YouTube: https://youtu.be/HBBCupdcKSc
For many farmers, the spring planting season has begun, and while agricultural prices are higher than they've been in years, the crisis in Ukraine is rapidly increasing costs here in the United States. Farmers are facing price increases across the board, including in gasoline and equipment, but especially in fertilizer.
In a regular year, Russia is the world's second largest producer of many important crop nutrients, and since the war has disrupted access to key ports, some American growers are having difficulty acquiring what the fertilizer they require. When they do manage to locate fertilizer, the costs are excessive.
Buying fertilizer is a major source of concern for corn and wheat farmers, as it accounts for more than a third of their operational expenditures.
According to one farmer and commissioner on the North Dakota Wheat Commission, average-sized farms in his state would spend $137,000 more on fertilizer this spring than they did last year. Furthermore, farmers are unlikely to benefit from higher commodity prices because they have little to sell following two years of severe drought.
Fertilizer costs had already tripled by 2021 due to a combination of pandemic-related variables, but they soared by more than 40% in the month following the start of hostilities in Ukraine, setting new highs.
Farmers' confidence in the agricultural industry has dropped to levels not seen since the early days of the epidemic since Russia invaded in late February.
Farmers are very concerned about the war's influence on their production expenses, according to researchers who questioned over 400 U.S. farmers every month for over six years. Farmers believe they will be worse off this year than they were in 2021; more than 90% believe their operational costs will increase by 20% or more this year, and that increased crop prices will not be enough to cushion the blow to their bottom line.
Many farmers are attempting to mitigate risk by moving some of their wheat acres to less fertilizer-intensive crops such as soybeans or peas.
Alternatively, one fifth-generation winter wheat farmer in Kansas bought fertilizer right after Russia's Ukraine invasion, thinking that prices would rise. While the farmer wishes for peace, he is concerned that the price of wheat may plummet before he gets an opportunity to sell his crops, which are now more expensive to raise.
