On the evening of May 13, local time, the Indian government announced that it would ban wheat exports from now on. Affected by this, the price of wheat futures in the international market rose sharply. According to the BBC reported on the 16th, since the release of india's wheat export ban, the benchmark wheat index of the Chicago Board of Trade in the United States rose by 5.9%, hitting a new high in two months.
According to a report by the Food and Agriculture Organization of the United Nations, global food prices reached new highs in February and March. (Xinhua News Agency)
According to data from the Food and Agriculture Organization of the United Nations, the conflict between Russia and Ukraine has affected the global wheat supply and hit the international food market. After India banned wheat exports, the Group of Seven (G7) Agriculture Ministers' Meeting spoke out against India's decision, with German Agriculture Minister Oz demir saying the move "will exacerbate the crisis".
About 70% of Japan's food consumption (including feed grain) depends on imports, so the Japanese table is inevitably affected by high international food prices. Soba noodles are a very popular popular food in Japan, and the prices of affordable foods such as soba noodles have recently risen to record highs.
Although buckwheat can still be imported from Russia after Japan announced sanctions against Russia, the supply is not stable, and transportation is intermittent, coupled with the recent surge in global commodity prices and the sharp depreciation of the yen, the cost of Japanese grain imports has soared. As some Russian banks were excluded from the Swift payment system, Japanese merchants said they had difficulty settling when importing Russian buckwheat. One Japanese soba importer said, "It may be harder and harder for Japanese people to eat affordable soba noodles." ”
On March 9, customers buy oden on the streets of Tokyo, Japan. (Xinhua News Agency)
The Tokyo Core Consumer Price Index (CPI), which is considered an indicator of Japan's price trend, rose 1.9 percent annually in April, the fastest gain since March 2015, according to data released by the Japanese government on May 6.
According to a questionnaire survey conducted by statistical agencies, as of April, 105 food processing companies across Japan have made it clear that they will raise product prices this year, and a total of 6,167 varieties of food are facing price increases. Not only the prices of major raw materials such as wheat flour, soybeans, and sugar have risen significantly, but also the prices of processed foods such as frozen foods, soy sauce, soy milk, and snacks have also risen significantly. Overall, the average price increase of 2909 processed food varieties in the Japanese market was 12%, the price of 1311 condiment varieties was 9%, and the price of 744 alcoholic beverage varieties was 15%.
A Japanese government official revealed that the price of imported wheat rose by about 17 percent in April, resulting in the biggest increase in the prices of take-out sushi, burgers and bread. Taking "Yamazaki bread" as an example, after two consecutive price increases this year, the price of 141 kinds of bread made in "Yamazaki bread" has increased by an average of 7.1%, while "Shikishima bread" and "Fuji bread" have also raised prices by 8% to 14%.
According to a questionnaire survey conducted by the Tokyo Business and Industry Research Corporation, nearly 70% of Japanese companies have not yet passed on the full cost of the increase to consumers amid the Russian-Ukrainian conflict and the sharp depreciation of the yen, which has led to high raw material prices. In other words, nearly 70% of these companies are likely to raise the price of goods or services at any time.
A man walks through a restaurant on the streets of Tokyo, Japan, on May 10. (Xinhua News Agency)
According to the "Japan Economic News" report, Japan has three types of grain dependence on foreign dependence: about 90% of wheat needs to be imported, and Russia is the world's largest wheat exporter, last year's wheat exports accounted for 19.5% of the world, Ukraine ranked fifth, accounting for 8.97%; corn and other concentrated feed raw materials about 90% dependent on imports, and Ukraine is the world's fourth largest corn exporter; the main raw materials of fertilizers also rely on imports, Russia is the main exporter of fertilizers, Belarus is the world's potash production and export giant, and Japan, in order to sanction Russia and Belarus, has reduced the import of fertilizer raw materials in these two countries to zero, which accounts for a quarter of Japan's total imports. Among them, the price of wheat and corn in March has risen by about 40% compared with the end of 2021. All of these factors have directly or indirectly pushed up food prices in Japan.
In addition to food production, global food transport has also been affected by the Russian-Ukrainian conflict. At this stage, Ukraine's grain exports have stagnated, and the United States and Europe have launched multiple rounds of sanctions against Russia, making it more difficult to purchase grain from Ukraine and Russia. Japan's grain import prices refer to the chicago board of trade, as well as the costs from the place of production to the port of export, maritime transportation and customs clearance costs, etc. Freight rates continue to be high, which directly affects the cost of food imports in Japan, resulting in rising food prices.
On May 11, a street food truck in New York, USA, saw multiple changes to the price on the menu. (Xinhua News Agency)
Masayuki Isawa, an associate professor at University in Japan, said that as the world's largest grain producer, most of the grain exported by the United States is transported through the Mississippi River, which flows through the granary area of the Central Great Plains region of the United States, and the barge freight used for transportation this spring hit a new high in 7 and a half years. According to the U.S. Department of Agriculture, 49 percent of U.S. grain exports in 2021 will be transported through the river. Freight on the Mississippi River barge from the Port of St. Louis, Missouri, a major U.S. food distribution center, to the Port of New Orleans rose to $16.04 a tonne, up 65 percent from the same period last year, according to a Report released by the U.S. Department of Agriculture on May 5.
The World Bank predicts that wheat prices could rise by more than 40 percent this year. In order to ensure the stability of the Japanese people's table, Japanese Prime Minister Kishida Fumio recently said that in the context of soaring global food prices, "Japan must increase its food self-sufficiency rate" and "work to strengthen the international competitiveness of Japanese agriculture."