June 2022 - 10

Ukraine-Russia conflict wreaks havoc on global markets
By Melanie Epp
VGN Correspondent
When the Ukraine-Russia crisis began at
the end of February, Russia's actions took
the world by surprise.
Reactions came swift and hard, as
countries around the world imposed
economic sanctions aimed at crippling
the Russian economy. The repercussions
and reactions to those actions can be
felt globally. Grain exports have slowed,
raising commodity prices. The cost of
energy and food has skyrocketed, and
many economies have hit record-high
levels of inflation.
What does all this mean in the world
of potatoes?
Too dangerous for Ukrainian
potato farmers to plant
Nick Gordiichuk, managing director of
Agrico Ukraine and vice-president of the
Ukrainian Potato Growers Association,
farms 600 hectares (approximately 1,500
acres) on two separate farms. He grows
winter wheat, corn and sunflowers,
but most of his land is dedicated to the
production of seed potato.
Divided unevenly, the first is a
100-hectare farm in Brovery, near Kiev.
The second, a 500-hectare farm dedicated
to seed potato production, is in the
Chernihiv area in Andriivka.
When fighting began Feb. 24,
Gordiichuk fled to Romania with his wife,
mother and three daughters. He returned
home alone a couple of weeks later. The
100-hectare
farm near Kiev
was deemed
safe enough to
return. But the
second farm,
the 500-hectare
farm devoted
to seed potato
production, is
occupied by
Russian troops. At
NICK
GORDIICHUK
the time of writing, it wasn't safe to return
to the region.
Work started at farms around Kiev,
but quickly stopped when mines and
unexploded bombs were discovered in
the fields. Areas in the east and south of
the country, and areas around Kiev, will
be difficult to farm, Gordiichuk said. But
farms in the west of the country should
be accessible.
Even if farmers could get in their fields,
they face further challenges that keep
them from getting planting season off to
a good start, said Gordiichuk, pointing to
the availability and price of fuel, as well as
transportation costs, as significant issues.
" Drivers do not want to drive to
temporarily occupied areas, " he said.
Unfortunately, many of Gordiichuk's
seed potato stores are in these areas.
The unavailability of fertilizer and
crop protection products also poses
significant challenges for farmers.
Finding labor is also a challenge. At last
count, 25% of Ukraine's population has
been displaced. Some 7 million people
are considered internally displaced,
10 | VegetableGrowersNews.com
A bin of potatoes. Photos: Nick Gordiichuk
A Ukrainian potato transport.
An explosive device in a Ukrainian field.
while another 3 million left the country
entirely.
Gordiichuk is particularly concerned
about finding laborers who can manage
heavy equipment. " There are not enough
workers, " he said. " Tractor drivers were
mobilized for the army. "
Ukraine farmers are also facing liquidity
difficulties. Those who had wheat and
other grains to sell in the spring are stuck
with the grain, because ports in Odessa
are completely blocked. " The banks are
reluctant to finance farmers of farms
when you have a war operation in the
country, " Gordiichuk said.
Potato production in Ukraine
Ukraine is the fifth largest producer
of potatoes in the world. Annually, the
country produces approximately 20
million tonnes, similar to the U.S. Most
of that, however, is grown in small-scale,
backyard plots for domestic consumption,
said Gordiichuk, who is one of just 20
seed potato producers in the country.
Only about 55,000 hectares are under
commercial production.
Ukraine's main export market had
been Russia, Gordiichuk said, but that
market closed in 2014 when aggression
first began. In fact, today, Ukraine doesn't
export any potatoes. The European Union
has been closed to the country since 2002
because of three quarantine diseases.
Gordiichuk said the phytosanitary system
has not been functioning since the
collapse of the Soviet Union. However,
the country is working with the EU
on various projects in an attempt to
harmonize with EU standards. They hope
the EU will become an export market in
the near future.
Cedric Porter, editor of World Potato
Markets, offered a more global view of
the war's effect
on global
potato markets.
To address
potential seed
potato shortages
in Ukraine,
Porter said the
Polish Potato
Association
is working
with the
Ukrainian Potato Producers Association
to coordinate the supply of table potatoes
for the civilian population, as well as
seed potatoes for growers. Because it is
planting season in Ukraine, it's a difficult
time for so many people fleeing the
country, he said. It's possible many will
not be able to plant potatoes at all.
To make matters more challenging,
CEDRIC
PORTER
Porter anticipates a much smaller crop
in Europe this year as well, with planting
area is expected to drop by 2.5%. Potato
prices are low, and grain prices are up,
which means some growers are likely to
shift focus. " It's a fairly intensive crop in
terms of fertilizer and fuel, " he said.
Data shows that planting area in the U.S.
may be lower this year as well, Porter said.
Fertilizer availability and cost will also
be a challenge. Currently, it costs European
growers €1,000/tonne (about $1,080) for
ammonium nitrate, more than twice the
previous price. Two to three years ago, it
was a quarter of that, Porter said.
Labor will also be an issue, especially in
Europe, he said, because many European
and UK potato producers rely on seasonal
workers from Eastern Europe. Under the
UK's seasonal worker scheme, two-thirds
of the 30,000 laborers hired last year were
Ukrainian, Porter said. Many of those
potential workers have been commissioned
to fight the war at home, though, meaning
they won't be available to work.
Finally, Porter expects potato
processors will be challenged by the
rising cost and shortage of sunflower oil
in the coming year. Ukraine is the biggest
producer of sunflower oil in the world.
Reports show sunflower oil stores will
run out in a month or so. Porter said the
shortage could spur a more economical
and efficient solution.
" Necessity is often the mother of
invention, " he said. " Maybe we start to use
all these resources and costs and fertilizers
more efficiently. "
" But doing that in one season is quite a
big ask, " he said. VGN
http://www.VegetableGrowersNews.com
June 2022

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