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Ukraine war: World Bank warns of ‘human catastrophe’ food crisis

Ukraine war: World Bank warns of ‘human catastrophe’ food crisis

A combine harvester in a wheat field.IMAGE SOURCE,GETTY IMAGES

The world faces a “human catastrophe” from a food crisis arising from Russia’s invasion of Ukraine, World Bank president David Malpass has said.

He told the BBC that record rises in food prices would push hundreds of millions people into poverty and lower nutrition, if the crisis continues.

The World Bank calculates there could be a “huge” 37% jump in food prices.

This would hit the poor hardest, who will “eat less and have less money for anything else such as schooling”.

In an interview with BBC economics editor Faisal Islam, Mr Malpass, who leads the institution charged with global alleviation of poverty, said the impact on the poor made it “an unfair kind of crisis… that was true also of Covid”.

“It’s a human catastrophe, meaning nutrition goes down. But then it also becomes a political challenge for governments who can’t do anything about it, they didn’t cause it and they see the prices going up,” he said on the sidelines of the IMF-World Bank meetings in Washington.

The price rises are broad and deep, he said: “It’s affecting food of all different kinds oils, grains, and then it gets into other crops, corn crops, because they go up when wheat goes up”.

There was enough food in the world to feed everybody, he said, and global stockpiles are large by historical standards, but there will have to be a sharing or sales process to get the food to where it is needed.

Mr Malpass also discouraged countries from subsidising production or capping prices.

Instead, he said, the focus needed to be on increasing supplies across the world of fertilisers and food, alongside targeted assistance for the very poorest people.

…click on the above link to read the rest of the article…

Will We Have Food Shortages In America?

Will We Have Food Shortages In America?

Green milling tractor.
Aerial shot of a milling tractor (Tom Fisk/Pexels).

Higher Food Prices And Shortages?

Our system has been betting on higher food prices since earlier this year, and of course the war in Ukraine has put upward pressure on food an energy. But now one of our Twitter correspondents warns we may have food shortages in America as well. Let’s start with the case for higher prices, then consider his warning of shortages and what to do about them.

Betting On Higher Food And Energy Prices

A month before Russia’s invasion of Ukraine, our system’s top names had shifted to an energy and food focus, as we noted in a post here at the time (Why Civilizations Collapse).

In that post, we noted we had two oil E&P stocks (Laredo Petroleum (LPI) and Antero Resources (AR)), two oil ETFs (ProShares Ultra Bloomberg Crude Oil (UCO) and VanEck Vectors Oil Services (OIH)), and a coffee ETN (iPath Series B Bloomberg Subindex Total Return (JO)) and a corn ETF (Teucrium Corn Fund (CORN)) in our top ten names.

Screen capture via the Portfolio Armor on 1/28/2022.

Since then, the energy and corn names have ripped higher (though coffee has cooled off a bit).

Of course, Russia’s invasion of Ukraine has played a role here. In addition to being one of the world’s top exporters of wheat (along with Ukraine), Russia is also one of the top exporters of agricultural inputs such as oil, natural gas, and fertilizer. The war, plus the sanctions regime in response to it, have raised food and energy prices and raised the prospect of food shortages in countries such as Egypt, which are dependent on wheat imports. America, as an agricultural superpower, seemed less likely to suffer food shortages.

…click on the above link to read the rest of the article…

David Stockman on Inflationary Hell That’s About to Break Loose

David Stockman on Inflationary Hell That’s About to Break Loose

Inflationary Hell

It is only a matter of time before Kiev surrenders to the Russians, with or without their clown-car president signing the armistice. But that deal will be so onerous from Washington’s perspective that it will not mark the end of the sanctions war, but will be an excuse for its actual intensification and indefinite prolongation.

When that becomes the reality, however, inflationary hell will break out all over the place. And the Fed’s decades-long experiment in egregious, inflationary money-pumping will splatter ignominiously all over the Eccles Building (Fed headquarters).

It now appears that commodities markets have been so drastically roiled by the action to date that Washington’s war on the global trading and payments system is now open-ended and can theoretically go on for years.

That’s because the Russian-loathing, Putin-demonizing Dems now in charge of policy in Washington cannot even see straight when it comes to the real issues of the conflict.

There is absolutely nothing wrong with partitioning Ukraine and Crimea, nor with Putin’s proposed new security arrangement that would have NATO move its missile bases to the pre-1999 status quo and the re-garrisoning of US and Western military forces to the old NATO territories.

