Commodities soar as war builds anxiety over supply shortages

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Commodities extended their massive rally as Russia’s invasion of Ukraine continues to roil global markets and fuel fears of supply crunches.

Prices from crude and nickel to aluminum and wheat soared, as raw materials stage their most stunning weekly surge since 1974, during the days of the oil crisis.

Russia’s growing isolation is choking off a major source of energy, metals and crops, sparking fears of prolonged shortages and accelerating global inflation.

Traders, banks and shipowners are increasingly avoiding business with Russia because of the difficulty in securing payments, while shipping lines are shunning bookings from the region.

At: https://www.bloomberg.com/news/articles/2022-03-04/commodities-soar-as-russia-s-nuclear-plant-attack-raises-tension

A Russian wheat farmer handles his harvest last year, in happier days.

The interruption of shipments from the world's top wheat exporter (Russia), and the world's 6th-largest exporter (Ukraine) - which together account for over 30% of global wheat exports - has pushed commodity prices for the key grain to record highs.

Raw materials more broadly are on a tear this week - with aluminum up 13%; Brent crude oil, 15%; corn, 17%; and wheat, a whopping 41%.

[progree]

1. Ughh, that's awful. And none of this will be reflected in the CPI report that comes out Thursday

since the report is of inflation in February. And it takes awhile for higher commodity prices to affect the prices of what consumers buy. It will affect the wholesale price index first (the Producer Price Index).

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2. Absolutely.

Short of some small miracle - there go our chances for the mid-terms, I'm sorry to say.

Would it that it weren't so. But as Jimmy Carter knows, voters are quick to blame presidents for high inflation - regardless of whether it's some foreign dictator's fault or not.

Of course though, this very same thing happened during Bush's disastrous second term - and there, Dubya only had himself to blame.

Like Putin, the Midland Moron no doubt thought an invasion would be all gain and no pain.

But then, the only real law of war is Murphy's law: what can go wrong, will. Especially if waged in bad faith.