Though the Russia-Ukraine conflict is thousands of miles away, the economic impact is being felt right here at home.
According to the Virginia Farm Bureau Federation, Russia’s invasion of Ukraine is having a ripple effect on world grain exports and production, oilseeds, fertilizers and petroleum.
Virginia Farm Bureau Federation grain manager Robert Harper explained that more than 1 billion bushels of corn are normally exported from Ukraine, making it a world-leading producer and exporter of the crop. However, due to the conflict, the crop is unlikely to be planted this year.
“This is causing extreme volatility in the futures markets,” he explained.
In addition, the conflict is also affecting wheat production, according to Qu Dongyu, director-general of the Food and Agriculture Organization of the United Nations. He pointed out that Russia is the world’s largest exporter of wheat, and Ukraine is the fifth largest.
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He said the two countries together produce 19% of the world’s barley, 14% of wheat and 4% of corn, accounting for more than a third of world grain exports.
“Traders estimate that 30% of the world’s wheat will disappear,” Harper said. “And the world is trying to figure out what we do when we lose 30% of our wheat.”
according to dr Mark Alley, professor emeritus of plant and soil environmental sciences at Virginia Tech, the components of the main fertilizers used in Virginia agriculture are also affected.
“Belarus and Russia are major exporters of potash and nitrogen, and these have now disappeared from the world market,” Alley said, adding that fertilizer prices in the US have risen by as much as 200% since that time last year.
Amelia County beef, small grain and produce farmer Kenney Barnard has been noting this for some time — even before the Russia-Ukraine conflict.
He explained that in the fall of 2021, fertilizing his small grains cost $150 an acre, an increase of $30 in just six weeks.
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While farmers certainly saw drastic price hikes before the Russia-Ukraine conflict, Barnard said he was concerned now.
Barnard, who has worked in agriculture since 1968, said the increased input costs for fertilizer and fuel are “the highest I’ve seen.”
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