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Highlights
- UK grocery bills may skyrocket with Russia’s invasion of Ukraine.
- The supply chain disruptions due to the sanctions may cause the UK food prices to escalate at their quickest speed in nearly a decade.
UK grocery bills may skyrocket with Russia’s invasion of Ukraine. According to experts, the ongoing conflict and sanctions can cause supply chain disruptions and the supply of grains from Ukraine may be heavily impacted. Half of the grains production in Ukraine, which is also known as the breadbasket of Europe, maybe impacted due to the invasion, and this would potentially lead to a doubling of wheat prices. The development would in turn cause the UK food prices to escalate at a fast pace in nearly a decade.
RELATED READ: Ukraine crisis: Russia-US tensions heat up, oil supply woes to deepen?
The entire world is prone to supply shocks as Russia and Ukraine are the key producers of grains like wheat, corn, and barley, and together they account for a fourth of the global wheat supply. Over the past few months, the UK food prices have been mainly impacted due to bread and cereals like wheat. The wheat prices may rise even further now, jumping up from less than US$8 currently to US$11 per bushel, according to JPMorgan. As cereals like wheat and barley have inelastic demand, the effect of the sanctions would be quite significant, as per Rabobank analyst Michael Magdovitz.
Let’s take a look at 3 FTSE stocks that may be impacted by the conflict.
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Wincanton plc (LON: WIN)
UK-based logistics provider Wincanton plc offers transport and logistics services, such as supply chain management for companies and high-capacity warehouses. The market cap of the company stands at £474.51 million, and it has provided a return of 34.12% to its shareholders in the last one year as of 31 January 2022. Wincanton Plc’s shares were trading at GBX 385.00, up by 1.05%, at 12:30 PM on 31 January 2022.
RELATED READ: Why Wincanton (LON:WIN) shares are up?
Xpediator PLC (LON: XPD)
UK-based globally operating freight management business, Xpediator PLC, is a fast-growing firm that offers solutions related to logistics, freight, and transport in the UK as well as other European countries. The market cap of the company stands at £72.26 million, and it has provided a return of 28.84% to its shareholders in the last one year as of 31 January 2022. Xpediator Plc’s shares were trading at GBX 54.50, up by 6.86%, at 12:30 PM on 31 January 2022.
Clipper Logistics PLC (LON: CLG)
UK-based retail logistics company Clipper Logistics PLC offers its services to retailers selling a wide range of products in the UK and Europe, including certain high-value goods. The market cap of the company stands at £654.81 million, and it has provided a return of 24.77% to its shareholders in the last one year as of 31 January 2022. Clipper Logistics Plc’s shares were trading at GBX 672.00, up by 5%, at 12:30 PM on 31 January 2022.
