Russian commodity export ban could reverberate

Russia today announced retaliation against some western sanctions in announcing that telecom, medical, auto, agricultural, electrical and tech equipment, as well as many forestry products, will be banned until the end of the year.

The details of these measures will be important but grains are particularly notable because the global market for food is tight and headed for extreme tightness. Ukrainian farmers are going to have a very difficult time securing fertilizer this year even if they can plant normally. Precipitation levels throughout Europe are also extremely low and Russia has banned fertilizer exports to European countries and other 'unfriendly nations'.

It's possible for supply chains to re-adjust but given all we've seen in the past two years and the glut in global shipping, that's a lot to ask.

Another one to note is forest products. It's not clear on exactly which products will be excluded but Russia had already planned to ban raw log exports (years ago announced) but some reports say timber is also on the agenda. The global wood market is very tight already and taking Russian lumber out of the equation and boosting US rates could add a headwind to US home construction.

Another market that's come back to life is steel, with the April futures Futures Futures or a futures contract represents a legal agreement to buy or sell a security or asset at a predetermined price at a specified time in the future. Of note, the parties are not known to each other.These transactions usually involve commodities or other securities involving the buying and selling for a forward or predetermined price.Futures also adhere to a delivery date, which specifies the date of delivery and payment. Relative to other forms of investing futures are much more complex, as Futures or a futures contract represents a legal agreement to buy or sell a security or asset at a predetermined price at a specified time in the future. Of note, the parties are not known to each other.These transactions usually involve commodities or other securities involving the buying and selling for a forward or predetermined price.Futures also adhere to a delivery date, which specifies the date of delivery and payment. Relative to other forms of investing futures are much more complex, as Read this Term contract up 9% today and over 50% since mid-February. The Ukraine and Russia are significant exporters and high energy prices in Europe will badly hurt production (or push up prices). Some of the production will be offline for the long-term as Mariupol's mayor yesterday said the giant steel works in that city employing 11,000 people was 'flattened'.

All of this is making the global manufacturing and pricing picture extremely tough to forecast. Increasingly, the demand side is a risk as well.

Much of this will fall back on Europe, so the recent bounce in EUR EUR The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value The euro (EUR) is the official currency of the European Union (EU) and 19 of 27 member states at the time of writing. It is the second most-traded currency worldwide in forex markets after the US dollar.The euro was originally introduced back on January 1, 1999, having replaced the European Currency Unit. Banknotes and physical euro coins subsequently entered circulation only in 2002.Upon its adoption, the euro replaced domestic currencies in participating EU member states. The rise in its value Read this Term/USD looks vulnerable.