The last few years have been marked by a number of upheavals, from the pandemic to the recent and on-going Russian invasion of Ukraine. One of the most corrosive and visible effects of this instability is the sharp rise in global food insecurity, which is of special concern here in Newfoundland and Labrador. The global food supply is supported by a network of infrastructures, a network in which Ukraine plays an important part. The Russian invasion has therefore upturned the global trade of grains and agriculture markets. What once seemed so certain–Ukraine’s position as a major agricultural exporter– is now uncertain.
It is estimated that in the last 18 months, the cost of wheat has risen 110 percent, corn140 percent, and soy 90 percent. Around the world from the ‘noodle shock’ to the increases closer to home, the prices of food are rising. Scholars have stated that the present global food system was already in “crisis” well before the invasion, and recently described the food system as “a house of cards.” The sole focus on food prices and inflation grab headlines, but it hides the precarious and brittle structure of the present global food system, or our food infrastructure.
This complex network of infrastructures that supports the global food system consists of an agricultural infrastructure, a market infrastructure, and an energy infrastructure. To understand why prices are increasing, we need to understand how these three infrastructures interact and influence one another.
Our food relies on a series of infrastructures that support its journey from the field to our tables. Agriculture requires an infrastructure of farmers who work with weather, seeds, soil, and inputs such as fertilizers and pesticides to grow crops like wheat. To move wheat to consumers, an infrastructure of harvesters, trucks, grain storage, railways, ports, and ships are required to move grain to markets around the world. Grain traders help coordinate the delivery of crops to food manufacturers, and from there, grocers move food to the shelves. A fossil fuel infrastructure, meanwhile, powers everything from synthetic fertilizers to the plastic packaging on our ramen noodles.
As Winona LaDuke and Debra Cowan state, infrastructure can either be used to sustain life or damage life. A pipeline, for example, can be used to transport life-supporting water, or climate disrupting fossil fuels. In short, infrastructures are neutral, what matters is how we use them.
Agriculture is essential, Ukrainian President Volodymyr Zelensky has stated, “because it’s about life. About our life. About our future.” The Russian invasion has disrupted agriculture with the placement of landmines in fields and the destruction of farm equipment and grain storage. The Russians have the “farm infrastructure wrecked.” Zelensky explained the Russians are “doing everything to ruin our agriculture potential and to provoke a food crisis not only in Ukraine but in the world”.
Zelensky is not understating Ukraine’s integration with global agricultural markets over the last few decades. Ukraine, before the invasion, accounted for 10 percent of the world’s wheat trade, 15 percent of corn trade, 15 percent of barley, and along with Russia about 80 percent of sunflower exports. Prices for agricultural crops are at record levels. The World Bank states food prices are at the third-highest (after 1974 and 2008). The steep rise in food prices will negatively affect the food security of the most vulnerable people around the world—primarily countries that are both poor and dependent on imported grains.
Of course, higher prices will impact people in both poor and rich countries. A bad food security situation is getting worse. The chief economist of the World Bank is warning “there will be important ramifications for the Middle East, for Africa, in particular.” Countries like Egypt import up to 80 percent of their wheat from Ukraine and Russia. In 2008, the rise in prices sparked food riots and demonstrations, and in 2011 the Arab Spring was prompted by rising food prices. While food riots do bring attention to the issue, it is not without another cost: the use of military force against protesters has been increasing.
Even before the Russian invasion of Ukraine, the Food and Agriculture Organization of the United Nations (FAO) estimated 720 and 811 million people in the world faced hunger in 2020. The FAO estimated between 8 and 13 million more people will be added to this total due to the conflict. Abeer Etefa, senior spokesperson for the World Food Programme, stated that “for some countries in the Middle East region, this conflict could drive millions of people into food poverty.” In addition, the WFP costs have also risen 44 percent and it relied on Ukraine for 50 percent of its grain supplies.
Other Factors Raising Food Prices Worldwide
It is no news that energy prices are rising too, but this is also not a coincidence: energy and food prices are linked in three ways.
First, the rise of energy costs increases the price of industrial food agriculture. Agriculture is highly dependent on energy-intensive methods such as fuels for transport, and the widespread use of agri-chemicals such as fertilizers and pesticides. As fossil fuel prices rise, so too do food prices.
