Ukraine crisis threatens global food security

Following the Russian invasion of Ukraine, the global food markets are once again faced with turbulence, which can very well threaten food security for the vulnerable populations around the world. So much so that talking with Bloomberg, the executive director of the World Food Programme, David Beasley, recently acknowledged: “The bullets and bombs in Ukraine could take the global hunger crisis to levels beyond anything we’ve seen before.”

Having said that, it was in 2007-08 when an unprecedented global food crisis led to the commodity prices spiralling out of control. A series of factors — rising oil prices, more food production going into bio-fuels and high prices being driven by commodity futures — all interlinked, had not only tightened the global food supplies but also led to food riots in 37 countries.

But despite the prescription to ensure that a repeat does not take place, commodity prices had been on the rise even before the war. Food prices in 2021 had broken previous records.

Given that all the other factors too are once again emerging strong, and adding to it the supply disruptions caused by the ongoing conflict in the Black Sea region, which provides 30 per cent of wheat, 28 per cent of barley, 18 per cent corn and 75 per cent of the global sunflower oil supplies, the world is once again staring at yet another round of a severe food crisis. How severe it will be, only time will tell.

Already, food protests have been seen in Iraq and Sri Lanka. Many countries, meanwhile, have already withdrawn under a protectionist cover to keep domestic food supplies intact. As Bloomberg rightly observed: “In the aftermath lies a looming crisis: more people likely will go hungry.”

With food prices already on the increase and supplies on the supermarket shelves dwindling, food security is increasingly coming under threat. With US economic sanctions imposed against Russia, the prices of fertilisers too have increased. While Russia is the world’s biggest exporter of nitrogenous fertilisers, the region is also a dominant producer of phosphorous and potash fertilisers. The production cost for farmers in several countries, including India, therefore, is expected to increase. This will also affect crop sowings and, thereby, impact food availability. It is important to know that not only food shortages, but even affordability will determine to what extent the food crisis worsens.

Meanwhile, the Middle East, northern Africa, including the Horn of Africa region, and countries like Afghanistan are likely to be hit first. Egypt, Madagascar, Morocco, Tunisia, Yemen, Lebanon in Africa and Indonesia, the Philippines, Bangladesh and Pakistan in Asia, and Turkey, Iran, Eretria and Iraq remain vulnerable, given the high food imports coming in from the war-torn region. In the European Union, the rising feed prices are hitting the livestock industry, sending meat process soaring. Spain has rationed edible oil supplies in supermarkets.

If the war continues for a little longer, the impact of the rising food prices will undoubtedly be felt across countries. Even before the war, wheat prices had touched a record high. In fact, the prices of most traded commodities have been soaring over the years. According to the UN Food and Agriculture Organisation (FAO), in 2021, wheat and barley prices had risen by over 31 per cent over what prevailed a year earlier, in 2020. This gave a push to the maize prices, which too recorded an increase of 44 per cent over the previous year. Sunflower oil had recorded an increase of 63 per cent in 2021. Further, wheat futures in the first week of March this year had crossed the record level it had touched in 2008 at the time of the earlier food crisis.

The prices are likely to rise further by another 22 per cent of their already elevated levels, increasing the number of undernourished people by another 8 to 13 million in 2022-23, based on the two scenarios that the FAO has worked out. Hunger and malnutrition will grow mainly in the Asia-Pacific region, Sub-Saharan Africa, the Middle East and North Africa.

While grain exporters in India are bracing to fill the gap in the supplies, with the ITC expecting wheat exports to increase threefold in the year to come, touching almost 21 million tonnes, what I find strange is that those who used to criticise Indian farmers for producing a surplus year after year are now brimming with excitement at the possibility of meeting the huge shortfall in the global grain supplies. Nor do I hear any more voices expressing concern at the rise in the export of virtual water when India exports huge quantities of grains, nuts and pulses.

As stated earlier, the world, in any case, was heading towards another food crisis. Oil prices are on the rise, inflation too is accelerating, food prices are already very high, at their peak in 40 years, and bio-fuel production — utilising food crops — has only increased. In America, for instance, writes the New Scientist, a third of the maize crop grown is used for ethanol production, a total of 90 million tonnes of food crops, whereas in the European Union, 12 million tonnes of wheat and rice are converted into ethanol.

In the midst of all this, the US has allowed a few transnational companies to continue trading with Russia. Although Big Ag like Cargill, Nestle, Archer Daniels Midland (ADM), PepsiCo and Bayer have scaled down operations, they continue maintaining the ‘critical’ supply link. This brings up the question as to why food security has been conveniently passed on to the hands of a few big players.

This is where the prescription for saving the world from a repeat of the 2007-08 global food crisis has gone wrong. The global scramble for sourcing food supplies that we see now is primarily because countries were asked to stay away from food self-sufficiency. Building up global food supply chains, in the name of ensuring competitiveness, is what has led to the present crisis.

Learning from the crisis, the immediate need is to reduce the dependence on markets and make farming economically viable. Let’s not forget what MS Swaminathan had said: “The future belongs to nations with grains, not guns.”