Tensions between Russia and Ukraine escalated in an instant. According to reports, on the 24th local time, The Ukrainian General Staff said that Russian armed forces began to attack military installations and military airports in several Ukrainian cities at 5:00 local time.
Ukraine's president, Volodymyr Zelensky has declared a state of war across the country and announced the severance of diplomatic relations with Russia.
The conflict between Russia and Ukraine sent gas and crude oil prices soaring, with Brent crude futures in London breaking 100 for the first time in more than seven years. How will this conflict affect China's fertilizer and grain markets?
Will it exacerbate the potash shortage?
Russia is one of the world's largest fertilizer exporters and a major supplier of potash to China. Notably, Russia's three main ports for potash exports do not use the Black Sea, the site of many conflicts, but use the Baltic Sea directly, so there is no impact on seaborne potash shipments.
But with the Russian military forces into Ukraine, Europe and the United States and other countries have increased the economic sanctions on Russia, the future does not rule out the possibility of the implementation of an embargo on Russia's fertilizer. It is worth noting that domestic border trade land transport. This piece of potash fertilizer is to go within the territory of Russia, so it will not affect land transport.
On the other hand, Belarus, another major potash fertilizer producer that has been sanctioned by Europe and the United States for a long time, is also involved in the Ukrainian battlefield and provides reinforcements to Russia, and faces the risk of further sanctions by Europe and the United States.
As as result, the tight global potash supply is likely to intensify in the short term, leading to continued price rises.
Will it affect domestic food prices?
The Russian-Ukrainian conflict area is located in eastern Ukraine, which is the main agricultural producing area of Ukraine. According to customs data, From January to November of 2021, China imported 7.315 million tons of Corn from Ukraine, accounting for 27% of China's total corn import, making China the second largest corn importer after the United States.
From the time point of view, every year from October to next May is the concentrated export period of Ukraine's corn. In recent years, China's corn is in a tight balance. If the war between Russia and Ukraine continues to ferment, it will have a certain impact on the domestic corn price.
In addition, China imported 1,088,000 tons of sunflower oil from Ukraine in 2021, accounting for 64% of the total imports, which has a great impact on edible oil.
In terms of barley, Ukraine is the main grain source of barley consumption in China. In 2021, Ukraine imported 2,575,300 tons of barley, accounting for 28% of the total imports. However, the export period is from July to September every year, so the influence is very limited in the short term.
In short, since Russia and Ukraine hold a large share in the global grain market, if the war between Russia and Ukraine continues to spread, it will undoubtedly boost the international grain price to continue to rise, and then transmit to the domestic market.
Tianpu water soluble fertilizer, focus on doing good fertilizer!