From Rome
In his semi-annual report on the World Food Outlook released this week, FAO (Food and Agriculture Organization of the United Nations) warned that the world’s most vulnerable populations currently pay more for less food. “Countries will spend this year a record 1.8 trillion dollars on importing the food they need, but the amount of food they will buy will not be more but less,” warned the FAO, whose global base is in Rome. And the biggest risk is that these price increases will lead to an increase in the number of undernourished people in the world.
And this could be the consequence not only of the increase in food prices, of the inputs that are required for the production of food and of transport costs, but also also from the war between Russia and Ukrainea conflict between two agricultural superpowers that accounted for 30% of world wheat trade and 78% of sunflower oil exports.
Since the beginning of the war, wheat prices increased by 40%, which affected more than thirty countries, net importers of wheat that depended on these two countries for at least 30% of their imports. Those 30 or more countries have seen their imports limited not only of cereals but also of fertilizers produced by the two countries at war. Russian grain exports were mainly destined for Egypt, Tunisia and Turkey as well as other African and Asian countries. While in the case of Ukraine, 75% of agricultural production was exported in normal times, to China, Europe and African countries. In 2021 Ukraine had had a super harvest that reached 106 million tons of grain.
Food prices also increased because the price of oil increased, derived from the sanctions that have been imposed on Russian oil and gas because of the war. It has also influenced the climate change that is being experienced throughout the world.
According to the FAO report, the global cost of food imports will increase by 51 billion dollars compared to 2021. It is also estimated that the poorest countries, including those in sub-Saharan Africa, will register an increase in total costs to despite the reduction in imported quantities.
Climate change it has caused droughts in many countries, including Italy to give an example, where the Po River, which irrigates the entire area of crops called Padania, has been significantly reduced by the lack of rain.
Cereal production will decrease
“In view of rising input prices, concerns about weather conditions, and increased market uncertainty as a result of the ukrainian warthe latest FAO forecasts point to the likelihood of food markets contracting and food import costs reaching a new record high,” said Economist Upali Galketi Aratchilage, Lead Editor of the Food Outlook report.
The FAO also anticipates that the world production of the main cereals such as wheat, corn and rice, among others, will decrease in 2022 for the first time in the last four years and that global use of them will also decline for the first time in the last 20 years.
World wheat production, for example, will decline to 771 million tons, according to the FAO. The UN agency highlights a tense context, with uncertain harvests due to the war in Ukraine or even droughts, such as the one taking place in India or Argentina. According to the AFP agency, Argentina, the eighth largest producer of wheat in the world, recently reported that its area planted with wheat will be 6.2 million hectares, the lowest in the last 12 years.
lower meat production
The international organization also warned that in the world not only the production of cereals will decrease but also of meatamong other foods. According to FAO forecasts, in Argentina, the European Union and the United States, meat production will decrease, although it was not specified by how much. But at the global level, a 1.4% increase is forecast instead thanks to the expected increase in pork production in China. World wheat stocks are set to rise slightly in the year, mainly due to earlier stock builds in China, the Russian Federation and Ukraine.
World corn production and utilization are expected to reach new records due to the increase in ethanol production (biofuel made from corn or sugar cane depending on the country) in Brazil and the United States and the industrial production of corn starch in China. World sugar production is also expected to rise after three years of decline, driven by increases in India, Thailand and the European Union.
Relief fund for poor countries
Faced with this scenario and with the possibility that acute food insecurity will worsen at the global level, probably causing localized famine conditions to be recorded in different parts of the planet, FAO has proposed to the member countries and to the G20 (intergovernmental forum for economic and financing), the creation of a Food Import Financing Fund to support low-income nations that are more dependent on food imports. Urgent global action is therefore needed to prevent hunger and food crises in vulnerable countries and in the poorest households that, given their high levels of indebtedness, do not have access to alternative sources of finance.
According to FAO calculations, the war in Ukraine could lead to the number of people suffering from hunger between 2022 and 2026 increasing by 13.1 million compared to a scenario that had already increased due to covid-19 ( there was talk of an increase of 13.8 million who suffered from hunger in 2021). Several United Nations organizations such as FAO, WHO (World Health Organization) and UNICEF (United Nations Children’s Fund), among others, estimated that in 2020 the undernourished people in the world had reached a total of 811 million, close to one tenth of the world’s population.
