As the crisis in Ukraine continues, some economists expect the disruptions in Ukraine to last several months, even if the war ended today. That’s not stopping Ukrainian President Volodymyr Zelenskiy from pushing farmers to plant their crops this growing season, saying it’s about life and Ukraine’s future.
Zelenskiy is calling on the country’s farmers to plant as many acres as possible this spring.
“This spring as much as any spring, we must make a full-fledged sowing campaign as much as possible, because it’s about life. About our life. About our future,” said Zelenskiy.
Ukraine is the world’s second-biggest shipper of grains, and it’s the biggest exporter of sunflower oil. The country’s ag producers’ union says farmers will put an emphasis on spring crops that will be harvested in the summer–buckwheat, peas and other types of crops–to ensure Ukraine is fully provided with food.
So, what is best-case and worst-case scenario for agriculture in Ukraine? U.S. Farm Report analysts recently discussed those scenarios on the show.
“Best case scenario is that the bombings stop, the killings stop, Russia leaves, and we get back to Ukrainian rule in Ukraine. That’s the best case scenario,” said Chip Flory, host of AgriTalk. “I don’t claim to know what’s going to happen here. I don’t think anybody can claim to know what’s going to happen. But that doesn’t seem to be in the cards with Putin’s aggression, with his the brutality that he has already exhibited, his willingness to lie and call a ceasefire and break it immediately. It’s all very, very troubling, and suggests that getting a crop out of Ukraine, getting supplies out of Russia, in the year ahead or two years ahead seems unlikely. And I don’t think the market is prepared for not getting any supply out of Ukraine in the year ahead.”
Read more coverage about the impact the crisis in Ukraine is having on agriculture.
According to AgWeb, Ukraine has more than 41.5 million hectares (or 102.5 million acres) of agricultural land that covers 70% of the country. And Chip Nellinger of Blue-Reef Agri-Marketing says the reality is even if Russia decided to end the war today, the damage to infrastructure will make it difficult for farmers to secure and move inputs and fuel.
“They’re essentially on the same growing season as the ‘I States’ along the I-80 corridor,” says Nellinger “If you think about it, we don’t like planting corn much past the first week or so June, that’s less than 90 days away. And you have to question at this point is that even possible? Putin is not pulling out of there, they may stop bombing, but he didn’t go into Ukraine for the idea of pulling back out in a month. So, he’s there to stay. I think it’s possible they [Ukraine] may get some crops in the ground, but they have so many issues, they can’t get seed and fertilizer, where it needs to be. Roads and bridges are bombed out. They’re running out of fuel. So, I just question whether they can get much in the ground.”
Arlan Suderman of StoneX Group says even if Ukrainian farmers are able to plant some of the 2022 crop, the reality is stocks were already extremely tight before the war started.
“Because of other dynamics, we were already tightening up the balance sheet,” said Suderman. “If you take all the world’s supply of corn, you take China off of it, because we believe USDA is overstating Chinese corn supplies by about 49 million metric tons, and then you take the United States off, what’s the situation the rest of the world? Well, according to USDA data, it’s about 34 days of supply, which is the tightest in 20 years. So, there wasn’t any room for margin before.”
Suderman says based on conversations with Ukrainian customers, while they remain as resilient as possible, he says the consensus is there’s not a large incentive to get in the field, especially considering all the other challenges they face.
“The winter wheat looks good where the wheat tank tracks haven’t gone over it. About 50% of the fertilizer is in place prior to this happening. Some of that got applied top dress in the western part of the country prior to the war breaking out, then everything came to a halt and no they wonder if that’ll even get harvested.”
