July 5, 2022
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CoBank: Ukraine/Russia War Upending Grain and Energy Markets

The Ukraine-Russia war has reignited speculation that globalization is coming to an end, and markets should prepare to turn inward to deal with disrupted supply lines and geopolitical challenges. The war will undoubtedly have long-lasting implications. However, according to a new Quarterly report from CoBank’s Knowledge Exchange, an unwinding of global supply chains and world markets is unlikely to be one of them. Still, Russia’s invasion of Ukraine agitated global grain trade and contributed to unprecedented price volatility in wheat, corn and soybeans. Grain markets could remain volatile for two or more years due to disruptions in planting, harvesting, input application and transportation. Prices for major fertilizers increased between eight percent and 13 percent during the first quarter of 2022, with the biggest spikes coming after Russia invaded Ukraine. While most U.S. ag retailers have adequate nutrient supplies this spring, the report says that may not be the case this fall and in spring 2023.

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