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War in Ukraine shifting scales of global trade

The chief risk officer for Compeer Financial wonders how much the conflict in Ukraine might shift the scales of grain trade.

Bill Moore tells Brownfield Ukraine represents about 15 percent of global corn exports.

“While most of that is to Africa, the Middle East and China, we all know corn is a global commodity and like water, if you drain it in one place it will just flow and equalize. And we expect that will probably happen with grain markets this coming year.”

With Ukrainian production very much up in the air in 2022, he says the U.S. will be competing with South America to fill gaps.  And Moore believes the U.S. has an advantage.

“Because the U.S. farmer has their nitrogen on hand, for the most part. The Brazilian farmers, who get 90 percent of their fertilizers from Russia, have not even started the negotiation process yet for that product.”

He says that could make it very difficult for Brazil during their planting season later this year, which would impact grain markets in 2023 and beyond.

Moore made these comments during a recent Compeer podcast as part of a content partnership with Brownfield.