Russian Wildfires & Economic Issues

Human Factors to Recent Wildfires

• Many recent forest fires caused damage to Russia's agricultural sector. The news site Ecosystem Marketplace argues that wildfires in Russia in fall 2010 were energized by the large geographic lands that make up the Russian agricultural sector. In the 1960s, Russia destroyed many peat-lands to create agricultural farms. Those peat-lands could have helped absorb carbon dioxide from the fires. Instead, by draining the lands to create farms, wildfires can accelerate across the country at alarming rates.

Economic Costs

• The World Bank estimated the 2010 wildfires destroyed around 25 million acres of land in Russia. This is roughly the size of Iceland. The intense fires sent smog into Moscow, increasing pollution and public health concerns. Almost all the crops affected by these fires were wheat. The wheat crop yield, estimated by the website Market Oracle, could decrease by a full 80 percent in the following year. As a result, then President Vladimir Putin banned all exporting of grains so Russia could keep what grains they had for its population.

Global Economic Results

• As a result of stopping wheat exports and Russian vendors purchasing imports from across the world to meet wheat demands, the global economic system was rocked by the wildfires. Wheat crops from the European Union and Canada saw a 90 percent price increase because the supply had been shifted to meet the demands of Russian consumer needs. Even with no Russian wheat exporting to the world market, the Russian marketplace still required large amounts of wheat to meet demands. Hence, according to the World Bank, major wheat-producing countries had to increase prices to other countries as Russia bought more international wheat.

The Cost

• National Public Radio in 2010 reported that in total the wildfires in Russia in 2010 cost Russia $14 billion as a result of environmental damage, import purchases and land restoration. This cost is roughly 1 percent of the Russia's GDP. As one can see, wildfires in Russia have immense economic ramifications.