Ukraine war will increase already inflated food costs globally, officials warn
Ukraine, Russia are among the top 3 global exporters of wheat, other grains
Loaves of freshly-baked bread stored in crates at a bakery in Rome, Italy, on Wednesday, March 9, 2022. Wheat futures swung wildly between gains and losses Tuesday after climbing to unprecedented heights as Russia's attack on Ukraine disrupts global food supplies. Photographer: Alessia Pierdomenico/Bloomberg via Getty Images
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Ukraine and Russia are both top producers of grains, and United Nations officials warn the ongoing war will continue to drive up food costs as Ukrainian farmers have been unable to tend to their crops under Russia's invasion.
According to the Food and Agriculture Organization of the UN, both countries were the top three producers of wheat, maize, rapeseed, sunflower seeds and sunflower oil. Russia is the leading producer of wheat, and Ukraine is the fifth largest globally.
Russia is the top nitrogen fertilizer and second potassic and phosphorous fertilizer producer worldwide. The cutoff in supply is being felt around the world as countries look to other sources to find fertilizer.
The cost of wheat increased by 100% to $400 per ton in the first week of the Russian invasion, according to the Ukrainian Agricultural Council (UAC). During this time last year, the grain cost $150 a ton.
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"That is why the failure of the sowing campaign in Ukraine, the reduction of grain production, its shortage and, as a consequence, rising prices, is a catastrophe for the whole world," Andrii Dykun, the head of the UAC, wrote.
Many countries that are highly dependent on these exports will now have to look elsewhere as Ukrainian ports close, and it's unclear how farmers will be able to harvest during the ongoing attack from Russian troops.
More than 50 countries depend on Russia and Ukraine for 30% or more of their wheat supply, Director-General of the Food and Agriculture Organization of the United Nations Qu Dongyu said in a statement.
In the Spring, farmers in Ukraine need to feed sprouts that would be ready in June.
Dykun said Ukrainian farmers are in a shortage of labor as many workers either left the country or were called to defend it. In some regions, active hostilities prevent farmers from even getting to their fields, Dykun said.
The most significant problem Ukraine's agriculture community faces is fuel shortages, Dykun said. Ukraine received up to 75% of its diesel fuel from Belarus and Russia, which cut off supply. Any other available fuel went to the Ukrainian army.
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Dykun warned if farmers do not sow this Spring, it could cause a "food crisis around the world."
Before Russia's invasion, Ukraine and Russia were expected to have favorable winter crops. However, early estimates suggest between 20 and 30% of Ukraine's winter cereals, maize and sunflower seeds will either go unplanted or remain unharvested for the 2022-2023 season due to the ongoing war.
The pandemic has already created elevated food levels, and the FAO warns the supply gap could inflate food prices by an additional 8 to 22%.
"The likely disruptions to agricultural activities of these two major exporters of staple commodities could seriously escalate food insecurity globally when international food and input prices are already high and volatile," Dongyu wrote. "The conflict could also constrain agricultural production and purchasing power in Ukraine, leading to increased food insecurity locally."
If the conflict continues, it could result in food prices rising in economically vulnerable countries that rely on these grains, according to the FAO report. Early estimates suggest the global number of undernourished people will increase by 8 to 13 million people, with the most impacts in Asia-Pacific, sub-Saharan Africa, the Near East, and North Africa.