More than a week ago russia cowardly invaded Ukraine. While russian army killed hundreds of civilians in Ukraine and lost around 10,000 of its own soldiers, death rate caused by the russian invasion on the global scale through destroyed global food security is going to be greater than that of Covid-19, says Andriy Yarmak, economist of Investment Department of the Food and Agriculture Organization of the United Nations (FAO).
While the developing world with lose lots of lives from growing hunger, the developed countries will lose unprecedented amounts of money directly and indirectly over decades to come. The russians will also slow down the scientific progress worldwide for many years ahead.
I have been working for 18-20 hours each day since the invasion, trying to do my job and helping people in Ukraine survive russian aggression, I do not have much spare time to do the in-depth analyses. However, I will provide only official stats and draw my own rough estimates based on my 30 years of experience in the global food market analytics. They should be very close to the reality, but I need to say that it is not an official position of my employer. I hope they will share their position asap as well. Here are the scary food security facts caused by russians.
- According to my colleague from the FAO Dmitry Prikhodko, who is one of the best grain market analysts with 30 years of experience, wheat and corn account for 27% of all calories, or, in other words, for 27% of all food in the world!
- Ukraine and russia together export more than 25% of all wheat in the world. Wheat is the key food security commodity on Earth. There are no exports from Ukraine now, and exports have almost stopped from Russia due to their issues with SWIFT and logistical risks. Prices are already in the space. Wheat prices reached $500 USD in Egypt and they can’t get it even for this high price!
- Where does this wheat from Ukraine and russia go? It is mostly exported to the third world countries. It is already becoming difficult to source it in these countries and some are already scared of the hunger riots.
Corn is also a critical product (it is an animal feed, critical to produce milk, meat, eggs and even fish) and Ukraine is the largest exporter in the region by far. Other exporters in the Americas. - Ukraine is a #1 global exporter of sunflower oil, and russia is the second. Together they account for 67% of the global exports! Basically, forget about the sunflower oil for now, nothing is being exported. I will not mention meat where Ukraine is a significant but not a critical exporter.
- Ukraine is already missing the planting campaign in the south, where huge hordes of russians are ruining the fields with their tanks and shotting randomly at civilians. Also, now it is critical to apply fertilizers, but this isn’t happening either.
- I wrote a large blog about fertilizers more than a month ago warning that the shortage is imminent even without the war and that it would worsen the global food security considerably. Nitrogen fertilizers are the most critical ones and nearly 80% of the production costs there is gas. With gas prices on their record high levels, the situation is already looking very grim for the yields globally this year.
- Expensive fertilizers mean that all countries of the world, especially the poor ones, will use less or no fertilizers. Without fertilizers the harvests will be reduced and some will not make it at all.
- Even if the war ends today, which is certainly not happening, Ukraine will not be able to export for many more months, and then it will take Ukraine another two years to reach the same production and exports levels. The aggressor, russia, will be isolated and will sharply reduce exports as well. They are already short of crop protection and other imported basics. Energy prices will be high for at least a few more years before the civilized world learns to live without russia’s gas and oil.
- The number of people in the world who do not have access to a minimum set of calories will increase, according to my very rough estimates, by 800 million people this year, and maybe even by 1 billion, totally destroying UN’s strategic goal to eradicate the global hunger. Please bear in mind that I did not consider the collapse GDP of all countries in these already very shocking estimates!
- It means a sharp increase in infant mortality rates in poor countries and many deaths from hunger and other diseases caused by malnutrition among adults.
- It also means that many children in the world will not be able to realize their full potential, make new scientific discoveries, promote human development, because the lack of food in childhood cannot be compensated later.
- These children from poor countries are now the basis for the development and progress in rich countries. Gifted young people emigrate to the United States, Britain, the EU, and to the developed countries in Asia and ensure their progress. All of this will now slow down sharply, only because putin decided to destroy a free, democratic country.
- In the rich countries, population keeps significant share of their savings, inclusive of pensions in the stock market. They already have lost hundreds of billions of dollars in the recent days due to the coward russian invasion into Ukraine. Guess what? They will lose even more as this war drags on for a while. They will also now spend hundreds of billions more on food, and this will also come from their future savings. So, the losses of rich countries are much greater than the losses of Ukraine or russia.
- I want people in the NATO member countries and other developed countries to understand that you are already losing much more than Ukraine or the rest of the world. Staying away from the war is actually bad for you and for your children!
- Moreover, not helping to end this war quicker, is causing the death of millions of children in the world’s poorest countries. Future Musks and Jobs may die already this year due to the growing malnutrition.
Army of occupiers is weak and rusty although very numerous. They no longer have any reserves after obliteration caused by Ukrainian resistance. Ukraine proved that russian army could be beaten even without much of the modern weapons. Getting directly involved in the war means saving hundreds of millions of lives as well as hundreds of billions of dollars of your money.
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