The price of wheat rose on Tuesday after an escalation of hostilities between Russia and Ukraine, including the destruction of a hydroelectric dam in Novaya Kakhovka and damage to an ammonia pipeline, Bloomberg reported, citing Agerpres.

Chicago Grain ExchangePhoto: M. Spencer Green / Associated Press / Profimedia Images

Russia and Ukraine accuse each other of undermining a hydroelectric dam located in the Russian-occupied area of ​​the Kherson region, as a result of which a stream of water was thrown out, which threatens the lives of the residents of the region and complicates the situation on the battlefield, which separates the two armies from – along the Dnipro River.

The Nova Kakhovka hydroelectric dam is some distance from three Ukrainian ports that are included in the international agreement on the export of Ukrainian grain, but flooding poses a significant risk to people, transport and logistics.

The destruction of the dam “appears to be a major escalation with negative consequences and a huge risk for the overall situation,” says Andriy Syzov, director of the SovEkon agricultural consulting firm. “This may be just the beginning of a period of price growth,” he believes.

A sudden jump in the price of wheat after the recent events in Ukraine

Wheat futures rose 3% on Tuesday on the Chicago Grain Exchange, having previously hit a 30-month low. The price of corn rose by more than 1%.

More than 80 settlements, as well as the city of Kherson, are in the flood zone, “which can cause hundreds of thousands of victims,” ​​says Deputy Minister of Development of Ukraine Mustafa Nayem.

According to him, the HPP, built in 1956, provides electricity to more than three million residents and is a “crucial component of Ukraine’s energy infrastructure.”

Separately, Ukraine announced damage to an ammonia pipeline as a result of Russian bombing in the Kharkiv region near the border between the two countries.

Russia considers this pipeline, which was closed during the war, to be key in discussions regarding the continuation of Ukrainian grain supplies through Black Sea ports.

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