AgWeb Live: Analysis and Market Reaction to the Russian Invasion of Ukraine
AgWeb Live Ukraine Invasion 022422
The financial and commodity markets reacted strongly to word that Russian President Vladimir Putin had launched military action in Ukraine.
Clinton Griffiths, AgDay Host and Farm Journal Editor, visits with Joe Vaclavik, owner of Standard Grain, and Dan Basse, president of AgResource Company, to dive into how these global events will impact the agricultural markets and more.
“The markets are clearly reacting to what is a full-scale invasion of Ukraine by Russia,” Vaclavik says. “There are a lot of implications, the first and immediate on is any sort of disruption of grain flow out of the Black Sea region.”
The other price categories that could be impacted, he says, are fertilizer and fuel.
“Higher grain prices are great, but lives are going to be lost. War is terrible,” Vaclavik says.
“This is a realignment of global ag trade flows,” adds Dan Basse, president of AgResource Company. “Barley, corn, wheat, vegetable oils are what the Black Sea exported. That will come to different countries
Because of the dryness in South America, Basse says demand will be shifted to the U.S.
“The U.S. farmer has a much bigger role in feeding the world,” he says.
The grain markets will feature volatility almost on a daily basis, Basse says.
“Today we traded $1 range in soybeans and Minneapolis wheat, corn has traded 40¢ to 50¢,” he says. “All of us will need a seatbelt in these markets going forward.”
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