Ukraine potato planting pushes on amid war and costs

Our first potato planting started bang on the equinox. Over 1000ha of potatoes are to be planted, and a further 700ha of contract growers for starch production for our factory to be managed. Oversupply has led to lower prices for both fresh and starch crops following a high yielding 2025.

We have avoided the dumping of surplus potatoes or sale to feed stock, sadly common across the UK and EU.  We hope to pick up some distressed stocks from smaller growers to process in our starch factory later. Our new outdoor cheap fleeced storage for our starch stocks has worked remarkably well despite the harsh winter.

Over 1000ha of potatoes are to be planted (Image: Dr Keith Dawson)

As noted last month the Ozempic 'skinny' jabs have led to lower contracted tonnages for crisping potatoes in 2026. This despite us producing the best quality crisping potatoes in Ukraine as the second largest grower.  Fortunately we bought our fertiliser early before Hormuz inflation.

Although cereal drilling has taken place in the earlier areas of Odessa and Mykolaiv the drilling has been delayed about three weeks compared to a normal season. By late March only 3% of the planned 16mha had been sown, 35% behind last season, with peas leading the drilling charge.

A tough and challenging season will not be helped by the ill judged events in Iran and the Gulf with the pinchpoint of the Strait of Hormuz causing power, fertiliser and fuel costs to rise. Entirely predictable as a consequence of the reckless, ill thought out, hubristic action by Trump and Netanyahu!

A longer tail on disruption is now being priced in with latest attacks on UAE, Qatar and further threats. Trump is simultaneously claiming he is winning a war he has already won, needs help to win the war but doesn't need any help, all to destroy a nuclear programme he claims to have destroyed last year. In reality he has already lost this asymmetric war,  victory no longer looks like it did, with the Iranian regime still in place and holding the global economy to ransom.

In my opinion Biden's weak approach in the early stages of the Ukraine war has led to emboldening of both Russia and Iran. This led directly to a boost to their cheap drone capability and tactics compared to much more expensive Western military hardware. More $4m Patriot missiles have been fired at cheap £50k Iranian drones in the first three days than by Ukraine in four years.

Ukraine is showing the way forward to Western powers and is now making gains on the frontline. The naval drones that Ukraine pioneered, and used to clear the Black Sea of the Russian navy, are now being used by Iran to threaten the forty vessels per day that were the daily traffic through the Strait. Drone hits at two huge oil refineries are damaging for Russia.

We heard a lot about Trump's expensive $1bn entry fee Board of Peace, we misheard, it now seems he's just Bored of Peace! The difference between Iran and Vietnam is that Trump knew how to get himself out of the latter! Dropping Russian oil sanctions is a big mistake. Cuba next? Defence stocks rise by the hour.

I have noted before the crucial role of Ukraine's power engineers. I was talking to a friend recently in the Swedish power industry and learnt that the Ukrainians are also teaching the EU energy industry, as well as it's military.

Part of the reason Ukraine are so successful is that the national grid is designed on a mesh network principle. If one part is damaged the power can flow through another part of the mesh. The Swedish system in contrast relies on five seperate main power connectors, much easier to disrupt catastrophically by an enemy.

The Swedes now recognise this and are building new infrastructure to mitigate such a risk. A risk which only a scant few years ago seemed unthinkable. AI may be hit with higher energy costs.  Has the UK industry acted on this very real threat or even woken up to it? No sign on UK food security!

Again Ukraine has taught us all how much damage a relatively cheap drone can inflict upon infrastructure. The ultimate bangs for bucks algorithm. We are living through this in the Straits of Hormuz and the Iranian backed Houthis in the Red Sea. Now that we have dismantled our domestic fertiliser industry, partly through net zero costs, we are now dependent on lower cost producers such as the Gulf States or Russia! Fertiliser security is at least as important as steel.

Whilst Ukraine's inflation rate has now dropped to around 7.5%, business confidence remains low due to the war and power outages. The hryvnia  exchange rate  continues to drift downwards, now 44uah to the dollar. When we set up just over two decades ago the exchange rate was then 8uah to the pound. This is a huge pressure for local companies.

It is a better situation, but still tough, for export based companies like our starch business, as we get paid in dollars/euros whilst local costs are in hryvnia. We recently developed new markets as far away as China and Guatemala for our potato starch. Our biodegradable biopolymers initiative continues to develop with firm steps forward into the first commercial sales direct to consumers of our products early next month.

Total Ukrainian grain and oilseed area for 2026 is forecast roughly unchanged year-on-year (16mha of spring crops). Higher input costs and fertiliser shortages are the main risks. So far the campaign is expected to proceed largely normally, if late. If fertiliser prices bite harder some growers in Ukraine and elsewhere in Europe will cut back and this will impact yields.  A reprise of global thought processes back in 2022.

Ukrainian farmers face higher costs this year with spring planting costs expected to rise about 15%. A fertiliser shortfall could slightly reduce yields. Still, the agriculture ministry says farmers have adequate stocks of fuel, seed, and basic inputs to start the season.

Logistics and security constraints still affect fertiliser supply in some regions. Ukraine still exports about 80% of its agricultural production, so maintaining planting is economically critical. Grain traders and market analysts are watching Ukraine’s spring planting very closely.

The view right now is fairly balanced, not alarmist. It’s not late enough yet to seriously threaten production, but there is a slightly bullish air if delays continue and or dry conditions affect germination. Palm oil and soya have already firmed on the basis of China/US relations as has US wheat on crop condition.

Our Winter Potato Meeting of the Scottish Society of Crop Research was held this month. We met at a tough time for the industry with more seed orders being cancelled than made. We had an update on GB Potatoes from CEO Scott Walker. He emphasised how good the potato work was at the James Hutton Institute and how little knowledge and recognition there was of this South of the Border. Great efforts are being made to maintain and rebuild research and industry links to everyone's benefit. Echoes of Brexit?

Interesting to note Trump has signed an executive order to protect glyphosate as a product for US national security. Though glyphosate has had a stay of execution in UK and EU, with caveats, it is still under fire. We would never have remediated our hundreds of square kilometres of abandoned land twenty years ago in Ukraine without it. It remains a crucial tool for most regenerative farmers, which will under new Scottish agricultural support scheme, be an underpinning arable requirement. Just as important for UK and EU national security as it is in the US.

A challenging season ahead in an uncertain, rapidly changing world and increasing food and energy insecurity. One thing all health experts are agreed upon, is that you are more at risk if you can't afford to eat than if you can. This requires farmers and a secure, solid and sustainable farming industry.