Essays on non-virtual reality #176

Nobody is qualified to become a statesman who is entirely ignorant of the problem of wheat. -Socrates Concerns over how Vladimir Putin might respond to Western sanctions against Russia following its invasion of Ukraine has focused attention on Europe's reliance on Russian energy. As Anne-Sophie Corbeau of the Center on Global Energy Policy has noted, the European Union depends on Russian gas for 45% of its imports and around 40% of its consumption. However, of equal if not greater importance is the massive impact of the Russian-Ukrainian War on the global availability of food. Speaking to the United Nations Security Council on March 29, David Beasley, Executive Director of the UN's World Food Programme, stated that Russia's invasion of Ukraine has turned the country "from the breadbasket of the world to breadlines," a situation which will "have global context impact beyond anything we've seen since World War Two." Russia's ambassador to the UN, Vassily Nebenzia, countered that rising food prices were not due to Russia's actions but to "hysterical sanctions" imposed on his country by the United States and other Western nations. Prior to the war, the International Food Policy Research Institute estimated that Russian and Ukrainian exports, together, accounted for 12% of all food calories traded in the world, including almost 30% of all wheat exports, 20% of all corn exports and over 80% of all sunflower oil. But in March, the Ukrainian Cabinet banned all exports of wheat, oats, millet, buckwheat and cattle to keep them for internal use and closed its ports for shipping. And stiff sanctions have blocked Russia's wheat trade with Europe and much of the rest of the world, although it is still being sold to the large market in China. This reduction in the availability of cereal grains (and seed oils) will affect some parts of the world more than others. According to the United Nations Food and Agriculture Organization, 26 countries, mainly in the Middle East and Africa, rely on Ukraine and Russia for over half of their annual wheat imports. In normal times, the United Nations' WFP, the largest supplier of food aid to struggling countries in these and other regions of the world, would purchase over half of its grain from the two countries. Even before the outbreak of war, the organization had been forced to cut back on its distribution of food due to high fuel and shipping costs. But now, with drastic reductions in global grain supplies, Beasley expects to see a "devastating impact" on its ability to feed some 125 million people. "The last thing we want to be doing as the World Food Programme" he says, "is taking food from hungry children to give to starving children." To no one's surprise, Russia has threatened to retaliate to the West's wide array of economic sanctions by shutting down its delivery of natural gas to Europe. But besides the obvious energy implications of such an act, a critical connection to food production is that natural gas is the source material for manufacturing nitrogen-rich ammonia and urea-based fertilizers. In February, Russia, the world's largest exporter of such fertilizers, imposed a ban on their export. On top of this, Russia and its close ally Belarus have also ceased export of potash, a critical potassium-rich fertilizer. Together, the two countries account for a third of the world's trade in potash, and removal of the commodity from world markets is already having an impact. Within two weeks of Russia's invasion of Ukraine, the Wall Street Journal reported, Brazil's Agriculture Minister was in Canada seeking replacements for potash shipments that had previously come largely from Belarus and Russia. This shift in fertilizer trade is but one example of widespread realignments in international trade that are likely to remain long after this war ends. On March 29, Reuters reported that Egypt, commonly the world's largest importer of wheat, is working with India to secure additional access to the grain. India is the world's second largest producer of wheat (after China), but has not been among even the top 20 exporters. But Reuters reports the country is now emerging as a "leading supplier of the grain to a host of countries that are struggling with cargo disruptions and sky-high grain prices in the wake of the crisis in the Black Sea region." Prior to Russia's invasion of Ukraine on Feb. 24, the country was the world's eighth largest producer and fifth largest exporter of wheat. But withshipping routes closed and Russia's destruction of the country's power grid impacting ventilation and temperature control of stored grains, and with fertilizer and seed for next year's planting in short supply, the "world's breadbasket" is in an alarming state of disarray. This year's wheat will be ready for harvest in July, but it remains an open question whether there will be fuel for Ukraine's combines — or farmers to operate them.