The global food system could be tipped into “disaster” as a result of the war in Ukraine, experts have warned, leaving millions facing severe hunger.
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The Covid-19 pandemic had already pushed up the cost of food prices before Vladimir Putin’s invasion of Ukraine. But the “additional strain of war” could be catastrophic for global food supplies as it threatens “supplies of key staple crops”, said The Guardian.
“We were already having problems with food prices,” Maximo Torero, chief economist at the UN Food and Agriculture Organization, told the paper. “What countries are doing now is exacerbating that, and the war is putting us in a situation where we could easily fall into a food crisis.”
‘Breadbasket of the world’
UN Secretary General António Guterres also warned that the crisis in Ukraine, a country often described as “the breadbasket of the world”, would impact food supplies, saying there is a “sword of Damocles” hanging “over the global economy, especially in the developing world.
“We must do everything possible to avert a hurricane of hunger and a meltdown of the global food system,” he said last week.
At least 50 countries rely on Russia and Ukraine for 30% or more of their wheat supply, including developing countries in North Africa, Asia and the near East, according to The Guardian.
Ukraine supplied 12% of global wheat before the conflict and was also the biggest producer of sunflower oil. Although about two-thirds of its wheat exports had been delivered before the invasion, “the rest is now blocked, and farmers may be unable to continue with spring planting, or take in grain harvests in the summer”.
“The crisis goes deeper” still, the paper added. The war has pushed up prices for fertiliser, of which Ukraine and Russia were major exporters, as well as sending energy prices rocketing, further impacting agricultural production costs.
Russia has also limited its exports of barley, rye, wheat, maize, mixed grains, sugar and brown sugar because of economic sanctions placed on it by Western nations. The measures are intended to “ensure supplies for the domestic population”, with the limits set to remain in place until at least 30 June, Deutsche Welle reported.
Rising prices
Europe will probably be able to “weather the immediate storm”, said Politico. While farmers are “bracing for even higher costs of basic inputs like fertilisers and animal feed”, it remains unlikely that consumers will see “empty supermarket shelves”.
But the picture is “more alarming” in the developing world, the site added, especially in North Africa and the near East, which has already been “stricken by droughts” meaning there could be much higher prices for basics like bread.
Ukraine accounts for 80% of Lebanon’s wheat imports and is a leading supplier for countries including Somalia, Syria and Libya, reported the Financial Times (FT). Beirut is “struggling with an already high import bill and this is only going to make things worse”, James Swanston, an emerging markets economist at Capital Economics, said.
Turkey also relies on Russia for over 60% of its wheat imports and is already facing sky-high inflation. “The war is only going to exacerbate the cost of food,” Ismail Kemaloglu, the former head of the state Turkish Grain Board, told the FT.
“What’s critical here is that the Black Sea offers a logistical and price advantage. Costs will rise significantly when [Turkey] buys from the US or Australia,” he warned. “Even if the war ends tomorrow, Ukraine’s planting season has already been disrupted and it will impact the 2022 harvest regardless.”
Political upheaval
High prices for food staples could ultimately “trigger unrest” around the globe, analysts warned the FT.
When wheat prices last spiked significantly in 2007 and 2008 it triggered protests in “nearly 40 countries from Haiti to the Ivory Coast”. An increase in grain prices is also considered to have been “one of the triggers” behind the outbreak of the Arab Spring.
It is also unclear how long the crisis will last, analysts have said, which in itself is raising prices. “The market is worried that this is not a problem that’s going to be solved any time soon,” said Tim Worledge at Agricensus, an agricultural data and pricing agency.
The UN’s Maximo Torero has urged countries to “share information on stocks, harvests and food availability” in order to “even out supply issues”, reported The Guardian.
“Right now, the short-term problem is availability. We need to find ways to fill the gap [in production caused by the war],” he told the paper. “We think the gap can be closed somewhat, but not 100%. Countries should also try to diversify their suppliers.”
But even if the conflict were to be resolved in the coming weeks, the impacts are still likely to be felt far into the future. The soaring costs of fertiliser will likely lead to reduced yields in coming harvests, for example. “These are the problems we will see next year,” Torero warned.
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