As a result of the war, commodity prices from energy to fertilizers to wheat to soybeans have skyrocketed. They are expected to remain high this year and will further weigh on pre-existing increasing inflation levels. This situation raises questions on the farmers’ capacity to purchase fertilizers, feed, and to pay their energy bills, particularly for farmers with energy-intensive and feed-intensive farms. The situation also raises questions on food affordability for low-income households.

Markets continue to be roiled by the ongoing Russia-Ukraine conflict. Price volatility is high as traditional buyers of wheat and other commodities are now scrambling to find new suppliers. The Russian Federation and Ukraine collectively account for about 30 percent and 15 percent of global wheat and maize exports, as well as a combined share of around 80 percent of sunflower seed products trade. The ongoing disruption to Black Sea supplies has exacerbated worries about already tight exporter stocks, lifting the IGC Grains and Oilseeds Index, which shows movements in grains/oilseeds export prices, to its highest level on record in mid-March. Looking at possible alternative sources of wheat, India appears to be well-placed to step in, with ample availabilities and competitive prices. However, deliveries from that origin will hinge on the country's logistics capacities and government procurement plans.

Amid uncertainty and volatility in the market, International Grains Council (IGC) has shared its first 2022/23 supply and demand projections for all commodities. IGC cut total global grain production by 12 million tons, trade by 9 million tons, and carryover stocks by 26 million tons from its 2021/22 forecast. Global wheat production in the 2022/23 season is projected at 780 million tons, down 1 mt from 2021/22. While consumption growth is forecast to be slower than average, end-season inventories are seen sharply down.