War In Europe’s Breadbasket Reverberates In An Unlikely Place

Food & Drink

Organic chickens may become too expensive to produce in the U.S. without crops from Ukraine to feed them.

The war in Ukraine and its horrific violence will have ripple effects that reach the unlikeliest places.

The besieged country, known as the breadbasket of Europe for its fertile soil and bountiful harvests, is one of the world’s leaders in the production of organic oilseed and grain – the kind eaten by American chickens. 

Most of Ukraine’s agricultural products are exported to African and other European countries, and certainly any shortages would be felt more deeply there than in the U.S., where 6 percent of chicken meat is organic — a small but growing chunk of the market. Companies like Salisbury, Maryland-based Perdue Farms, with $8 billion in annual sales, buy a portion of Ukraine’s organic oilseed and grain to feed livestock that fetches a premium price in supermarkets. U.S. organic oilseed imports from Ukraine reached 1.85 billion pounds last year, according to organic and non-GMO commodities data service Mercaris. 

Already, just over a week since Russian President Vladimir Putin ordered troops into Ukraine, executives for Perdue, the fourth-biggest U.S. poultry producer and one of the world’s leading sellers of organic meat, were keeping a wary eye on the battlefield to see whether they could continue sourcing organic feed ingredients from Ukraine and how it might affect pricing. 

“We continue to actively monitor the ongoing situation for any potential impacts to agricultural markets and our farmer partners,”  said Perdue spokesperson Diana Souder. “An extended closure of Ukrainian grain processing and exporting capacity has had, and will continue to have, an impact on world grain and oilseed prices as well as input prices for farmers.”

Another concern is transportation. One of the effects of war is the danger of travel, and farmers worried about being killed are less likely to get their grain to market. “It all comes down to access,” said Ryan Koory, Mercaris’ vice president of economics. “Will they be able to ship to the U.S.? Access will be a big point of contention.” 

With problems such as drought and port delays, commodity prices were already rising before the war. Since the conflict began, they’ve soared. Some experts fear that without the right feed ingredients from Ukraine, organic chickens, which are more costly to produce than other chickens, could become too expensive to raise in the U.S. Chicken is typically cheaper than beef or pork, which means that consumers, who already labor under the highest inflation in 40 years, may not be willing to pay the high prices that producers need to turn a profit. 

“Organic will see price spikes,” said Alison Grantham of Grow Well Consulting. “It could hurt the overall organic market size. People are dealing with so much inflation already. It’s a choice, whether you buy organic or not organic chicken. We might see some shrink in organic poultry. I don’t know how much the consumer can bear.”

One caveat: Sometimes organic doesn’t necessarily mean organic. The European Union included Ukraine, and Russia, in a 2018 list of Eastern European countries suspected of committing organic fraud. A 2017 case tracked a shipment of 36 million pounds of soybeans from Ukraine that transferred to Turkey before shipping to California. Sometime during the trip, the ordinary soybeans acquired the stamp “USDA Organic.” Since then, the U.S. Department of Agriculture has received more funding to better monitor imported goods. 

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