The worst consequence of the war in Ukraine, more serious than the rise in energy prices, is the rise in wheat prices. The G-7 warns of the risk of a global food crisis and conflicts, as António Guterres, Secretary General of the UN, reminds, have their roots in the lack of food.
In the last four years, the number of people in places where the conflict is the main cause of lack of food has grown by 88%. Nearly 140 million people now live in war-torn regions with severe feeding difficulties.
The Russian invasion of Ukraine has made life worse for these and many other people around the world. Basic foods have become more expensive by 30% due to the increase in the price of wheat.
Supply is well below demand and will remain so for quite some time, according to the latest report from the Peterson Institute for International Economics. The climate crisis and the pandemic contribute to creating a "perfect storm" that Russia has aggravated.
In mid-May, when the FAO and other international agencies warned of the danger running the global food balance, Indian Prime Minister Nerendra Modi pulled out his chest.
"Every time humanity faces a crisis - he said in Copenhagen - India finds the solution". Then, she promised to "feed the world" that suffers from the rise in the price of wheat due to the war in Ukraine and the climate crisis.
Days later, however, his government announced a total embargo on grain exports. The world market lost its second producer of wheat and the price of a ton shot up to 438 euros per ton, a record.
Although today it has dropped to 406 euros, wheat still costs 30% more than before the Russian invasion of Ukraine.
India is one of more than twenty countries that in recent months have banned the export of cereals or some other food.
As the Spanish Minister for Foreign Affairs, José Manuel Albares, said a few days ago at the Vanguard Forums colloquium, the war is causing a food crisis that will be longer than the war itself because it will take more time to recover the farmland and reestablish supply chains.
During the pandemic two years ago, some countries restricted the export of food, but these were short-lived embargoes that were soon lifted. Now, as the International Food Policy Research Institute (IFPRI) indicates, the situation is very different because before the war there was already a shortage of grain and vegetable oils.
The imbalance between demand and supply triggers prices and also restrictions on food exports. "Export embargoes are contagious," warns IFPRI, while emphasizing that "the World Trade Organization does not have the necessary tools to prevent them."
India is the second largest producer of wheat behind China but is not an exporting country. Last year it exported just over seven million tons, far from the 43 of Russia, the main exporter.
The ten countries that lead the ranking of exports put more than 160 million tons of wheat on the world market last year. This year it is possible that the hundred million tons will not be reached, a drop close to 40%.
Russia has decided not to export wheat so as not to aggravate the strong inflation that it suffers as a result of the economic sanctions for having invaded Ukraine. This country has more than 20 million tons ready for export, but the Russian fleet blocks Odessa and the rest of the Black Sea ports that are still in Ukraine's hands. The sea routes to these ports are also mined.
Other major exporters, such as the United States and France, will have worse harvests this year due to drought and high temperatures. This is one of the reasons that India has also used for not "feeding the world".
The temperature in New Delhi reached 49.2 degrees on May 19, a record that spread to the main grain-producing states in the north of the country: Uttar Pradesh, Punjab and Haryana. Consequently, the harvest will not exceed 105 tons, 5.7% less than forecast.
Not having an assured annual supply of grain, Egypt, Indonesia, Pakistan, Bangladesh, Lebanon, Turkey, Serbia, Kosovo, Azerbaijan, Kazakhstan, Kyrgyzstan, Afghanistan, Iran, Kuwait, Algeria, Tunisia, Burkina Faso, Ghana and Argentina have banned exports of many foods.
Bangladesh, for example, received half of the seven million tons that India exported, while Egypt was the main importer of wheat from Russia and Ukraine.
The drought will also reduce wheat production this year in an arc that goes from Morocco to Bangladesh, according to the Agritel consultancy. Countries like Morocco, Algeria, Tunisia and Turkey are looking for open markets to import the grain they lack and it is not easy for them.
Demography plays against it, but so do export embargoes and speculation on the price of wheat. Argentina, the United States, Canada and Australia are the most obvious markets to alleviate the lack of Russian and Ukrainian wheat, but prices are very high.
India's Commerce Secretary, BVR Subrahmanyan, justified the grain export embargo on the grounds that "we don't want it to be stockpiled and diverted from the food needs of vulnerable countries and populations."
Some 700 million Indians receive free or subsidized food. To do this, the Government forces wheat producers to sell it to them at a guaranteed minimum price. These producers, however, prefer to export because the world price is much higher and they accuse the government of depriving them of unprecedented profits.
Prime Minister Modi, in any case, prefers to feed the 700 million struggling compatriots rather than satisfy the main agricultural producers. The United States and Britain are trying to convince him to lift the embargo on exports, but his position now seems firm.
Meanwhile, the UN and the World Bank are working to meet the needs of the most vulnerable countries with loans and aid to farmers.
Agriculture, as Qu Dongyu, director general of the FAO, points out, "is one of the keys to security and peace in the world." Food crises are often a source of conflict. Of the 800 million undernourished people, 80% live in conflict zones and their situation will continue to worsen as long as the price of wheat does not fall.
Ukraine and Russia were the breadbasket for much of Africa and the Middle East, regions where the majority of the population most vulnerable to conflict lives.
Hunger remains a weapon of war, and Russia is now using it by preventing Ukraine's wheat exports.
The great paradox is that this year's wheat harvest will be a record in Russia itself, enough to offset the ravages of the climate crisis in other latitudes and keep the price under control, but the Kremlin has other priorities.
