BRICS+ Set to Shake up Global Grain Trading
来源:www.agriland.ie;发表于:2024-03-20;人气指数:47
Wednesday, March
20, 2024
BRICS+ Set to Shake up Global Grain
Trading
By Justin Roberts
Interest in the ongoing conflict in
Ukraine has focused substantially on the military and political situation, with
some arguing that there has been little attention paid to the wider
implications, one of which is the growth of the BRICS+ organisation.
BRICS started as an informal reference
to an unofficial grouping of countries that were growing in size but were not
considered to be part of the ‘west’ as America and Europe would consider
themselves.
The countries concerned were Brazil,
Russia, India and China, with South Africa being included later.
Over the years, the arrangement has been
formalised into a trading block which was joined by Saudi Arabia, Egypt, United
Arab Emirates (UAE) and Ethiopia at the start of this year, hence the + sign
now often appended to the acronym.
Driving the agenda
Russia has been an enthusiastic
supporter of the organisation and holds the presidency for 2024.
It has at the top of the agenda the
formation of a grain trading organisation which will rival that of
Chicago-based system that has been serving as the world’s main exchange since
WWII.
The challenge is one to be taken
seriously for between them these countries account for 44% of the world’s grain
production, and 44% of its consumption; the west will most likely lose overall
control of grain prices and distribution.
There are three main reasons driving
this change. The first is an altruistic desire to make grain available to
developing countries that find themselves with inadequate nutrition.
Some would claim that the finance-driven
markets exclude poorer nations from participating fully.
The second is that the BRICS+ is now big
enough to address the old complaint of ‘American imperialism’.
BRICS+ has a point, the gross domestic
product (GDP) of its members now exceeds that of the GDP of the G7, which
includes the great bread baskets of the United States and Canada.
The third item is the desire to
undermine the dollar as the world’s major trading currency. This is already
happening with oil being paid for between BRICS+ members via the Chinese yuan,
the rouble and Indian rupee.
Grain has now been dragged on stage as
the next commodity to be de-westernised and this will come to influence what
farmers in Ireland are paid for the grain,
Just as importantly, it will also
influence what they will be paying for their feed as there is a direct
connection between the two.
For the western food and milling
industry, one of the major concerns will be that the usual factors affecting
grain prices may no longer apply, or they will be usurped by the new
considerations of BRICS+ member states, which may not coincide with the interests
of western countries.
Grain priorities
This will make the forecasting of prices
and trading in futures more uncertain.
Nobody is suggesting that the west and
BRICS+ would trade with each other – they will continue to do so – but the
policies and priorities of non-western governments will have a far larger
influence on price and availability than we have hitherto been used to.
If, for instance, India suffers a bad
harvest, then the priority for BRICS+ will be to ship large quantities of grain
to help out, and if that means a scarcity of grain for Ireland, that may be a
consequence.
The EU will have little say in the
matter and the Irish government none at all.
The tillage sector would enjoy higher
prices yet they will be capped by what purchasers will be willing to pay for
grains, and substitution by other produce in the livestock sector.
Justin Roberts studied at Welsh
Agricultural College, Aberystwyth having first worked in both the feed and seed
sectors of the industry. He has two decades of experience in writing about farm
machinery, both vintage and contemporary across several publications.
Agriland
The views in the article are the
author’s own and do not necessarily reflect the editorial policy of InfoBRICS.
Source: www.agriland.ie