By Nicole Winfield in Rome
ROME (AP) — Prices for food commodities like grains and vegetable oils reached their highest levels ever last month largely because of Russia’s war in Ukraine and the “massive supply disruptions” it is causing, threatening millions of people in Africa, the Middle East and elsewhere with hunger and malnourishment, the United Nations said Friday.
The U.N. Food and Agriculture Organization said its Food Price Index, which tracks monthly changes in international prices for a basket of commodities, averaged 159.3 points last month, up 12.6% from February. As it is, the February index was the highest level since its inception in 1990.
FAO said the war in Ukraine was largely responsible for the 17.1% rise in the price of grains, including wheat and others like oats, barley and corn. Together, Russia and Ukraine account for around 30% and 20% of global wheat and corn exports, respectively.
While predictable given February’s steep rise, “this is really remarkable,” said Josef Schmidhuber, deputy director of FAO’s markets and trade division. “Clearly, these very high prices for food require urgent action.”
The biggest price increases were for vegetable oils: that price index rose 23.2%, driven by higher quotations for sunflower seed oil that is used for cooking. Ukraine is the world’s leading exporter of sunflower oil, and Russia is No. 2.
“There is, of course, a massive supply disruption, and that massive supply disruption from the Black Sea region has fueled prices for vegetable oil,” Schmidhuber told reporters in Geneva.
He said he couldn’t calculate how much the war was to blame for the record food prices, noting that poor weather conditions in the United States and China also were blamed for crop concerns. But he said “logistical factors” were playing a big role.
“Essentially, there are no exports through the Black Sea, and exports through the Baltics is practically also coming to an end,” he said.
Soaring food prices and disruption to supplies coming from Russia and Ukraine have threatened food shortages in countries in the Middle East, Africa and parts of Asia where many people already were not getting enough to eat.
Those nations rely on affordable supplies of wheat and other grains from the Black Sea region to feed millions of people who subsist on subsidized bread and bargain noodles, and they now face the possibility of further political instability.
Other large grain producers like the United States, Canada, France, Australia and Argentina are being closely watched to see if they can quickly ramp up production to fill in the gaps, but farmers face issues like climbing fuel and fertilizer costs exacerbated by the war, drought and supply chain disruptions.
In the Sahel region of Central and West Africa, the disruptions from the war have added to an already precarious food situation caused by COVID-19, conflicts, poor weather and other structural problems, said Sib Ollo, senior researcher for the World Food Program for West and Central Africa in Dakar, Senegal.
“There is a sharp deterioration of the food and nutrition security in the region,” he told reporters, saying 6 million children are malnourished and nearly 16 million people in urban areas are at risk of food insecurity.
Farmers, he said, were particularly worried that they would not be able to access fertilizers produced in the Black Sea region. Russia is a leading global exporter.
“The cost of fertilizers has increased by almost 30% in many places of this region due to the supply disruption that we see provoked by a crisis in Ukraine,” he said.
The World Food Program has appealed for $777 million to meet the needs of 22 million people in the Sahel region and Nigeria over six months, he said.
To address the needs of food-importing countries, the FAO was developing a proposal for a mechanism to alleviate the import costs for the poorest countries, Schmidhuber said. The proposal calls for eligible countries to commit to added investments in their own agricultural productivity to obtain import credits to help soften the blow.
USAID head urges crisis-hit Sri Lanka to tackle corruption
By Krishan Francis in Colombo
COLOMBO, Sri Lanka (AP) — A visiting U.S. diplomat on Sunday urged Sri Lankan authorities to tackle corruption and introduce governance reforms alongside efforts to uplift the country’s economy as a way out of its worst crisis in recent memory.
USAID Administrator Samantha Power told reporters that such moves will increase international and local trust in the government’s intentions.
“Assistance alone would not put an end to this country’s woes,” Power said. “I stressed to the Sri Lankan president in my meeting earlier today that political reforms and political accountability must go hand in hand with economic reforms and economic accountability.”
She said that international investor confidence will increase as the government tackles corruption and proceeds with long sought governance reforms. “As citizens see the government visibly following through on the commitment to bring about meaningful change, that in turn increases societal support for the tough economic reforms ahead,” she said.
During her two-day visit, Power announced a total of $60 million in aid to Sri Lanka. After meetings with farmers’ representatives at a rice field in Ja-Ela, outside of the capital Colombo on Saturday, she announced $40 million to buy agrochemicals in time for the next cultivation season.
Agricultural yields dropped by more than half for the past two cultivation seasons because authorities had banned the imports of chemical fertilizers ostensibly to promote organic farming. She said that according to the World Food Program, more than 6 million people — nearly 30% of Sri Lanka’s population — are currently facing food insecurity and require humanitarian assistance.
On Sunday, she said an additional $20 million will be given to provide emergency humanitarian assistance to vulnerable families.
Sri Lanka has faced its worst crisis after it defaulted on foreign loans, causing shortages of essentials like fuel, medicines and some food items.
It has reached a preliminary agreement with the International Monetary Fund for a $2.9 billion package to be disbursed over four years. However, the program hinges on Sri Lanka’s international creditors giving assurances on loan restructuring. Sri Lanka’s total foreign debt is more than $51 billion of which $28 billion must be repaid by 2027.
Power said that the U.S. stands ready to assist with debt restructuring and reiterated that it is imperative that China, one of the island nation’s bigger creditors, cooperate in this endeavor.
Infrastructure like a seaport, airport and a network of highways built with Chinese funding did not earn revenue and are partly blamed for the country’s woes.
Saskatchewan warns that federal employees testing farmers’ dugouts for nitrogen levels could be arrested for trespassing
Ottawa’s planned attack on fertilizer will hurt our farmers.
It needs to stop.
Less fertilizer means less food.
Europe shut in about 50% of its fertilizer production.
Canada should not repeat the same mistake. pic.twitter.com/BztOiC1CPd
— Jason Kenney 🇺🇦 (@jkenney) July 27, 2022
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