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Are high food prices here to stay? – Thomson Reuters Foundation

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Are high food prices here to stay? – Thomson Reuters Foundation

May 07, 2022

Climate change, conflict and poverty could spell the end of cheap food

Food prices around the world have hit record highs this year as the Russian-Ukrainian war slashes those countries’ key wheat and fertilizer exports, while droughts, floods and heat fueled by climate change climatic conditions call for more harvests, reported Thomson Reuters. Foundation.

Wheat prices hit a 14-year high in March and maize prices hit their highest on record, the International Panel on Sustainable Food Systems (IPES) said in a report on Friday.

This has made basic necessities more expensive – or harder to find – for families in many countries, especially poorer ones.

Climate change, widespread poverty and conflict are now combining to create “endemic and widespread” risks to global food security – meaning rising food prices could be the new normal unless measures are taken. taken to stem the threats, IPES noted.

He suggests not only rapidly cutting emissions to limit climate change, but also tackling commodity speculation, alleviating debt, reducing dependence on chemical fertilizers, reshaping trade and bolstering reserves. national cereals.

If these things are neglected, the world will find itself “sleepwalking into the catastrophic and systematic food crises of the future”, noted the IPES experts.

Why are food prices so high right now?

Russia and Ukraine supply around 30% of world wheat exports, but these have fallen due to the conflict.

National stocks of wheat – mainly consumed in the countries where it is grown – remain relatively high, said Brigitte Hugh of the US Center for Climate and Security.

But lower exports from Russia and Ukraine have increased competition for remaining wheat on the world market, leading to higher costs that are particularly painful for poor and indebted countries that rely heavily on imports.

Nearly 40% of Africa’s wheat imports come from Ukraine and Russia, while rising world wheat prices have pushed up bread prices in Lebanon by 70%, IPES said.

But the disruption of wheat exports from Russia and Ukraine is not the only reason for the price hikes, which have spilled over into corn, rice and soybean markets as buyers seek alternative grains.

Fueled by the conflict, financial speculators have taken to trading grain futures, for example, ‘artificially’ inflating prices as they seek to take advantage of market uncertainty, ministers complained of G7 agriculture.

Since the last food price crises of 2007-2008 and 2011-2012, “governments have failed to curb excessive speculation and ensure transparency in food stocks and commodity markets,” said Jennifer Clapp, professor specializing in food security at the Canadian University of Waterloo.

The problem “must be addressed urgently” if the world is to ensure more stable food prices in years to come, as climate change, conflict and other threats increase the risks, she added.

Can’t we grow more food to increase the global supply?

Some wheat-producing countries are already planting more, and India has said it will increase wheat exports to meet demand, although its current heat wave could reduce yields, Energy and Climate Intelligence has warned. Unit based in London.

But efforts to boost production globally have been hampered by shortages of chemical fertilizers. Russia and Belarus produced 40% of international potash exports last year and this trade has also been affected by the war.

The impacts of climate change – from droughts and heat waves to floods and new pests – are also making it harder for farmers in many parts of the world to get a reliable harvest, a problem that is expected to worsen as Global warming emissions continue to rise.

Moreover, the land available to plant more wheat, corn and rice is limited, with the expansion of agricultural land – especially in countries like Brazil – often coming at the expense of forests which are essential to maintain stability. climatic.

With a limited supply of land under increasing pressure from those trying to grow food, protect nature, install renewable energy and store carbon, land could become this century’s strategic global asset, a said Tim Benton, research director of the environment and society program at think tank Chatham House.

The desire to control more Ukrainian farmland – and more of the future global food market – may even be one of the drivers of the Russian invasion, he noted.

What could help keep food affordable?

Because so much of the world’s grain is used to feed livestock, persuading people to eat less meat and dairy products could dramatically increase grain supplies, said Pierre-Marie Aubert, an agriculture expert at the Institute. French for sustainable development and international relations.

The global grain shortage in export markets this year is expected to be 20-25m tonnes – but if Europeans alone cut their consumption of animal products by 10%, they could cut demand by 18-19m tons, he noted.

Improving grain storage, especially in countries heavily dependent on imports, and helping these countries grow more staples at home – not the cash crops for export that have often replaced staples – could also help, say food experts.

And globally, planting a wider variety of crops to reduce reliance on just a few grains, with markets dominated by a small number of exporters, could boost food security.

Policy changes – such as Africa’s new continental free trade area – could eventually allow some poorer countries to reduce their dependence on distant producers and fragile supply chains, said Sithembile Mwamakamba of the Food, Agriculture and Natural Resources Policy Analysis Network (FANRPAN).

In addition, investing in climate-smart agriculture to protect crops as the planet warms would help shore up global food supplies, while debt relief could give poorer countries greater fiscal space to manage fluctuations in food prices.

What happens if food prices continue to rise?

As food prices soar on global markets, aid organizations struggle to buy grain for starving people in conflict-affected regions like Afghanistan, Yemen, South Sudan and Syria.

Before the Russian-Ukrainian war, the international aid system was already “overwhelmed” by growing needs and insufficient funding. Now high prices mean less grain can be bought, said Gernot Laganda, head of climate and disaster risk reduction at the United Nations World Food Programme. .

“It’s never been so bad,” he told the Thomson Reuters Foundation. He fears that as climate change adds to existing threats to food security, price hikes will be “a runaway train that you cannot stop”.

Worse, while expensive food threatens to stoke political unrest and consume public funds, it could derail efforts to curb climate change and build resilience to its impacts, leading to a vicious cycle of poverty, growing unrest and hunger, he warned.

Benton of Chatham House said the Russian-Ukrainian war could trigger a historic shift in food prices.

“The end of cheap and highly available food, for some people, is going to become a reality,” he noted.

Source: Reuters