Ukrainian farmers had been watching the talks to allow resumption of grain exports the last few weeks with great hope, because it’s their only lifeline to be able to plant a new crop this fall. However, farmers as well as U.S market experts said there were many challenges involved with implementation of the deal, even before Russia had bombed the port of Odesa.
Even before the ink was dry on the deal to allow resumption of Ukrainian grain exports skepticism ran high.
Joe Vaclavik of Standard Grain says, “Do we trust Putin? Do we trust that the Russia’s going to allow for all this to happen? I don’t really know. So I’m kind of skeptical of the whole thing.”
After the signing ceremony I talked to one Ukrainian farmer who told me he was hopeful the deal would help move the 18 million tons of grain farmers had left from last season. However, he was also trying to be realistic about whether or not Russia would hold up their end of the deal.
Ukraine farmer Nick Gordiichuk says, “Unfortunately, I’m not optimistic about it because many times we saw, that words of Russia mean nothing.” Even so, he says Ukrainian officials told them grain exports would resume within days. And they desperately need these sales. “So we see that when the channel is open for export the price will go up and we’ll be able also to, the farmers can get some money so they can start a new planting season for winter crops for next season, 2023.”
Without quick release of the grain, he says especially small farmers will plant little if any new crops. Gordiichuk says, “Small farmers they have less access to capital and finance might go out of business.” He says they can no longer use credit, but instead has to prepay for 100-percent of his fertilizer and herbicide needs. And even then the prices have doubled making it cost prohibitive.
Unfortunately, the deal may be too little too late for some operations that have already been forced to declare bankruptcy. And if the deal doesn’t work many more will follow suit.
