2022 food crises

Source: Wikipedia, the free encyclopedia.

2022 saw a rapid increase in food prices and shortages of food supplies around the world. The compounding crises in different parts of the world were caused by compounding geopolitical, economic, and natural causes, such as extreme heat, flooding and drought caused by climate change. The crises follow food security and economic crises during the COVID 19 pandemic.

Following the 2022 Russian invasion of Ukraine, the Food and Agriculture Organization, as well as other observers of the food commodities markets, warned of a collapse in food supply and price increases.[1][2][3][4][5] Much of the concern is related to supply shortages of key commodity crops, such as wheat, corn, and oil seeds, which could cause price increases.[3] The invasion also led to fuel and associated fertilizer price increases, causing further food shortfalls and price increases.[5]

Even before the war in Ukraine, food prices were already at record highs: As of February 2022, year-over-year food prices were up 20% according to the Food and Agriculture Organization.[6] The war further increased year-over-year prices another 40% in March.[7] The compounding issues, including COVID-19, the Russian invasion of Ukraine, and climate-related crop failures, are expected to reverse global trends in reducing hunger and malnutrition.[8]

Some regions, such as East Africa and Madagascar, were already experiencing drought and famine due to agricultural system failures and climate changes, and the price increases are expected to make the situation worse.[5][7] Even Global North countries that usually have secure food supplies, such as the UK and US, are beginning to experience the direct impacts of cost inflation due to food insecurity.[9] Some analysts described the price increases as the worst since the 2007–2008 world food price crisis.[7]

Background

The COVID-19 pandemic significantly disrupted food supply chains around the world, disrupting distribution channels at the consumption and distribution stages of the food industry. A rise in fuel and transport prices further increased the complexity of distribution as food competed with other goods.

At the same time, significant floods and heatwaves in 2021 destroyed key crops in the Americas and Europe.[10]

Causes

Energy crisis

Natural gas is a major feedstock for the production of ammonia, via the Haber process, for use in fertilizer production.[11] The development of synthetic nitrogen fertilizer has significantly supported global population growth — it has been estimated that almost half the people on the Earth are currently fed as a result of synthetic nitrogen fertilizer use.[12]

The 2021–2022 global energy crisis has spread to the fertilizer and food industries.[13][14][15] According to Julia Meehan, the head of fertilizers for the commodity price agency ICIS, "We are seeing record prices for every fertiliser type, which are all way above the previous highs in 2008. It’s very, very serious. People don’t realise that 50% of the world’s food relies on fertilisers."[16]

Russian invasion of Ukraine

Wheat prices surged to their highest prices since 2008 in response to the 2022 attacks.[17] At the time of the invasion, Ukraine was the fourth-largest exporter of corn and wheat, and the world's largest exporter of sunflower oil, with Russia and Ukraine together responsible for 27% of the world's wheat exports and 53% of the world's sunflowers and seeds.[18] The head of the World Food Programme, David Beasley, warned in March that the war in Ukraine could take the global food crisis to "levels beyond anything we've seen before".[19] A potential disruption to global wheat supplies could exacerbate the ongoing hunger crisis in Yemen,[20] Afghanistan[21][22] and East Africa.[23] The American Bakers Association president warned that the price of anything made with grain would begin rising as all the grain markets are interrelated. The chief agricultural economist for Wells Fargo stated that Ukraine will likely be severely limited in their ability to plant crops in spring 2022 and lose an agricultural year, while an embargo on Russian crops would create more inflation of food prices. Recovering crop production capabilities may take years even after fighting has stopped.[24]

Surging wheat prices resulting from the conflict have strained African countries such as Egypt, which are highly dependent upon Russian and Ukrainian wheat exports, and have provoked fears of social unrest.[25] At least 25 African countries import a third of their wheat from Russia and Ukraine, and 15 of them import more than half from those two countries.[26] On 24 February, the Chinese government announced that it would drop all restrictions on Russian wheat as part of an agreement that had been reached earlier in February;[27] the South China Morning Post called this a potential "lifeline" for the Russian economy.[28] On 4 March, the Food and Agriculture Organization (FAO) of the United Nations reported that the world Food Price Index reached an all-time high in February, posting a 24% year-over-year increase. Most of the data for the February report was compiled before the invasion, but analysts said a prolonged conflict could have a major impact on grain exports.[29][30]

On 30 March, at a United Nations meeting, the United States Deputy Secretary of State Wendy Sherman stated that the 2022 Russian invasion of Ukraine, including the naval blockade of Ukraine's sea ports and armed attacks on civilian cargo ships, created a critical food shortage in Ukraine, with worldwide ramifications.[31]

