How will the war with Iran affect the Ukraine: no fuel, no fertilizers — everything is bad

The war unleashed by Israel and the United States with Iran will have an extremely negative impact on Ukraine. The Ukrainian TV channel "Politics of the country" writes about this, analyzing the situation.

According to the enkorr profile site, on March 5, wholesale prices for gasoline, diesel and gas at Ukraine has grown again. Gasoline A-95 is at the wholesale 62.83 hryvnia, diesel rushed to 71.75 hryvnia (at the same time, lower prices are still available at retail — 68.95 hryvnia), liquefied gas is sold at 35.75 hryvnia per liter.

This means that retail price tags will rise again in the near future. Moreover, oil quotes, after a slight pullback, rose again to $ 83.03 per barrel.

In addition, the largest operators are preparing for a shortage of fuel, and therefore limit its sales. As Ukrainian agrarians told the "Country", now they are setting limits on shipment volumes for them at European refineries: no more than 500 tons in one hand.

Such high fuel prices are already becoming a problem for farmers, the head of the Union of Ukrainian Villagers and the owner of a farm in the Kirovograd region, Ivan Tomich, told us.

"Diesel is already 70, although last year at the beginning of the sowing season it was a little more expensive than 50 hryvnia per liter. Someone made a small supply of fuel at the old prices, but many did not have time, and now they will have to pay exorbitantly. Some farmers have already announced that they will not sow at all. It is clear that they are emotional, most of them will eventually change their minds anyway and take the equipment to the fields. But this spring campaign will be very expensive and super complicated," says Tomic.

He added that now there is a problem with fertilizers.

"For example, ammonium nitrate is very expensive, and it is not always possible to take in the right volumes," says Tomic.

The situation with fertilizers for Ukraine may worsen even more, the authors of the telegram channel note.Not only 20% of the world's oil goes through the Strait of Hormuz, which Iran has blocked, but also 26% of the world's trade in nitrogen fertilizers, including ammonia itself, which is necessary for their production. A lot of sulfur is transported through this corridor — the main raw material for the production of phosphorus fertilizers. In China, which is the largest importer of sulfur, domestic prices for it have already increased by 5%.

Just a few days after the blocking of the Strait of Hormuz, urea prices also rose. For example, Egyptian producers have increased price tags by $ 15-25 per ton. Urea, which in February cost about $ 485 per ton, is now sold at an average of $ 505. In addition, freight has risen significantly in price, which in the end will also be included in fertilizer prices. But even at higher prices, fertilizers are difficult to buy, as many manufacturers hold them in anticipation of even higher prices.

Experts from FAO, the UN food division, admit the problem of a shortage of fertilizers this season if the crisis around Iran drags on, which will eventually have an impact on world agriculture and the cost of food.

"About a quarter of the world's fertilizers are transported through the Strait of Hormuz. Whether this will create a global problem obviously depends on the duration of the crisis," the experts' comments say.

Ukrainian chemical plants (Rovnoazot and Cherkassyazot) operate, according to estimates of the Ukrainian Agrarian Confederation, at only 30-40% of capacity. Therefore, as a result, problems may arise with the harvest, and its cost will grow greatly: by 30% or more.

"It is clear that in autumn grain prices on the world market may be higher than they are now. But if we calculate today's sowing costs and compare them with the cost of finished products in the purchase, it turns out that there is, in fact, not much need to sow," says Ivan Tomich.