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Who's to blame for sky-high food prices?
More than a year after Russia's war in Ukraine, have we turned from not enough food to more expensive food for all? How is this having different impacts in the developed and developing world?
Who's to blame for food inflation? And can the US and Canada do something to make food more available and affordable for the rest of the world?
At a US-Canada summit, GZERO's Tony Maciulis caught up with Ertharin Cousin, who knows a thing or two about this stuff as CEO of Food Systems for the Future and former head the UN World Food Programme.
For more, sign up for GZERO North, the new weekly newsletter that gives you an insider’s guide to the world’s most important and under-covered trading relationship, US and Canada.
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Food emergency: what to do when people are hungry now
On global issues, the international community must walk and chew gum at the same time. It needs to learn to deal with simultaneous crises that play off each other, says UN Foundation President Elizabeth Cousens.
That's why we dropped the ball on hunger.
Now the needs are huge and growing. We haven't seen a lot of images of starvation yet, but they are coming, Cousens tells Ian Bremmer on GZERO World.
"We have to be able to rise to this challenge, and see it as something that's in both our interest," she says, adding that “we have done heroic things before on the humanitarian front — it's not like we're not collectively capable."
Watch the GZERO World episode: Inequality isn't inevitable - if global communities cooperate
Inequality isn't inevitable - if global communities cooperate
Almost three years after COVID, we're still grappling with the geopolitical convulsions that the pandemic unleashed or worsened. They're all wiping out decades of progress on fighting global inequality.
What's more, the world has become more unequal at a time when global cooperation is often an afterthought. So, what can we do about it?
On GZERO World, Ian Bremmer speaks to UN Foundation President and CEO Elizabeth Cousens, who thinks it's the perfect time for institutions backed by the 1 percent to step up even more.
Foundations have traditionally resisted going big on fixing the world's problems because they're in it for the long run. But now the stakes are so high and the crises so urgent that Cousens sees a "window" of opportunity for philanthropy to play a bigger role in global development.
The are real problems, she says, that money can solve immediately.
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Podcast: Salvaging the world we leave our kids with innovative philanthropy
Listen: Global inequality has reached a level we haven’t seen in our lifetimes and recent geopolitical convulsions have only made things worse. The rich have gotten richer while extreme poverty has exploded. UN Foundation President Elizabeth Cousens thinks it's the perfect time for institutions backed by the 1% to step up. She speaks with Ian Bremmer on the GZERO World podcast about the key role that innovative philanthropy could play to address problems exacerbated by the war in Ukraine, economic fallout from the COVID pandemic, and a warming planet.
Why now? The stakes are so high and the crises so urgent that Cousens sees a window of opportunity for philanthropy to take swift action instead of their traditional long-term approach. When it comes to immediate and deadly problems like famine and flooding, an influx of money could start making a huge difference very quickly.
Subscribe to the GZERO World Podcast on Apple Podcasts, Spotify, Stitcher, or your preferred podcast platform, to receive new episodes as soon as they're published.- Is the world coming apart? Drama at Davos ›
- Global food crisis: when food isn't merely expensive ›
- In a food crisis, export controls are "worst possible" thing to do, says UN Foundation chief ›
- Podcast: The Ukraine war is crippling the world's food supply, says food security expert Ertharin Cousin ›
- Inequality isn't inevitable - if global communities cooperate - GZERO Media ›
- Philanthropy's moment to act - GZERO Media ›
The perils of depending on food imports: UN Foundation chief
We all know there's a global food crisis due to the impact of shortages of Russian and Ukrainian grain, fertilizers, and fuel. But UN Foundation chief Elizabeth Cousens thinks high prices are hurting some countries even more.
Take for instance Yemen, which imports 90% of its food and is thus highly vulnerable to any external shocks.
While addressing famine is the top priority, Cousens says in a Global Stage livestream conversation that the long-term plan should be "laying the foundation for a much more resilient, equitable food system."
Her two dream goals: sustainable agriculture and reducing food import dependence.
Why is Russia on the UN Security Council?
“The UN is back,” said Melissa Fleming, the UN’s Under-Secretary-General for Global Communications. In an interview with GZERO Media on the sidelines of the 77th General Assembly, Fleming reflected on the return to in-person diplomacy after years of disruption caused by pandemic.
“There is this real feeling that the UN is the only place for global cooperation,” she said. “We cannot solve the world's intractable problems of climate change, of war, of refugees without multilateralism, and multilateralism is the UN. It is nations working together to solve problems.”
In the interview, Fleming also acknowledged that the collision of recent global crises had created uncertainty about the power of multilateralism. But she said recent diplomatic efforts lead by the UN, including the Black Sea grain initiative to help mitigate a growing food insecurity crisis, have brought renewed energy.
On Russia’s membership and role at the UN, Fleming said, “Russia's invasion of Ukraine has absolutely launched a discussion about how the Security Council works, how it is dysfunctional, especially when one permanent member of the Security Council is the invading country. So, it's obviously started a debate.”
Laborer carries food at the main market in Colombo, Sri Lanka.
Is the global food crisis here to stay?
The mood surrounding the annual UN General Assembly kickoff this week has been grim. Russia is pounding Ukraine and climate-related disasters are devastating places as far-flung as Pakistan, Portugal, and Puerto Rico.
