Russian-Ukrainian War Disrupts Global Food Supply As Soybean Price Hit Record High

A foreign media reported on June 13th, soybean prices have increased approximately 30% since the beginning of the year, a record high in history.

The continuous contract for soybeans on the Chicago Board of Trade closed with $17.69 a bushel last Thursday, surpassing the previous high of $17.68 in September of 2012.

Data from the U.S. Department of Agriculture shows that purchasing commitments for soybeans (planted this spring that have only just started to grow) are up 68% from the same time last year.

Soaring soybean prices have rippled through the global food supply chain. Soybeans are used in feeding poultry and fish such as chickens, pigs, cattle, and salmon can also be made into edible oils, soy products and biofuels, it plays an important role in food security.

Ukraine is one of the largest agricultural countries in the world and the largest producer of sunflower seeds as well as its by-products. Prior to Russian invasion, U.S. Department of Agriculture estimated Ukrainian production of 2022 would reach 17.5 millions tonnes sunflower seed, 6.45 millions tonnes sunflower seed oil and 6.2 millions tonnes sunflower powder.

The Ukraine war has worsened global supply. Following by shipment blockage at Ukraine ports, importers quickly turned to U.S. soybeans to fill the gap and soybean oil prices rocketed to nearly an all-time high. Last Friday, on Chicago Board of Trade, soybean oil price settled at $0.8 per pound, which is close to the all time high of $0.87 per pound when Indonesia announced banning palm oil export on April 28th.

On June 10th, US Bureau of Labor Statistics reported inflation continued to increase in May. The consumer price index has increased 8.6% compare to the previous year and the highest since December 1981.