (FAO) reported that "the food price index has surged 34% since the Ukraine crisis." As the war prolongs, the rise in grain prices is pulling up general inflation, marking the full onset of agflation. Additionally, a global shortage of fertilizers has been confirmed, leading experts to expect further increases in grain prices, including corn, in the near term.

David Malpass, President of the World Bank (WB), expressed concern, stating, "The sharp rise in energy and food prices due to the war and worsening supply disruptions will hinder economic growth not only in emerging countries but also in developed countries."

This content was produced with the assistance of AI translation services.