On Wednesday, the Federal Reserve Board released its February 2022 Beige Book update, a summary of commentary on current economic conditions by Federal Reserve District. The report included several observations pertaining to the U.S. agricultural economy.
Farm Policy News
Russia Invasion: Likely “Biggest Grain Supply Shock in Living Memory,” Wheat Prices Continue to Surge
David L. Stern, Alex Horton, John Hudson and Kareem Fahim reported on the front page of today’s Washington Post that, “Russian forces laid siege to key urban areas across Ukraine on Wednesday, advancing on the strategic port city of Kherson and bombarding Kharkiv, the nation’s second-largest city, while facing fierce resistance and resupply challenges in other areas.”
Global Fertilizer Flows Could Face “Prolonged Disruptions,” as Grains Extend “Blistering Rally”
Financial Times writers Roman Olearchyk, Guy Chazan, Polina Ivanova and Demetri Sevastopulo reported on Tuesday that, “Russia stepped up its bombardment of Ukraine’s biggest cities, firing missiles on targets in populated areas as Vladimir Putin’s forces turned to more brutal military tactics in a bid to regain momentum on the sixth day of the invasion.”
Grain Flows Dry Up, Ukraine’s Ports Closed- Wheat Prices Soar, Food Inflation Worries Persist
Valerie Hopkins, Steven Erlanger and Michael Schwirtz reported on the front page of Tuesday’s New York Times that, “The first talks between Ukraine and Russia aimed at halting the Russian invasion were eclipsed Monday by a deadly Russian rocket assault on Kharkiv, Ukraine’s second-largest city, that raised new alarms about how far the Kremlin was willing to go to subjugate its smaller neighbor.”
Trade Flows Upended, as Shipments from Ukrainian Ports “All But Ceased”
Yaroslav Trofimov reported on the front page of Monday’s Wall Street Journal that, “Russian and Ukrainian officials prepared to meet for the first talks since Moscow began its invasion four days ago, as Ukraine’s defenders held on to the capital, Kyiv, and pushed back Russian troops in urban combat in its second-largest city, Kharkiv.”
War Stymies Black Sea Exports, Importers Seek Alternative Sources of Wheat, Corn- Food Inflation Worries Grow
Los Angeles Times writers Nabih Bulos, Jaweed Kaleem and Henry Chu reported on the front page of Sunday’s paper that, “As a tense Ukraine awaited daylight early Sunday, military forces and thousands of armed volunteers fought fiercely to protect their capital against Russian troops after a day of explosions and gunfire that shook parts of the city, leaving a missile-hit high-rise tower partially destroyed and residents crowded into subway stations for shelter.”
The 2022 Outlook for U.S. Agriculture From USDA’s Chief Economist
Speaking on Thursday at USDA’s virtual Agricultural Outlook Forum, USDA Chief Economist Seth Meyer provided a broad outlook for U.S. agriculture. Today’s update provides an overview of key aspects of Dr. Meyer’s presentation.
Russia Invades Ukraine: Supply Disruption Concerns Fuel Wheat, Fertilizer Prices
Michael Birnbaum, Mary Ilyushina, Paul Sonne and Isabelle Khurshudyan reported on the front page of Thursday’s Washington Post that, “Russia on Thursday launched an attack on cities and military installations across Ukraine, forcing thousands of civilians to flee, as Ukraine’s president called for his nation to fight in the streets and NATO leaders said Europe’s security had been fundamentally altered.”
As Fertilizer Prices Climb, Acreage Decisions Loom, and Wheat, Soybean Prices Surge
DTN writer Russ Quinn reported on Wednesday that, “Average retail prices for most fertilizers continued to climb the second full week of February 2022, according to sellers surveyed by DTN. For the second week in a row, prices of all but one of the major fertilizers were higher compared to last month.”
Russia, Ukraine Conflict Escalates, Ripple Effects Could Include Impacts on Food Prices, Production, and Fertilizer
Robyn Dixon, Paul Sonne and Ellen Nakashima reported on the front page of Tuesday’s Washington Post that, “Russian President Vladimir Putin on Monday recognized the independence of two Moscow-backed separatist regions in eastern Ukraine and ordered Russian forces onto their territory for ‘peacekeeping’ purposes, a dramatic escalation in a crisis that is threatening a full-scale war.”
Supply Chain Variables Continue to Percolate: Potash, Glyphosate, Bird Flu, and Grain/Wheat Exports
Late last week, Bloomberg writers Elizabeth Elkin, Jen Skerritt, and Tarso Veloso Ribeiro reported that, “A Belarusian potash miner that accounts for a major chunk of global supply has declared force majeure, shaking up a market that’s already contending with soaring prices.”
USDA Agricultural Projections to 2031- Focus on Corn, Soybeans
On Wednesday, the U.S. Department of Agriculture released its 10-year projections for the food and agricultural sector.
Fertilizer Prices Mostly Higher in February as U.S. Farmers Feel the “Squeeze of Inflation”
DTN writer Russ Quinn reported on Wednesday that, “Retail fertilizer prices continued to be mostly higher the first full week of February 2022, according to sellers surveyed by DTN. All but one of the major fertilizers were higher compared to last month.”
New Report: China Failed Trade Commitments; While Continuing to Focus on Domestic Ag Production
New York Times writer Ana Swanson reported today that, “The Biden administration criticized China in a new report released Wednesday morning for failing to uphold a wide range of trade commitments, including promises it had made when it joined the World Trade Organization in 2001 and others in a trade deal signed with the Trump administration in 2020.”
A Closer Look at Ukrainian Corn and Wheat Exports- Recent USDA Reports
The USDA’s Economic Research Service (ERS) indicated last week in its monthly Feed Outlook report that, “Ukraine borders Russia to the north and east, Belarus to the north, and several Eastern European countries—Poland, Romania, Hungary, Slovakia, and Moldova—to the west.”
Federal Reserve Ag Credit Surveys- 2021 Fourth Quarter, Rise in Farmland Values Accelerates
Last week, the Federal Reserve Banks of Chicago and Kansas City released updates regarding farm income, farmland values and agricultural credit conditions from the fourth quarter of 2021.
Food Prices Surge 7%, The Most Since 1981
Washington Post writers Andrew Van Dam and Rachel Siegel reported on the front page of Friday’s paper that, “Prices continued their upward march in January, rising at an annual rate of 7.5 percent, the fastest pace in 40 years, as pandemic inflation continues to defy expectations, climbing faster and lasting longer than nearly anyone would have guessed.”
U.S. Agricultural Exports Set Record in 2021
A news release on Tuesday from the USDA’s Foreign Agricultural Service stated that, “The American agricultural industry posted its highest annual export levels ever recorded in 2021, Secretary of Agriculture Tom Vilsack announced today.”
DTN: Fertilizer Prices Cool Slightly
DTN writer Todd Neeley reported on Tuesday that, “Most retail fertilizer prices tracked by DTN cooled off a bit during the first week in February, as five of the eight fertilizers reported small price drops.”
On Phase One, U.S. Patience with China “Wearing Thin,” as Purchase Commitments Fell Short
Reuters writers Andrea Shalal and David Lawder reported this week that, “U.S. officials called on Monday for ‘concrete action’ from China to make good on its commitment to purchase $200 billion in additional U.S. goods and services in 2020 and 2021 under the ‘Phase 1’ trade deal signed by former President Donald Trump.”