Ukraine War Threatens to Cause a Global Food Crisis

[TU Curmudgeon]

I know, but during WWII everyone stepped up - it's going to be like that,

Would you like to bet your lunch money against the deed to my ranch on that one?

I hope it will bring us all together. Next 1/6 all Democrats and trumpists will gather at the Capitol and sing, "Kum-bah-yah

If you remember Stan Freeburg's "Elderly Man River" you will know that that simple isn't going to happen because the "correct" title is "Come by here".

 

[lurchadams]

Would you like to bet your lunch money against the deed to my ranch on that one?

If you remember Stan Freeburg's "Elderly Man River" you will know that that simple isn't going to happen because the "correct" title is "Come by here".

Shit.

 

[TU Curmudgeon]

Shit.

I thought that you'd like it. It's from 1957 and holds up VERY well.

 

[lurchadams]

I thought that you'd like it. It's from 1957 and holds up VERY well.

No. I don't like it at all

 

[Metric Mouse]

Sorry, but there is a global shortage of oil and so the Canadian and Mexican government have placed export tariffs of $75/bbl on all oil exported in excess of the levels exported on 01 JAN 2021. Purchasers wishing to have oil exported in excess of that amount must deposit enough hard currency to pay for 30 days worth of exports in advance and must not allow that deposit to drop below 75% of the total amount predicted to be required to pay the tariff. Vendors who export oil in excess of the permitted amounts, without the export tariff having been paid by the Purchaser, will be required to pay a fine of 300% of the tariff that the Purchaser should have paid AND the Purchaser who had the oil exported without having paid the requisite tariff will be required to pay a fine of 300% of the tariff that they should have paid.

A like program applies to the raw materials for fertilizers.

Oh noes! Sucks to be anyone not named America.

Going to be a brutal blood bath for small farmers this year.

 

[Lord Tammerlain]

Oh noes! Sucks to be anyone not named America.

Going to be a brutal blood bath for small farmers this year.

Input costs are going to be through the roof.

Pesticide costs are increasing drastically, fertilizer costs will be increasing (lots of potash comes from Belarus) Glyphosate is in short supply in North America. Even with record prices farmers might have difficulty making a profit

 

[TU Curmudgeon]

Oh noes! Sucks to be anyone not named America.

Going to be a brutal blood bath for small farmers this year.

Ahhh, but it will be a bonanza for "Big Agriculture" (and that's where the dividends lie [and that's were the campaign contributions come from {and that's the way the votes in Congress go <and that provides a nice "retirement cushion""}]).

 

[TU Curmudgeon]

Input costs are going to be through the roof.

Pesticide costs are increasing drastically, fertilizer costs will be increasing (lots of potash comes from Belarus)

Import Sources (2016–19): Canada, 83%; Belarus and Russia, 6% each; and other, 5%.

The US imports about 92.73% of its Potash needs. The US imports about 5.56% of it's Potash needs from Belarus and another 5.56% from Russia. Assuming that agricultural output is directly related to Potash imports, if both Russia and Belarus were to stop exporting Potash to the US, US agricultural output would drop by around 11.13%. That massive a drop might well be within the range that would result in food availability declining to the point where the level of obesity in the US dropped substantially.

On the other hand, if the US were bereft of Canadian potash, then the (roughly) 76.97% drop in US agricultural output just might be slightly more than a minor inconvenience.

Glyphosate is in short supply in North America.

Which most certainly helps keep prices (hence profits [hence dividends {hence campaign contributions}]) up - right?

Even with record prices farmers might have difficulty making a profit

Not a real problem. The government will simply step up its programs for "price stabilization" and "to preserve the family farms" by several billion dollars or so and that will keep prices down to where the average taxpayer can afford to buy food. (How those expenditures will be paid for [and when] is someone else's problem that won't likely arise until well after the current crop of legislators have retired.)

 

[EnigmaO01]

Well, right now , it's planting season, so I am sure things are more flexible NOW than they would be 2 or 3 months from now

There is winter wheat that is already planted and is harvested in summer, and there is spring wheat that is harvested in late summer.

 

[EnigmaO01]

I was going to downsize my garden this year but I'm going to buy lots of seed and see how things pan to in the next month or two. Might not downsize.

 

[Metric Mouse]

Ahhh, but it will be a bonanza for "Big Agriculture" (and that's where the dividends lie [and that's were the campaign contributions come from {and that's the way the votes in Congress go <and that provides a nice "retirement cushion""}]).

I was on track to have a good night and your post made me sad.

 

[Lord Tammerlain]

Import Sources (2016–19): Canada, 83%; Belarus and Russia, 6% each; and other, 5%.

The US imports about 92.73% of its Potash needs. The US imports about 5.56% of it's Potash needs from Belarus and another 5.56% from Russia. Assuming that agricultural output is directly related to Potash imports, if both Russia and Belarus were to stop exporting Potash to the US, US agricultural output would drop by around 11.13%. That massive a drop might well be within the range that would result in food availability declining to the point where the level of obesity in the US dropped substantially.

