How much will current tension in the Middle East impact Canadian ag exports?
It has been a very difficult week for Canadians, as conflict in the Middle East between the U.S. and Iran attempts to find calmer ground. In an unbelievable tragedy, 176 people were killed, including 57 Canadians, when a passenger jet was shot down — reportedly by mistake — leaving Tehran.
Earlier this week on RealAg Radio, I was talking to Chuck Penner, of LeftField Commodities, about acreage forecasts for the coming year but squeezed in a question regarding agricultural exports. The Wall Street Journal ran a story suggesting that U.S. wheat exports to the Middle East were threatened by the increasing tensions. I asked Penner on whether Canada could face the same punitive measures from countries such as Iraq and he sees the impact as minimal.
“These countries are going to find ways to feed their people, and you have to remember that the traders there will want to keep their head down and purchase wheat,” says Penner. He continued, “They might buy more Russian wheat but I do not see a huge impact on Canadian exports to the region based on how anyone feels about the U.S.”
That’s not to say that other countries in the same region have reacted similarly. The reaction by Saudi Arabia to then-foreign affairs minister Chrystia Freeland’s unwanted commentary resulted in halted barley and wheat sales.