Minnesota agribusinesses with large operations and investments in Ukraine — often called the breadbasket of Europe — are preparing for a worsening situation as Russia escalates the conflict.

With 70% of its land arable, Ukraine is an agricultural power, among the world's largest producers of sunflower oil, corn, wheat, barley, canola oil and soybeans.

Minnetonka-based Cargill has a sizeable footprint in Ukraine, including a major port operation on the Black Sea, multiple grain silos and oil processing plants scattered across a country that's nearly as big as Texas.

The company's easternmost office and facility is in Braginovka — just shy of 30 miles from the Donetsk region currently held by Russian-backed separatist leaders.

"Right now, as of (Tuesday) morning, our businesses in the region continue to operate as normal.​ We do have contingency plans in place as a precautionary measure because there is still a great deal of uncertainty," said April Nelson, a Cargill spokeswoman. "We are closely watching the situation there, prioritizing the safety of our people first and foremost."

Inver Grove Heights-based CHS Inc. also operates in Ukraine, including at a deep-water port near Odessa, like Cargill. Its operations there are smaller than Cargill's, but it does have export terminals around Ukraine and Russia.

CHS said most of its employees are based in Kyiv and the company is keeping a close eye on the developing situation.

"(Our employees') safety and the safety of their families is top of mind. CHS has operated within Ukraine for the last 13 years and we are hopeful that a diplomatic solution to the crisis can be achieved," CHS spokesman Tom Ryan said in an e-mail.

Tuesday afternoon, President Biden announced what he called a "first tranche" of economic sanctions against Russia. The sanctions are aimed at limiting Russia's ability to seek Western financing and hamstring that nation's ruling elites.

Cargill has dealt with geopolitical conflict in the region before. In 2014, the company surrendered control of a sunflower crushing plant in Donetsk to a group of armed rebels.

As one of the world's largest grain traders, Cargill also has 2,500 employees in Russia, including at its Moscow office. On its website, the company says it is one of the largest foreign investors in Russia's agro-processing industry, contributing more than $1.1 billion to the Russian economy.

President Biden's economic sanctions announced Tuesday will likely make the cost of doing business there more expensive, said Jason Ward, managing director of Minneapolis-based Northstar Commodity.

"If further economic sanctions get put on Russia, which I believe the market thinks will happen, there will be a lot less wheat available in the world," Ward said. "Today there was a sharp, sharp rally in wheat prices."

Ukraine is the world's third-largest exporter of wheat; Russia is no. 1.

Wheat prices rose 6% on Tuesday, the largest single-day jump since July 2018. Corn prices rose 3% in Chicago trading.

Ward, who has been a commodity market analyst for nearly two decades, said U.S. producers could see higher prices for their grains, including corn that's already experiencing its tightest global supply on record. Ukraine is the world's fourth-largest exporter of corn.

"Ukraine is rich in natural resources and agriculture. It makes them a target for what Russia is doing," Ward said.

Several nations in the Middle East and North Africa receive as much as half their wheat from Ukraine, making them far more dependent on the country's exports than Western nations are. Foreign policy and humanitarian groups worry that a full-scale Russian invasion could jeopardize food security in other countries.

"[Constrained supply] will drastically increase food prices over the next year if this conflict escalates," Ward said. "There's no faster way to [more] conflict than food insecurity."