3 Big Things Today, February 22, 2022
1. Wheat Futures Surge as Russia Moves Into Ukraine
Wheat, corn, and soybeans all jumped in overnight trading after Russian forces moved into Ukraine.
Russian troops moved into two breakaway enclaves overnight in what it calls a “peacekeeping” effort after Moscow formally recognized the areas as independent states.
Western government officials are concerned this is a precursor to a larger invasion of Ukraine.
The United Nations Security Council Monday night harshly rebuked Moscow for the incursion, saying Russian President Vladimir Putin was testing international law.
The U.S. on Monday moved most of its administrative personnel from Ukraine to Poland on fears Russia would invade. Ukraine government officials have told their citizens to prepare to defend their country.
“There will be losses,” Defense Minister Oleksii Reznikov said today. “We will have to go through pain and overcome fear and despair, but we will definitely win because we are on our land and the truth is behind us."
The Russian incursion into the territories threatens global trade including that of agricultural products. Russia is the world’s largest exporter of wheat and Ukraine is the third-biggest shipper of the grain, according to data from the U.S. Department of Agriculture.
Russia is forecast by the USDA to ship 35 million metric tons of the grain in the 2021-2022 marketing year that ends on May 31, and Ukraine is expected to export 24 million metric tons.
Wheat for May delivery jumped 18¾¢ to $8.22¾ a bushel overnight on the Chicago Board of Trade, while Kansas City futures surged 21½¢ to $8.61½ a bushel.
Corn futures for May delivery rose 8¼¢ to $6.61 a bushel.
Soybean futures for May delivery rose 15½¢ to $16.19 a bushel. Soymeal was up $2.10 to $447.80 a short ton, and soybean oil futures gained 1.52¢ to 69.13¢ a pound.**
2. Russian Forces Move Into Ukraine, International Sanctions Applied
Russian forces have moved into two breakaway territories in eastern Ukraine, European Union leaders said.
European Union foreign affairs and security policy chief Josep Borrell said Russian troops have moved into the territories, which Russia formally recognized as independent unions and authorized the incursion of a “peacekeeping” force into Ukraine.
While Russian forces are in the areas, Borrell said it was not a “full-fledged invasion.”
European Union countries have implemented sanctions against Russia, with Germany stopping the key Nord Stream 2 natural gas pipeline. The U.S. also has started to impose sanctions.
“Russia’s move to recognize the “independence” of so-called republics controlled by its own proxies is a predictable, shameful act,” Secretary of State Antony Blinken said on social media. “We condemn them in the strongest possible terms and stand with Ukraine, as I told Foreign Minister Dmytro Kuleba tonight.”
U.S. officials anticipated that Moscow would formally recognize the regions of Ukraine as independent so it would have an excuse to invade the country, an unnamed senior U.S. government official said during a teleconference yesterday.
President Biden signed an executive order prohibiting new investment, trade, and financing by American citizens in the regions.
The unnamed official said Washington plans to take further actions against those determined to be operating in the areas of Ukraine.
“We will take further measures (Tuesday) to hold Russia accountable for this clear violation of international law and Ukraine’s sovereignty and territorial integrity, as well as of Russia’s own international commitments,” the official said.
3. Winter Weather Hitting the Northern Corn Belt
Blizzard and winter-storm warnings and winter-weather advisories have been issued for much of the north-central U.S. as snow and wind hit the region, according to the National Weather Service.
In northeastern South Dakota and southeastern North Dakota, blizzard warnings are in effect until 6 p.m. tonight as another 2 inches of snow on top of what has already fallen are forecast along with winds gusting up to 40 mph, the NWS said in a report early this morning.
Winter-storm warnings are in effect until midnight tonight as an additional 6 to 14 inches of snow are expected in parts of northern Minnesota and Wisconsin.
“Travel could be very difficult,” the agency said. “Patchy blowing snow could significantly reduce visibility.”
Winds will gust as high as 35 mph, causing blowing and drifting snow and reducing visibility to less than .25 mile.
In central Iowa, a winter-weather advisory is in effect until this evening as mixed precipitation is in the forecast. “A couple inches” of snow are possible near the Minnesota border with ice accumulations of 0.10 inch expected.