BLOG: How the Ukraine/Russia conflict could affect the food and agriculture industry

On February 24, 2022, Russian President Vladimir Putin ordered Russian troops to invade Ukraine, followed by a series of targeted airstrikes on Ukrainian military buildings. Though it’s been said that Russian troops are meeting more resistance than expected, it’s going to take help from other countries to give Ukraine a leg up in the fight.

With this being the situation, many NATO members, including the US, are placing sanctions on Russia. Americans are already feeling some of the effects of these new actions, including warnings of potential oil and energy price increases. The conflict could also have a notable impact on the food industry.

Already, fertilizer prices were reaching high numbers, but these are only expected to increase. Russia is one of the largest high-volume fertilizer producers. As stated in an agriculture.com article, “The magnitude of the ripple will depend on how many countries impose sanctions and how aggressive the sanctions are.”

As shown in the graphic by Vox, Russia and Ukraine’s farms are critical to the global economy for several products, including:

• Seed oils

• Wheat and meslin

• Barley

• Linseed

• Corn

• Sunflower seed

• Fertilizers

The conflict between Russia and Ukraine is not limited to affecting the food economy for just farmers. On a smaller level, some states, like Pennsylvania, are choosing to remove all Russian vodkas and other products from Pennsylvania Liquor Control Board-owned franchise “Fine Wine and Good Spirits.”

The PA governor called this act “a show of solidarity and support for the people of Ukraine, and an expression of our collective revulsion with the unprovoked actions of the Russian state.” This ends up actually connecting back to that original graph because there has been debate over what is considered “Russian-branded products” — some argue that alcohol containing Russian wheat (like the Stolichnaya brand) should be included, even if the product was produced elsewhere. The final verdict ended up being that these products would not be included in the ban by the Pennsylvania Liquor Control Board (PLCB).

While the sentiment seems to be there, there are definitely consequences to be considered following bans like this. In an article for Foobooz, the food and drink blog for Philadelphia Magazine, PLCB spokesperson Shawn Kellysaid “Many consumers often associate vodka with Russia, so some producers give their vodka Russian-themed monikers and marketing.” Yet, in reality, Foobooz reported “Russian products accounted for just six hundredths of a percent — meaning 0.06 percent — of the $1.7 billion in spirits sold by the PLCB over the last 52 weeks.” Critics question whether the ban is more so a performative action than something to make tangible change.

In terms of effects on the whole world, restrictions and conflict between countries due Russia and Ukraine could even worsen food insecurity and hunger. Ukraine's spot as a major producer could end up leading to harvest shocks for places in Africa, for example. With these shocks could come the potential for violence from the chaos. As things progress between Russia and Ukraine, and as other countries make decisions about their involvement, we will have to keep watch over how sanctions and restrictions affect the economy, especially related to food and farming. Most likely, this is just the beginning and changes in the food economy will observed with a "wait and see" approach.