On the menu today: The worsening global food crisis might be the biggest problem that you’re not hearing nearly enough about. The sudden shortage of food across the planet is not just because of the Russian invasion of Ukraine, although that is a major factor. It is due to the Russian invasion of Ukraine and a global fertilizer shortage and India;s suffering a severe heat wave and countries’ enacting new food-export restrictions.
Pay Attention to the Global Food Crisis
Senator Roy Blunt (R., Mo.), speaking earlier this week:
“You can find different numbers on this, but roughly 25 percent of all the wheat exports in the world come from Ukraine and Russia, about 20 percent of all the corn exports in the world. 90 percent of the sunflower cooking oil comes from there, and a lot of fertilizer comes from there right now from Ukraine, which is the bigger partner in that food distribution of the two countries.”
“And nothing is coming out of Ukraine. Nothing is coming out of the port at Odessa. Nothing is coming out of the port at Mariupol and hasn’t since the Russian invasion began. ”
“This has huge impact on the whole world but particularly on Africa, food in Ukraine, food in Africa. What’s in the silos in Ukraine right now is not getting out. And Ukrainian farmers aren’t getting crops planted for this year.”
Keep in mind, even if the Russian invasion ended tomorrow — and it won’t — there’s still the issue of the hundreds of anti-ship mines now floating around in the Black Sea, a few of which have ended up drifting into the territorial waters of Turkey, Bulgaria, and Romania. It’s not going to be safe to send cargo ships through those waters for a long time.
And in addition to a long, long list of other allegations of war crimes, the Ukrainian government says Russian soldiers have stolen “several hundred thousand tons” of wheat as well as agricultural equipment from areas of Ukraine that they are occupying. In a spectacular demonstration of the power of GPS tracking and global satellite signals, the Ukrainians remotely disabled at least two dozen John Deere combine harvesters, tractors, and seeders that had been taken out of the country. But the Russians are likely to strip the stolen equipment for parts anyway.
For what it’s worth, U.N. secretary-general Antonio Guterres said this week that there is no realistic work-around, that until the war in Ukraine ends, the world is going to have a shortage of wheat and corn: “There is really no true solution to the problem of global food security without bringing back the agriculture production of Ukraine and the food and fertilizer production of Russia and Belarus into world markets despite the war.”
There were hopes that India could increase wheat production and make up the gap, but that country is now experiencing an ill-timed, intense heat wave that is expected to reduce this year’s crops. And now that India is unsure if it’s going to have the surpluses it had previously anticipated, it’s considering restrictions on wheat exports. (More on export restrictions in a moment.)
One analyst pointed out that the problem is, at least for now, less a lack of food than a lack of ways to get it where it needs to go. Right now, Ukraine has 15 million tons of grain that can’t fit into its existing silos, because the grain in the silos can’t get exported to any customers.
But the global fertilizer shortage is likely to reduce crop yields in a lot of places, which means we may be dealing with a worse problem in the coming months and years. Using less fertilizer usually translates into fewer crops. And keep in mind that this is not just a far-off overseas problem. “The cost of the fertilizers farmers across Mid-Michigan use has doubled, and in some cases tripled.” No joke, “manure is absolutely a hot commodity.”
The world probably could have done without the comments from U.S. Agency for International Development administrator Samantha Power on ABC News this weekend:
Fertilizer shortages are real now because Russia is a big exporter of fertilizer. And even though fertilizer is not sanctioned, less fertilizer is coming out of Russia. As a result, we’re working with countries to think about natural solutions like manure and compost. And this may hasten transitions that would have been in the interest of farmers to make eventually anyway. So never let a crisis go to waste.
Please stop telling us what a great opportunity there is in an oncoming famine. I would love to take the slogan, “Never let a crisis go to waste,” put it onto a rocket, and blast it into the sun.
