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How the War in Ukraine Could Raise Americans’ Grocery Bills
March 1, 2022
As Americans watch the Ukraine-Russian conflict play out on the other side of the world, they may soon begin to feel the war’s impact on their grocery bills.
Russian and Ukraine supply roughly one-third of the world’s wheat, a quarter of its barley, and nearly three-quarters of all sunflower oil, according to the International Food Policy Research Institute (IFPRI), and the war threatens to disrupt this supply as fighting damages ports and prevents planting and harvesting.
Countries in the Middle East and North Africa that import a lot of grain from Ukraine are likely to be most impacted, but the European Union gets 6.4% of its total food imports from Ukraine and Russia. The U.S. does little direct food trade with the two countries, but will still feel the effects as uncertainty roils the global commodities markets.
The IFPRI estimates that 80% of last year’s wheat harvest has already been exported from Ukraine and the next crop has been planted, but the planting of other crops like corn, as well as the harvest of last year’s wheat crop, are due this spring and are likely to be disrupted by the war.
This means consumers could see higher prices for grain-based products like bread and cereal at the supermarket. Higher grain prices also mean higher prices for livestock feed, so meet prices may rise as well. Even prior to the invasion, the U.S. Department of Agriculture estimated that wholesale beef prices would increase 7.5% in 2022.
