Why Ukraine’s ports are vital for global food prices

Global food supply is a strategic weapon in Russia’s war as Ukraine is the biggest exporter of sunflower oil and a major supplier of wheat and maize.

Expert comment Updated 14 September 2022 2 minute READ

The blockade of Ukraine’s ports is choking critical supplies of crops to the world and risks tipping vulnerable populations in developing countries closer to famine. Before the invasion, Ukraine and Russia were together supplying 100 per cent of Somalia’s wheat imports, 80 per cent of Egypt’s and 75 per cent of Sudan’s.

Global food prices have reached all-time highs since Russia’s invasion and households in countries across the world are suffering the consequences. Humanitarian agencies are struggling not only to reach those suffering from an acute lack of basic supplies in Ukraine itself, but to maintain their operations in other parts of the world as food and energy prices skyrocket.

The impact of the invasion on global food security are set to worsen significantly. Ukraine’s fields would usually be harvested in June and July, with exports continuing throughout the second half of the year. The United Nations (UN) expects up to 30 per cent of the usual crop to go either unplanted or unharvested with many having been forced to fight or to abandon their land, and others struggling to access fertiliser and fuel for farm machinery.

Vladimir Putin’s targeting of port cities appears highly strategic. It gives Russia important leverage over the international community

The war has shrunk this year’s harvest, and more worrying still is the damage being done to Ukraine’s capacity to supply global markets in seasons to come. In blockading Odesa – the country’s main conduit for exports – and the surrounding ports, and in occupying and laying siege to other major port cities, Russia has severed Ukraine’s sea links with the world.

Woefully underfunded infrastructure

The European Union (EU) is scrambling to get food moving out of Ukraine by overland routes, but it faces major obstacles in doing so. Ukraine’s roads and railways are woefully underfunded and undermaintained. Moving goods around the country was a challenge even before the war, and these trade arteries have since become a target of Russian bombardment.

Shipments that do reach the border face long delays as they are unloaded and reloaded – a necessary step as many Ukraine’s Soviet-era railway tracks are not compatible with those of the EU.

The war has shrunk this year’s harvest, and more worrying still is the damage being done to Ukraine’s capacity to supply global markets in seasons to come

Vladimir Putin’s targeting of port cities appears highly strategic. It gives Russia important leverage over the international community and calls from the UN to end the blockade have been met with demands that sanctions against Russia be lifted first. It also seriously damages Ukraine’s prospects for returning to its position as a global wheat and sunflower oil supplier – few companies will be willing to risk trading in the Black Sea while Russia’s blockade remains.

Importing countries are looking to other major food-producing regions to fill the gap and restore market confidence to enable food prices to fall. But across parts of the US, South America, Europe and India, farmers are struggling with exceptionally hot and dry conditions – the effects of the climate crisis.

Why Ukraine’s ports are vital for global food prices 2nd part

Fears of domestic shortages have prompted more than 25 countries to restrict or ban exports of key crops and foodstuffs, further pushing up global prices and contributing to continued market volatility. The loss of fertiliser exports from Russia – critical to production in much of South and Central America, West Africa and Europe including Ukraine itself – and exceptionally high global fertiliser prices will constrain harvests in seasons to come.

Unless Ukraine’s sea links to global markets can be restored, critical global food supply lines – and the ability of households around the world to access sufficient and affordable food – will remain crippled for several years.

This article was originally published in The Independent.