But to give the Biden administration a little bit of credit, it is moving to provide $670 million in food assistance to other countries that need it. It will spend $282 million to procure U.S. food commodities to bolster existing emergency food operations in six countries facing severe food insecurity — Ethiopia, Kenya, Somalia, Sudan, South Sudan, and Yemen — and then another $388 million to cover ocean-freight transportation, inland transport, internal transport, shipping and handling, and other associated costs.
In late March in Brussels, Biden said that, “We had a long discussion in the G7 with the — with both the United States, which has a significant — the third-largest producer of wheat in the world — as well as Canada, which is also a major, major producer. And we both talked about how we could increase and disseminate more rapidly food. Food shortages.”
But there are some ominous signs that a lot of countries’ governments are moving their policies in exactly the wrong direction. With countries getting more worried about food prices and reliable food supplies, more countries are restricting the export of food:
Since the Russian invasion of Ukraine on Feb. 24, the number of countries imposing export restrictions on food has climbed from 3 to 16 (as of early April 2022). The total amount of exports affected by the restrictions represents about 17 percent of total calories traded in the world. Those restrictions include export bans implemented by 16 countries covering 29 separate measures, and account for 12.4 percent of traded calories.
At the exact time that we need to make it easier to get food from one country to another, countries such as Russia, Indonesia, Turkey, Kyrgyzstan, and Kazakhstan are making it more difficult or outright impossible to export food. (I’ll cut the Ukrainians some slack for their food-export restrictions, on account of the whole “getting invaded” thing.)
This may seem mundane, but India lost access to 45 percent of its palm oil overnight.
Few of these problems are expected to be short-lived. The numbers in the latest World Bank assessment are eye-popping:
Energy prices are expected to rise more than 50 percent in 2022 before easing in 2023 and 2024. Non-energy prices, including agriculture and metals, are projected to increase almost 20 percent in 2022 and will also moderate in the following years. Nevertheless, commodity prices are expected to remain well above the most recent five-year average. In the event of a prolonged war, or additional sanctions on Russia, prices could be even higher and more volatile than currently projected. . . . Wheat prices are forecast to increase more than 40 percent, reaching an all-time high in nominal terms this year. That will put pressure on developing economies that rely on wheat imports, especially from Russia and Ukraine.
The human cost of this is staggering, with the number of people around the world at risk of famine jumping from 45 million to anywhere from 53 million to 65 million.
Right now, there’s probably some cold-hearted isolationist saying, “Yes, yes, this is all very sad, but how is this America’s problem?” Well, hungry people do things that well-fed people do not. They protest and they riot. (A lot of Middle East political experts argue that grain prices triggered the Arab Spring, although some other experts dispute this or contend that it is an oversimplification.) Hungry people move across borders as refugees. They are more easily recruited into terrorist or extremist groups. (This is not saying that terrorists are motivated simply by hunger or poverty, just that a hungry, unemployed, and desperate young man is easier to recruit to an extremist cause than a well-fed, employed, and satisfied young man.) Hungry populaces are more likely to turn to demagogues promising an easy solution. Where there is hunger, there is conflict.
As our Andrew Stuttaford warned back on March 7, “Given the experience of the Arab Spring (let alone centuries of evidence showing the turbulence that sharply rising food prices can bring), it’s not the boldest of predictions to think that widespread political trouble lies ahead.” Andrew also noted that the Chinese government was aggressively pursuing self-sufficiency in food production.
Plus, there was this guy who, about 2,000 years ago, said, “For I was hungry and you gave me something to eat, I was thirsty and you gave me something to drink,” and He seemed to be quite insistent that we have a moral obligation to help people.
ADDENDUM: This week ExJon — a.k.a., Jon Gabriel — is sitting in for me on the Three Martini Lunch podcast, and I understand he’s even quoting Dennis Green’s famous postgame rant and making jokes about the Jets.
And in case you missed it yesterday, I took a look at what quantum computing is, what it does, and why it is important to U.S. national security.