By Matt Reese and Dale Minyo
In the next few weeks farmers in the United States will be turning their attention to the details of the weather, field conditions and getting seeds in the ground in a timely manner. With their planting season almost here as well, farmers in Ukraine have their focus on very different concerns.
Fairfield County farmer David Brandt got a phone call a couple of years ago from an agronomist in Ukraine hoping to learn about no-till farming practices. That phone call led to relationship between Brandt and several Ukrainian farmers via conference calls to regularly discuss the details of farming. Brandt is in touch with the group several times a year. More recent messages from the group have taken a different turn.
“I received a message Sunday morning just before I went to church. The one fellow I like really well said, ‘It is tough over here David, but we’re still surviving,’” Brandt said. “He was saying the Russians were destroying their equipment so they couldn’t farm. He didn’t know how much time he would have to farm because he is now part of the volunteer military. He was talking about making bombs and carrying guns. I am thinking about them and praying for them. I am really concerned about how agriculture is going to work there. It is great to be in America and see $16 beans, $8 corn, and $10 wheat, but it is tough when you think about other people suffering.”
The initial invasion sent shock waves through global markets, said Doug Tenney, with Leist Mercantile.
“The reality of seeing Russia invade Ukraine the last week of February was displayed full force in a period of two days. The previous six weeks provided multiple days of double digit increases or declines and often two or more times in just one week. In the hours following the invasion, corn, soybeans, and wheat had huge ranges. Wheat was up its 50 cent limit on Thursday, Feb. 24. Soybeans had over a dollar range for that day. At one point corn was up the 35 cent limit. Corn, soybeans, and wheat were down sharply the following day as wheat was down its expanded daily limit of 75 cents,” Tenney said. “The sharp declines of that Friday were fueled largely on two fronts. First, the market realization that U.S. sanctions on Russia at that time did not involve agricultural or energy components. Second, the perception that a quick end to the war just days after the invasion began, would allow Russia to ship already sold wheat and corn exports out of Ukraine ports, gaining much needed currency for Russia.”
The resulting uncertainty in such a globally vital agricultural area will likely further strain already tight fertilizer and fuel supplies for global agriculture, disrupt export markets and push commodity prices higher. For more on Ukrainian agriculture and the current Russian invasion, click here.