Phil MeekinView Profile
Recent pictures of the heat wave in Russia have shown locals trying to stay cool in +38°C; they are, of course, more accustom to dealing with – 40°C in the winter.
On a personal level, a number of Russians have died in recent weeks, some caught in wildfires and others collapsing after apparently taking a swim sometimes after drinking excessive quantities of vodka.
Russia, one of the world’s largest wheat exporters, has experienced one of the worst and most prolonged droughts in many years. Apart from the human loss, this has resulted in severely damaged crops with wildfires sweeping through agricultural areas. The government has declared a state of emergency. The economic result is that there has been a decimating of the harvest. Consequently, wheat prices have increased by 50%. If wheat is affected then it is likely that other grain products will be too.
So how will this affect the man-in-the-street in the UK? Initially, expect the cost of a loaf to increase – and possibly your pint. But as usual, it’s never that simple. Many of our sources of protein – meat, dairy produce, etc – ie agricultural livestock – consume grain. So the knock-on effect will be inflationary and drive up prices on many basic food products. Food production industries will doubtless feel the squeeze as raw material costs increase and pressure raises from supermarkets to keep prices down.