Wheat grows in a field trial at Penn State's Landisville research farm.

Wheat grows in a field trial at Penn State's Landisville research farm.

Despite major disruptions to world ag markets, the United States remains a land of plenty.

That is, the nation has plenty of food, but also has plenty of room to reform the ag economy, according to Will Masters, an ag economist at Tufts University in Massachusetts.

As the U.S. looks to put the COVID-19 pandemic behind it, food prices are rising at their fastest pace in 40 years, and headlines have warned of a global food shortage stemming from Russia’s invasion of Ukraine.

While high food prices will continue to cause pain, the U.S. is unlikely to see a true shortfall of food, Masters said.

America’s food supply chain can be surprisingly resilient, in part because it isn’t really a chain.

Retailers generally have a variety of vendors they can choose from, so if one can’t fulfill an order, the next one probably can.

This system could be called a “supply mesh” or “supply chain-link fence,” Masters said.

“We do sometimes have empty shelves for specific things, but overall food suppliers are very, very good at staying up all night and arranging the alternative source,” he said.

The U.S. and its allies have also been able to mitigate some disruptions from the Russia-Ukraine war.

U.S. intelligence services publicized Russia’s troop buildup near Ukraine’s border well before the attack, preventing a surprise that could have rocked world markets.

And sunflower oil, one of Ukraine’s top ag exports, can often be replaced with other vegetable oils like canola if necessary, Masters said.

Still, Ukraine is facing major crop losses in two categories — already-harvested crops that can’t be exported, and future crops that won’t be planted because of war damage or input shortages.

There’s nothing to be done about the stored grain that has been destroyed through shelling, fire and spoilage.

But Ukraine and Western countries have been working on ways to get the rest of the export crop to market — or at least away from the Russians, who have been accusing of plundering grain reserves.

Ukraine would normally export its grain through its efficient ports on the Black Sea, which are now blockaded or captured.

As a result, the grain could be evacuated by truck or rail to ports in Romania or Poland. These countries don’t all use the same railroad gauges, though, and overland transportation will bloat the cost of exporting.

“The advantage of the ocean is so great that losing it is a terrible, terrible blow,” Masters said.

North Africa and the Middle East would usually be Ukraine’s major foreign markets, simply because Ukraine is the closest breadbasket region to them.

For the time being, more distant producers like the United States and Argentina can replace Ukrainian grain in those markets.

“The world wheat market is highly diversified in places that it comes from and destinations, and so when one location is disrupted, it’s usually possible to adapt fairly quickly,” Masters said.

For many families around the world, adapting would be easier if other wars, weather problems, and supply chain issues hadn’t already been driving up food prices.

In the past two years, the number of severely food-insecure people worldwide has doubled to 276 million, U.N. Secretary-General Antonio Guterres said in May.

Ukraine was a major supplier to the World Food Program, which feeds people in refugee camps, natural disaster areas, and violence-plagued countries such as Yemen and Somalia.

To make matters worse, the U.N. body will struggle to raise its budgets fast enough to keep up with rising food prices, Masters said.

Millions more people around the world who are in financially precarious situations may have to forgo medical care, education and other costs so they can eat — but eat they will, if at all possible.

“People will defend their basic calorie needs with every fiber of their being,” Masters said.

With much of the Black Sea grain off the market, U.S. farmers could see an increased demand for their crops.

To grow production, farmers might convert pasture acreage to field crops, and some who were chasing premium organic prices might switch to higher-yielding conventional crops, Masters said.

USDA is allowing farmers to take land out of expiring Conservation Reserve Program contracts a year early, but the land put in this program is usually marginal.

Some vegetable oil and corn could be diverted from biofuels, but Masters thinks that nonfood demand is largely locked in.

Ethanol has actually contained inflation in fuel prices because the biofuel is less expensive than gasoline, according to the National Corn Growers Association.

In addition to growing production to chase high grain prices, farmers could respond to high fertilizer costs by improving their nitrogen management.

