Rising global food prices brought on by Russia's invasion of Ukraine and commodity shortages triggered by climate emergencies are threatening to “destabilize” economies around the world, a United Nations (U.N.) official warned.
The number of people acutely hungry have dramatically accelerated since the beginning of the COVID-19 pandemic. While 135 million people faced acute food insecurity before the pandemic, that number has more than doubled to 276 million over the last two years.
“It’s the story that keeps getting from bad to worse,” U.N. World Food Programme (WFP) Chief Economist Arif Husain told Yahoo Finance Live (video above). “When the World Food Programme is setting records, that's not a good thing for the world. And we have been doing that since at least 2021.”
According to the WFP, 50 million people across 45 countries are already on the verge of famine. Another 345 million people are approaching starvation across more than 80 countries, Husain said, a 25% increase from the start of the year.
War and climate change
The ongoing Russia-Ukraine war is exacerbating the food crisis.
Ukraine and Russia collectively account for 30% of globally traded wheat, 20% of maize, and 70% of sunflower supplies, according to the WFP. A shortage of supply has pushed prices higher, even as global energy prices have added to the cost pressures with sanctions limiting Russian oil exports, a key global supplier.
A shortage of fertilizer coming from Russia, one of the most important suppliers, has only added to the problems, driving import-dependent countries with higher costs and less food to eat.
“You can easily put about 50 million people to the consequences of the war in Ukraine,” Husain said.
The stronger dollar, stemming from higher interest rates, has only exacerbated the situation, he added, creating a “triggering factor” for dozens of countries that have lost more than 25% of their currency value in less than a year.
“In 2020, we assisted about 116 million people," Husain said. "That was a record in our 60-year history. In 2021, we assisted 128 million people. Again, that was a record. This year, we are planning to assist upwards of 140 million people, which will, again, be a record."
Those records are exacerbated by the ongoing impacts from climate change. Historic heat waves in Europe and India have already depleted crop production. In 2022 alone, these crises are expected to result in a deficit of roughly 15-20 million metric tons of wheat and corn from the global supply, according to research by McKinsey. That number is expected to nearly double by 2023.
Meanwhile, unusually high weather in India prompted the country to ban wheat exports a few months ago, though the country remains a small part of the global whet trade. Over in the Middle East, the UN has warned hotter and drier conditions are likely to decrease crop production by 30% 2025.
Hussain said more people are increasingly being displaced by climate shocks than conflict year on year.
“We see it on the ground that seasons are shifting," he said. "They are shrinking, which essentially means for smallholder farmers, they sometimes have to plant multiple times. Out of frustration out of seeing these shortages on the agricultural side… they start to move. Where do they go? They go to the slums in urban areas. That's where the conflict starts. So it's a vicious cycle of hunger, poverty, destabilization, and then migration out of destitution.”
Akiko Fujita is an anchor and reporter for Yahoo Finance. Follow her on Twitter @AkikoFujita.