The state of the global food supply is only set to worsen, as U.S. agriculture faces very poor harvests due to droughts, supply chain issues, and the Ukraine war – just a few elements creating a ‘perfect storm’ for a worldwide food crisis.
The ongoing Russia/Ukraine conflict has cut off vital shipments needed to make fertilizer and grain products.
According to top-level executives from big agricultural firms, North and South America would need at least two more years of good harvests to ease supply pressures.
“The current market expectation is that global grain and oilseeds markets need two consecutive normal crop years to stabilize global supplies,” Chuck Magro, chief executive of Corteva, told the Wall Street Journal.
He explained that efforts to restock global crop supplies were in vain due to this year’s harvest falling below typical yields.
Aside from supply problems, the United States and South America have suffered massive drought this summer, adding to the building crisis.
Drought conditions worsened throughout the U.S. Grain Belt, with a massive harvest reduction due to lack of water.
Not only that, farmers in Northern California trying to tackle the water problem were told by the government to stop diverting water from a region dedicated to protecting fish.
As we reported in August:
The State Water Resources Control Board sent a draft cease-and-desist order to the Shasta Water Association, ordering farmers to discontinue collecting water from the Shasta River watershed.
In a letter to the water board – dated August 17, the agricultural group said it thought the exemptions permitted it to cut down its diversion of water by just 15%, stating it would begin using water for animals when the weather reaches high temperatures and to suppress fires.
Corn production plummets
In September, the Agriculture Department announced it had lowered the estimates of its nationwide corn production to 13.9 billion bushels.
This is 3 percent lower than its August projections – around 8 percent lower than the total amount harvested in 2021.
In August, projections for soybean production were down 3 percent, down from last year.
As global recession fears loom, food commodity markets are bearing the brunt.
According to the WSJ, wheat price futures at the Chicago Board of Trade soared 17 percent over the past 12 months.
Meanwhile, corn is up 28 percent, while soybeans jumped 14 percent.
Then Russia’s invasion of Ukraine earlier this year also sent food prices skyrocketing.
But the July agreement between Russia and Ukraine, brokered by Turkey via the United Nations, eased crop prices slightly – allowing over a million tons of grain to be exported through the black sea from Ukraine.
Since the invasion of Ukraine in February, about 15 percent of grain stocks have been lost, the Ukraine Conflict Observatory noted.
Ukraine could only export about 40 percent of its normal grain shipments during that period before the Black Sea agreement, Juan Luciano, CEO of Archer Daniels Midland, said at a September investor conference.
Russian President Vladimir Putin accused the West of diverting Ukrainian grain to their own countries instead of allowing it to arrive in developing world countries.
Putin’s statement caused a jump in wheat prices, which had been declining since the deal.
Western leaders later accused Putin of spreading misinformation about the destination of Ukrainian grain.
“Contrary to Russian disinformation, this food is getting to Africa, the Middle East, and Asia,” said European Commission President Charles Michel at a U.N. conference.
According to various Russian officials, despite sanctions, items in the agreement that allowed Russia to sell its agricultural products were violated.
Now experts say fertilizer shipments are being disrupted due to the war and, as a result, are seriously affecting global harvests.
According to the U.N.’s Global Food Security Summit on rising food insecurity, we could be in a devastating crisis by 2024 if Russia’s war with Ukraine continues.
“As we’ve seen over the last years as a result of Covid, before that climate change and, more recently, conflict—notably Russia’s aggression against Ukraine—profound food insecurity touches well over 200 million people on this planet, including, of course, in Yemen,” said U.S. Secretary of State Antony Blinken.
The perfect storm
David Beasley, the executive director of the U.N. World Food Program, told the U.N. Security Council last week the world is facing “a global emergency of unprecedented magnitude.”
Beasley said there was a real risk of “multiple famines” this year.
He added that 345 million people are facing starvation, with 70 million directly affected by disrupted shipments due to the war in Ukraine.
U.N. Secretary-General Antonio Guterres also warned that if the war with Ukraine does not stabilize in 2022, “we risk to have a real lack of food” by 2023.
As The Daily Fetched highlighted earlier this month, there is also an apparent coordinated attack on agriculture, which is becoming glaringly obvious.
The epidemic of food processing plants mysteriously burning to the ground is another bizzare factor adding to the “perfect storm.”
We noted some hard data points which make it impossible to deny what is coming – see the full list here.