Experts are warning that the consequences of Russia’s attack on Ukraine could include higher food prices due to global fertilizer shortages.
Second only to Canada, Russia is one of the world’s top producers of major fertilizers including potash.
Potash is used extensively in the agricultural industry to grow major crops and produce.
Officials with the US fertilizer company Mosaic Co. told analysts on Wednesday that the developing conflict in Ukraine would likely lead to shortages on the global market and rising costs for farmers.
They warned that as farmers bear the strain of a fertilizer price hike and reduce their consumption of potash, lower crop yields would translate into higher price tags at the grocery store.
On the other hand, the Canadian potash industry could see a boom as a result of sanctions and export restrictions leveled against Russia.
Those standing to benefit include Nutrient Ltd., which is the number one crop-nutrient industry producer. Earlier this month, the company stated that it would ramp up potash capacity, citing global supply shortages.
On Thursday, Russian troops crossed into Ukraine the day after President Vladimir Putin recognized the country’s breakaway eastern rebel regions of Luhansk and Donetsk as independent states.
Since then, Russia has occupied several strategic areas in the beleaguered country and has commenced military operations targeting major cities including the nation’s capital, Kiev.
Prime Minister Justin Trudeau and the Liberal cabinet announced a spate of sanctions against major Russian officials and entities as well as export controls on Thursday.
“These sanctions are wide-reaching,” Trudeau said. “They will impose severe costs on complicit Russian elites, and they will limit President Putin’s ability to continue funding this unjustified invasion.”
