Higher Wheat Prices on Russian Ban, Food Riots Commence

Russia surprised the world when it announced it was going to extend the ban on exporting wheat, pushing wheat prices up, and resulting in riots in Mozambique because of higher bread prices.

Wheat won't be exported from Russia until the latter part of 2011, assuming the wheat harvest goes okay.

Wheat futures for December increased to $7.35 a bushel on the Chicago Board of Trade, a gain of 21 cents. In just three days wheat has risen 7 percent. which follows on the footsteps of a 38 percent increase in July and a 3.7 percent increase in August.

This all seems to be driven by emotion, as the actual situation isn't that dire, and there are plentiful wheat supplies around the world.

Even the goofy call by the United Nations' Food and Agriculture Organization to call a meeting over this is ridiculous. There's nothing to be concerned with, other then nations ordering supplies from alternative sources. How hard can that be?

This is more of a manufactured crisis with reporting on only one side of the issue, leaving out the huge supply of wheat there is available around the world.

Few in the industry are offering balance because they like the high prices and profits they're getting.