Global agricultural commodities trader issues warning about ‘food wars’
Date
6/30/2024 8:49:31 AM
(MENAFN) Olam Agri, a prominent global agricultural commodities trader within the Olam Group, has issued a stark warning about the emergence of what it terms "food wars" due to escalating geopolitical tensions and increased protectionist measures. According to statements cited by the Financial Times, Sunny Verghese, CEO of Olam Agri, emphasized that global disputes over food resources could potentially surpass historical conflicts over oil and water.
Verghese highlighted that government-imposed trade barriers aimed at bolstering domestic food reserves have exacerbated food inflation worldwide. This trend, he pointed out, began with the onset of the COVID-19 pandemic and intensified following geopolitical developments such as the Ukraine conflict and subsequent Western sanctions against Russia. These measures have led to disruptions in grain and fertilizer exports, worsening food insecurity particularly in vulnerable regions and contributing to a global cost-of-living crisis.
Despite these challenges, Verghese noted that major agricultural commodity traders have seen unprecedented profitability in recent years. He attributed the heightened food price inflation to government interventions by wealthier nations, which have accumulated surplus stocks of strategic commodities, thereby distorting global supply-demand dynamics.
Verghese underscored that countries like India and China have significantly bolstered their buffer stocks, exacerbating the global food supply imbalance. This situation, he argued, not only intensifies economic pressures but also poses substantial risks to food security and stability on a global scale.
The observations from Olam Agri highlight deepening concerns within the agricultural commodities sector about the ramifications of geopolitical rivalries and protectionist policies on global food systems and affordability, emphasizing the urgent need for coordinated international efforts to mitigate these challenges.
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