UFA official says 2022 will be “a tough year to negotiate” for farmers

Smith says fuel prices are among the costs going up. He says the price for West Texas Intermediate oil was at around $75 a barrel at the start of the year. It had reached $90 by the time Russia invaded Ukraine and has reached over $120 a barrel at times since then and remains over $100. Smith the re-starting of the world economy also contributed to the increase.

Smith says even with rising costs, UFA customers have not been cutting back their input purchases.

“Our members are going ahead, I mean, this is what farmers do. They do weather the storms.”

“They might be changing some of the grains that they’re putting in, depending on what they think is going to be better for their land as well as better for the overall farm economics.”

Smith says how long prices stay high will depend on several things.

“The length and extent of the war in Ukraine. It’s going to depend on the impact on China of their recent outbreak of [COVID-19] and how the rest of the world, in terms of their economies, are going to have to adjust to this rising inflation and what that does to the growth rate of the US economy and western Europe economies.”

Smith says one thing to watch is the impact of the invasion of Ukraine on the world food supply as both Ukraine and Russia produce a lot of grain.

by Curtis Galbraith

UFA official says 2022 will be “a tough year to negotiate” for farmers

What's Happening