Countries banning food exports amid rising prices, inflation
On Sunday, May 1, 20,22, workers unloaded wheat bags from trucks at the Punjab Grains Procurement Corp. facility, Ludhiana, Punjab, India.
T. Narayan | Bloomberg | Getty Images
India has banned wheat exportsThe country is the latest to follow suit, as the cost of grains rose this year partly due to wars between Russia and Ukraine.
Russia and Ukraine have been the top exporters of wheat since the conflict. They account for 29% global wheat exports. according to the World Bank.
On Monday, the wheat market soared by around 6% India’s weekend announcement.
“With food prices already high due to COVID-related supply chain disruptions and drought-reduced yields last year, Russia’s invasion came at a bad time for global food markets,” said the Peterson Institute for International Economics (PIIE), a Washington D.C.-based think tank, in an April note.
According to PIIE, Russia and Ukraine rank among the five top global exporters of many essential cereals and oilseeds such as sunflowers and oil and maize.
India is not the only one. Russia, Ukraine and Kazakhstan have all banned exports of wheat.
This is not limited to wheat. Due to the rise in global inflation caused by Ukraine’s crisis, several countries also have banned other food exports.
The prices of many other foods have shot up, which has contributed to the rise in inflation around the world. These products include palm oil, sunflower oil and fertilizers.
Other than the rising cost of food, many foods are in supply.
Ukraine cannot export fertilizers or grains and has been prevented from selling vegetable oil. The conflict in Ukraine also threatens crop fields, reducing their yields and disrupting normal growing seasons. Also, the government accused Russia of stealingMore than 100 million metric tonnes of grain reselling them. CNBC reached Russia’s Foreign Ministry for clarification but they did not respond immediately.
Joseph Glauber, Abdullah Mamun and David Laborde, PIIE analysts, wrote that “as the war continues there is a growing probability that food shortages (especially of grain oils) will become acute. This could lead more countries to restrict trade.”
The Group of 7 industrialized countries issued an alert over the weekend warning of the danger of world hunger crises unless Russia removes the blockade placed on Ukrainian grain currently held at Ukrainian ports. according to the Financial Times.
The PIIE has created a live tracking system that shows which countries have blocked food exports since the Russia-Ukraine War began.
Source: Peterson Institute for International Economics
Local media reports claim that India announced it would ban exports of wheat “to manage its overall food security.”
Indonesia was one of the other countries to implement food export bans. It banned palm oil exports, an ingredient that is used in many foods and non-food items.
Like India, Indonesia also cited the necessity to guarantee food availability in its own country, following record-breaking levels of food inflation after the war. Indonesia is home to more than half of all the world’s food imports. Palm oil supplies