OSLO
Russia’s invasion of Ukraine will deliver a catastrophic hit to global food supplies, the head of Norwegian fertilizer maker Yara International has said.
Svein Tore Holsether, chief executive officer (CEO) of Yara, which operates in more than 60 countries and buys essential raw materials from Russia, said the international community must reduce its dependence on the Russians for food and described the war as a catastrophe on top of a catastrophe, The National reported on Monday.
With the global food supply chain already vulnerable to shocks, the war will increase food insecurity in poorer countries, Holsether said. He spoke of an additional 100 million people suffering from hunger over the past two years. The cost of fertilizer had already been high amid soaring wholesale gas prices but that situation will only worsen, he said.
“We were already in a difficult situation before the war … and now it’s additional disruption to the supply chain and we’re getting close to the most important part of this season for the Northern Hemisphere, where a lot of fertilizer needs to move on and that will quite likely be impacted,” Holsether said.
Ukraine and Russia are major exporters of some of the world’s most basic foodstuffs, together accounting for about 29 percent of global wheat exports, 19 percent of world corn supplies and 80 percent of sunflower oil exports. But Russia also exports crop nutrients as well as natural gas, which is critical for producing nitrogen-based fertilizers.
In total, 25 percent of the European supply of nitrogen, potash and phosphate – vital ingredients in fertilizers, which enable plants and crops to grow – comes from Russia.
“With the geopolitical conditions out of balance, the biggest sources of raw material to Europe’s food production are being subject to limitations and there are no short-term alternatives,” Yara International said.
With half of the world’s population getting food “as a result of fertilisers”, Holsether said if that product was removed from the field, agricultural yield would drop by 50 percent. “It’s not whether we are moving into a global food crisis, it’s how large the crisis will be,” he said.
The Norwegian company, which is one of the world’s biggest fertilizer producers, supplies Ukraine’s agricultural sector and is a big buyer of raw materials, such as phosphate and potash, from Russia, which also supplies Europe’s nitrogen fertiliser plants with natural gas.
Sanctions against Russia are already affecting Yara’s operations, with the company finding it harder to secure deliveries due to shipping industry disruption.
The Russian government has urged its producers to stop fertilizer exports, adding another layer of jeopardy to the global food supply.
Natural gas is vital for global agriculture as it is used to produce ammonia – another key ingredient in nitrogen fertiliser – and Yara has long been importing Russian gas to its European plants.
