Today's Daily Spotlight: Why the Ukraine-Russia conflict will make potato chips more expensive
, which means anything that requires transportation at any stage of production—almost everything—will be impacted. Penfield predicts inflation may hit 11% by the end of the year.will be particularly vulnerable. Ukraine is the largest exporter of sunflower oil in the world, responsible for up to 46% of sunflower-seed and safflower oil production, according to the Observatory of Economic Complexity. The second largest producer is Russia, which exports about 23% of the world’s supply.
That’s because of how globalized the marketplace is for cooking oils and other products. “When there’s a supply chain issue or problem that happens in one place,” says Penfield, “it impacts the price for all the oils everywhere.” Nor is it easy for manufacturers changing to a different cooking oil for their products. Due to food safety and regulatory laws in many countries, switching to a more available oil would require snack companies to produce new packaging indicating the presence of whatever oil they swapped in. “We can’t switch overnight to using another vegetable oil,” says Thomas Lock, founder of the United Kingdom-based British Snack Co.