The Economy

Prolonged Ukraine Crisis Could Deal Blow to U.S. Companies

Agriculture, energy infrastructure and fast food are most exposed to the threat of Russian military occupation and continued political unrest.
Vincent RyanMarch 3, 2014

Which industries and companies could be hurt from the political and military situation in Ukraine? According to The Street, those at risk include large U.S. agricultural companies, energy infrastructure exporters and fast-food giants. All could suffer if the situation in Ukraine deteriorates further, according to The Street’s report.

In agriculture, Deere exports parts for agricultural machinery to Ukraine, and Archer Daniels Midland and Cargill are major players in agricultural trade. In energy, the Ukraine and surrounding region has one-fourth of the world’s natural gas reserves. Chevron, Royal Dutch Shell and Exxon Mobil operate in the region, and Siemens “has plans to build rail infrastructure” there, reported The Street.

In both energy and medical diagnostics, the country is in the process of replacing Soviet-era infrastructure, which had represented opportunities for Medtronic and Pfizer.

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On the consumer front, PepsiCo and McDonald’s could see hits to their sales numbers because of the conflict. In a Securities and Exchange Commission filing, Anheuser-Busch InvBev stated that it’s beer volumes in Ukraine fell almost 19 percent in fiscal year 2013, “the instability in the country significantly impacting beer consumption.”

Developments in Ukraine rattled Western markets on Monday, as Russia seized border posts and planned to expand its forces in the Crimea region.

Source: Chevron, Exxon Among U.S. Companies Vulnerable to Ukraine Unrest

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