On the other hand, if the US were bereft of Canadian potash, then the (roughly) 76.97% drop in US agricultural output just might be slightly more than a minor inconvenience.

Which most certainly helps keep prices (hence profits [hence dividends {hence campaign contributions}]) up - right?

Not a real problem. The government will simply step up its programs for "price stabilization" and "to preserve the family farms" by several billion dollars or so and that will keep prices down to where the average taxpayer can afford to buy food. (How those expenditures will be paid for [and when] is someone else's problem that won't likely arise until well after the current crop of legislators have retired.)

Re Glyphosate, and employee bonuses for those that work with companies that make it.

Re Potash, I am more talking about global supply and prices. The mines in Sask had a tough time the last few years due to competition from Belarus on the global market, quite a few shut down or made serious cuts

 

[TU Curmudgeon]

Re Glyphosate, and employee bonuses for those that work with companies that make it.

Now you are talking about state control of industry (something that BOTH the Fascists and the Communists highly approved of).

Re Potash, I am more talking about global supply and prices. The mines in Sask had a tough time the last few years due to competition from Belarus on the global market, quite a few shut down or made serious cuts

Well that competition most certainly wasn't for the US market.

 

[Metric Mouse]

Input costs are going to be through the roof.

Pesticide costs are increasing drastically, fertilizer costs will be increasing (lots of potash comes from Belarus) Glyphosate is in short supply in North America. Even with record prices farmers might have difficulty making a profit

And diesel fuel prices; going to be awful.

 

[TU Curmudgeon]

And diesel fuel prices; going to be awful.

I saw diesel at CDN$2.09/l yesterday. That works out to around US$5.92724/USgal.

Strangely enough, Canada is a petroleum exporting country and produces (and refines) enough petroleum products domestically to meet its domestic needs so - theoretically - it doesn't cost a penny more (or less) to produce a gallon of gas if the "world spot price" is $10/bbl or $100/bbl or $1,000/bbl.

I do note that some of the "conservative" posters on DP made quite a point of the fact that the US was also a "net exporter" of oil, so it also shouldn't cost a penny more (or less) in the US to produce a gallon of gas if the "world spot price" is $10/bbl or $100/bbl or $1,000/bbl.

So, other than "Hey Bob, everyone is panicking over an oil shortage that doesn't affect us, so let's crank up the price of gasoline as high as we can and make tons of money so the shareholders will get huge dividends and vote us equally huge performance bonuses.", why is the price of gasoline soaring?

 

[Metric Mouse]

I saw diesel at CDN$2.09/l yesterday. That works out to around US$5.92724/USgal.

Strangely enough, Canada is a petroleum exporting country and produces (and refines) enough petroleum products domestically to meet its domestic needs so - theoretically - it doesn't cost a penny more (or less) to produce a gallon of gas if the "world spot price" is $10/bbl or $100/bbl or $1,000/bbl.

I do note that some of the "conservative" posters on DP made quite a point of the fact that the US was also a "net exporter" of oil, so it also shouldn't cost a penny more (or less) in the US to produce a gallon of gas if the "world spot price" is $10/bbl or $100/bbl or $1,000/bbl.

So, other than "Hey Bob, everyone is panicking over an oil shortage that doesn't affect us, so let's crank up the price of gasoline as high as we can and make tons of money so the shareholders will get huge dividends and vote us equally huge performance bonuses.", why is the price of gasoline soaring?

Greedy ****ing gas station owners, charging more when oil prices are down 30 percent. Thankfully the United States isn't as bad as Canada. Diesel is only 5.13 US on average. Going to be hard for Canadian farmers to compete with lower cost wheat etc. from the United States and other countries, but hopefully they'll be alright.

 

[TU Curmudgeon]

Greedy ****ing gas station owners, charging more when oil prices are down 30 percent. Thankfully the United States isn't as bad as Canada. Diesel is only 5.13 US on average. Going to be hard for Canadian farmers to compete with lower cost wheat etc. from the United States and other countries, but hopefully they'll be alright.

Most gas stations are franchise operations and the prices that they sell their products for are set by the franchising company.

If you had an intersection with four gas stations on it and one of those was an "independent", you would most likely find that the price per gallon was identical at all four gas stations.

If the "independent" lowered their price, the odds that the franchising companies would NOT match (and possibly beat) that reduction closely approximate 1 in 1,000,000,000.

If the "independent" persisted in trying to get prices down, the odds that the "independent" would find that the price that it was paying to the refinery (which was owned by one of the franchising companies) was going up to the point where it could no longer stay in business. (You might note that the refineries do not have any "posted prices" and that their daily (hourly[?]) rate sheets always contain a "Prices may change without notice at any time." caveat attached. That, of course, means that the gas that they were selling to their franchise operations for $2.00/l suddenly went up to $4.00/l when the tank truck from the "independent" pulled in to load up - and then dropped back down to $2.00/l when it was finished loading.