As a major food crisis looms: what are the opportunities for improvement?
By Simon Winter - Executive Director, Syngenta Foundation for Sustainable Agriculture
Let me start with the bad news: Exports from Russia and Ukraine account for about 12% of the world’s traded calories. The two countries play a particularly large role in three crops. Together, they provide – or until recently provided – 53% of traded sunflower oil and seeds and 27% of wheat. For commodities such as wheat, the Russian-Ukrainian war has already sent prices soaring above what were already historically high levels.
Worse is yet to come. The current crops in Ukraine might not be harvested and exported; some countries may refuse imports from Russia. Direct bans on Russian food exports are unlikely for humanitarian reasons. But there may still be major disruptions as sanctions make it harder for Russia to receive international payments.
And it’s not just about the current crop. Future global agricultural production is also threatened. The fertilizer market is in turmoil. Russia and its ally Belarus are responsible for 40% of global potash exports. Russia supplies 15% of nitrogenous fertilizers and 22% of the world’s ammonia. Sanctions and logistics challenges will disrupt these exports, and prices will rapidly increase. Farming everywhere will be affected.
Poorer countries will suffer most
Initially, however, certain countries will be particularly hard hit. North Africa and the Middle East import over 50% of their cereal needs from Ukraine and Russia. Turkey buys 26% of its imported wheat, corn, barley, canola, and sunflower oil and seeds there. The percentages for China and Egypt are similar. India is “only” 13% dependent on such imports – but 13% of its population means more than 180 million people!
The next Ukrainian harvest of wheat, barley, and canola would normally be ready in the next couple of months. By then, working the fields may often be impossible, and moving the harvest even harder than it is today. The usual April and May planting of corn, sunflower, and pulses might simply not happen. This double loss would shoot food prices further upwards, hitting lower-income countries most. Millions more people would be pushed into hunger and poverty.
What does this mean in more detail? Take wheat in Africa, for example. Wheat accounts for 26% of total cereal consumption. In 2018-2020, Africa imported Russian wheat worth $3.7 billion; another $1.4 billion came from Ukraine. Together, they made up 46% of the continent’s wheat imports. For 17 African countries, the share was over half. Some of these countries already suffer from their own armed conflicts. They include Somalia, which gets almost all its wheat from Russia.
Intra-African trade can’t replace such imports. The regional wheat supply is comparatively small, and many countries lack adequate transport and storage. Countries searching for new sources of wheat will have to pay high prices elsewhere, for example for imports from India.
As I say: We are not seeing the worst of this yet. High fertilizer prices lead to hoarding; farmers will probably also use less, which leads to lower production. That will be particularly true in developing countries with a shortage of foreign exchange. The crisis is likely to mushroom between September and November. David Laborde from the International Food Policy Research Institute says: “We’re not just losing six million tons of grain” [from last year’s harvest in Ukraine], “but potentially 60 million tons. Losing the next harvest will be a critical shortage that no one will be able to make up.” Judging by the 2007-08 food price crisis, the resulting shortages and inflation could lead to violence and upheaval in many countries.
Coordinating action to realize opportunities from the crisis
Understandably, many commentators focus on the bad news, and it's likely worsening. But the situation also brings new opportunities. Which ones does the Syngenta Foundation see?
In the very short term, the opportunity – an imperative, in my eyes – is to strengthen global governance and cooperation in food systems. Countries should coordinate action to address high prices. That means avoiding bans on food exports, for example, and sharing real-time information about stocks. It also means discouraging the use of food as biofuel, as well as strengthening social safety nets for consumers and producers.
Also important in the short term is a look ahead to the next planting season. Governments should work closely with the private sector and donors to boost yields, sustainably. We need to incentivize growers to increase yields and shift, where suitable, production of crops most affected by the crisis: wheat, corn, barley, and sunflower. In parallel, farmers should be encouraged to use more organic fertilizers and apply mineral ones more efficiently. Governments and donors should urgently coordinate efforts to identify regions with the highest potential for closing yield gaps in the most affected crops and deploy smart subsidies, including for fertilizers through the price crisis. This would encourage agri-businesses to ‘lean in’ to those areas and maximize opportunities for local farmers to raise productivity, in a climate-smart and sustainable manner. Changes to crop rotations can also help. To strengthen food value chains sustainably, rapid investment is also required in storage, logistics, and processing capabilities. Some platforms already exist to make such public-private cooperation easier, such as the Farm to Market Alliance in East Africa.
What about the longer term? The world also needs policy changes to address underlying problems, build resilience and reduce the impact of both this crisis and those to come.
The changes should include:
- Better intra-regional infrastructure and policies that enhance food production and encourage trade not only in food but also in improved seeds and other vital inputs
- Greater diversity in the sources of fertilizer and energy, globally, regionally, and locally
- Incentives to shift from mineral fertilizers to those produced more sustainably
- Review of WTO global trade rules to help avoid food export restrictions.
Does that sound about right to you? Keen to participate? More suggestions to add? Our Foundation is just one small actor in the global food system. But together with you and others, we can help create enduring opportunities from the current tragic crisis. I look forward to hearing from you.