Second, many food crops are used to produce biofuels. Grains like wheat and corn, and oil seeds like sunflower and soy are not just destined for our bellies, they are used to create ethanol and biodiesel. The demand for biofuels puts upward pressure on prices especially as oil and gas prices increase. The high energy prices mean that food crop prices are now in competition with energy prices. After the last significant energy price hike in 2008, biofuel demand has contributed to the food crisis.
Third, food prices for major grains fluctuate considerably as they are determined by the larger financial market of commodity exchanges. Price is determined for many commodities—wheat, corn and so on—in the futures markets, which includes energy. This has global implications. Through arbitrage, global investors calculate, invest, and speculate on future prices. This means the prices we pay are partially shaped by financial actors and other investor’s speculations on futures markets.
A large part of the global market infrastructure are the major grain traders, ABCDs (Archer Daniels Midland, Bunge, Cargill, and Louis Dreyfus) and the Chinese COFCO. Together they account for somewhere between 70 to 90 percent of global grain trade. The high dependency of such a large swathe of the global grain trade on a few corporations makes the food system very precarious. In Canada, for example, supermarkets and the meat-processing industry also feature highly concentrated ownership and have been implicated in a number of price fixing schemes and lawsuits.
Beyond corporate concentration, investors and speculators also affect food prices. As food prices rise, global commodity markets become targets for speculation, which can contribute to further price rises. Experts have tracked how excessive speculation adversely affects food prices and a recent report shows that investment funds have increasingly moved into agricultural commodities over the last two years.
The infrastructure that supports our food is on uncertain footing, but one of the biggest threats is military adventurism because it is an infrastructure of death and destruction. While self–evident, war and military conflicts contribute to short- and long-term human suffering. But less attention is paid to the harm they inflict onto the most important part of any agricultural infrastructure: the environment.
Military infrastructure and military adventurism produce environmental harm and destruction on multiple scales. Military adventurism means massive GHG emissions, long-term issues of environmental degradation of fields, waterways, and forests due to toxic pollution from armaments, as well as fuel spills, fires, and other kinds of damage incurred from fighting wars.
We do not know the full effects of the military on climate change because governments are not required to share greenhouse gas levels emitted by armed forces. But we can estimate that top military spenders like the US, China, India, and Russia are huge contributors. For example, Brown University’s Costs of War project, named the US military as “the largest single source of greenhouse gas emissions in the world.” Russia, no doubt, would be high on that list too.
The long-term environmental effects of the Russian invasion—toxicants in the soil, leftover munitions in fields as well as the acute destruction of lives and built agricultural infrastructure—are a menace to agriculture and food security the world over.
Food For Thought About Tackling Food Security
What to do?
How can we support infrastructures that sustain life rather than facilitate death?
- Diversification. Agricultural exporters are highly specialized, and this leads to a high dependence on a few countries for a few specific commodities such as wheat, corn, and soy. The FAO and other experts have called for diversification throughout the food system. This would encourage self-sufficiency to lessen food imports, increase variety in suppliers and food consumption. It would mean not solely relying on a concentrated trading system with a few key crops and intensive energy inputs.
- Regulation. Speculation on food commodities must be regulated. After two decades of ‘light touch’ regulation, we have only seen an increase in the volatility and unpredictable food markets. It shows no sign of ceasing unless it is regulated at national and international scales
- Tapering Fossil Fuels. The industrial food infrastructure relies extensively on fossil fuels, which means it is contributing to climate change, and climate change in turn, is a threat to agriculture. In NL, government support for oil and gas is a direct threat to the environment, and ultimately to agriculture (and fishing too). Using less energy-intensive agriculture and more efficient food ways are essential.
- Food security: There is a sharp and worrying increase in food insecurity. We know—and this links back to the FAO recommendations—that supporting social safety net programs work. Vulnerable groups must be supported. The high prices of food and energy are regressive. Existing cash transfer programs must be expanded and new programs must be introduced.
- Militarism in all forms must be opposed.
Food insecurity is worsening; it is time to commit to a more diverse set of food practices, markets, and food ways that foster life, not death.
Did you enjoy this article? Fund more like it, and support the future of journalism in Newfoundland and Labrador.