Global Food Security – Is a crisis possible?

4 April 2022

Global Food Security – Is a crisis possible?

Russia’s attack on Ukraine comes at a vulnerable time for economies around the world. War broke out – millions have had to flee, farmers have been forced to neglect their fields and ports that would typically distribute food staples across the world have been compelled to shut down. The planet is facing a crisis – a shortage of food and an increase in world hunger.

A critical portion of the world’s wheat, corn and barley supplies are now trapped in Russia and Ukraine as a result of the war – and an even bigger portion of the world’s fertilizers remain in Russia and Belarus. Ukraine and Russia together produce nearly 30 percent of the world’s traded wheat, and 12 percent of its calories. Ukraine is a country of 40 million people, but they produce food for around 400 million people – this is the reality of our globalized world – this crisis affects everyone. Economists are equally as worried by the impacts on the fertilizer market – without the vast quantities of fertilizers exported from Russia and Belarus, the entire global food trade could be significantly impacted, not just wheat. The invasion has upended geopolitics, caused a humanitarian crisis in Ukraine and sent the price of wheat, oil and a number of other commodities catapulting up.

Agricultural and food experts have warned of increasing food insecurity, particularly in poorer countries – many of which are already suffering from high hunger levels. Covid-19, shipping constraints, high energy costs, recent droughts and floods have already presented a problem and the outbreak of war is only compounding this. Millions of people rely on subsidized bread made from Ukrainian grains to survive. Earlier this month, the United Nations stated that the impact of war on the global food market alone, could cause an additional 7.6 million to 13.1 million people to go hungry.

Across the world, we’re seeing different examples of this immediate impact. Farmers in the US are nervously waiting to see whether US wheat exports spike. In the European Union, farmers are concerned about rising costs for livestock feed. Egypt’s state procurer of what, normally buying heavily from both Ukraine and Russia, had to cancel two orders in less than one week – one for overpricing and the second as there were insufficient companies offering to sell their supplies.

Countries like Mongolia and Kazakhstan have in the past imported virtually all of their wheat from Russia and Ukraine and are now obliged to find new sources. Competing against the much larger buyers including Turkey, Egypt and Iran provides a big challenge for these smaller countries.

What has now become more worrying is the next harvest, particularly in Ukraine. The United Nations is predicting that up to 30% of Ukrainian farmland could become a war zone, and as more and more citizens either flee or join the front lines, far less are able to work on the fields. If farmers are unable to continue with their regular farming cycles and complete the planting of new crops this spring , the next harvest will be severely dented, significantly extending the food supply crisis. Russian and Ukrainian wheat is not easily replaced. With the conflict dragging on, and planting season of early April just a couple of weeks away, there is an agricultural time bomb ticking ever louder. Australia is currently at almost full shipping capacity; Argentina is limiting exports and inventories are already tight in the US and Canada. Executive Director of the World Food Program, David M. Beasley says, ‘Ukraine has only compounded a catastrophe on top of a catastrophe…there is no precedent even close to this since World War II”.

Against this blackness is the ingenuity and determination of human nature. Finding a way through, discovering new solutions and supply lines that we never realized existed. Santé Group are pleased to be working closely with several leading organisations to assist in the location, procurement and shipment of many essential food lines required across Ukraine and the surrounding countries. Partnering with leading food supply company, Tradelink International, we are working hard to provide rapid solutions to these supply problems faced by so many – working specifically in two areas: bulk supply to manufacturers, and ready to eat meal packs. A complete end-to-end solution – locating, procuring, and handling shipments – ensuring fast and guaranteed access to those in need. You can find out more about our offering & crisis management support here.