The Imminent Global Food Crisis Requires Immediate Coordination of All Sectors

By Boston Consulting Group (BCG)

Cover Image Attribute:  Russian Embassy London; Anti-War signs 27 February 2022 / Source: Kwh1050, Wikimedia Commons
Cover Image Attribute:  Russian Embassy London; Anti-War signs 27 February 2022 / Source: Kwh1050, Wikimedia Commons

The Ukrainian conflict highlights the urgent need to rethink and improve the structure and resilience of our food systems.


The invasion of Ukraine by Russia is putting the capacity of global food systems to feed the world in times of crisis to the test. According to the UN Task Team for the Global Crisis Response Group, an estimated 1.7 billion people, most of whom reside in developing nations, might experience a sharp increase in food insecurity, a rise in energy prices, or an increase in debt loads. Each of these things negatively impacts people's ability to provide for themselves. Concurrently, there is an urgent need to address them more comprehensively and across all sectors to transform our food systems to combat this humanitarian disaster and future ones.

The War in Ukraine and the Rush to Feed the World is the title of a new report by Boston Consulting Group (BCG) that examines the multiple direct and indirect effects of the unrest in Ukraine. It provides 30 near- and medium-term solutions to help respond to the crisis and improve the resilience of global food systems. According to the analysis, the impending global food crisis has nothing to do with the world's ability to produce enough food. Instead, it is the failure of our food systems to store and distribute sufficient food and the resources required to make it securely and equitably in the face of the disruption produced by the ongoing war.

According to the International Food Policy Institute, Russia and Ukraine are leading exporters of vital commodities such as wheat (28 percent of global trade) and sunflower oil (69 percent of international trade). Russia and Ukraine are responsible for approximately 12 percent of the total food calories traded worldwide. The World Food Programme (WFP) purchases from Ukraine fifty percent of the wheat it distributes worldwide. In addition, when exports from these nations decline, other significant exporters have imposed export bans or licensing limitations to preserve their food stocks.

As a result, prices are increasing, not only for food but also for crucial agricultural inputs like fertilizer and fuel, which Russia has been a significant provider of for decades. Approximately half of the world's population relies on food outputs that require fertilizer. A decline in fertilizer supplies could devastate vulnerable people for up to four years unless prompt action is taken to increase reserves. Moreover, disruptions in the fertilizer supply chain would have global repercussions for consumers.

The impact of the war on fuel costs has been similarly profound. In many developing nations, last-mile inland transportation accounts for as much as 40 percent of food expenses and the increased cost of gasoline for farmers' equipment. Consequently, as gasoline prices rise, so does the total cost of food, creating a vicious cycle.

Making matters worse, the current economic crisis coincides with significant debt levels in many developing economies worldwide. According to the International Monetary Fund, about 60 percent of low-income countries are currently in or in great danger of debt distress, up from 30 percent in 2015. This is mainly attributable to public spending on COVID-19-related difficulties.

"While this crisis will impact all of us around the world in significant ways, low-income economies risk devastation and potential unrest," said Ertharin Cousin, CEO and founder of Food Systems for the Future, and a co-author of the report. "We're not just talking about the poorest of the poor, who are already suffering from hunger. We're also talking about people who could recently afford a loaf of bread for their families and who now will literally be unable to do so."

Exhibit A: The War in Ukraine and the Rush to Feed the World
Exhibit A: The War in Ukraine and the Rush to Feed the World

To alleviate the current crisis, it is essential that all stakeholders—governments, development institutions and banks, nongovernmental organizations (NGOs), and private companies—respond immediately and in concert to the most urgent humanitarian needs. In addition to providing food and financial help, they must also supply the seeds, inputs, tools, and technical assistance required to enable sustainable intensification and other crop substitution efforts. The report provides thirty primary suggestions for all parties involved. (See the Exhibit A.)

"There is a lot of talk about the individual components of the crisis, but we must look at things holistically and recognize the interdependence of factors ranging from rising costs of food, fertilizer, and fuel, to maxed-out debt, climate-related issues, ongoing conflicts elsewhere in the world, and COVID-19. There are multiple prongs of failure at risk of being tipped over by Russia's invasion of Ukraine," said Shalini Unnikrishnan, a managing director, and partner at BCG, the global leader for Food and Nature in the firm's Social Impact practice and a co-author of the report.

"Just as critically, we need a coordinated effort across all sectors to rethink and repair our food systems, making them more equitable, more resilient, and more responsive in great need," Unnikrishnan continued. "Avoiding more such crises will require diversifying food production across diets, supply chains, and markets, and addressing the indebtedness, economic inequities, and market distortions that have contributed to the current crisis."

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IndraStra Global: The Imminent Global Food Crisis Requires Immediate Coordination of All Sectors
The Imminent Global Food Crisis Requires Immediate Coordination of All Sectors
By Boston Consulting Group (BCG)
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