But these plausible solutions are so far removed from the war fevers now raging on the Potomac that there is no chance of Washington embracing a negotiated solution to the Ukrainian war. It will actually take a historic GOP sweep in the 2024 elections to clear the decks of Putin/Russian demonization, and even that would not make a difference if the blood-thirsty neocons and military hawks retained control of the GOP.

Meanwhile, just like that, the price of oil recently hit $130 per barrel.

Here’s the thing.

Double-digit inflation is now guaranteed and it will be long-lasting.

…click on the above link to read the rest of the article…

One-Third of Ukraine Farmland May Go Unplanted As Russia Begins ‘Second Phase’ Of War

One-Third of Ukraine Farmland May Go Unplanted As Russia Begins ‘Second Phase’ Of War

About one-third of Ukraine’s farmlands may not be harvested or cultivated this year as Russia begins the second phase of the conflict in the war-torn country.

The Food and Agriculture Organization of the United Nations (FAO) noted in a report on Tuesday that the “vast destruction of crops and infrastructure due to the war jeopardizes food production.”

FAO estimates approximately 33% of the crops and agricultural land may not be harvested because of the escalating war.

In March, Ukraine President Volodymyr Zelenskyy urged farmers to sow as many fields as possible to protect the food supply, but that appears to be a challenging task considering the displacement of people (labor shortage), bombed-out fields, severely damaged infrastructure, and shortage of everything (diesel, seeds, & fertilizer).

Ukraine is considered the world’s second-biggest shipper of grains and the biggest exporter of sunflower oil. The planting season has already begun — its crop production is vital to the global food supply.

Even if farmers were to sow as many fields as possible, their ability to export crops would be severely impacted during the harvest season due to damaged infrastructure, such as bombed-out rail systems, highways, bridges, and ports. Also, buyers of grains can barely get dry bulk carriers insured to transit the Black Sea to a Ukrainian port because of soaring war risk premiums.

Besides FAO, some private ag forecasters have warned crop harvests could be halved.

Forecast data from ag expert UkrAgroConsult show Ukraine’s corn output could be as low as 19 million tons, about half of last year’s 41 million tons.

There’s no question in our minds the impacts of continuing war will boost global food prices to new record highs. Ukraine is a top producing grains country and what this may spell next is a worldwide food crisis.

 

Global Rice Production Set To Plunge 10%, Threatening Half Of Humanity

Global Rice Production Set To Plunge 10%, Threatening Half Of Humanity

Farmers in China, India, Bangladesh, Indonesia, and Vietnam — the largest rice-producing countries could experience reduced output due to soaring fertilizer prices.

The International Rice Research Institute warns that harvests could plunge as much as 10% in the next season, equating to about 36 million tons of rice, or enough food to feed a half billion people, according to Bloomberg.

Chemical fertilizers, such as nitrogen, phosphorus, and potassium, are the most applied nutrients for high-yielding rice cultivation. Farmers have been particularly vulnerable to soaring fertilizer prices as some have reduced the amount of nutrients to save costs. This threatens future harvests as production declines could stoke food inflation for a crop that feeds half of humanity.

Humnath Bhandari, a senior agricultural economist at the institute, said the 10% drop in global rice production is a “very conservative estimate.” He said if the Ukraine conflict continued and fertilizer prices remained high and supply limited, then the decline of rice output could be even more severe. This may trigger a full-blown global food crisis, similar to the one that the UN has been warning about.

Russia and Belarus are big suppliers of every major type of crop nutrient. Western countries have sanctioned both, which have limited fertilizers shipments to the rest of the world, crimping supply and why prices are soaring. On top of this, Moscow has reduced or halted nutrient exports.

Nguyen Binh Phong, the owner of a fertilizer shop in Vietnam’s Kien Giang province, said nutrient costs have soared three-fold over the past year, forcing farmers in the region to reduce fertilizer use by up to 20% because of rising prices.

“When the farmers cut fertilizer use, they accept that they will get lower profit,” Phong said.

…click on the above link to read the rest of the article…

3 Factors Which Are About To Make The Coming Food Shortages Even Worse

3 Factors Which Are About To Make The Coming Food Shortages Even Worse

A confluence of circumstances has come together to create a “perfect storm” for global food production, and now that “perfect storm” is about to get even worse.  For months I warned that this crisis was coming, and in recent weeks I have been documenting how dire conditions have already become all over the globe.  The head of the UN World Food Program is warning that this is going to be the worst worldwide food crisis since World War II, and even Joe Biden is admitting that the approaching food shortages “are going to be real”.  Unfortunately, there have been some new developments which threaten to significantly escalate things.

