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Ukraine and Weather in SAM and U.S. Long-Range


Update for February 18th, 2022

South American weather problems persist and have helped maintain the tailwind pushing U.S. corn and soybean prices. Production issues in Brazil, Argentina and Paraguay have kept analysts busy revising yield estimates lower. Outlooks for the Argentine corn crop show a steep decline from early estimates and are now at 45 MMT vs 51.5 MMT harvested a year ago vs the current USDA estimate of 54 MMT.

Soybean harvest in Brazil has been running ahead of the normal pace which will allow for the planting of the second crop corn acres earlier than normal, meaning pollination should occur during a cooler point of the growing season. While this looks promising for the Safrinha yields we also need to recognize that this corn crop still faces an entire weather season before any potential benefits of early planting can be realized. In addition, the enormous cost of inputs and the shortage of essential weed control products could weigh on the final total of the 2nd crop corn acres planted. A successful growing season is more important than ever though in Brazil as the major production losses incurred last season have tightened the domestic supply now available.

Paraguay’s trade industry told Reuters that for the first time ever, the country may need to import soybeans. They report that soybean inventories are extremely low in the land-locked country and processors may run out of soybeans in the next 4-5 months. This situation is a direct result of the severe drought during the previous growing season, and yield losses of 50% to 60% off from pre-season estimates for the current crop are predicted due to the lack of rainfall and hot temps. The Paraguayan Chamber of Oilseed and Cereal Processors (Cappro) which represents big commodity companies like ADM, Cargill and Louis Dreyfus told Reuters they have petitioned the government’s National Economic Team to approve the removal of a tax for soy crushers currently in place that makes the importing of soybeans uneconomical.

As U.S. farmers prepare for the quickly approaching planting season weather here at home starts to gain more attention. Drought plagued many key growing regions of the country last year which greatly influenced final yields. The 2021 growing season began with the presence of La Niña. The weather pattern faded for a short time but returned in the fall and is still in place. Currently 2022 is starting out very similarly. No two La Niña’s are identical but the outlook for this season is quite similar in that the pattern is predicted to fade this spring and remain in a neutral state through the summer. And while the weather during the growing season is more vital to crop yields than the weather that occurs earlier, the lack of precipitation during the off-season means crops won’t be planted into optimal soil conditions. While this may be beneficial to getting crops planted early, a crop that begins the growing season in drought-stricken soil could likely face an uphill battle.

Drought remains active in the Plains, western Corn Belt and portions of the central Corn Belt. At the end of 2021 U.S. corn acres in drought totaled 19%, last week that total had jumped to 32%.

DTN meteorologists use an analog system for long range outlooks instead of the constantly changing weather models we typically see. Their spring and summer outlooks that are based upon blended, multi-year data forecasts show an unfavorable growing season instore for most of the U.S --unless there is a massive swing in ocean temperatures in the meantime. Hot and dry is expected in all regions except for the Southeast during June, July and August. Of particular concern are the Plains state of Nebraska and Kansas which could potentially see worse conditions than last year. The Plains states of North and South Dakota and Minnesota are also expected to experience another year of poor conditions. In addition, there is an elevated risk of drought development east of the Mississippi River due to inconsistent and light precipitation during the growing season.

The following 2 maps from ECMWF forecast models show the June, July and August outlooks as of February 1.

The number of Russian troops and equipment along the Ukraine/Russian border continue to rise as do tensions. The significance of the quality and quantity of resources within the nation of Ukraine is much larger many realize. Following the map below is a list found online of many resources within Ukraine and their ranking in quantity compared to the rest of the world.

For those who ask: “Why does Ukraine matter? “

How the nation of Ukraine ranks:

1st in Europe in proven recoverable reserves of uranium ores;

2nd place in Europe and 10th place in the world in terms of titanium ore reserves;

2nd place in the world in terms of explored reserves of manganese ores (2.3 billion tons, or 12% of the world's reserves);

2nd largest iron ore reserves in the world (30 billion tons);

2nd place in Europe in terms of mercury ore reserves;

3rd place in Europe (13th place in the world) in shale gas reserves (22 trillion cubic meters)

4th in the world by the total value of natural resources;

7th place in the world in coal reserves (33.9 billion tons)

Ukraine is an agricultural country:

1st in Europe in terms of arable land area;

3rd place in the world by the area of black soil (25% of world's volume);

1st place in the world in exports of sunflower and sunflower oil;

2nd place in the world in barley production and 4th place in barley exports;

3rd largest producer and 4th largest exporter of corn in the world;

4th largest producer of potatoes in the world;

5th largest rye producer in the world;

5th place in the world in bee production (75,000 tons);

8th place in the world in wheat exports;

9th place in the world in the production of chicken eggs;

16th place in the world in cheese exports.

Ukraine can meet the food needs of 600 million people.

Ukraine is an industrialized country:

1st in Europe in ammonia production;

2-е Europe's and 4th largest natural gas pipeline system in the world (142.5 bln cubic meters of gas throughput capacity in the EU);

3rd largest in Europe and 8th largest in the world in terms of installed capacity of nuclear power plants;

3rd place in Europe and 11th in the world in terms of rail network length (21,700 km);

3rd place in the world (after the U.S. and France) in production of locators and locating equipment;

3rd largest iron exporter in the world

4th largest exporter of turbines for nuclear power plants in the world;

4th world's largest manufacturer of rocket launchers;

4th place in the world in clay exports

4th place in the world in titanium exports

8th place in the world in exports of ores and concentrates;

9th place in the world in exports of defense industry products;

10th largest steel producer in the world (32.4 million tons).

A couple of clippers will pass through the Midwest over the weekend. Temperatures are expected to vary wildly as warm temps ahead of the clippers will be followed by significantly cooler temps. Wind is also likely during the period with the possibility of a winter system arriving Monday night. The following graph illustrates the expected temperature swings.

The variations in temps will greatly affect the form of precipitation received. Precipitation could begin as freezing rain or sleet but eventually change over to snow as colder air arrives.

Powdery snow is likely in Minnesota and Wisconsin and possibly far Northern Iowa. If windy conditions occur as forecast, blizzard conditions are possible in these areas.


The forecasted precipitation totals for the next 7 days are indicated in the first map below. Followed by the extended outlook for February 25th through March 3rd.

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