ALEXANDRIA, Va.—Wheat prices are spiking due to Russia’s war on Ukraine—two top producers of wheat, reports the Associated Press. Ukraine and Russia combined make up about 30% of global wheat exports, and Ukraine just cut off exports of wheat and other food staples to keep enough food for its citizens and avoid a humanitarian crisis, according to Ukraine’s minister of agrarian and food policy.

Prior to the war, wheat supplies were already low, and prices were higher than in years past due to poor growing weather, reports the Wall Street Journal. Milling wheat in Paris and the most-traded U.S. futures contract delivered to Chicago (soft red winter wheat) hit record prices early last week and then plummeted. Chicago futures ended the week 8.5% lower, the worst weekly performance since 2014. However, the benchmark U.S. price, at $11.07 a bushel, is 72% higher than last year.

The rise in wheat prices could result in food price inflation, while food prices globally hit a record high last month. U.S. food prices were up 7.9% in February over 2021. The United Nations warned that global food prices could increase by 22% due to the Russian-Ukrainian conflict, with both countries producing more than a tenth of the world’s calories.

Many of the countries that rely on Russia and Ukraine for food supplies are least developed countries or low-income, food-deficit countries in Northern Africa, Asia and the Near East, according to FAO Director-General QU Dongyu.

“The conflict’s intensity and duration remain uncertain. The likely disruptions to agricultural activities of these two major exporters of staple commodities could seriously escalate food insecurity globally, when international food and input prices are already high and volatile,” Dongyu said in a statement. “The conflict could also constrain agricultural production and purchasing power in Ukraine, leading to increased food insecurity locally.”

One bright spot in the wheat supply market is India and Australia. Both countries are having successful wheat production years, which could help stem the impact of the war in Ukraine. Australia is expected to have a record harvest this year, and India has been exporting more wheat amid a string of bumper crops.

With food costs on the rise and record-high gas prices at the pump, Americans’ wallets have been hit hard, with inflation rising 7.9% over the past 12 months—the highest it has been since January 1982. Food prices have risen 1%, and food at home jumped 1.4%, both the fastest monthly gains since April 2020.

With inflation continuing to rise, consumers and businesses alike will need to adapt, with Janet Yellen, U.S. Treasury secretary, saying “very uncomfortably high” inflation will persist all year. The U.S. Federal Reserve is expected to begin increases in interest rates, which would boost the dollar and put downward pressure on oil prices, reports Reuters. The Fed is meeting this week.

Reuters also reports that the U.S. economy may have room for the added pressure of inflation and high gas prices, saying that growth entering 2022 was strong.

"The U.S. has become less sensitive to energy shocks," with a steady decline in the share of income spent on energy, Bank of America economists wrote in a note. "With Omicron cases fading, the reopening of the service sector has resumed ... Excess savings built up over the last two years can fund this rebound."