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Ukraine war: WTO warns of global crisis

A food crisis kicked off by the Ukraine war could last for years without intervention, the head of the World Trade Organisation has said.

African countries could be hit especially hard by wheat and fertiliser shortages, WTO director general Ngozi Okonjo-Iweala said.

Millions of tonnes of grain are sitting in warehouses and Ukrainian ports unable to be exported due to the war.

She said that it was “really sad” to see as grain prices soar.

Ukraine is a major global exporter of wheat, contributing 9% of the global market. It also accounts for a massive 42% chunk of the global sunflower oil market, and 16% of the world’s maize.

Because of gridlock due to a Russian blockade of Black Sea ports, and Russian and Ukrainian mines along the coast, between 20 and 25 million tonnes of wheat are stuck in Ukraine while global grain prices spiral upwards.

Okonjo-Iweala said wheat prices had risen 59% compared with last year, sunflower oil was up 30%, while maize was 23% higher.

The United Nations is leading efforts to try to establish a “grain corridor” with a Turkish naval escort for tankers leaving Odessa and other Ukrainian ports.

But Russian Foreign minister Sergei Lavrov has said Ukraine needs to clear mines from its Black Sea ports.

“We state daily that we’re ready to guarantee the safety of vessels leaving Ukrainian ports and heading for [Turkish waters], we’re ready to do that in cooperation with our Turkish colleagues,” he said on Wednesday.

Meanwhile Ukraine has said it needs “effective security guarantees” before it can start shipments, voicing concerns that Moscow could use the potential corridor to attack Odessa from the sea.

Ukraine typically produces enough to feed 400 million mouths, but Russia stands accused of turning that breadbasket into a stealth missile, with blockaded ports reducing the stream of exports to a trickle.

Only two million tonnes of grain have been exported from Ukraine via train and in trucks, and Okonjo-Iweala said it was “critically important to see if we can get an answer” to the problem.

UN secretary general Antonio Guterres has formed a task force looking at these issues, she said.

“He’s spent a lot of time trying to work with Russia to see if an arrangement can be made, so, we’ll keep our fingers crossed,” she said.

If an agreement can’t be made, “this is really going to be a dire situation worldwide”, Okonjo-Iweala said.

She said 35 countries in Africa import food from that Black Sea region, while 22 import fertiliser.

“You can imagine what a big impact this is going to have, even just on the African continent,” she said. “I hope that we don’t go into a really severe food crisis for the next couple of years.”

She said grain can’t be exported from the region at the moment, and there is a harvest coming up in July, “with a similar quantity that will go to waste, so you can see that this will work its way through for the next year or two, and that will be really disastrous for certain parts of the world”.

She added that supply chain bottlenecks caused by the Covid pandemic and labour shortages exacerbate the issue.

In addition, she called on leaders to relax export restrictions on foodstuffs, which can worsen food price spikes. — BBC.

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