This week Russia announced, in an effort to put pressure back on sanctioning countries, that it would no longer import their Ag Products. The US last year exported around $1.3 Billion in Ag goods to Russia. Reports indicate that while this will hurt Ag prices for the US markets and others, this block could destroy what is left of Russia’s economy. Russia has already seen 7%+ inflation this year and that could double very quickly after this block is implemented.
So what does this mean for the US?
While most reports did not specify the exact details of the block, here is some information I dug up on what Russia imports from the US.
Table 3: Russia’s main agricultural import products, average value in 2008-10
Import value Share in agro imports
million US$, %
Bovine meat 2,399.1, 8.0
Beverages 2,203.2, 7.4
Pig meat 2,111.4, 7.0
Milk (equivalent) 1,539.9, 5.1
Tobacco 1,207.8, 4.0
Sugar and honey 1,172.6, 3.9
Poultry Meat 1,136.1, 3.8
Cheese 1,094.2, 3.7
Total agricultural imports 29,972.3, 100.0
Beverages: Beer, wine and spirits
Another Ag import that was mentioned in another article I read was Farm Machinery. If this is also banned, it could have quite an impact on the already tough year machinery manufacturers are having.
While this will have an impact on the US Ag markets, I’m interested to see just how long Russia plans to cripple its own citizens and make them pay for their leaders need for more power and control by attacking Ukraine.
What are your thoughts about how this will impact the US Ag markets? What about Russia’s economy?