In recent days, the number of newly confirmed COVID cases in China has soared to record highs, and Chinese authorities have responded to this with unprecedented lockdowns.

As a result, almost 400 million Chinese are now “under full or partial lockdown”

Nearly 400 million people across 45 cities in China are under full or partial lockdown as part of China’s strict zero-Covid policy. Together they represent 40%, or $7.2 trillion, of annual gross domestic product for the world’s second-largest economy, according to data from Nomura Holdings.

Analysts are ringing warning bells, but say investors aren’t properly assessing how serious the global economic fallout might be from these prolonged isolation orders.

Chinese lockdowns are a lot more brutal than lockdowns in the western world.

By now, you have probably seen video footage of Shanghai residents literally screaming from their apartment windows.

I have never seen anything like that before, and these lockdowns will continue as long as COVID keeps spreading.

To put this in perspective, the number of people that are currently locked down in China is greater than the total population of the United States.

…click on the above link to read the rest of the article…

Putin Driving Up Oil Prices Is An “Outrageous Lie”: USF Geology Professor Dr. Marc Defant

Putin Driving Up Oil Prices Is An “Outrageous Lie”: USF Geology Professor Dr. Marc Defant

“I read a lot of the literature on global warming and for AOC to come out and say 2 or 3 years ago that the world was going to end in 12 years – that’s just hysterical craziness.”

About two weeks ago, I published an interview with Dr. Marc Defant about why he thought President Biden’s oil policies were “bat-shit crazy” and creating more turmoil than they were helping alleviate problems in markets.

This past weekend, I was happy to welcome him onto my podcast for a discussion about the current state of energy in the U.S., including pros and cons of natural gas, fracking, shutting down pipeline projects in the U.S. and the cost benefit analysis of extreme activist environmentalists.

Why We are Alone in the Galaxy | Marc Defant | TEDxUSF - YouTube

Dr. Marc J. Defant is a professor of geology/geochemistry at the University of South Florida. He worked for Schlumberger Well Services and Shell Oil for three years, with two years at Shell working as an exploration geologist.

He has been funded by the National Science FoundationNational Geographic, the American Chemical Society, and the National Academy of Sciences, and has published in many internationally renowned scientific journals including Nature. He has written a book entitled Voyage of Discovery: From the Big Bang to the Ice Age and published several articles for general readership magazines such as Skeptic and Popular Science and appeared on the Joe Rogan Experience podcast. You can reach him via this contact form.

First, we talked about how the price of oil got so high to begin with.

Dr. Defant told me: “Gas was up 40% and oil was up 80% before the Ukrainian war started. What got me a little incensed was that Biden is going around saying the price of gasoline is due to to Putin.”

…click on the above link to read the rest of the article…

What War in Ukraine Means for Energy and Money

What War in Ukraine Means for Energy and Money

Easier said than done: National self-sufficiency in a changed world

Easier said than done: National self-sufficiency in a changed world

In the wake of a rapidly evolving realignment of the world trading system resulting from the economic equivalent of World War III, President Joe Biden last week took the first of what are likely to be many steps toward building greater self-sufficiency for the United States.

Biden called for increasing U.S. production of key minerals used in the manufacture of electric vehicle batteries. He invoked the Defense Production Act which allows the government to support production of certain materials and goods deemed essential for national defense and even to order industry to mine minerals and make machinery including vehicles such as tanks and bombs.

For the Biden administration its first small step toward U.S. self-sufficiency consists of making companies which mine minerals key to electric vehicle batteries such as lithium, nickel, graphite, cobalt and manganese eligible for direct subsidies or purchase commitments to incentivize increased production. The applicable program (called Title III) has about $750 million to spend, not that much to rectify what is a huge deficit.

It’s worth looking at U.S. net imports of each of these minerals to understand just how hard reaching self-sufficiency will be. For starters, let’s examine a table from a U.S. Geological Survey (USGS) report about U.S. import dependence for key minerals:

USGS Minerals Table
Of the five minerals listed above, the United States is 100 percent dependent on imports for two: graphite and manganese. (It’s worth noting the China, Russia and Ukraine are among the top six producers of graphite and China is the largest producer by far. China and Ukraine are among the top five producers of manganese and again China is by far the biggest producer.)

