Svenja Schulze, Germany’s Minister for Economic Cooperation and Development, has advocated that a worldwide alliance for food security be established in order to eliminate world famine. Specifically, she claims that the nations of Africa, the Middle East, and Asia would have the most difficult time because of food shortages. We recognize the magnitude of the danger and the extent to which Russia is capable of altering the current situation despite the sanctions.
Russia’s President Vladimir Putin has often warned of a worldwide food catastrophe as a result of the West’s activities in respect to the country. According to him, the sanctions have resulted in the disruption of food and logistical ties, as well as the acceleration of inflation and the deterioration of the living conditions of millions of people. The president highlighted that mass famine is a distinct possibility in the world’s poorest nations.
Russia, with its vast grain and food reserves, is one of the world’s top grain and food providers. According to Agroexport, sales of agricultural goods from the Russian Federation are expected to expand by 21 percent in 2021, reaching more than $37 billion dollars. Cereals, oil and fat products, as well as fish and seafood, are among the most highly sought-after export items. The EU nations, China, Turkey, Kazakhstan, Egypt, and South Korea are the top purchasers, followed by Turkey and Kazakhstan.
In an interview with the Czech online journal Seznam Zprávy, UN Secretary General António Guterres said that Russia and Ukraine combined account for 30 percent of global wheat and barley output, a fifth of world maize production, and more than half of world sunflower oil production. Farmers are unable to harvest, ports are closed, and exports are halted as a result of the fighting, according to the Secretary General of the United Nations. All of this, he said, causes supply lines to be disrupted and results in a dramatic increase in pricing.
Ngozi Okonjo-Iweala, the president of the World Trade Organization (WTO), raised similar worries in a speech last month. According to her, the spike in global food costs as a result of the situation in Ukraine runs the potential of resulting in food riots. “Food and gasoline are the two most crucial commodities in the consumer baskets of impoverished people all around the globe, regardless of where they live. The poorest nations and the poorest people in impoverished countries would bear the brunt of the consequences “In an interview with RIA Novosti, the organization’s president said that
The White House has also addressed the threat of starvation in Africa and the Middle East, as well as other regions. During an interview with CNBC, US administration economic council spokeswoman Cecilia Rose said that Russia and Ukraine are the breadbasket for many parts of the globe since they are major producers of wheat, soybeans, and other agricultural products. According to French President Emmanuel Macron, after a meeting of the leaders of the G7 nations, the next food crisis will be unparalleled in its scope. As a result, he believes that the situation will deteriorate much worse in the following 12-18 months.
In an earlier statement, Russian Prime Minister Mikhail Mishustin said that Russia is self-sufficient in grain, vegetable oil, fish and meat to a greater than 100% degree. More than 80% of the country’s demands for potatoes, milk, and vegetables are met by the local agro-industrial complex, according to the minister. Farmers have received more than 32,000 tractors, combines, and other pieces of agricultural equipment as a result of subsidies from the Russian government for the purchase of domestic agricultural equipment by farmers, as well as a preferential leasing program, according to Mishustin.
Way from food crisis
According to Anatoly Tikhonov, head of the International Center for Agribusiness and Food Security at the RANEPA Higher School of Corporate Management in Moscow, food shortages started during the epidemic. Still, logistical links were broken, and the poorest nations were unable to get food on time and at costs that they could pay, according to the expert’s observations.
“During the epidemic, all nations, particularly China, started to “overstock” their supplies.” And food shortages started to affect the world’s most impoverished nations, including those in Africa and the Middle East, as well as those in so-called “hot spots” of the world’s population. However, the number of hungry individuals rose dramatically even then,” Tikhonov observed.
According to the expert, food supplies have not yet restored to their pre-pandemic levels during the acute phase of the outbreak. The present state of the globe has only compounded the severity of the issue.
Worldwide, according to the United Nations’ Food and Agriculture Organization (FAO), more than 800 million people are already hungry or malnourished, according to their estimates. “This is a gigantic number,” Tikhonov said, referring to the statistics.
US and European countries are also at danger of food shortages in the future, although in their case, the hazards are mostly tied to meteorological circumstances rather than agricultural production. Tikhonov used the case of an unusual drought that occurred in the state of Kansas in the United States as an illustration. According to the expert, crop failure will most likely occur for the second year in a row as a result of the unpredictable nature of the weather.
“However, wealthy countries such as the United States and the European Union will be able to simply purchase the harvest at a discounted price. And the poorest nations will not have the money to pay for this – that is precisely the aim of the exercise. Because a portion of the items has been removed from the market, the price of the remaining commodities would rise as a result “Tikhonov was emphatic in his statement.
At the same time, it will become more difficult for Americans and Europeans to make purchases of merchandise. According to the expert, this is due to the fact that the cost of all components used in the manufacture of agricultural goods has grown multiple times in the present economic climate.
According to Tikhonov, Russia may theoretically continue to export agricultural goods to other countries. As a result, he claims, exceptions are made in all sanctions that are related to agricultural goods and the agricultural economy. Exporting Russian products overseas, on the other hand, has grown much more difficult in reality as a result of logistical difficulties, according to him.
“From a practical standpoint, as long as other nations do not intervene, there will be an issue with supply,” says the author. Because to exclusions to sanctions, there is the option of exporting items from Russia. However, there are difficulties with the logistics. Many transportation businesses have ceased to do business with our ports, carriers, suppliers, and manufacturers as a result of this. As Tikhonov forecasts, “if a crisis scenario develops, I am 100 percent certain that they will issue a directive, and all carriers will rush to us to load cargo.”
In my perspective, we will have a better grasp of how we will be able to export the upcoming harvest within the next two to three months. Sanctions on us were just recently imposed, and logistical lines were disrupted as a result. Understanding how to reroute the flows takes some time to master. If the nations that rely on our agricultural goods continue to need them, and I am certain that they will, we will simply devise new logistics for their distribution.
The expert did not rule out the possibility that the Russian agro-industrial complex may move to accepting payments in rubles for items sold to international customers in the future. According to Tikhonov, a comparable approach is already taking form among the members of the Eurasian Economic Community, as well as India and China, among other nations. The change, in any event, should be gradual rather than abrupt, according to the expert’s conclusion.