Management
Scientists cautioned that policy-makers should not abandon sustainable farming practices to increase grain production in response to resulting food insecurity, but change "the demand side which can [also] lead to both a more resilient and more sustainable global food system"[32] – such as limiting the import of animal feed (e.g. as meat-production requires relatively large amounts of needed foods and of agricultural land)[33] – and e.g. expanding wheat production in high-productivity areas.[34]

From Feb. 2 to April 1 Russia has banned the export of ammonium nitrate (AN) to guarantee supplies for domestic farmers following the spike in global fertilizer prices, which were impacted by rising costs for natural gas.[35]

Climate crises

Multiple heat, flooding, and drought events between 2020 and 2022 significantly hurt global food supplies and reserves. These weather events, which have been connected with climate change, made the food system less resilient to shocks like the war in Ukraine. Global reserves of wheat were extremely low at the beginning of 2022 because of these weather events.[36]

East African drought

A drought in East Africa began in 2021 and further intensified in 2022, precipitated in part by the oncoming La Niña in 2022.[37][38] Three rainy seasons failed in the horn of Africa region, destroying crops and killing large herds of livestock.[37] The UN identified 20 million people at risk of famine.[37] Both wildlife and livestock have been killed by the drought.[37] The region is especially vulnerable because an extreme wet season caused the 2019–2021 locust infestation, which destroyed large regions of crops.[37]

By early October 2021, nearly a year after the Tigray War started, Mark Lowcock, who led OCHA during part of the Tigray War, stated that the Ethiopian federal government was deliberately starving Tigray, "running a sophisticated campaign to stop aid getting in" and that there was "not just an attempt to starve six million people but an attempt to cover up what's going on."[39]

North American Heatwave and drought

European extreme weather

Droughts in Spain and Portugal during early 2022 led to 60-80% loss predictions for crops in some areas.[40] The huge amount of precipitation in March and early April 2022 in mainland Spain provided relief but did not fully revert the ongoing meteorological drought.[41] Fruit crops in most of Europe were damaged by a cold wave that caused freezing rain, frost, and snow during early budding, after a period of unseasonably early warm weather.[42]

Additional drought in Italy, has reduced the flow of fresh water near the Po River, which is responsible for 40% of crop production. Salt water intrusion is expected to reduce as much as 30% of crop production in areas near the delta.[43]

South Asian heat wave

During the 2022 food crises, India began taking steps to export more wheat, in part to fill the gaps created by the Russian invasion of Ukraine.[44] However, the heatwave caused increasing local prices and lower supply, issues also exacerbated by the war increasing fertilizer prices.[45] The heat wave occurred mostly during the final weeks of the wheat growing season, killing the plants shortly before harvest.[46][47] The heatwave caused a reverse in policy by Indian government, from trying to import to address the crises, to halting exports.[48]

The heatwave has also severely impacted peach and apple harvests in Balochistan.[49]

Southern Cone heat wave

A heatwave that deeply effected Argentina, Uruguay, Paraguay, and Southern Brazil caused yield declines for corn, soy, and other key grains, resulting in significant global commodity price increases.[50][51][52][53] The heatwave further exacerbated an already dry season in much of the region.[53]

Australian floods

A severe flood in New South Wales during February 2022 caused the complete destruction of soy and rice crops and 36% of macadamia nut production.[54] Animal herds and farming infrastructure were also severely damaged by the flooding, which was the third major natural disaster to agriculture communities in the region.[55]

Supply chain failures

In a May 2022 editorial for the Guardian, environmental George Monbiot described part of the collapse of food supply, a problem of concentration of supply in a handful of supply chains through the "Global Standard Diet" making the food system vulnerable to critical failures.[56] He compared the food system failures to the 2008 banking crises, in terms of similar structural problems of concentration of economic power.[56]

In China, rolling lockdowns as part of a zero-COVID policy significantly reduced key agricultural inputs for important grain crops.[57]

War in Yemen

The main cause of the famine in Yemen is the ongoing Yemeni Civil War. Aid often cannot effectively reach the population because of the blockade of Yemen by Saudi Arabia which started in 2015.[58][59] 17.4 million do not have enough food and malnutrition levels in Yemen are among the highest in the world.[60]

Effects by region

Afghanistan

Following the Taliban takeover, western nations suspended humanitarian aid and the World Bank and IMF also halted payments to Afghanistan.[61][62] The Biden administration froze about $9 billion in assets belonging to the Afghan central bank, blocking the Taliban from accessing billions of dollars held in US bank accounts.[63] In October 2021, the UN stated that more than half of Afghanistan's 39 million people faced an acute food shortage.[64]

The price increases connected to Russia’s invasion of Ukraine may make the economic crises in Afghanistan following the US withdrawal worse.[65] According to the UN, $4.4bn to pay for increased food costs,[66] with human rights experts calling on the US to unblock assets of the Afghan's central bank to ease humanitarian crisis.[67]

