What we need to do is to analyze our facts. If you look at the data, you’ll discover it’s not the past two months, the food prices started to grow. If you look at the UN statistics on food, prices were going up 70% in the last two years and more than 50% of that happened before February. It’s always a combination of reasons that produce the result.
All of this started in 2020. What triggered all of this. First phase was money printing. Second phase was energy crisis in Europe. Here we have mistakes from the European Commission on energy policy with over reliance on renewable energy and short-term contracts which lead to a substantial decrease in in fertilizer production. Lower fertilizer production means you have a lower harvest, which also heavily impacts the food crisis.
Now that brings us to February. But it’s not about the operation in Ukraine. It’s about a lot of sanctions imposed on fertilizer production in Belarus and Russia. It’s sanctions ships, it’s sanctions on payments through SWIFT, which counter trade.
Russia wants to support more food and fertilizers, but these sanctions are blocking supplies to the market. There’s a food crisis, an electricity crisis, a fuel crisis, and a fertilizer crisis. Is this a perfect storm? It’s a number of factors coming together. That is the reason. It’s not just a single factor. It’s all of these factors combined that’s resulting in the problems we’re facing these days.
The number of people on the verge of starvation has doubled to about 300 million people. What are these people to do?
Russia on our side will try to do everything it can to provide more food, but it will not be enough to cover the needs of people who need to buy food. But it’s really hard to export when the European and American sanctions attack the logistics.