Masters said fertilizer prices have mostly been modest for decades, which has limited farmers’ incentive to prevent runoff and volatilization.

“You just knew that you were wasting half your nitrogen, but it didn’t matter,” Masters said.

With fertilizer as dearly bought as this spring’s was, farmers might change their approach, increasing use of precision technology to maximize the nitrogen that stays on the farm. That strategy would benefit both farm profitability and the environment.

While the U.S. is in no way headed for famine, the country has faced retail shortages of certain foods — meat and milk early in 2020, baby formula more recently — over the past two years.

Those brief disruptions may have tarnished America’s image as a land of abundance, but Masters said such problems are not new, even in the postwar era. He lived through the early 1970s, the era of stagflation and long lines for gasoline.

“I was 12 years old at that time, and that’s what really kicked me into interest in food,” he said. “I was reading the newspaper for the first time, and it was full of stories about how there’s no meat and people can’t buy bacon.”

Though supply systems can be flexible, they can also break down when they are built more like a chain than a mesh.

Meatpacking and infant formula processing both rely on a handful of major plants, so a problem at one or a few of those locations can slow the flow of goods to consumers.

In recent decades, Masters said, federal policy has sometimes helped Americans achieve a safe, affordable lifestyle, but it has often flopped.

At the beginning of the pandemic, the U.S. established eviction moratoriums and food aid that prevented an uptick in homelessness and food insecurity — major achievements given the disruption to the economy.

But the U.S. continues to provide poor health care for children, and it permitted millions of needless COVID-19 deaths by allowing unscientific resistance to masking and vaccines to run rampant, Masters said.

Since the 1980s, Republicans have generally viewed government programs with suspicion on the grounds that money is being taken from “us” and given to some undeserving “them.”

Attacking government spending ended up hurting conservatives, Masters said. The strategy limited the funding for infrastructure that rural businesses need, and it weakened the enforcement of regulations that help startups succeed.

“There’s a lot of babies out with the bathwater,” Masters said.

Masters sees an unflattering contrast between today and an earlier time in U.S. history, when antitrust laws and safety inspections in meat plants were created. In some sense, he said, the United States regulated its way to greatness.

In the 19th century, for example, the U.S. was vying with Australia, Argentina and Brazil to become a livestock powerhouse.

Those countries all had similar resources, but the U.S. won because it was the first to get control of cross-state livestock epidemics that were undermining productivity.

Sometimes U.S. marshals had to be called in to enforce the killing of infected herds, but eventually the federal government overcame resistance from state legislatures, Masters said.

The federal government is still leading the fight against animal diseases, as shown during this spring’s outbreak of highly pathogenic avian influenza.

USDA mandated the depopulation of more than 40 million poultry. Indemnity payments helped farmers weather the loss, and industry is on board with the federal response protocol.

But in the nation as a whole, Masters said faith in institutions has eroded in step with a sinister turn in the us v. them rhetoric.

The main conflict in U.S. politics, he argued, is no longer between free-market conservatives and conventional liberals.

Small-R republicans who still trust institutions and want to spread success widely are now pitted against authoritarians — they might call themselves nationalists — who want charismatic individuals to bring benefits specifically to their in-group.

Masters hopes that Americans will relearn to trust democratic institutions and each other, and support rules that help small businesses compete.

“It all comes down to whether people feel that we are willing to make individual sacrifices for a longer-term better future,” he said.

With the war in Ukraine disrupting global food supplies, USDA is allowing farmers to back out of expiring conservation contracts a little early.

The Russian invasion of Ukraine will have devastating effects on Ukrainian agriculture. Fuel shortages, damaged infrastructure, and land mines in the fields threaten Ukraine's ability to grow food.

Pennsylvania grain growers have an opportunity to get good prices right now thanks in part to the war in Ukraine.

Phil Gruber is the news editor at Lancaster Farming. He can be reached at 717-721-4427 or pgruber@lancasterfarming.com. Follow him @PhilLancFarming on Twitter.

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