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With the Russian offensive against Ukraine, analysts are concerned about the acceleration of inflation in the country. According to Carlos Caldarelli, economist and PhD from Usp/Esalq, the attack on Ukraine could bring instability to financial markets and, therefore, lead investors to look for countries with more solid assets, and, in this way, affect the exchange rate, which is transmitted in inflation.
As they are countries that produce commodities such as wheat and corn, the market's concern is with global supply. Ukraine accounts for around 10 to 15% of the world's production of various grains and oilseeds such as wheat, corn, barley, sunflower and soybeans and is the 4th largest exporter of corn behind only the USA, Brazil and Argentina.
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Furthermore, the country is responsible for 7% of the bran market and 3% of the vegetable oil market, with emphasis on sunflower oil.
Together, Russia and Ukraine account for about a quarter of world grain trade. The 2 countries have been rapidly increasing production of soybeans and derivatives with soybean oil exports growing by 18% per year since 2010.
In the case of the sanctions announced yesterday by the United States (USA) government, Caldarelli believes that the most effective impact falls on the financial sector, especially on the Russian exchange rate (ruble) and the stagnation of that economy, in addition to affecting Gross Domestic Product (GDP) and foreign trade.
Source: DATA
