Maintaining Biofuel Mandates Worsens Global Food Crisis Caused By Russia’s Invasion of Ukraine
Russia’s invasion of Ukraine is disrupting both countries’ exports of grain. Combined, Ukraine and Russia account for 26 percent of global wheat exports and 16 percent of corn exports. Just how deeply the war will cut grain exports from both countries this year is uncertain.
However, world markets evidently expect significant reductions. For example, the Food and Agriculture Organization’s food price index averaged 140.7 points in February 2022, up 5.3 points (3.9 percent) from January and as much as 24.1 points (20.7 percent) above its level a year ago. The index, which measures the changes in both the nominal and real prices of agricultural foods like grains, meat, and sugar, has a baseline of 100 set for the period between 2014 and 2016.
Current numbers are at an all-time high, exceeding the previous peak in February 2011 by 3.1 points.
With Russia’s invasion of Ukraine, the loss of global grain exports could be in the millions of tons. Last year, Ukraine exported just over 23 million tons of corn and Russia just under 4 million tons. On top of these supply uncertainties, increases in what farmers must pay for fertilizer and fuel are also contributing to the global rise in food prices. Keep in mind that similarly steep increases in grain prices in 2008 and 2011 coincided with a wave of civil unrest across the globe, including the upheavals known as the Arab Spring revolts.- READ MORE
Responses