Analytical review
Ukraine has long been positioned as a guarantor of food security in many countries around the world due to its traditionally strong food exports. Ukraine's contribution to the world food market in 2021 was equivalent to providing food to about 400 million people [1].
Ukraine has been consistently among the top five world exporters of grains and legumes. According to the results of the 2020/2021 marketing year, exports of grains and legumes and products of their processing amounted to 44.9 million tons. In particular, 16.6 million tons of wheat, 4.2 million tons of barley, 18.4 thousand tons of rye, 23.1 million tons of corn and 126.9 thousand tons of flour were exported. The importance of Ukraine's role was particularly evident during the COVID-19 pandemic, when global supply chains were disrupted. Ukraine has continued to meet its commitments and significantly contributed to the food security of its partners in the Middle East, Europe, Southeast Asia and North Africa [2].
In 2021, Ukraine joined the UN Committee on World Food Security, which reports to the UN General Assembly through the UN Economic and Social Council, and the Food and Agriculture Organization of the United Nations (FAO).
For the first time in its history, the International Grains Council (an intergovernmental organization dedicated to promoting and strengthening international cooperation on grain crops between grain-exporting and importing countries) was chaired by Taras Kachka, Deputy Minister of Economic Development and Trade Representative of Ukraine.
The UN Food Systems Summit, held in September 2021, gave Ukraine an additional impetus to transform the food system to advance the 2030 Agenda for Sustainable Development. For Ukraine, the summit resulted in Decree № 41/2022 of February 7, 2022 "National priorities in the transformation of food systems in Ukraine" signed by the President of Ukraine and an action plan for the transformation of food systems in Ukraine until 2030 developed by the Cabinet of Ministers of Ukraine.
Russia's hostilities in Ukraine will have an extremely negative impact on the functioning of food systems. In particular, the following consequences are expected:
- disruption of integrated supply chains of agricultural products and food products (from primary producers to end consumers), as well as activities to create added value in the agro-industrial complex related to the production, processing, distribution, consumption and disposal of food;
- breakdown of the sowing timeline, which is particularly threatening, given the high world prices for gas and, consequently, mineral fertilizers [3]. Active hostilities are currently taking place in Kharkiv, Odesa, Zaporizhzhia – the regions where most of the wheat is grown. On the aggregate, these factors will reduce grain yields, harvests and exports;
- hampered exports of Ukrainian products to foreign markets due to the blockade of Ukrainian ports by Russia (60% of Ukraine's agricultural products are exported by sea), which will negatively affect primarily the countries that depend on food imports.
The consequences will pose serious threats to global food security. They will lead to:
- a further rise in world food prices (according to the FAO forecast of 11.03.2022, world prices for wheat and coarse grains may increase by as high as 20 percent due to the war in Ukraine);
- a global spike in inflation, which will primarily affect countries with underdeveloped economies in the Middle East and North Africa [4].
The FAO Food Price Index in February 2022 has already reached an all-time high of 140.7 points, which is 5.3 points higher than its level in January 2022 and 24.1 points higher than in February 2021. The grain prices in February 2022 compared to January 2022 increased by 4.2 points, including wheat by 2.1 points and maize by 5.1 points. Note that wheat and maize account for almost 3o percent of all calories consumed by the world's population.
Due to the Russian hostilities in Ukraine, the US Department of Agriculture (USDA) downgraded the forecast for maize exports from Ukraine in the 2021/2022 marketing year, which are projected at 27.5 million tons, according to the forecast as of February 2022 (instead of the 33.5 million tons expected according to the forecast as of February 2022) and under 20 million tons of wheat (instead of 24 million tons). The forecast of total world wheat exports in 2021/2022 marketing year dropped to 203.1 million tons (instead of 206.7 million tons).
On March 2, 2022, the United Nations issued the Ukraine Flash Appeal [5] stating that a severe disruption of the food systems in Ukraine could multiply the number of food insecure households “as farming households and small businesses flee conflict-affected areas".
FAO Director-General Qu Dongyu warned of the possible consequences of the crisis for food security outside Ukraine, including countries that are more or less dependent on wheat supplies from Ukraine.
Therefore, in order to minimize the effects of the global food crisis, it is necessary to protect and support agricultural production in Ukraine under martial law, taking advantage of Ukraine's impact on global food policy, which it has gained by achieving leading positions in world agricultural markets, as well as intensifying cooperation with international and intergovernmental organizations, including FAO, on the transformation of food systems.
Such actions should contribute to the reliable provision of Ukraine’s population with food, while scaling up the economic and physical availability of food and preventing the disruption of export contracts for agricultural products.
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[1] Ukraine feeds 400 million people worldwide. URL: https://agronews.ua/news/ukrayina-goduye-400-mln-lyudej-u-sviti/
[2] Ukraine joined the UN Committee on World Food Security / URL: https://agropolit.com/news/19610-ukrayina-uviyshla-do-komitetu-prodovol…
[3] Attack on Ukraine will significantly affect the world grain market - USDA / URL: https://biz.censor.net/n3323645
[4] Ukraine remains the breadbasket of the world / URL: https://ukurier.gov.ua/uk/articles/ukrayina-j-nadali-zalishayetsya-zhit…
[5]FLASH APPEAL UKRAINE, HUMANITARIAN PROGRAMME CYCLE MARCH – MAY 2022, https://reliefweb.int/sites/reliefweb.int/files/resources/Ukraine%20Fla…