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The global food crisis worsens

If there is a 5% shortage of food, it brings the brunt of not just a 5% price increase, but an escalation until the 5% of the population that can’t afford food starves to death.” War, oil prices, and extreme weather, the three fires that ignited the food crisis, meet one after another in 2022.The United Nations has already warned that the world will face a food crisis within 10 weeks after several countries restricted food exports. Since May, many countries have announced restrictions on grains or food exports. On Monday, local time, Malaysian Prime Minister Ismail Sabri announced the decision of the cabinet meeting held on the same day: from June 1, Malaysia will stop exporting 3.6 million chickens per month until chicken prices and production return to stability. Malaysia is not the first country to fight the “food defense”. In early May, Indonesia issued a ban on palm oil exports; on the 14th, India, the world’s second-largest wheat producer, suddenly announced a ban on wheat exports. In addition, Kazakhstan issued a six-month ban on sugar and raw sugar exports, which came into effect on May 23. Data from the International Food Policy Research Institute show that 23 countries have implemented export restrictions, approaching the 28 countries that implemented restrictions during the peak of the food price crisis in 2008. While the categories of exports banned vary, there is no doubt that the export ban itself is a very dangerous sign. With the withdrawal of these major food exporters, there will be a huge gap of up to 17 percent in the global food supply.

In the Northern Hemisphere, crops are typically planted in March and April, but this year’s planted area is well below normal. In the U.S., for example, U.S. farmers are expected to plant less spring wheat and more soybeans this year, and spring wheat area will decrease by 2% compared to 2021, according to a forecast released by the U.S. Department of Agriculture in April. Meanwhile, the U.S. Department of Agriculture said the total wheat planting area in 2022 is expected to increase by only 1%.

The situation is even worse in other major grain-producing countries. According to data published by the UN Food and Agriculture Organization, Russia and Ukraine are the world’s largest and fifth-largest wheat exporters, respectively, with both countries accounting for about 30 percent of global wheat exports in 2021. Ukraine’s wheat exports account for about 12 percent of the world. And due to the Russian-Ukrainian conflict resulting in supply disruptions, in April, Ukraine’s monthly wheat exports fell to 1 million tons from the normal 4-5 million tons.

But before the outbreak of the Russia-Ukraine conflict, global food prices started to move way up. This was primarily due to the decline in production in some grain exporting countries due to extreme weather in 2021. Whereas this led to higher prices with unchanged demand, the international strife that immediately followed only exacerbated the trend of higher food prices.

What’s worse is that Ukraine, where the strife took place, missed the best time to plant grain and the harvest has been drastically reduced. Based on meteorological studies, extreme weather will continue to affect food output worldwide this year, even causing some areas to be left without a harvest.

Many countries are in the food crisis

The latest volatility in food prices has also worsened the food shortfall that would have been caused by global epidemics, regional frictions, climate change, and other factors. Sara Menker, CEO of agricultural analysis firm Gro Intelligence, recently told a special meeting of the UN Security Council that the world now has only 10 weeks of wheat supplies left.

She also noted that the Russian-Ukrainian war was not the trigger for the food security crisis, but “just pouring some gasoline on a fire that has been burning for a long time.” She said droughts around the world are causing a decline in wheat resources, and global food supplies are also being severely impacted by climate change and fertilizer shortages.

Food price hikes have become unbearable for some import-dominated countries. With severe food and fuel shortages, Sri Lanka has been plunged into its worst economic crisis in more than 70 years, with political and social unrest ensuing; Turkey’s inflation rate has reached a staggering 70 percent, a new two-decade high.

Simultaneously, Lebanon, Yemen, Syria, Afghanistan, Sudan, and other less developed countries are in a “desperate situation”. Lebanon, for example, imports 90 percent of its wheat from Russia and Ukraine, and its annual grain import needs are estimated to be as high as 2 million tons, which, at current market prices, would cost the country as much as $800 million a year just to import grain. Lebanon is currently facing its worst economic crisis in decades, with more than three-quarters of the country’s population mired in poverty. Even if they could find an alternative market for imports, it would be difficult to afford such high prices.

Notably, “food security” is likely to be counterproductive. According to Aditya Mattu, chief economist for East Asia and the Pacific at the World Bank, restrictions on food exports in some countries will trigger more countries to introduce new control measures to curb domestic food prices, leading to further increases in global food prices and reducing the efficiency and fairness of food distribution. Matu said that in 2008 and 2011 when global food prices rose sharply, many countries introduced a total of more than 80 food trade interventions, but instead led to a further increase in global food prices by 13 to 15 percent.

Many countries took measures accordingly

Currently, many governments are trying to fill the food supply shortage to ease the supply and demand tension. President Joe Biden recently announced specific measures to boost U.S. agricultural production, including increasing the number of counties eligible for “double-crop insurance” nationwide by 681 to 1,935; reducing farmers’ production costs through “precision farming” and other technical assistance to improve crop planting efficiency; expanding the use of key products; and simplifying the application process for farmers; and increasing the federal government’s investment in domestic fertilizer production by The program will reduce production costs for farmers, expand access to key products and simplify farmer-related applications; and increase federal investment in domestic fertilizer production from $250 million to $500 million.

The European Commission has also taken immediate action to enhance global food security, such as temporarily allowing farmers to grow crops on fallow land. The European Commission also supports reducing the proportion of food crop-based biofuels blended, saying these initiatives will help farmers devote more land to food production and increase the cultivation of crops such as corn and sunflowers.

The food crisis is a predictable crisis

As a necessity of life, food is not like cars and chips that can wait for a while. Most countries around the world cannot be “self-sufficient” in the food supply, and many countries rely on imports for more than half of their food consumption. For these countries, domestic food reserves generally can only support a few months, that is, if no solution is found before the food reserves are depleted, it will be a food crisis. A few months may seem like a long time, but considering the still rampant COVID-19 epidemic and the significantly reduced shipping capacity, there is not much time left for these countries to rely heavily on food imports.

Rich countries can raise enough food in the short term by lifting prices, while some poor and backward countries will bear the brunt of the food crisis. However, with the expansion of the food supply gap, food prices will eventually rise to a level that ordinary people can’t afford, even the developed countries are not immune.

Some countries are already experiencing food shortages, but this is just the beginning. We have no better solution for this impending crisis at the moment. Once upon a time, we thought that money could buy everything, but while people are focusing on the rising and falling numbers on the stock market, they are ignoring the barren land and hungry people.

People have never been so concerned about food security. Only one day did it suddenly dawn on them that their country could not afford to feed its people. Having enough to eat has never been a simple problem, but the rapid economic development and the acceleration of the globalization process have masked it. Some countries did not have the basis to develop agriculture in the first place. At the same time, due to the long agricultural production cycle, many countries have gradually shifted to secondary and tertiary industries with higher added value in the process of globalization and neglected the development of their agriculture. The resulting food shortage is mainly dependent on imports, and the food self-sufficiency rate is declining. Food security is related to the survival of every individual. If we cannot even guarantee our survival, how can we talk about development?

By Shiyue Luo

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