Wheat is a diplomatic weapon at the heart of the food crisis

The wheat crop in Ukraine is in danger of spoiling if it is not harvested at harvest time.

AFP

Within a few months, wheat, which had long been a peace factor in times of plenty, became a diplomatic weapon in the context of the Russian invasion of Ukraine.

Here is a review of the main causes of the major crisis caused by the suspension of its exports, which threatens the food security of millions of people.

More than 200 million people in the world suffer from severe hunger, according to the United Nations, which fears a new "famine cyclone" due to the sharp rise in food prices since the beginning of the conflict.

Why can't you dispense with wheat?

"Wheat is eaten by everyone, but not everyone can produce it," says French economist Bruno Parmentier, author of the book "Nourer L'Humanite".

Today, only dozens of countries produce enough wheat to be able to export it: China is the world's largest producer of wheat, but it is also a major importer of the grain, producing not enough to feed its 1.4 billion people.

The main exporting countries are Russia, the United States, Canada, Australia and Ukraine.

Wheat, consumed by billions of people and subsidized in many countries, is "the main grain of global food security," asserts Sebastian Apis, associate researcher at the Institute for International and Strategic Relations in Paris (IRIS).

As for corn, “it is used above all for animal feed or for industrial needs.”

Really tense situation

Grain prices had skyrocketed before the war.

The price of wheat began to rise in global markets from the fall of 2021, and it remained at high levels in light of the economic recovery after the pandemic.

There are factors behind this upward curve: the sharp rise in energy costs from rising oil and gas prices, nitrogen fertilizers (made from gas, which have tripled in price in a year), transportation (congestion of ports and labor shortages) and unfavorable weather, especially the disastrous harvest in Canada was hit by a severe heat wave last summer.

Why did the war worsen the situation?

After the Russian invasion on February 24, 2022, the price of wheat set records: the price of a ton rose to more than 400 euros in May on the European market, double what it was last summer.

This increase cannot be borne by poor countries, especially those that import "at least 30% of their needs from Ukraine and Russia", as the Food and Agriculture Organization of the United Nations (FAO) asserts.

Russia and Ukraine accounted for 30% of world grain exports.

In recent years, their production has increased steadily, with Russia on the list of exporters, and Ukraine on its way to becoming third.

What are the consequences for Ukraine? The closure of the Sea of ​​Azov and the blockade of Ukrainian ports on the Black Sea have left markets with more than 25 million tons of grain now stuck on farms or in port depots.

While some quantities were exported by land and by rail, exports are still six times lower than when they were transported by sea.

Ukrainian farmers faced a dangerous planting season, while some had to work in bulletproof vests and hire specialists to remove mines and other munitions from the fields.

Yields are expected to fall by 40% for wheat and 30% for maize, according to estimates by the Main Association of Producers and Exporters of Ukraine.

Wheat is a weapon of war

Bruno Parmentier asserts that “in times of war, the major producing countries control the fate of other countries,” because “no country can leave its capital to starve.”

But famines “are not related to food production, but are always caused by problems of access,” according to Aref Hussein, chief economist at the World Food Program.

Negotiations began under the auspices of Turkey in early June, at the request of the United Nations, to establish “safe sea lanes” that would allow the export of Ukrainian stocks, but they did not lead to a result.

The solution could have been for the countries with stocks to release their reserves in the markets.

But most of the stock is in China, which will not resell it, while India, which pledged to increase its grain sales, reversed its decision after being hit by a devastating heat wave, temporarily banning exports, which led to an increase in prices.

As for Russia, whose wheat crop will be exceptional this year, "it continues to export to certain countries, especially in the Middle East, which in return will not vote against it at the United Nations," as one of the market observers points out.

What are the solutions?

In the short term, the solutions will be new crops that appear to be "fairly good" in America, Europe and Australia.

The wheat harvest for 2022 is expected to reach 775 million tons, according to the US Department of Agriculture.

And prices, which have risen significantly for geopolitical reasons, have fallen in recent weeks for several reasons: the beginning of the harvest season, the market taking over the situation in Ukraine, and the fear of an economic recession, as Edouard de Saint-Denis explains.

For her part, says Elizabeth Claverie de Saint-Martin of CIRAD, agricultural research and international cooperation for development, that in the medium term, "we must ensure that we have more food produced and processed locally."

"We must now mainstream agro-environmental transformations in order to deal with climate change, and support these transformations, which must be economically sustainable," she added.

 Prices, which have risen significantly for geopolitical reasons, have fallen in recent weeks for several reasons: the beginning of the harvest season, the market situation in Ukraine, and the fear of an economic recession.

The closure of the Sea of ​​Azov and the blockade of Ukrainian ports on the Black Sea have left markets with more than 25 million tons of grain now stuck on farms or in port warehouses.

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