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Food commodity prices rallied, with wheat reaching its highest level since 2012 and palm oil on a record run. Russia and Ukraine account for about a quarter of global wheat trade and most sunflower oil exports.
Drought in South America also weighed on soybean supply prospects, and a labor shortage in Malaysia was limiting palm oil output.
Higher wheat, corn and vegetable oil prices raise input costs for feed and food manufacturers. Low starting stocks leave little buffer against further supply shocks.
business-standard.comAnuradha Raghu, BloombergFeb 24, 2022After 361 past bullish geopolitics events, Wheat (SRW) moved a median +0.7% over 5 sessions (58% higher; middle half -1.4% to +3.7%), and +1.3% over 20.
After 323 past bullish geopolitics events, Corn moved a median +0.5% over 5 sessions (57% higher; middle half -1.5% to +2.9%), and +0.9% over 20.
After 62 past bullish geopolitics events, Palm Oil moved a median +2.5% over 5 sessions (74% higher; middle half -0.1% to +5.8%), and +4.0% over 20.
After 72 past bullish geopolitics events, Soybeans moved a median +0.4% over 5 sessions (60% higher; middle half -1.0% to +2.5%), and -1.0% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Food commodity prices including palm oil rallied on Russia-Ukraine risk, while Malaysian labor shortages limited output.
