Ukraine farming issues could be positive for North American farmers

Feb 11, 2015

Eastern-European country may have to increase imports

As access to fertilizer, seeds and other agriculture supplies for farmers in Ukraine seems to diminish because of political strife, the country may be forced to look elsewhere to feed the citizens.

If that’s the case, it could be good news for Canada and the United States.

Statistics Canada reported over $209 million in exports to the Ukraine in 2013. The top exports from the agri-food sector were, in order, frozen pork products, dog and cat food, soybean seeds and live cattle.

Soybeans are largely grown in Manitoba, Ontario, Quebec and Prince Edward Island. Ontario leads the way with over 3 million metric tonnes of soybeans produced in 2013, followed by Manitoba with just over 1 million metric tonnes.

The United States Department of Agriculture (USDA) just released the February World Agricultural Supply and Demand Estimates (WASDE) Report and it showed soybean ending stocks are projected to be down 25 million bushels and selling from $9.45 to $10.95 per bushel. If things don’t improve in the Ukraine, the soybean market could see them as a large export partner.

As far as the United States goes, they exported $135 million of agriculture products to Ukraine in 2012. The top products were poultry meat, planting seeds and egg-related products.

Video: Did Bears Win Thanksgiving, Will Bulls Get Christmas?

Did the bears win Thanksgiving (although this week had green on the screen), and will the bulls get Christmas? Bears won thanksgiving thanks to a USDA Nov crop report dud that stalled the bullish grain momentum for a brief period. But a bullish lower yield surprise in the Dec crop report could reignite the rally.
2026 U.S. winter wheat planting is nearly complete at 97% while crop conditions improved by 3 points to 48% good-to-excellent. US corn & soybean harvest is complete.
High corn demand, which is off the chart, and more Chinese soybean demand could support a Christmas rally.
Nasdaq had it’s worst November since 2011.
A U.S. Fed rate cut in December will help fund flow and sentiment.
Bitcoin held a long-term support at 80,000 and that's positive for fund flow and sentiment. It should help stock prices and Ag as we go into December.
Fertilizer prices continue to climb as we look ahead to 2026. Farmers may rely more on the nutrients that they already have in their soils.
South American Weather remains critical as the soybean reproductive stage starts from late Nov to late Feb depending on planting date.
Will a Russia-Ukraine peace deal happen by year-end?
CFTC data as of showed more managed money fund sell-off as of October 14th.