In addition to the war between Russia and Ukraine being a humanitarian tragedy, the military conflict should also cause changes in global trade and benefit sectors of countries that produce commodities, such as wheat, corn or oil, as well as the military equipment industry.
According to experts consulted by the UOL, the vacuum in the export of products manufactured by countries directly affected by the war and the increase in demand for other products should strengthen some items. Some exporting countries will also win, such as Australia, China, France and Nigeria, for example.
“In the short term, the countries supplying inputs that were produced by the countries directly or indirectly involved in the confrontation tend to benefit,” said Carla Argenta, chief economist at CM Capital.
For Ricardo Rocha, professor of economics at Insper, countries like China and Australia, for example, can benefit thanks to the appreciation of some of the main products that countries sell during the year.
“Commodity producing countries have a differentiation in relation to food, ore or oil. So, yes, these countries must strengthen”, he said.
Experts have listed some sectors that may emerge strengthened from the conflict between Russia and Ukraine. Look:
Corn
Ukraine was one of the main corn producers in the world. With the war, the country should reduce the supply of food, giving space to countries like the USA and Argentina, according to experts.
Conab data show that last year Ukraine produced around 18.7 million tons of maize. The production leaders are the USA (54 million t) and Argentina (33.5 million t). The two main producers must win the market that Ukraine will no longer supply and also take advantage of higher prices with lower production.
“Obviously, as a result of commodity prices having risen a lot due to scarcity, these countries are the beneficiaries of this commodity,” said Thiago Guedes, economist at AMG Capital.
war industry
In addition to food production, the arrival of a war in Europe after decades should also encourage the sale of weapons on the continent.
“The immediate consequence of these disputes is the increase in the arms race around the globe, which will benefit the main countries that manufacture weapons, aircraft and other military equipment”, said Thiago Guedes, economist at AMG Capital.
For Guedes, the main beneficiary should be the US, which is the biggest arms seller in the world. Russia is the second largest exporter, and France is also expected to benefit, taking that place.
According to data from the Stockholm International Peace Research Institute (Sipri), last year the US sold US$ 10.6 billion in weapons, while France, ranked third, sold about US$ 3.9 billion.
Wheat
The countries directly involved in the conflict are also major wheat producers. According to Conab data, Russia ranked fourth in last year’s production, with 72.5 million tons, while Ukraine was sixth, with 33 million tons.
Between the destruction of Ukrainian production and Russian export difficulties during the conflict, countries that already own a large part of the production must take part of the market.
China, which produces 136 million tonnes, and India, with 108 million tonnes last year, lead the production ranking and are expected to expand exports, according to Austin Rating’s chief economist, Alex Agostini.
Ore
The reduction in ore production, with an increase in price, should leverage the sector, according to an analysis by XP Investimentos.
In addition, Russia and Ukraine are relevant producers of ore pellets. The material is an agglomerate of ore used in the production of steel. Together, the two countries concentrate around 30% of the supply of this product to the steel sector.
With the war, there are doubts about production, which, among other reasons, made the price of the commodity rise about 30% this year.
Metinvest, controlled by Ukraine’s richest man Rinat Akhmetov, for example, said Ukraine had cut back more than half of its iron ore production after the Russian invasion.
So much uncertainty in production should make Australia, the world’s largest iron ore exporter, be able to grab part of the market not supplied by the countries.
Petroleum
The war caused several countries to stop buying Russian oil. Countries such as Canada, the United States, the United Kingdom and Australia have banned the import of oil from the country.
The trouble point is that Russia is the third largest oil producer in the world, behind only the US and Saudi Arabia, and all the uncertainty about Russia’s ability to extract the commodity has caused prices to rise.
Thus, according to Austin Rating’s chief economist, Alex Agostini, higher oil prices and the vacuum in Russian production should lead to new investments being made in the sector and, also, open an opportunity for smaller countries to cover this demand.
“It is one of the sectors that gained value in the product, given that oil soared and should be strengthened by the investments that will be made,” he said.
Therefore, according to experts, countries with economies that are more dependent on oil exports, such as Saudi Arabia and the United Arab Emirates, or others with large reserves, such as Venezuela and Nigeria, can benefit.
According to the most recent data from OPEC (Organization of Petroleum Exporting Countries), Venezuela has the largest oil reserves on the planet, with 25% of the total. Nigeria is second only to Middle Eastern countries and has 3% of reserves.