In 2022, with total war returned to Europe and the global pandemic having scrambled supply chains, the food crisis is where the conversation is at.
But it’s not an issue of scarcity. This year’s global food crisis was initially (mostly) due to Russia’s blockade of Black Sea ports in southern Ukraine, which prevented millions of tons of grain from reaching countries that rely on Europe’s breadbasket to feed their populations. Ukraine is a major exporter of wheat, corn, and edible oils, accounting for more than 40% of sunflower oil supply globally before the war. (Dinner party fact: the yellow band on the Ukrainian flag represents the country’s vast golden fields of sunflowers.)
The scarcity issue has begun to stabilize since the UN and Turkey brokered a deal between Moscow and Kyiv in July, allowing exports to resume. But the problem is far from resolved.
Surging prices → hunger pains. Amid the war in Ukraine, global food prices rose in July by 13% year on year and could continue to rise another 8.5% over the next five years, according to the UN. There are several reasons for this.
The food crisis has been exacerbated by the surging price of fertilizer ingredients that are crucial to crop nutrition. Crucially, many fertilizer ingredients – like ammonia, nitrate, and potash – come from Russia and Belarus, both of which are unable (or unwilling) to meet global demand due to Western sanctions. Meanwhile, the situation has been exacerbated by Chinese curbs on some fertilizer ingredient exports.
Though the EU insists that its sanctions “have minimal impact on the agriculture sector,” Russian and Belarusian entities have been cut off from the SWIFT global payment network, and shipping companies face extremely high insurance premiums to transport Russian goods. Russia, for its part, says that Western sanctions make it difficult to export its stockpiles.
“While the information fog of war dictates caution, it’s pretty clear the invasion is the primary cause of food disruption. The Russian track record also indicates they are not above weaponizing food,” says Gerald Butts, vice chairman of Eurasia Group.
Connecting the dots. Fertilizer production is extremely energy-intensive, particularly for nitrogen fertilizer, which needs a lot of natural gas. Europe, for its part, is grappling with an energy crunch as it limits its reliance on Russian natural gas, which has driven up prices for European fertilizer producers that are then passed along to consumers.
What’s more, as Europe has become a net importer of fertilizer, many states have turned to alternative sources – like Morocco – for key fertilizer ingredients. However, upscaling takes time and has led to bidding wars for limited supplies that put emerging market economies at a disadvantage.
“In 2022, we have enough food that is not well distributed,” UN Secretary-General António Guterres told GZERO Media in a recent interview. “But in 2023, if we don't normalize the fertilizer market we simply won’t have enough food worldwide,” he says, adding that “fertilizer is extremely important not only for the present situation but for next year.”
African agriculture reels. The impacts of the food crisis are being acutely felt across Africa, long vulnerable to climate change, drought, and food insecurity. Heavily dependent on imported fertilizers, many African farmers either can’t afford the ingredients or can’t find them on the market. The African Development Bank, for its part, says the continent is short of at least two million metric tons of fertilizer, which could exacerbate hunger crises in countries already on the brink of famine, like Somalia.
In some African states, including the Ivory Coast and Cameroon, fertilizer prices have increased by 50% since Russia invaded Ukraine, prompting some agriculture workers to slash fertilizer usage, further threatening food production. In other countries, farmers have sought fertilizer substitutes: Some Ugandan farmers are replacing nitrate with … maggots, whose digestive systems transform food waste into fertilizer. And while a few international fertilizer producers are donating fertilizer to African farmers, many say it’s “too little too late.”
When leaders huddle at the UN this week, the deepening hunger crisis – including how climate change is exacerbating food insecurity – will be high on the agenda.
But what can the UN actually do to mitigate the worsening food disaster?
“Wealthy economies have limited capacities to directly tackle the issue of price inflation in the short run,” says David Laborde, a senior researcher at the International Food Policy Research Institute. However, they “could prioritize fertilizer production when dealing with natural gas rationing, make sure that global trade remains fluid and … avoid new waves of export restrictions,” Laborde says, pointing to concerns over India’s recent decision to limit some rice exports.
“It’s really a ‘money issue,’” Laborde adds, noting that “UN agencies need 30 more billion this year to tackle the hunger and malnutrition crisis.”
Overlapping factors make the current global food crisis extremely hard to address. But one thing is clear: maggots are not the only answer.
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António Guterres: the world won’t have enough food in 2023 without Russian fertilizer
The UN- and Turkey-brokered deal with Russia to unblock Ukrainian grain exports stuck at Black Sea ports was a big success for the United Nations — and for Secretary-General António Guterres.
Look, he recalls he told Vladimir Putin and Volodymyr Zelensky: this is a dramatic situation caused by the war because it is threatening the living conditions of most of the world.
The UN chief tells Ian Bremmer on GZERO World that we need to find a way for Ukraine to ship its grain; and the UN hopes to negotiate with the US, the EU, and others to get some exemptions from Western sanctions against Russia so Moscow is able to export the food and fertilizer that the world needs right now.
Guterres says that this year we have enough food. But we may not in 2023 if we don't fix the fertilizer market soon.
Watch the GZERO World episode: How a war-distracted world staves off irreversible damage
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