World is paying a huge price today, for grossly neglecting food shortage cues available six months ago. Nations around the globe, regardless being developed or developing are getting increasingly worried about their fast depleting food buffer stock.
To check the rising inflation and political unrest arising out of it, governments of every grain exporting nation have begun to impose curbs on exports of food grains. In a recent development, Kazakhstan also banned their wheat exports despite being one of the largest wheat exporters in the world. Earlier a similar decision to impose ban on rice exports from Indonesia had an immediate effect on rice futures. Kazakhstan’s decision will only help to incite speculation on wheat prices globally.
Kazakhstan joins the ever growing list of export ban countries which includes Indonesia, Vietnam, Egypt, China, Cambodia and India. Indonesia’s export ban boosted the price of rice futures in Chicago to an all-time high of $22.17 per 100 pounds, up 63 per cent since January this year. Wheat prices too saw a high of $9.11 per bushel and traders forecast more price rise as Kazakhstan’s ban together with restrictions in Russia, Ukraine and Argentina, is expected to create severe wheat shortage in international markets. Wheat importers are also apprehensive about getting their contract share, due to the latest developments.
Kazakhstan’s stance of ‘no wheat for foreigners’ is signaling famine situation for its southern neighbors. Kyrgyzstan imports 214,000 tons of grain from Kazakhstan; Tajikistan 216,000 tons; Uzbekistan 117,000 tons; and Turkmenistan 2,400 tons. But officials pointed out, banning the export of wheat during the planting season is not uncommon practice and expects global food prices to come down before the expiry of the ban, September 1.
Nevertheless, Kazakhstan will plant wheat in 13.5 million hectares this year, 600,000 hectares more than in 2007. An increase in area planted will dramatically raise the output and is expected to meet its regional demand by this year end.