Russia is a major exporter of fertilizer. Ukraine and Russia are major producers of wheat, corn, barley, and sunflower oil. Between them, about 30 percent of the world’s wheat exports. According to a study cited by Jack Nicas, New York Times’ Brazil bureau chief, Russia and Ukraine account for about 12 percent of the world’s calories. Nicas spoke about his March 20 story on The Daily podcast on Tuesday.
Nicas wrote in March:
The upheaval is compounded by major challenges that were already increasing prices and squeezing supplies, including the pandemic, shipping constraints, high energy costs and recent droughts, floods and fires.
Now economists, aid organizations and government officials are warning of the repercussions: an increase in world hunger.
The looming disaster is laying bare the consequences of a major war in the modern era of globalization. Prices for food, fertilizer, oil, gas and even metals like aluminum, nickel and palladium are all rising fast — and experts expect worse as the effects cascade.
“Ukraine has only compounded a catastrophe on top of a catastrophe,” said David M. Beasley, the executive director of the World Food Program, the United Nations agency that feeds 125 million people a day. “There is no precedent even close to this since World War II.”
Ukrainian farms are about to miss critical planting and harvesting seasons. European fertilizer plants are significantly cutting production because of high energy prices. Farmers from Brazil to Texas are cutting back on fertilizer, threatening the size of the next harvests.
Wheat prices are up 61 percent in the last year and 12 percent since the Russian invasion (as of March 20). There are stockpiles in many countries, but prices may render wheat products unaffordable until Eastern Europe stabilizes.
A report from Alistair MacDonald in The Wall Street Journal (March 21) is summarized in Illinois Farm Policy News:
“Much of the exports go to developing economies already struggling with food-cost inflation.”
MacDonald added that, “Russia’s naval blockade and fighting around Ukraine ports has all but stopped maritime shipping and left limited means for transporting goods. Wheat prices have hit record levels over the effect on Ukrainian and Russian shipments.
“Like Ukraine’s military efforts, the country’s agriculture sector is rallying. Exports are being rerouted, and Ukraine is asking the U.S., Poland, France and others for supplies, said Taras Vysotskyi, Ukraine’s deputy minister of agrarian policy and food. In the best case scenario, the country’s agricultural exports will fall by a fifth this year compared with 2021, he said, but a much bigger drop is more likely.
“Should Russian forces leave immediately, Dmitry Skorniakov said, his four farms would still struggle to resume work. Tractors, chemical sprayers and a grain silo were destroyed on one farm located close to the besieged city of Mariupol, he said. Some of his workers have left to join the country’s defense.”
Vladimir Putin doesn’t care what impact his actions have around the planet. Not when “Russia’s Tucker Carlson” says he is “waging a special operation not against Ukraine, but against the whole West.” You are all “Nazis” now.
Drink up. You may be paying more for beer soon.
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