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Why Russia’s War in Ukraine Means a Hungrier World

A wheat harvest in Kryvyi Rih, Ukraine, on Tuesday, June 28, 2022.
A wheat harvest in Kryvyi Rih, Ukraine, on Tuesday, June 28, 2022. (Bloomberg)

The surge in food prices that followed the outbreak of war in Ukraine underlined the country’s pivotal role in feeding the planet. By disrupting exports of Ukrainian wheat, corn, barley and oilseeds, the conflict has stoked a hunger crisis in poorer nations and contributed to a surge in inflation in the developed world. The prolonged fighting was decimating Ukrainian farm incomes and destroying infrastructure, making it increasingly unlikely that production will bounce back to normal when peace returns. 

1. Why is Ukraine so influential in global food markets? 

Europe’s second-largest country, Ukraine is covered in level plains containing dark, rich soil that’s ideal for agriculture. Cheap food from Ukraine has helped to shape the course of European history, feeding the populations of fast-growing industrial cities in the 19th century and sustaining the vast Soviet Union through decades of isolation. Before the war, Ukraine exported more grain than the entire European Union and supplied about half of globally traded sunflower seeds and oil. More than 30 countries that are net importers of wheat rely on Russia and Ukraine for over 30% of their wheat import needs.

2. How did the war affect exports? 

They collapsed when Russian forces invaded in late February and imposed a blockade on Ukraine’s key export terminals of Odesa and Mykolayiv. By mid-year, at least 25 million tons of grains harvested in 2021 were still stuck in the country, just as a new wheat harvest was due to begin. Some wheat, corn and barley was transported overland to Romania, Poland and Baltic Sea ports on roads, railroads and Danube river barges. These routes could only handle about a fifth of Ukraine’s prewar exports and efforts to boost volumes were held back by a dearth of fuel for trucks and transport bottlenecks. Ukraine’s ex-Soviet rail tracks use a wider gauge than their western counterparts, causing border delays of up to 30 days. Grain exports in June totaled just 1.4 million tons versus about 5 million tons monthly in a typical year.  

3. Why does that matter? 

The slump in deliveries from the fourth-biggest grain exporter sent prices shooting higher and left import-reliant nations in Asia, Africa and the Middle East scrambling to secure alternative supplies. The shortages were contributing to sporadic political unrest and 43 countries were at risk of famine, according to the United Nations World Food Programme. Ukraine has been one of the largest contributors to the WFP: Eritrea and Somalia were almost entirely dependent on Russia and Ukraine for their wheat supplies last year, while Tanzania, Namibia and Madagascar relied on them for more than 60% of supplies, according to UN data. 

4. What’s stopping Ukraine resuming exports?

While the biggest export terminals were largely undamaged and still under Ukrainian control, the ports and coastal waters were riddled with mines. Ukraine accused Russia of stealing grain and selling the cargoes as its own. Russia benefits from the blockade as it’s deprived the Kyiv government of revenue to sustain the resistance, inflicted economic pain on Moscow’s western adversaries and boosted the value of its own wheat on the international market (Russia is an even bigger wheat exporter than Ukraine). 

5. Can anything be done to resolve the dispute?

The UN led talks in July to try to end the impasse and allow escorted convoys from Ukraine’s Black Sea ports. A first round of discussions ended with a “ray of hope,” according to Secretary General Antonio Guterres, who said more work was needed to achieve a breakthrough. Ukraine’s government was wary of clearing mines in the Black Sea that help to protect its ports, as Russian troops could then launch an assault on them. Russia’s government has previously suggested it might allow the ports to reopen if the U.S. and its allies relax sanctions on Moscow -- an idea they were unlikely to accept. 

6. How is the war impacting the next harvest? 

The government expects this year’s crop to be 40% smaller than last year’s after farmland was damaged or cut off by the conflict. Farmers who are able to gather their crops could run out of room to store it as silos are still loaded with last year’s grains. That lack of storage capacity, combined with a collapse in incomes that’s left farmers without money to buy seeds, means it could take years for exports to fully recover.  

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