The Russian blockade of grain from Ukraine will put pressure on grain prices in Spain

2023-07-19 16:54:12

If the drought was severely affecting Spanish farmers’ harvests, Russia’s decision to block Ukraine’s grain export deal will only make the situation worse. The lack of rain will cause Spanish cereal production to be cut in half this year, to 7 or 8 million tons, so record imports of some 25 million tons would be needed to guarantee supplies as raw materials for food and feed, according to data from Accoe, the Spanish cereal trade association.

Therefore, this rupture will make imported grain more expensive, they say from Asaja, which will increase the price of feed in a year very marked by drought. The general secretary of the Cuenca organization, Manuel Torrero, explains to this newspaper that there will be a “chain effect” that will cause food to also end up rising in price. “When a raw material goes up, it is immediately transferred to the production chain,” he points out.

From the Union of Small Farmers (UPA) they explain that Spain is a country with a deficit in cereals and, at the same time, a livestock power. “With this scenario, the interruption of a grain supply route is a cause for concern,” they say. For this reason, they call for stable markets that are organized on the basis of “logical supply/demand rules”. “Experience tells us that in the face of market tensions those who lose are always the consumers,” they indicate from UPA.

With the rupture of the Black Sea export agreement, Spain will lose access to grain from Ukraine, a critical situation since it was the main supplier of corn and sunflower oil. The Minister of Agriculture, Luis Planas, described this Wednesday as “unjustifiable” that Russia uses food “as a weapon of war.” In the press conference after the informal summit of EU Fisheries ministers held in Vigo, Planas asked that both the UN and the president of Turkey, who has acted as a mediator in the conflict, manage to resolve this issue and allow grain to leave Ukraine to other countries that need it.

This is also referred to from Asaja, since they remember that from now on a negotiation period opens to reach an agreement on world trade, so you have to be “calm” and “cautious.”