For the international food market, few worse nations to be involved in conflict than Russia and Ukraine exist. During the last five years, combined they have provided much of the world's wheat, corn, 32% barley (an important source of animal feed) and sunflower seed oil.
Ukrainian fields are on the verge of missing vital planting and harvesting times. European factory fertilizer plants are reducing production by half due to soaring energy prices. Brazilian farmers to Texas farmers are reducing the use of fertilizer, which is endangering the size of future harvests. And China, with its worst wheat harvest in decades following devastating floods, is set to purchase much of the world's reduced crop.
The outcome is that international food and fertiliser prices are through the roof. Wheat prices have risen by 21 percent since the invasion last month, barley by 33 percent and certain fertilizers by 40 percent!
This is all added to circumstances already driving up prices and constricting supplies: the pandemic, shipping restrictions, high energy prices and recent droughts, floods and blazes.
Globally, the outcome will be even greater supermarket bills. In February, grocery prices in the United States were already 8.6 percent higher than a year earlier, the biggest jump in 40 years. Economists forecast that the war will continue to drive those prices higher.
Whether apocryphal or not, that is what Marie Antoinette supposedly uttered when informed the French peasants had no bread. And we know what became of her. What really causes people to take the streets in protest? It begins from food shortages and food price inflation.
In accordance with the UN Food Prices Index, food commodity prices were already 10-year highs due to international harvest problems, and that was prior to the war in Ukraine. Now they are at a record high since records have been kept 60 years ago!
That has sparked a cost-of-living crisis that is alarming politicians and has prompted warnings of social unrest globally.
The economies and budgets of most Arab and African nations are creaking under the weight of food prices. Tunisia struggled to make payments for part of its food imports prior to the war and now is attempting to avert an economic meltdown. Inflation has already triggered protests in Morocco and is fueling unrest and brutal repression in Sudan.
While America and its allies are attempting to come up with methods of diverting production, it is not possible to manufacture millions of tons more of wheat.