[COFFEE] Food prices & shortages in the world

Looking over the events in the last year('s) there will be consequences that we as world will probably face soon, namely food shortages & rising food prices.

Based on the video of Patrick Boyle:

I would like to open the discussion over the global food shortage that could come in the coming year.
What other geopolitical consequences are possbile?
What are your takeaways?

Last time when Russian exports where missing in the market (also a huge exporter for the Africa and Middle East region), the Arab Spring started, with final consequences of Lybia and Syria being civil war theatres. It is even considered by some as one of the first events started by climate change (the missing exports of Russia were due to huge fires and extreme weather events in the black sea region and parts of Southern Siberia.

I am pretty pessimistic therefore.

Worst part is, that the exports are actually replacing local food production, which is not able to keep up with the heavily subsidised agricultures of the ex Soviet Union, EU and US which are being dumped into this markets. For instance, in markets which are not impacted by war, 2/3 of the people suffering from hunger are or were farmers, which lost activity because local markets have been destroyed by cheap imports (e.g. chicken rests like wings and legs, which are not used in the EU and dumped into this markets at below production price costs since the profit has already made with the chicken breast).

The FAO estimates that “only” 265 B$/y until 2030 would be enough give sustainable access to food to the extremely vulnerable part of world population. (p. 26 https://www.fao.org/3/i6583e/i6583e.pdf). To put it into perspective, for the EU alone this would mean only about 600 $/y/person.


I have an additional question: Have you seen Oils disappear from shops? In Germany and France Sunflower oils disappeared from supermarkets and when they do reappear, they get sold pretty fast and costs 2x more.

I’ve also seen in a French shop a sign that said that some products changed ingredients because of the war.

I haven’t seen neither in Switzerland. Are we in a happy bubble?

I did not know that those event where correlated, but it makes sense.
The fact that fertilizer just almost tripled in price, India banned export of crops and China still faces massive logistic issues makes me a bit worried.

I don’t see much issues here in Switzerland, since we can basically just outbid the rest of the world and at worse meat or food just gets more expensive.
I fear for the weaker parts of the world where people don’t have options. This will cause repercussions on other sectors and generate potential for conflicts.

I saw some smaller stocks in Supermarkets, but you are right, prices seemed more stable than in Germany. Also when you look into the detailed LIK (index of consumption) the part for oil stays pretty stable (just some few percents). This could indicate :
a/ more inland production
b/ shops have still have stocks, and did not increased the prices yet out of fear to lose market share to discounters or others, and it the next price increase will come with the next harvest season, when they will be forced to give the higher purchase prices through
c/margins are so high that they do not need to react right away and they “smooth it out”.

BTW total index increased only by a mere 1.6 points between January 2022 (101.71) and April 2022 (103.34), and 2.5 points on a YoY comparision (April 2021-April 2022).

Russia and Ukraine are very important produces for Oilseeds. In 2020 ukraine held a 51% market share in the export traded Sunflower oil. Russian 21%.

In switzerland we have approx 24‘500ha rapeseed which is equal to ca 63% degree of self-sufficiency.

Sunflower is cultivated on ca 4500ha with a self sufficiency degree of ca 6%.

So we rely also heavy on imports, but swiss distributors source only limited volume in Ukraine - that is the reason why we dont see shortage in the shelfs. The fact that in germany the shelfs are empty and in switzerland not is imho only a symptom for a optimized supply chain. There were obviously no relevant stocks in germany. We should nit feel to safe in CH, because the volume is missing in the world market and will also affect swiss importers. At least we held some mandatory stocks „Pflichtlager“ for oil and fats.

Germany has also a very important need in food grade oilseeds for biofuels production (same for maize). Again big advantage for switzerland for only promoting second generation biofules with tax benefits.

Also we should take into account the huge impact russia (and belarus) has in fertilizers. Russian is producing more than 20% of global traded ammonia. And together with Belarus approx 50% of global traded Potash.

Not to forget Russia’s importance in phosphorus and kalium production.

Furthermore alternative countries in food production are facing problems of their own (USA fighting with droughts, India and Pakistan with a heatwave) India already lost about 50% of their annual wheat production)

…and we have seen how they use it :frowning: (if we trust internet)

Different kind of phosphorus. It is also a main product for fertilizer (with ammonium and kalium).

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You probably mean phosphates.


I recently read an article about this, in summary it shouldn’t be a problem for Switzerland / most European countries in terms of hunger etc. but it will have indirect effects. It will likely cause unrest, hunger, etc. in poorer countries. Russia is hoping that it will cause another stream of refugees from those countries into Europe. What will eventually lead to shortages in Europe, higher unemployment, problems with housing / flats, overload of public infrastructure, higher costs in social welfare etc. and as such it may cause civil unrest.

thanks for point out.

About Potash (salt of potassium) I gave already some numbers. For Phosphate we should differentiate between fertilising endproduct and rock phosphate. For rock phosphate russia accounts approx 5-10% of global trade. For DAP / MAP (fertiliser with phosphate and nitrogen) it is about 12% of global trade.

It is clearly potash where russia (with belarus) held the most important part of global share. Phosphate you find a lot in other (for europe) accesible regions such as north africa. Unfortunately there you have higher pollution with heavy metals since the origin of the rock phosphate is sedimentari and not igneouns rock phosphate.

Nitrogen fertiliser production consumes a lot of energy (eg gaz). You need it as prime material (the hydrogen of CH4) and as energy source for the Haber-Bosch Process. You need approx, 0.57 tonne of gaz to produce one tonne of ammonia and 0.58 tonne ammonia for 1 tonne Urea - globally the most important nitrogen fertilizer. Western european nitrogen production sites rely heavy on russian gaz or on direct ammonia imports from russia.

Also we need to take into account that we talk here from commodities (fertilizer and Ag Products as wheat, rapeseed). That means big volumes. It is not so easy to change the supply chain an to find other transport routes.

Anyway see these facts:

  • The world food system is dependent from russia. As fertilizer supplier or ar raw materials supplier for fertilizer

  • There are other sources, but it is complicated and expensive. That means we have a lower availability of fertilising products in Europe and the rest of the world.

  • Farmers will think twice before buying fertiliziser due to alltime-high prices

  • Ukraine is a very important and very producitve country for food production.

  • I think Ukrainian harvest will be lot smaller as it used to be. Same time we have to dry weather in france and high fertilizer prices making famers acces to fertilizer difficult in some countries

→ World food production will be down. Most affected area will be africa and europe due to geographical proximity to russia and ukraine

For us in switzerland it won’t matter that much. Food prices in switzerland are below average (we spend only ca 7% of our income for food) - we can afford it to pay more to secure supply. Other countries (eg egypt) are having serious troubles.