The Crisis in Ukraine Has Major Implications for the Agricultural Sector and Global Food Security
As Russia’s attacks on Ukraine escalate in Europe’s breadbasket, global food and agriculture markets are increasingly strained, exacerbating worldwide food insecurity – especially in the Middle East and northern Africa. An ALEC statement, as well as ALEC materials about the conflict, can be found here.
Russia and Ukraine together account for nearly one-third of wheat and barley exports. The Black Sea region typically produces more than a billion bushels of corn for export, and Ukraine is the world’s largest producer of sunflower oil (46%). Ukraine exports over 12% of all food calories consumed in global markets and nearly 40% of those exports go to the Middle East and Africa. Ukraine is also a major supplier of feed for domesticated livestock.
Some of the fiercest fighting is taking place in the country’s most fertile regions, making it difficult for farmers to plant crops even if they are able to procure fertilizer and fuel for their farm equipment. In many cases, even those who can plant have chosen to defend the nation despite military service waivers for agricultural workers. Furthermore, the Ukrainian government is restricting food exports to preserve domestic resources to prevent a domestic humanitarian crisis, disrupting international supply chains.
The war’s impact on food is being felt around the globe. Turkey imports 90% of its wheat from Ukraine, while Israel sources almost half from the beleaguered country. However, the crisis is most acute in areas where food insecurity is already widespread. Yemen, in the grip of a civil war since 2014, typically imports one-third of its wheat from Ukraine. Global price spikes and grain shortages along with the diversion of aid to assist Ukrainian refugees will have a devastating impact on the 80% of Yemenis reliant on foreign aid, pushing an estimated 161,000 of them into famine. More than 85% of Sudan’s wheat originates in Ukraine resulting in food insecurity for 20 million Sudanese – roughly half the country’s population –further destabilizing an already fragile country.
So how is this impacting American farmers? Although grain prices are increasing – including a more than 50% increase in price for wheat – because of decreasing supply, farmers’ own costs are soaring. In addition to increasing fuel prices, which we addressed last week, some products necessary for agriculture, such as nitrogen and other fertilizers, are also skyrocketing in cost due to the global supply chain’s reliance on Russian exports. Russia is the third-largest exporter of fertilizer products, and the global industry is only beginning to feel the impact of western sanctions. Cushioning the impact on American and Russian consumers is one reason that many US agricultural firms have not interrupted activities in Russia in spite of mounting pressure to do so rejecting the weaponization of food production.
Unfortunately, higher production costs are not being offset by increased profits. As the conflict enters its fourth week and the northern hemisphere’s planting season begins, American consumers and farmers are feeling and will continue to feel the pinch as prices rise.
State legislators have several tools with which to combat increasing food costs. They can support Right to Farm legislation, which protects domestic farm operations. Legislators can also support federal lawmakers by passing resolutions calling for support of the Processing Revival and Intrastate Meat Exemption Act or the PRIME Act. The PRIME Act amends the Federal Meat Inspection Act to permit intrastate distribution of custom-slaughtered meat such as beef, pork, or lamb to consumers, restaurants, hotels, boarding houses, and grocery stores, cutting down on shipping, processing and distribution costs.
Finally, state legislators can support our nation’s farmers by challenging the forthcoming Waters of the United States rulemaking. If passed as written, the current version of the rule under consideration will tie up the nation’s agriculture resources in costly federal litigation and regulatory review processes, costing both our nation’s farmers and consumers at a time when we can ill-afford to do so.