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Everybody, Peter Zion here coming to you from Ruby Bay, the chocolate and COO zielen. The big news that I’ve noticed is that the Russians are throwing a bit of a fit about the great fortune they have with the Ukrainians. Now, Ukraine, until very recently was one of the world’s five biggest agricultural exporters for wheats and a number for in core and it’s number one in sunflower, you know, all important things that help prevent a lot of countries from starving to death. Well, the problem is that most of the stuff that comes out of Ukraine is shipped by water, it’s far easier to to pick and just buy water than it is by land in terms of Braille versus watery about a three to one cost difference. And if you create, it’s perfectly set up for that, because they’ve got the Nieper river that cuts right south to north, through the middle of the country. And so everything just gets out of the park goes out, eventually hits to the series, cities of KEARSON. And Odessa are put on the big polluters have been taken to the Black Sea, the Turkish straits and the rest of the world. What has happened, however, is with the Russians, first capturing Pierson and then putting Odessa under assault, this is all been disrupted. So the only way to move things out of Ukraine at present is by rail. And not only that Ukraine not have a well developed rail system, it doesn’t use the same gauge as the European ports. So it’s been very, very difficult to get it out really less than about one out of six bushels that they used to ship they can ship now. Now, the Turks in league with the United Nations have convinced the Russians to sign on to a Green Deal. And this Green Deal allows ships to come into Odessa, get searched by the Russians on the way in to make sure they’re not carrying weapons, and then load up with grain and they get searched on the way out to make sure that they’re not carrying anything that the Russians don’t want to get out. This has increased the volume to about 20 to 25% of the volume that the Ukrainians could do before the war. So still not great. Now, if you’ve been following the war, you know that throughout the winter, the Russians have been bombing the power grid with drones and missiles to try to kill as many Ukrainians as possible. They’ve been doing this in the winter thinking that if you can freeze the country to death, many 10s of 1000s if not hundreds of 1000s of people be injured and killed. And that might weaken the war effort. Why once we get to summer, that’s going to change. So what the Russians are facing here is they the Green Deal is normally renegotiated every 120 days, are now insisting that they only want a 60 day renewal. Well, if you fast forward from late March 60 days, we’re getting into the beginning of summer, in the beginning of summer, the Russians will have a vested interest in destroying the power grid because no one’s going to freeze to death. So they’re going to go after the agricultural system. Everything from fertilizer on the front end to the silos and the rail stations on the back end try to kill as many people as possible that way. So last year, was probably the last year that Ukraine will be a significant agricultural exporter at pol and we should not expect to see the Green Deal renewed come late May. That’s just the situation you were at. And if you throw in the problems with natural gas and nitrogen processing unit or in Europe hitting the fertilizer market, the problem is getting potash out of Belarus hitting the fertilizer market. The crops hitting phosphate out of China hitting the fertilizer market later this year. It’s going to be really rough for a lot of places. All right. That’s it for me. I’ll see you guys at the next spot. Take care
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In addition to the facts, we believe it’s vital to hear perspectives from all sides of the political spectrum. We hope these different voices will help you reach your own conclusions.
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The commentaries published in this section are solely those of the contributors and do not reflect the views of Straight Arrow News.
Peter Zeihan
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