if you want to know RU economic future, look at Venezuela today…
(original)
google translate:
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(sorry, I cant get the google translate to work, it seems)
Yes, but imagine Venezuela with 1/3 of it’s trade cut off. That’s what Russia will be like. Assuming that India and China will still trade with Russia - probably they will, at deep discount prices.
I think I can translate.
Not too long ago, from the Port La Cruz, in eastern Venezuela, the ferries(?) that took thousands of Venezuelans to the touristy Isla Margarita. But the ferries stopped navigating and are forgotten and half sunk. What happened?
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straight out of the comunist playbook:
the private company that run those, was expropiated … and the ferries started to be run by competent people of Chavez’ comunist state.
which lasted for about 2-3 years b/c the first item that the regime “redirected” was the maintainance budget …
… that is pretty much the link to russia - as their (flying and non-flying) assets seem to be following the same book.
WaPo article indicates that sanctions are starting to bite:
Paywalled. Let me ask this - does the article identify many specific ways that their economy is suffering?
Non-oil and gas revenue down 20% year-to-year in October, Russian retail sales down 10%, cargo turnover down 7%. Gas production down 20%, oil sales “plummeting” (so they don’t have a number, only a sense of decline). Russia claims GDP has only dropped 3.5%, but analysts point out that is now a meaningless figure since rubles can no longer be converted rendering notions of its value uncertain. The Russian Central Bank is warning of heavier GDP declines next quarter and more and more hard currency is being pulled from the banking system.
Does Russia mine all their coal, or do they import some?
Russians Face Freezing to Death As They Run Out of Fuel To Heat Homes (msn.com)
A Swiss study reports that “fewer than 9% of western firms have divested from Russia since it launched its invasion of Ukraine.” [?!]
I hope all you guys are ready for the world food crisis we’re going to face over the next two or three years.
Are you suggesting that there might be a negative aspect to prolonging a war in one of the worlds most productive farming regions?
Oh hell, that’s just the FIRST problem.
It does seem that the Russian leadership is willing to sacrifice anything to win this war. At this point, their lives are on the line and failure is not an option. Sanctions will not disuade Putin, and may even draw more domestic support. There is nothing to cheer about here
Russia as it currently exists is probably doomed. They cannot win this war through conventional means; their chance was last March and it’s gone. The country is in terrible shape economically, has no real allies, and is sitting on a demographic time bomb.
The problem is they’re gonna take a lot of innocent people with them. I am not joking about the food problems the world is going to face. It’s not just Russian and Ukranian food exports, though the lack of that will kill millions; it’s also their exports of basic precursors to farming, like potash. Russia and Belarus are the world’s second and third largest potash exporters.
Are there any models or predictions about the likely global impact of these agricultural disruptions?
There are some reports from earlier in the conflict.
There are many poor and middle income countries that are dependent on Russia and the Ukraine grain and edible oils that are facing a food cost crisis. The disruption of fertilizer supplies will also increase food costs around the world.
How will that be addressed in the short term? You seem to be aware of the issue; what areas will be providing potash or substitutes, if there are any?
Saskatchewan is the single biggest producer of potash in the world. I wouldn’t be surprised if Nutrien and the others are ramping up production.
Saskatchewan has absolutely massive potash production (typically about 30% of global production), and over the past few decades a lot of that production capacity has been idling as prices have been on the low side. Those mines have all been hiring like mad over the past year, and there’s actually a huge new one just coming online - BHP’s Jansen mine stage one is expected to have a capacity of 4.3 million tonnes/yr, which is something like 5% of global production capacity by itself. I don’t think we can make up for the entirety of Russian and Belarusian production, but we can cover a significant portion of the shortfall if all our players turn on all their available production. And since China and India are two of the largest importers and will probably happily buy discounted Russian/Belarusian potash, I would expect that potash prices will be very high but not ludicrous while sanctions remain in place.
In googling about for statistics, I saw a Nutrien press release from mid-last year saying they’re ramping up production by 40% to 18 million tonnes/year by 2025. That’s without opening any new mines.
I’m sure K+S is doing likewise, but I don’t think they had anywhere near as much idle capacity as Nutrien.