GMA Presents with NBCA’s Kent Bacus: The Ukraine War
Last week, Kent shared with GMA Presents analysis into the political and economic ramifications the continued conflict in Ukraine will have on the global meat sector.
Key takeaways
Just 31% of land expected to be sown in Ukraine has been, and we are seeing significant swings in prices for grain, corn, wheat, barley, corn, livestock feed, and sunflower and cooking oils
Now is the time for the sector to engage more with decision makers, as supply chains gain attention from politicians and consumers
The EU is trying to focus on plant-based protein to make up the protein gap caused by the conflict
Wrap up
More than 12 million Ukrainian people have been displaced since the Russian invasion began. As Kent notes, the gravity of the situation is in the hearts and minds of all of us.
The ramifications of the war directly impact our sector. Ukraine farmers have been unable to be in the field: less than one-third of land expected to be sown in Ukraine has been.
There are significant swings in the prices of grain, corn, wheat, barley, corn, livestock feed, and sunflower and cooking oils. Fertiliser costs and oil have also been impacted.
You can find a wrap up of the impacts the Ukraine War will have on the global meat sector on the GMA blog.
Supply chain and global meat sector impacts
As an expert in beef and cattle trade policy, Kent says one of the most disturbing trends that continues to emerge is the concept of export controls – and livestock feed may be in the firing line.
“A prime example of that is Argentina, instead of addressing underlying issues, you’ve seen a turning back to old policies like export tariffs to try and hold down food cost. You’ve seen Indonesia consider similar measures on palm oil,” Kent said.
“There is concern about potential restrictions on livestock feed as those prices go up, but I think history has shown us this approach is not successful in the long run and it creates a downward economic spiral that makes it very difficult to recover.”
“Globally, I think more countries are looking at trade, not as a tool for ‘let’s see how much market access we can get and increase profitability’, it’s ‘let’s see how we can strengthen our supply chains with our allies so that we are not dependent on markets or sources from areas of the world that are more volatile’.”
Also of concern for our sector is reports of calls for European Union plant protein strategy.
“In response to food security concerns in Europe, we saw the recent proclamation from Versailles where the EU is now trying to focus on plant-based protein to make up that protein gap,” Kent said.
There may be a need for the global meat sector to work to ensure to make it known our product can address food security concerns.
What can we do?
Kent worked on political campaigns in Texas and spent several years as the agriculture and appropriations legislative assistant to U.S. Senator Elizabeth Dole.
He says now is the time for the sector to engage more with decision makers, as supply chains gain for attention.
“For the past few years, climate concerns have been the major driver for domestic and international policies. COVID really disrupted that, and it grew greater attention to supply chains,” Kent said.
“Two years ago, let’s face it, we were probably the only ones talking about logistics and supply chains while our friends and loved ones, their eyes glazed over… But now there’s a lot more supply chain experts on social media. People now know the importance of supply chains.
“As we move forward, there are going to be a lot more government interventions, there are going to be a lot more politicians looking to make a name for themselves.”
About Kent
An expert in beef and cattle trade policy, Kent brings extensive knowledge of food supply chains in the U.S. and globally with NBCA.
From his work with the U.S. Congress, US Administration Agencies, and foreign governments, Kent works to advance the policy priorities of the U.S. beef and cattle industry, including in foreign markets.
A returning friend of GMA’s, Kent also spoke last year, when he accurately predicted implications the incoming Biden Administration would have on the meat sector.