Europe’s Breadbasket Is Broken

Not for nothing are the two warring countries known as the “breadbasket of Europe.” Russia accounts for 17% of the world’s wheat exports, and Ukraine for 6%. The Russian siege of Odessa has effectively removed Ukrainian wheat from the market, leaving it in danger of rotting. At the same time, Russia is set to produce just half of its normal wheat supply this year, 40 million tons instead of 80 million.

The result — an expected shortage of 5 million tons of wheat, per data from the Amis Market Monitor. Since the outbreak of the war, wheat prices have risen by 57% over last year. The price of corn has risen by 26%, and the price of soybeans by 22%. On top of all this, fertilizer prices have also surged, further increasing the cost of food production.

The wave of price increases is causing a chain reaction. “Food security,” previously an academic term, is suddenly becoming a very real concept for many: Countries are fighting over the right to buy wheat for their citizens’ nutrition. Wealthier countries are able to afford it, despite inflation and the increasing costs. Less well-off countries risk famine and political unrest.

“On top of Covid-19, the Russian war has unmasked the precariousness and inequalities of the world food system,” says Professor Philip McMichael of Cornell University. “Low-income folks will feel it everywhere, especially in parts of the Middle East and North Africa — states rendered as food importers via the World Trade Organization regime, as food staple prices continue to rise, including in the US. People with purchasing power will manage.”