How West Used Global Food Crisis to Whip Up Profits
Grain harvest in the fields
InternationalIndiaAfricaFranceAgriMer, a state agency for French agricultural and fishing products, announced an increase in the forecast for wheat exports outside the EU, linking it to growing demand in North Africa and rising costs of deliveries from Russia due to higher insurance costs. What’s behind the trend?One should not be surprised by the growth in demand for French wheat at a time when the Russian commodity of the same quality is cheaper, Russian agriculture experts told Sputnik, referring to the West’s tricky anti-free market measures wrapped up as a response to Moscow’s special military operation in Ukraine.
"Over the past year, we have observed an artificial escalation of hysteria in the world grain market," Dmitry Bulatov, resident at the National Food Exporters Union, told Sputnik. "Some Western media insisted that many countries in need were in danger of starvation due to the withdrawal of Ukraine – which was dubbed the world's leading supplier of wheat – from the market. The purpose of those publications was quite obvious: to drive up grain prices which is extremely beneficial for the United States and its allies, who provide more than half of all [grain] supplies to the world market."
When speaking about the significance of Ukraine’s food supplies, allegedly “blocked” by Moscow, the Western press usually noted that “together,” Russia and Ukraine account for 30% of global wheat exports. Still, Western reporters failed to specify that two thirds of these exports come from Russia.Similarly, the mainstream press remains silent about the adverse effect of Western sanctions on Russia’s food and fertilizer exports. Moreover, the European Council claims that the West has never “directly” barred Russian exports of agricultural products.However, following the beginning of its special military operation to demilitarize and de-Nazify Ukraine, Russia has been subjected to unprecedented restrictions from the West that have targeted virtually all sectors of the nation’s economy. As a result, Russia’s food trade was crippled.
Sputnik ExplainsRussia’s Grain Fleet: Why is West So Unnerved About Moscow Growing Independent?27 December 2022, 17:51 GMT
Grave Effect of Indirect Sanctions
“Officially, food is not subjected to sanctions,” said Bulatov. “However, a number of measures are enforced against Russia, but indirectly impede the supplies of our products to the world market. Such measures include bans on the supply of seeds, plant protection products, spare parts for agricultural machinery, creating problems with the transportation of food products on international routes, disconnecting agricultural banks from the SWIFT settlement system, blocking foreign exchange reserves, and much more.”Russia is also facing obstacles in terms of logistics, lease of ships, air transportation, to name but a few, the costs of transportation have skyrocketed. As a result, Russia’s manufacturers are forced to sell at lower prices while buyers have to pay more because of indirect sanctions, according to Vasily Uzun, doctor of economics and professor at the Russian Academy of National Economy and Public Administration under the President of the Russian Federation.“The main beneficiaries are, of course, our competitors,” Uzun told Sputnik. “They get more opportunities to enter the world market and offer a higher price while trying to suppress us in every possible way. This suppression creates unfavorable conditions and forces Russia to leave international markets.”To illustrate his point, Uzun referred to the fact that sanctions are forcing Russia to transport grain through Kazakhstan. Eventually the profits are divided between Russia and Kazakhstan, he noted. At the same time, the West is stepping up imports from Ukraine “at very competitive prices.”However, the crux of the matter is that the West’s sanctions not only negatively affect the volume of Russia’s exports, but also destabilize international trade in food products in general, emphasized Bulatov. The African Union, a continental union consisting of 54 member states, drew attention to the “collateral impact” of the West’s unprecedented sanctions on Russia’s food supplies to the Global South in May 2022.A whopping 350 million Africans suffer from food insecurity, according to a recent report by International Committee of the Red Cross (ICRC) Director-General Robert Mardini. Impoverished nations of the Global South urgently need agricultural products, most notably fertilizers, while the US and its allies are ramping up anti-Russia sanctions. The global “fertilizer price shock” could not be attributed to anything but Western sanctions, given that Russia is the leading exporter of the commodity.
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Russia Taking Steps to Overcome Global Food Crisis
Russia is determined to export its agricultural products to the world market despite Western sanctions, according to Uzun.”[Russia’s] actions do not provoke a food crisis,” the professor said. “The assertion that we are guilty of this crisis, especially based on the results of the past year, looks absurd. Russia is continuing to supply its [agricultural] products for export. We have increased our production very significantly compared to previous years. Accordingly, the volume of exports will increase. We will export our products. We have it in abundance, we can process it in flour, pasta, and bakery products, if we are talking about grain.”Russia harvested a staggering 150 million tons of grain in 2022. As of November 2022, the nation exported over 15 million tons of grain, as well as a large amount of mineral fertilizers within the framework of the Russo-Ukrainian grain deal, according to Russian First Deputy Prime Minister Andrey Belousov.“More than 90% of deliveries go to countries in Africa and Southeast Asia,” Belousov told reporters on the sidelines of the Asia-Pacific Economic Cooperation’s (APEC) summit in Bangkok in November 2022.Moreover, Russia has the capacity to export around 50 million tons of grain between July 1, 2022 and June 30, 2023, according to Deputy Prime Minister of the Russian Federation Victoria Abramchenko.In addition, from January 1 to December 25, 2022, Russia exported 881,000 tons of wheat- and wheat-rye flour, which is 3.5 times more than the same period in 2021, according to the Federal Center for the Development of Export of Agricultural Products of the Russian Federation (Agroexport). The list of top five importers of Russian flour includes Georgia, Iraq, Afghanistan, Turkey, and Turkmenistan.
AfricaRussia Can Cover 40% of Algeria’s Milling Wheat Demand in 2022-2023 Season – Grain Union12 January, 06:08 GMT”We are increasing our production and increasing exports,” Uzun stressed. “This clearly demonstrates that we are trying to prevent this food crisis, contrary to the West’s allegations. We still have favorable conditions: we supply grain, bread, vegetable oil. These are the two main products of energy supply for people, including those in poor countries. That is, not only the rich can afford our products. We feed about half a billion people around the world.”Meanwhile, Western countries have no scruples about lying that Russia is using food as a weapon, according to Bulatov. In particular, European Commission President Ursula von der Leyen claimed at the 2022 World Economic Forum in Davos that Russia is “using hunger and grain to wield global power.””The West openly shifts its own blame to Russia’s shoulders, while using the situation to ensure its own interests,” Bulatov explained. “At the same time, due to obstacles artificially created by the West, 500,000 tons of Russian grain, intended for gratuitous assistance to countries in need, cannot be exported so far. Here, no extra explanations are needed.”
