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Ukraine Crisis Underscores Need for Long-term Solutions for Global Food Security
Posted by: Prof. Dr. M. Raupp (IP Logged)
Date: March 02, 2022 11:10AM

When wheat prices rise, so do global food prices, along with conflict,
inequality and instability. Over the past two decades, the world has
witnessed multiple crises erupt over the social and political
instability caused by rising costs for staple cereals. The global food
crisis that impacted many parts of the world in 2007‚??2008 was a
response, in part, to the prices for wheat and rice which had increased
130% and 70% compared to the year before. More recently, spikes in grain
prices catalyzed the 2011 Arab Spring.

With the ongoing conflict in Ukraine and the resulting longer-term
disruptions of the country‚??s rural economy, there is potential for
another round of turmoil linked to prices for staple cereals.

Ukraine is a breadbasket for the world, with57% of its land area arable
for agriculture
[data.worldbank.org].
Wheat production in the country increased roughly 10%, on average,
between 2000 and 2020. In 2022, Ukraine ranked as the fifth largest
wheat exporter globally,exporting $3.59 billion of wheat
[www.fao.org].

Today, global wheat prices are at their highest levels since 2012: $9
per bushel, based ondata from the Chicago Board of Trade
[www.nasdaq.com].

Wheat is a staple crop, essential to food security. It is consumed by
over 2.5 billion people worldwide, including large proportions of the
populations of many food-insecure regions in the world. Many of the
wheat-consuming countries in these regions are far from wheat
self-sufficient, relying on global imports to meet demand. This causes
significant vulnerability in food supply and increases associated
humanitarian risks. In 2019, important quantities of Ukrainian wheat
were exported to low- and middle-income countries in North Africa and
the Middle East. Although the impacts of current price increases are
anticipated to be short-term, they are likely to be inequitably felt, as
not all buyers are able to pay higher prices.

There are over6 million hectares of wheat planted in farmers‚?? fields
across Ukraine
[www.spglobal.com]
will be due for harvest in June and July of 2022. The length and depth
of the current crisis has potential implications for the fate of this
in-field crop, and for its subsequent harvest and global distribution.
Likewise, sanctions and trading restrictions on Russia, the world‚??s
largest wheat exporter ‚?? exporting $7.92 billion of wheat in 2020 ‚?? are
likely to place added pressure on international wheat markets. This
comes at a time of rising costs in agriculture, including the soaring
price of nitrogen fertilizer and increasing fuel and supply chain costs.
The gap between supply and demand is also becoming wider with climatic
instability ‚?? such as drought conditions ‚?? hitting both domestic
production and export stocks in several countries.

Rising prices for staple cereals have historically led to instability,
particularly in fragile regions where food security is low. The impacts
of current high wheat prices are likely to be felt most significantly by
populations in the Global South who rely on wheat imports.

The potential humanitarian crisis beyond the borders of the current
conflict needs to be addressed to avoid deepening global divisions in
equality of access to food. In the case of wheat, long-term solutions
will require much higher levels of investment, coordination and
cooperation between governments, development organizations and
agro-industry. Without doubt, part of the solution lies in increasing
wheat productivity and profitability in food-insecure regions where
wheat has traditionally been grown, as well as supporting the expansion
of wheat production into climatically suitable areas in countries which
have traditionally relied on imports to meet local demand.

What price wheat? ‚?? CIMMYT [www.cimmyt.org]



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