(MENAFN- Syndication Bureau) By Nikola Mikovic
While the United States and Europe are essentially self-sufficient in food production, the war in Ukraine is having a destabilizing effect on an unlikely agricultural necessity: Fertilizers. That does not mean that a wave of hunger is poised to sweep the planet. But if the conflict goes on, prices of food will undoubtedly continue to skyrocket as fertilizer becomes harder to source.
Russia is one of the largest fertilizer exporters, accounting for 13 percent of the world’s total output of chemicals and minerals added to soil to help crops grow. Recent moves by Russia suggest that the Kremlin is ready to weaponize this fact. On March 4, the Russian government halted exports of fertilizers, a move that sowed panic from India to Idaho.
Belarus, another significant producer and Moscow’s only ally in Europe, is also slowing its fertilizer exports. After the West imposed sanctions on Minsk for its role in supporting Russia’s invasion of Ukraine, Belarus can no longer ship potash, resulting in global supply chain disruptions of this critical agricultural additive.
President Vladimir Putin knows these export suspensions could lead to food shortages for hundreds of millions of people. The Russian Ministry of Industry and Trade estimates that disruptions in fertilizer shipments could “cause a collapse in external food markets” from Southeast Asia to Latin America. “After all,” the ministry recently wrote, “it is either extremely difficult or even impossible to replace Russian fertilizers today.”
Even if Russia and Ukraine were to end hostilities soon, prices of energy, fertilizers, and food would remain high for at least another year. While richer Western countries can weather the price hikes, in Lebanon, Tunisia, Yemen, Libya, and elsewhere, food shortages brought on by the lack of access to Russian and Ukrainian exports could be destabilizing.
Russia knows this, too. According to the UK’s defense ministry, Russian naval forces have established a blockade of Ukraine’s Black Sea coast, effectively isolating Ukraine from international maritime trade. Russia now controls Ukraine’s agricultural exports, although it’s not clear that Ukraine has much food left to sell. On March 9, Kyiv instituted its own ban on the export of wheat, oats, sugar, cattle, and other products to ensure domestic supplies. But if Russia also stops exporting wheat, barley, corn, and rye, food shortages in many countries could become acute.
It is worth noting that the Kremlin has already suspended grain exports to members of the Moscow-led Eurasian Union – Armenia, Belarus, Kazakhstan, and Kyrgyzstan. The decision was motivated by the need to ensure the country’s food security and to help protect the domestic market. “Save yourselves” seems to be the official policy not only of the Russian Federation, but of most actors in the global arena.
The problem for many countries is that Russia and Ukraine account for about 30 percent of world wheat exports and about 80 percent of sunflower oil exports. At the same time, 40 percent of wheat exports from the Black Sea region go to the Middle East and North Africa, where food prices have already risen sharply.
Lebanon will be hit especially hard, given that 80 percent of its wheat supply comes from Ukraine. Turkey, on the other hand, imports 70 percent of its wheat from Russia, but the country’s agriculture ministry claims that supply shortages won’t be felt until the next harvest season, if at all.
Other major wheat importers – particularly Egypt, Bangladesh, and Iran – are also heavily dependent on grain that comes from Russia and Ukraine, and are expected to face serious food shortages. In Tunisia, where a financial and political crisis is deepening, the current price of wheat – $13 per bushel – is already unbearable.
Algeria is one of a few MENA countries that does not import wheat from Russia or Ukraine. Instead, Algiers purchases grain from Argentina and France. Potentially, the country could also source wheat from the US, but transportation takes weeks, which drives up the price.
With Ukraine’s own harvests in doubt, and commodity export bans being used by the Kremlin as a political cudgel, global food shortages are almost certain to continue long after an end to hostilities. Sanctions imposed on Russia by the West will not be lifted when Russian forces return to their barracks, and the Kremlin is unlikely to lift counter-sanctions any time soon.
Thus, the war in Ukraine has triggered processes that will upend international trade and threaten global food security for years to come. To compensate, countries rich and poor will need to become more self-reliant – to counter the loss of what goes into the soil, and to ensure that abundance comes out.
Nikola Mikovic is a political analyst in Serbia. His work focuses mostly on the foreign policies of Russia, Belarus, and Ukraine, with special attention on energy and “pipeline politics.”
MENAFN21032022006092013299ID1103881403
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.