Russia and Ukraine are two of the most essential pillars of the global food trade, producing 25 percent of the global wheat supply. More than 160 days after Russia invaded Ukraine, food, commodity, and energy shortages have plunged many economies across the world into recessions, particularly in the Middle East, where some countries are among the world’s largest importers of these commodities. On average, Ukraine harvested 80 million metric tons of grain annually (wheat, corn, barley). This is enough to feed 200 million people for a year. The Russian invasion has reduced the harvest to less than half of its grain capacity. The naval blockade of the Black Sea has meant that much of Ukraine’s grain could not leave the port. In March, food prices reached a 10-year high and the United Nations warned of multiple famines within the next year. After months of negotiations, on August 1, a ship carrying 26,000 tons of grain left the port of Odessa; the first ship to do so since the start of the war. The agreement reached on July 22 in Istanbul between Ukraine and Russia guarantees continuous passage of grain out of Ukraine. This especially a good sign for countries throughout the Middle East and North Africa, where many states import more than 80 percent of their national grain supply from Ukraine, and are most vulnerable to rising food prices. But free shipping routes will not abate the growing food crisis. Russian destruction of farmland and heavy machinery has caused more than USD 4.3 billion in damages to the agricultural industry. More than 6 million poultry birds have died and half a billion USD worth of grain has been stolen. Some estimate more than half of Ukraine’s operable farmland is under occupation. In a video interview with Global Voices, David Rundell, a thirty-year diplomat to the Middle East and author of “Vision or Mirage: Saudi Arabia at the Crossroads,” explained the distributed impact of the war on countries across the region: “There is very little interest across the Middle East for getting in the middle of a fight they don’t believe is theirs. There is much more concern about what impact the war will have on political stability. Many nations are seeing what happened in Sri Lanka and are concerned that similar events will transpire in their own neighborhood.” This analysis is in line with broad attitude surveys across the Middle East and North Africa. In an Arab News-YouGov poll of the region, 66 percent of respondents had no stance on the war, 18 percent supported Ukraine and 16 percent supported Russia Rundell emphasized the outsized impact of commodity shortages on the region: “many countries across the region are very sensitive to the price of wheat, sunflower seed oil, and petroleum. All of these have been adversely affected by shortages or rising global prices. At the moment, the various governments are trying to maintain the subsidies that they have and it is leading to huge budget deficits.” Nearly every country in the region is hard hit by the war. The war has inflicted unprecedented inflation shocks on the Egyptian economy. There is almost no tourism from Ukraine and Russia, which normally account for 30 percent of Egypt’s incoming visitors. The manufacturing and construction industries have been most affected due to energy and material prices increases. Egypt, which gets 80 percent of its wheat from Ukraine and Russia, has been forced to look to other countries for grain imports, and the cost of bread has increased by 50 percent since the start of the war. As a result, the Suez Canal raised toll fees and the central bank devalued the currency by 14 percent to support the struggling economy. Food insecurity is expected to become even more acute in Yemen, which imports 40 percent of its wheat from Ukraine and Russia. The humanitarian crisis in the country that began with the civil war in 2015 is expected to significantly exacerbate. Wheat prices have risen by 35 percent since the start of the war, and at certain times, the grain has completely disappeared from the markets. Libya imports 90 percent of its wheat from Ukraine and Russia. Across the board, prices of bread, rice, and couscous have risen more than 30 percent. The war has added more than a percentage point to the country’s inflation pressures, bringing the overall rate to 9 percent. Algeria is the most insulated from adverse impacts of the war. The country imports 3 percent of its wheat from Ukraine and Russia, and domestic supplies are sufficient to outlast shortages until the end of 2023. Tunisia imports approximately 54 percent of its wheat from Ukraine and Russia. The country already owes USD 300 billion to Ukrainian wheat exporters.
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Opening of shipping routes from Ukraine will not abate commodity and food pressure on the Middle East and North Africa
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