World grain prices are forecast to grow until the end of 2023: NBU forecast

World grain prices are forecast to grow until the end of 2023: NBU forecast

After a sharp decline, world prices for wheat and corn are expected to rise until the end of 2023, according to the forecasts of the National Bank of Ukraine (NBU). This is caused by oversaturation of the market with cheap Russian wheat and a record harvest of Brazilian corn. In this article, we will examine the factors leading to these changes.

First, it is worth noting that wheat is becoming more expensive due to reduced global production, especially due to low yields in Australia and Canada. This is an important factor that will outweigh the increase in exports from Russia. The NBU report also highlighted the reduction in stocks to the lowest level since the 2015/16 Marketing Year, according to the USDA agency.

In addition, corn is also expected to rise in price even though global production is rising and stocks are building. The increase in prices is due to the exhaustion of excess supply due to the significant sales of Brazilian corn from the current crop. Brazil is facing a lack of storage capacity, which is driving up prices. Worsening harvest expectations for the next marketing year will also affect exports as early as early 2024.

These trends indicate important changes in the global grain market, which may have an impact on the economy and producers of consumer products. Despite the temporary increase in prices, these factors may require careful examination and adaptation of production and export strategies. The NBU should adapt its policy to these new conditions in order to promote the stability and development of the agricultural sector of Ukraine. In addition, the National Bank of Ukraine predicts that in the coming years, grain prices will decrease due to a steady increase in supply and a slower growth in demand in conditions of significant accumulated reserves.

As a result, world prices for wheat and corn are rising, and this has an important impact on the global grain market. The NBU is already ready for these changes and predicts their impact on the Ukrainian economy. It is important to monitor these trends and take necessary measures to maintain the sustainability and development of the country's agricultural sector.