Looming Crisis
"By the time we are done with 2022, it is likely that more than 100 million additional people on earth will experience either famine or acute hunger, something that the world has never seen before. Civil unrest in many countries in the Middle Eats and Africa is expected," Charlebois said.
"A big disaster is coming. How much is due to the war, and how much to the total financial and economic war against Russia, is a big question. As I see it, the economic war against Russia makes the food situation all the more perilous, especially because food prices follow energy prices closely," they said.
"Inflation driven by food prices harms the population in poor countries where the majority of the population expense a relatively larger share of their household income on food, people in compared to rich countries. Hence, the rising food price crisis from the recent war between Russia and Ukraine could potentially lead to social conflicts in poor countries where the reallocation of resources is required due to inflation", Lim explained.
Food Hoarding
"We are expecting countries to hoard and protect food supplies. We’ve just heard from Indonesia about palm oil. Traders in Canada and other richer countries are already buying next Fall’s harvest, to secure supplies. This will obviously have an impact on commodity prices over several months", Charlebois said.
"Also, the US-China trade war since early 2018 has distorted global food value chains and further brought attention to national food security. Lastly, the rising oil price increases transportation costs within/across countries. Thus, I prospect the conventional approach to the international agricultural trade might not operate in the current crisis", Lim suggested.