In 1972, the Soviet Union experienced a terrible drought and the wheat crop failed, forcing the Soviets to turn to international grain markets to feed their people. Carefully concealing the magnitude of the crop failures from the West, the Soviets secretly bought 3 million tons of grain (wheat, corn, and soy) from the United States.
In a brilliant operation involving KGB phone taps of US traders' phone lines to find the lowest prices and secretly buying small amounts from different dealers, the Soviets managed to spend $1.3 billion in the US grain market, purchasing nearly 25% of the total US harvest, all without driving up prices and without anyone catching on. In addition, the Soviets benefited from $300 million of US taxpayer money in the form of export subsidies, at a time when the US government was looking to alleviate chronically depressed grain prices by encouraging grain exports.
When everyone finally realized what had happened, which took several months, all hell broke loose. Exacerbated by a drought in Australia and a big move by India to expand purchases on international grain markets, worldwide grain prices skyrocketed to 125-year highs. The price of soy, for example, zoomed from $3.31 a bushel to $12.90 in just 10 months, an increase of 390%. Traders who had placed bets on a rise in prices booked spectacular gains, leading to accusations of insider trading, but investigations later ruled this out. The Soviets had simply been too sneaky.
The so-called "Great Grain Robbery of 1972" led to stringent new reporting rules for US commodity dealers that are still in place to this day. The Robbery was also a significant part of a massive surge in overall commodity prices that helped drive the US economy into recession and stagflation, ultimately resulting in Ronald Reagan.