To hear more audio stories from publications such as The New York Times, download Audm for iPhone or Android†
WASHINGTON – In Yemen, the price of bread has risen by 35 percent in the week that Russia invaded Ukraine. Wheat mills without grain in Lebanon have shut down in recent months, forcing bakeries to close. And cooking oil is scarce in Kenya.
As the United States and Europe consider their next round of sanctions to starve Russia off the revenues funding its war, concerns are growing that the fallout will fuel an alarming hunger problem around the world that won’t be easily reversed. Policymakers have been busy plotting to open supply chains and provide food finance to developing countries, but the combination of rising energy costs and limited exports from Russia and Ukraine threatens some of the world’s most vulnerable populations.
Russia’s President Vladimir V. Putin has embraced and exacerbated the crisis by blocking exports of food and grain from the region and using the shortages as leverage to roll back Western sanctions. Top officials from the United States and Europe have so far turned down such offers, while also discussing how to extend sanctions without increasing collateral damage.
The region’s critical role in the food supply chain has had a cascading effect, driving food prices up worldwide. Much of the world’s grains and fertilizers come from Russia, Ukraine and Belarus. Russia and Ukraine together export about 30 percent of the world’s wheat and 75 percent of sunflower oil. The cutting off of those supplies, along with uncertainty about the length and scope of Western sanctions, has prompted other governments to block exports as countries try to stockpile goods.
President Biden this month said he is working on a plan to build temporary silos on the borders of Ukraine and Poland so grain that Russia blocks from passing through the Black Sea can be transported by rail to Europe and beyond.
“I am working closely with our European partners to get 20 million tons of grains on the market in Ukraine to lower food prices,” Mr Biden said at an AFL-CIO convention. “But it takes time.”
In its latest Global Economic Prospects report, the World Bank states that nearly half of people in low-income countries face food shortages, often leading to social unrest.
“There is a serious risk of malnutrition and increasing hunger and even famine in some areas,” World Bank president David Malpass said when he warned of global stagflation in early June.
People in emerging economies often spend the majority of their daily budget on food, and that expenditure is increasing. Food prices rose nearly 30 percent in May from a year earlier, according to the Food and Agriculture Organization of the United Nations, further fueled by rising grain and meat prices.
Rising fertilizer prices, driven by sanctions against Russia and Belarus, along with high global energy prices, amplify the magnitude of food shortages by making it more expensive to produce and transport food around the world.
“Without fertilizers, shortages will spread from maize and wheat to all staple crops, including rice, with devastating consequences for billions of people in Asia and South America,” said António Guterres, the United Nations Secretary-General.
The price increases are leading to new waves of protectionism. Countries like Indonesia, India and Malaysia have restricted the export of cooking oil, wheat and chicken to isolate their domestic markets. According to the Center for Strategic and International Studies, about 20 countries have some sort of export control in place to limit the impact of high food prices.
The problem is particularly annoying because much of the food crisis can be attributed to Russian sabotage.
“It is the war that is causing this to happen,” Irish finance minister Paschal Donohoe said in an interview. “But policy makers in Europe, in America, within the G7 are very aware of the risks that developing countries in particular could face in terms of food security later in the year.”
Mr Donohoe, who also chairs the Eurogroup, a club of European finance ministers, said policymakers are working on sanctions so they can keep food inflation to a minimum. In the United States, the Treasury Department has issued several sanctions waivers, or general permits, designed to keep food exports flowing.
Despite those efforts, some fear that attempts to punish Russia will have unwanted side effects.
The European Union issued a new package this month that will ban the majority of Russian oil imports. To tighten the restrictions, it is also phased out a ban on maritime insurers of Russian cargo ships, a move intended to hinder Russia’s ability to divert its oil to other parts of the world.
Treasury Department officials have warned against such a move out of concern that the food load could also be affected. If insurers become too cautious about violating sanctions, they may engage in what the government calls “self-sanctioning,” refusing to carry any cargo because they fear it could get them in trouble. To prevent such a development, the Biden administration has reminded agricultural and shipping companies that US sanctions are not stopping them from buying and transporting Russian fertilizer.
Treasury Secretary Janet L. Yellen said in April that the United States is preparing sanctions over the global food supply.
“Even as we continue to escalate our sanctions and other economic measures against Russia,” she said, “we are reiterating our commitment to adopt vital humanitarian and related activities that benefit people around the world – ensuring the availability of basic foodstuffs and agricultural products.”
Still, some development experts say such commitments are not being met and that opposition over the sanctions is also permeating Africa.
At a European Union summit in late May, African Union president Macky Sall warned officials that removing major Russian banks from the international SWIFT messaging system hampered African countries’ ability to buy Russian food and fertilizers.
“When the SWIFT system is disrupted, it means that even if the products exist, payment becomes complicated, if not impossible,” said Mr Sall, who is also president of Senegal.
As the war in Ukraine continues and food shortages worsen, the debate over whether to see sanctions easing is likely to intensify if famine were to avert.
The war between Russia and Ukraine and the world economy
A far-reaching conflict. The Russian invasion of Ukraine has had a ripple effect around the world, adding to the stock market woes. The conflict has caused staggering spikes in gas prices and product shortages, prompting Europe to reconsider its reliance on Russian energy resources.
Ian Mitchell of the Center for Global Development said Ukraine had become a global magnet for humanitarian aid, to the detriment of low-income countries in the Middle East, Africa and Central America that already suffered from food insecurity and now have to cope. at higher prices. He argued that sanctions relief should be on the table.
“Serious consideration needs to be given to whether there are some concessions on the fringe that address that suffering, even when it is clear who is the aggressor in the war,” said Mr. mitchell. “Will easing some of these sanctions really have a dramatic impact on Russia’s calculations?”
That dilemma is exactly what analysts say Mr Putin is counting on.
“Russia’s hostage-taking of the food supply is reprehensible,” said Alex Zerden, a former Treasury Department official in the Obama and Trump administrations. “The fact that they are trying to negotiate sanctions relief to allow some grain exports shows that Russia can unilaterally expand the global food supply to help those most at risk.”
Meanwhile, humanitarian aid organizations struggle to deliver aid to poor countries as inflation strains their own budgets.
The World Bank has pledged to invest $12 billion in new projects over the next 15 months to support farmers and facilitate trade, and many of the world’s largest international financial institutions have pledged to roll out aid and financing plans to help reduce food shortages. .
For many countries, that may be too late.
Tjada D’Oyen McKenna, the chief executive of the humanitarian group Mercy Corps, said sanctions have unintended consequences for the most vulnerable communities and that higher shipping costs and export controls are making matters worse. Her team has tried to offset rising fertilizer costs in Colombia and help medium-sized dairy farmers in Lebanon build more capacity, but inflation isn’t making aid money as far as it once did.
Ms McKenna said that in Yemen, rations should be reduced so that families get only wheat flour and cooking oil, but no beans and salt. The impact of the war in Ukraine, she explained, is being felt far from the conflict.
“Everyone is looking at the reception and support that Ukraine is getting and how different countries in the Middle East and Africa are not getting the same support,” Ms McKenna said. “Decades of progress on poverty have been rolled back.”
Audio produced by Parin Behrooz†