Bangladesh

International Monetary Fund (IMF) forecasted Consumer Price Index (CPI) in Bangladesh to rise to 5.9% by the year 2022. Price of cooking oil, sugar, eggs and chickpeas increased sharply in the country which contributed largely to the inflation. According to the Bangladesh Bureau of Statistics', general inflation climbed to 6.17% by February 2022. Government officials links the local overprice to the global market situation as well as necessary particulars that have been taken to stabilize price hike by regarding these conditions. Although experts outlook government failure behind price hikes, where Russia's invasion of Ukraine, pressuring inflationary tendencies further. Before the invasion of Ukraine, 95% of the cooking oil in Bangladesh was imported from overseas, the price of cooking oil per barrel was $700 then, it went up to $1,940 prior to the invasion. Price of liquified petroleum gas (LPG) also have increased to 12% by March.[68][69]

Chile

The 2022 food crises have added to the mounting inflation in Chile has experienced since 2020. Measured by the change in the Índice de Precios al Consumidor (IPC) in March 2022 relative to March 2021 indicate the inflation rate (1.9%) is the highest known since October 1993.[70] Bread and meat prices increased as well as those of food in general.[70] Cooking oil prices have risen, with a particular brand at a Santiago supermarket experiencing a 90% price increase from April 2021 to April 2022.[71] The inflation in food prices is thought to be behind an increasing number of supermarket credit card issued in 2022 as well as increasing rates of supermarket credit card debt default.[71] In April 2022, President Gabriel Boric announced a $3.7 billion economic recovery plan that included an increase in the minimum wage to help people deal with rising prices.[72] Supermarkets belonging to Cencosud begun rationing cooking oil, rice and flour in late April.[73]

Europe

Europe's energy crisis caused by the 2022 Russian invasion of Ukraine caused significant price increases for European fertilizer and food industries.[74][75] According to Julia Meehan, the head of fertilizers for the commodity price firm ICIS, "We are seeing record prices for every fertilizer type, which are all way above the previous highs in 2008. It's very, very serious. People don't realize that 50% of the world's food relies on fertilizers."[76]

India

Though early reporting and government policy after the price increases following the war in Ukraine for wheat suggested India was well positioned to export more wheat, by end of April a heatwave that is projected to decrease harvests, increasing local prices, and fertilizer price increases projected a shortfall rather than an export-friendly market.[77] The decrease in harvests was largely driven by the 2022 Indian heat wave which is expected to severely reduce wheat harvest, killing the plants during the final weeks where they are usually growing.[78]

Indonesia

Witnessing extreme price rises around cooking oil which sparked student protests and other civil unrest, the national government of Indonesia banned export of palm oil.[79] As the largest producer of palm oil, and with a harvest decline in the second largest producer and neighbor Malaysia, the ban has caused severe global supply chain disruptions and further exacerbated the price increases caused by the loss of Russian and Ukrainian oil exports and failures of soy crops in South America.[79]

MENA and East Africa

Price increases for certain staples, such as wheat, were expected to most severely affect countries like Egypt, Turkey, and Somalia in MENA and East Africa, which rely heavily on wheat imports from Ukraine and Russia.[7] This is expected to further hurt prices in regional food markets, such as Ethiopia, Kenya, Somalia, and South Sudan.[7]

The changes in the food market caused by the invasion of Ukraine further exacerbated existing drought problems in the already vulnerable Horn of Africa.[37] In February, the World Food Programme and UNICEF had already projected nutrition and hunger gaps for thirteen million people in East Africa.[80] By March, the UN had expanded that number to 20 million people.[81]

North America

North America was already experiencing significant shortfalls and supply chain issues connected to the 2020–22 North American drought and the 2021–2022 global supply chain crisis.[7]

West Africa

Oxfam, ALIMA and Save the Children warned that the food crises in West Africa could affect 27 million people, especially in Burkina Faso, Niger, Chad, Mali, and Nigeria.[82]

During a visit in Nigeria, the Secretary-General of the United Nations voiced concerns over the war exacerbating the crises of food, energy, and economies in Africa as a whole.[83]

Responses

United States

The Biden Administration responded to the growing shortages in April by trying to increase US farm production. The US policy community was worried about China or other countries filling the food gap. Obstruction in the US Congress prevented new funding and resources for the crises.[36] A group of 160 advocacy groups challenged funding cuts by the Biden administration and Congress to USDA programs.[84]

On May 18, 2022 the US announced $215 million USD in development assistance to advert the crises.[85] This was in addition to $320 million for the horn of Africa.[85]

International Organizations

The World Bank announced a new $12 bn USD fund designed to respond to the food crises.[86][87]

In May, the UN called for Russia to facilitate the reopening of Ukrainian grain ports to advert the global food crises.[88]

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