Global food supply chain supply risks increasing

Washington DC - As the conflict in Ukraine continues to escalate, the impacts on sustainable development become more pronounced and the vulnerabilities in global food supply chains increase.

Almost half of the world’s calorie intake is derived from essential crops, such as maize, rice and wheat. According to World Bank analysis, Ukraine and Russia account for 29 percent of global wheat exports and 17.4 percent of the world trade in maize. The supply of crucial cooking oils and fertilisers has also been affected.

Many companies have suspended trade and operations in Russia due to sanctions and stakeholder pressure.

While the diplomatic agreement reached to unblock Black Sea trade routes from Ukrainian ports offers some encouragement, uncertainties remain. In addition, concerns over products being obtained under extortion add to the challenges for companies involved in commodity trade throughout the region.

New Zealand produces enough food to feed 40 million people, exporting much of it, including $16 billion of dairy, $3.7 billion of beef and $3.9 billion of sheep meat a year.

While New Zealand is self-sufficient with milk, meat, fruit and vegetables, it turns out Aotearoa is not self-sufficient in flour. It's not an impossible scenario that in a future crisis the country could lose access to bread.

When agricultural areas are devastated and water installations destroyed, the right to food of the local population is violated.

Yet, the impact of the Ukraine crisis spreads well beyond its borders. It is expected that many millions of people will be at risk of hunger globally as a result of the tightening supply and affordability of essential crops. And this comes on top of existing difficulties that have been exacerbated by two and a half years of covid.

Not all of the world's regions are exposed in the same way. Where people are already experiencing severe poverty, the risks of hunger and malnutrition are much higher.

As the World Food Programme has warned, countries dependent on food exports from the conflict-affected region are being hit hardest. Meanwhile, to prevent local shortages, we are seeing some countries restricting food exports, which may further impact the global supply.

When viewed from a human rights perspective, the right to food for many is not primarily about a lack of sufficient quantity, but a lack of access largely due to affordability.

With continuing declines in Russia-Ukraine food exports, however, we are seeing heightened concern over the insufficiency of food availability. The fewer crops harvested and planted in 2022 are likely to instigate a spiral of worsening food security in the year ahead too.

Most food is produced, processed, traded and distributed by private businesses. At the same time, when an individual company looks at its impacts on food security in isolation, it often struggles to determine them.

Multinational companies may also focus on developed markets, where food security is not a significant concern.

The actions of the companies producing the essential food and materials on which humanity’s survival depends can be a multiplying factor when it comes to the UN sustainable development goals.