Estonian producers feeling effects of record-high grain prices

Harvesting grain.
Harvesting grain. Source: (Mirjam Nutov/ERR)

Record high world grain prices are affecting Estonia's producers — even though the country produces more than it consumes.

Russia's war in Ukraine and India's decision to stop exporting wheat pushed commodity prices to record levels on Monday, ETV's "Aktuaalne kaamera" reported on Tuesday.

Economists are concerned about food shortages and rising prices, while the Bank of England warned of "apocalyptic" food prices earlier this week.

The price of wheat has more than doubled in a year and continues to rise. 

Estonia produces more grain than it consumes, which provides a level of safety and puts the country in a "very good situation", said Roomet Sõrmus, head of the Chamber of Agriculture and Commerce.

"Where our level of self-sufficiency is two to three times better, depending on the crop, than what we consume ourselves. This will definitely create a feeling of relative safety for us," he said.

But producers will not be unaffected as it is more profitable to sell grain elsewhere than to sell it in Estonia at affordable prices.

"Farmers want to sell their grain. Estonia is also a big exporter of grain, so the situation is difficult for grain consumers [in Estonia]. Grain is very expensive, it is now very, very expensive to feed animals. And then another question is how to keep this expensive grain here, in Estonia, so that their animals can be fed," Rõrmus explained.

One example is chicken eggs. Feeding chickens is 70 percent of the costs of egg production.

The price of grain started to rise last autumn, said Dava Foods' management board member Vladimir Sapozhnin.

"For example, wheat, which is the largest feed component, was €145 a tonne in the autumn, today we are talking about €400. Rapeseed oil was €750 a tonne, now it is €2,000 a tonne and is rising every day," he said.

These price increases will be reflected in the final product, hitting consumers.

"The end product has already become more expensive. We have already had to raise prices twice — at the start of the year and now in March-April. So, if this continues, the same thing could happen [again]," said Sapozhnin.


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Editor: Helen Wright

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