The global food crisis sounded again.
Recently, a Thai government spokesperson said that Thailand and Vietnam plan to jointly raise rice prices; according to media reports, the Indian government may tighten rice exports.
It is worth mentioning that rice is considered to be the staple food that helps prevent the worsening of the world's food crisis. India, Vietnam and Thailand are the top three countries in the world's rice export volume, accounting for 70% of the world's total export volume.
Therefore, the export restrictions or price increase of agricultural commodity in these three countries have caused market concerns that it will further aggravate the food crisis and prompt higher food costs for consumers around the world.
At the same time, Russia has also made the latest statement. According to CCTV News , the Russian Ministry of Agriculture stated that it does not intend to lift the export ban on sunflower seeds until the end of August 2022; previously, Pakistan , the eighth-ranked sugar production in the world, announced a complete ban on sugar exports; Ukraine, which is deeply in the dilemma of war, announced a restriction on the export of agricultural products such as buckwheat , rye and oats.
Nowadays, many countries have begun to impose food export bans, and according to the latest data from the Institute of International Food Policy (IFPRI), more than 20 countries are restricting food or fertilizer exports. There are many affected items, such as wheat, corn, vegetable oil, chicken, beef, potato, tomato, beans, sugar, phosphorus salt rock, nitrogen fertilizer , etc.
In fact, many countries prohibit exporting food to give priority to ensuring their own supply, so that food can be self-sufficient and ensure food security.
When more and more countries regard food (standard food) as important resources to protect, restrict or even prohibit exports, a global "food war" has actually broken out.
At present, international grain prices represented by wheat, corn and soybeans continue to rise and are still operating at a high level.
Specifically, the main contract for US corn rose from 584.75 cents/bushel at the beginning of the year to 765 cents/bushel at the current year, an increase of 30.82%; the main contract for US wheat rose from 736 cents/bushel at the beginning of the year to 1130 cents/bushel at the current year, an increase of 53.53%; the main contract for US rice rose from the lowest point of 14.5 cents/bushel at the beginning of the year to 17.11 cents/bushel at the current year, an increase of 18%; the main contract for US soybeans rose from the lowest point of 1353 cents/bushel at the beginning of the year to 1676 cents/bushel at the current year, an increase of 23.87%.
Among them, wheat futures rose the highest. Since the beginning of the year, CBOT wheat futures have started a continuous upward pattern, especially from early February to March 8, which rose nearly 70% in the past month and reached its stage high of 1,363 cents/bushel on March 8.
The reason why the "food war" broke out is closely related to the Ukrainian war, the repeated epidemic situation and the weather.
The two major parties to the Ukraine-Russia War, Russia and Ukraine, are important agricultural product producers, and the war will affect the production, harvesting, processing, transportation and trade of food. Especially in Ukraine, of the more than 40 million people after the outbreak of the war, nearly 10 million people worked as refugees at home or abroad, and it is inevitable that agricultural production will be seriously affected. Ukraine recently warned that its food production may drop significantly by 50% this year.
Secondly, the benefits of agricultural production are directly affected by climate change. As the world's second largest and small wheat producer, India has encountered extreme high temperatures this year, which has affected food supply by 122 years. This is a typical case.
According to Reuters , in February this year, India expected annual wheat production to reach a record 111 million tons. At that time, the Indian Commerce Minister even tweeted and said boldly: "Indian farmers are feeding the whole world." But due to the high temperature weather, this position quickly changed. According to a report cited by Reuters, India's wheat harvest this year is expected to cut production by 6% due to the impact of high temperatures. Indian government officials said, "Based on the output estimates released by the government in February, we could have easily exported more than 12 million tons of wheat, but now it seems that exports will be reduced."
As for the impact of the epidemic on agricultural production, it is even more global. For example, in China, in order to prevent the farmers from going to the ground, some places even issue "spring farming certificates".
At the same time, the food crisis directly pushed the stock prices of related targets to rise rapidly. On May 30, the grain concept stock rose sharply, Jinjian Rice Industry hit the daily limit, Zhongshui Fisheries rose 8%, Oriental Group rose 4%, and Nongfa Seed Industry and Beidahuang rose more than 3%.
Specifically for stocks , the certainty of profitability transmission is also a dimension that investors pay attention to. From the first quarter, the planting and seed stocks such as Beidahuang, New Agriculture Development , Longping Hi-Tech , Suken Nongfa , and MDF Seed Industry all performed well and were optimistic in the long run.
According to the first quarter of 2022, Beidahuang's net profit was 441 million yuan, a year-on-year increase of 17.44%, and a gross sales profit margin of 70.03%; Xinnong Development's net profit was 47 million yuan, a year-on-year increase of 104.61%, and a gross sales profit margin of 45.46%; Longping Hi-Tech's net profit was 54 million yuan, a year-on-year increase of 34.38%, and a gross sales profit margin of 44.89%; Suken Gaofa's net profit was 134 million yuan, a year-on-year increase of 15.04%, and a gross sales profit margin of 14.00%; Nongfa Seed Industry's net profit was 19 million yuan, a year-on-year increase of 4517.6%, and a gross sales profit margin of 9.30%.
But there is no need to overload the burden because high global grain prices will increase the profit expectations of domestic planting companies. my country's staple food inventory is high and its policy influence is great, which can effectively control the transmission of international market conditions.
