Russia’s invasion of Ukraine last year triggered tumult across global grain markets. As the cost of corn and wheat surged, panic spread about instability in countries from Yemen to Bangladesh that depend on the warring region for low-cost grains. Would famine worsen? Would civil unrest ensue?
While food-insecure countries have suffered keenly from high grain prices over the past year, some of the consequences we feared most have been avoided. Even as the conflict continues to rage, grain markets have calmed down considerably, with prices close to pre-invasion levels — a better outcome than many expected.
Astute diplomacy, next-level technologies, a resilient distribution infrastructure and efficient trading strategies were key elements of coping with these disrupted markets. The world acted quickly to leverage those strengths across global networks, moving grain from regions where it’s cheap and plentiful to those where it was scarce and costly.
Imagine what would be possible if we planned ahead? At a time when the global food supply is increasingly vulnerable to geopolitical and climatic disruptions, here are five crucial ways we can build on lessons from a year of conflict in Ukraine:
1. Refocus funding efforts for food aid.
Spreading hunger has put food-relief agencies such as the United Nation’s World Food Program and US Agency for International Development under pressure to expand assistance. In 2022, WFP Director David Beasley raised $14 billion from public and private donors — more than double previous years — but took flack for publicly cajoling billionaires such as Elon Musk to help. Such aggressive measures are entirely defensible. The money Beasley raised went largely to buying high-cost grains and channeling the supplies to populations that can’t afford them.
Cindy McCain, who will soon be succeeding Beasley, and the forthright USAID Administrator Samantha Power should follow suit with continued bipartisan calls to fund their work. Food aid organizations must look beyond stopgap handouts and forge long-term strategies to subsidize resilient farming practices in climate-stressed regions. Supporting food-insecure populations must become a central topic of every major international conference going forward, from Davos to COP 28.
2. Strengthen diplomatic channels that anticipate future food disruptions.
Global hunger today would be far more acute if not for the Black Sea Grain Initiative, an agreement between Russia and Ukraine forged and recently renewed with the help of Turkey and the UN to ensure the continued shipment of agricultural and fertilizer products from Ukraine’s key Black Sea ports. The agreement has brought some relief to countries including Turkey, Morocco, Egypt and Kenya that rely heavily on imports from this region, as well as Pakistan, where 5 million citizens are currently close to famine.
This kind of diplomacy will be essential to stabilizing markets after political and environmental shocks. No country will be insulated from food disruptions. As Joe Janzen, who teaches agricultural economics at the University of Illinois, told me: “When global markets face shocks, importing and exporting countries become more interdependent, not less.”
3. Reassess how staple crops are traded.
Grain traders, brokers and regulators — the men and women behind the scenes who transmit price signals throughout the market — catalyzed millions of acres of new wheat and corn production in the US, Argentina, Canada and Brazil to address the Ukraine shortfall and help rebalance supplies. But merchants, largely employed by agribusiness giants like Archer-Daniels-Midland Co. and Cargill Inc., are focused on profit, not alleviating hunger.
The Biden administration and its Commodity Futures Trading Commission need to think about how to help maintain integrity, transparency and perhaps even justice in global grain markets. In a crisis, could grain flows be guided not just according to who pays the highest price but to which regions are most in need? How can the data and price signals become more accessible not just to traders and brokers, but to the consumers who depend on imports? As of now, the US and EU are among the few global players with commissions to set rules for fair and transparent grain-trading practices. The Biden administration should consider a new attempt at partnering with the UN to establish an international agency for common standards among all major grain exporting and importing countries.
4. Invest in logistics infrastructure.
The future of food security will involve a complex game of transportation logistics to move grains more expediently from nations with abundance to those with scarcity. Investing in better storage facilities, railways, highways, shipping networks and ports has never been more important. Investment is especially needed in the newest frontiers of low-cost grain production, from Canada to Mongolia, where warming temperatures are increasing prospects for grain production.
5. Double down on developing the next generation of ag tech.
By mid-century the world may reach a threshold of global warming beyond which current agricultural practices “can no longer support large human civilizations,” according to an International Panel on Climate Change report. One solution is to change current practices with technology that can enable the production of more food on less land. We can usher in this new era by applying the tools at hand: artificial intelligence, robotics, cellular agriculture, genetic engineering, vertical farming, satellites and big data. Those tools can also enhance efforts to restore traditional and regenerative agricultural practices that will improve the integrity of soil health, making croplands more resilient to heat, flooding and drought.
Global grain markets are still fragile. Countless environmental and political variables could deliver more shocks at any time, hampering yields from the US, Latin America, Canada, China and other major producers. But in the past 12 months, the rebalancing of grain supplies and the quelling of prices prove that we have the ability to chart a sustainable path for the road ahead.
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ABOUT THE WRITER
Amanda Little is a Bloomberg Opinion columnist covering agriculture and climate. She is a professor of journalism and science writing at Vanderbilt University and author of “The Fate of Food: What We'll Eat in a Bigger, Hotter, Smarter World.”
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
