|
Ukraine and Russia are both major exporters of some of the
world's most basic foodstuffs, together accounting for about 29%
of global wheat exports, 19% of world corn supplies and 80% of
world sunflower oil exports.
But Russia also exports crop nutrients as well as natural gas,
which is critical for producing nitrogen-based fertilisers. Yara
said that in total, 25% of the European supply of the key crop
nutrients nitrogen, potash and phosphate come from Russia.
"With the geopolitical conditions out of balance, the biggest
sources of raw material to Europe's food production are being
subject to limitations, and there are no short-term
alternatives," Yara said in a statement.
The Norwegian company, which is one of the world's biggest
fertiliser producers, supplies Ukraine's agricultural sector and
is a big buyer of raw materials, such as phosphate and potash,
from Russia, which also supplies Europe's nitrogen fertilisers
plants with natural gas.
David Beasley, Executive Director of the World Food Programme (WFP),
said last week that war in Ukraine would have a dramatic impact
on the organisation's ability to reach the 120 million people it
feeds, adding that food, fuel and shipping costs would
"skyrocket" in what he described in a Twitter post as "an
absolute catastrophe".
Wheat futures have soared in recent days on concerns that
Russia's invasion of Ukraine, which began on Feb. 24 and which
Moscow is calling a "special operation" will continue to disrupt
grain shipments from the Black Sea region.
"One potential consequence is that only the most privileged part
of the world population gets access to enough food," Yara said,
adding that while high prices may have a short-term positive
impact on profit, they would mean an unsustainable food system,
leading to starvation and conflict in the long term.
"It is therefore crucial that the international community come
together and work to secure world food production and reduce
dependency on Russia, even though the number of alternatives
today is limited," Yara said.
Fertiliser prices rose sharply in the final months of 2021,
tracking soaring natural gas costs. This is leading in turn to
higher food prices, which could lead to famine for the most
vulnerable, Yara warned in October.
(Reporting by Victoria Klesty; Editing by Alexander Smith)
[© 2022 Thomson Reuters. All rights
reserved.]
This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content.
|
|
