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INTRODUCTION: $34.25 BILLION OF AGRICULTURAL WAR LOSSES
After eight months of Russia’s full-scale war against Ukraine, the damage toll to Ukraine’s agriculture reached $6.6 billion, or nearly 23% of its capital stock.
Agricultural War Damages Review regularly provides details on the structure and estimates of damages1.
Damages, however, usually fall short of the economic losses. While damages reflect the destruction of tangible assets and inventories, the losses estimate the foregone revenue due to lower quantities of goods produced and additional costs the producers bear because of the war.
Compared to the report’s previous issue, the total amount of losses increased by $10.8 billion, resulting in $34.25 billion in losses. The key drivers of the increase are depressed domestic prices due to the export disruptions and soared export costs ($3.1 bn.), the inclusion of the losses for winter crops in the 2023 calendar year ($3.0 bn., the only category that was not included in the previous issue of the report)), and an increase in the production losses for the annual crops ($4.7 bn.) in the 2022 calendar year. The increase in production losses for annual crops in 2022 is caused by both lowered expected harvest and changes in the methodology of estimations.