Complete U.S. dependence on imports implies that there is no current production of these minerals in the United States and that nobody has even been looking for these minerals on U.S. soil…

…click on the above link to read the rest of the article…

Farmers on the Brink

Farmers on the Brink

Farming looks mighty easy when your plow is a pencil and you’re a thousand miles from the corn field.” – Dwight D. Eisenhower

It was a spooky time to be out at sea off the US East Coast on Halloween in 1991. A strong storm system over the maritime provinces in Canada merged with the remnants of Hurricane Grace, forming a new, epic, and dangerous Nor’easter. The winds of this new storm breached 70 miles per hour and a wave as high as 100 feet was measured off the coast of Nova Scotia, but the storm was not renamed as either a tropical storm or a hurricane – instead, it is known only colloquially as simply the Perfect Storm. Six fishermen from Massachusetts perished when their vessel Andrea Gail sunk in open waters, and the story of the storm and of that tragedy became the subject of a best-selling book and a blockbuster feature film.

While the concept of a perfect storm is often too casually assigned in popular culture, it is difficult to find a more apt description of what has been unfolding in the global agriculture markets over these past several months. The tempest caused by the European energy disaster has merged with the hurricane of consequences flowing from Russia’s invasion of Ukraine, forming the genesis of a generational crisis in food that will leave few unaffected. While we’ve been warning about just such a scenario for some time, after spending the past two weeks traveling across the US Midwest and conferring with our contacts in the agricultural sector, even we are a little spooked by what we’ve learned. In a financial crash, the correlation between all asset classes converges to one…

…click on the above link to read the rest of the article…

No one will win in the Russia-Ukraine conflict

No one will win in the Russia-Ukraine conflict

Most people have a preconceived notion that there will be a clear winner and loser from any war. In their view, the world economy will go on, much as before, after the war is “won” by one side or the other. In my view, we are basically dealing with a no-win situation. No matter what the outcome, the world economy will be worse off after the fighting stops.

The problem the world economy is up against is the depletion of many kinds of resources simultaneously. This depletion is made worse by rising population, meaning that the resources available need to provide an adequate living for an increasing number of world inhabitants. Because of depletion, the world economy is reaching a point where it can no longer grow in the way it has in the past. Inflation, food shortages and rolling blackouts are likely to become increasing problems in many parts of the world. Eventually, the population is likely to fall.

We are living in a world that is beginning to behave like the players scrambling for seats in a game of musical chairs. In each round of a musical chairs game, one chair is removed from the circle. The players in the game must walk around the outside of the circle. When the music stops, all the players scramble for the remaining chairs. Someone gets left out.

Figure 1. Circle of chairs arranged for a game of musical chairs. Source

In this post, I will try to explain some of the issues.

[1] In a world with inadequate resources relative to population, conflicts are likely to become increasingly common.

…click on the above link to read the rest of the article…

Nightmare Scenario: Operational Miscalculations Could Trigger Nuclear War

Nightmare Scenario: Operational Miscalculations Could Trigger Nuclear War

Since Russia’s invasion of Ukraine on Feb. 24, Defense Secretary Lloyd Austin and Gen. Mark A. Milley, the Chairman of the Joint Chiefs of Staff, have tried to set up phone calls with Defense Minister Sergei Shoigu and Gen. Valery Gerasimov but the Russians “have so far declined to engage,” said Pentagon spokesman John Kirby in a statement Wednesday, March 23.

“A nightmare scenario would be a Russian missile or attack aircraft that destroys a U.S. command post across the Polish-Ukrainian border,” James Stavridis, a retired admiral who served as the Supreme Allied Commander at NATO from 2009 to 2013, told the Washington Post. “A local commander might respond immediately, thinking the event was a precursor to a wider attack. This could lead to rapid and irreversible escalation, to include potential use of nuclear weapons.”

According to a CNN report detailing a rare face-to-face meeting between Russian and US military officials last week, the US believes that the refusal for high-level meetings is due to Kremlin worries that the encounters would show them to be vulnerable if they allowed such meetings, because it risks a tacit admission that an abnormal situation exists, according to the readout of the meeting.

Though the assumption of vulnerability appears misconceived considering while the Pentagon has allegedly attempted to maintain high-level contacts with Russian counterparts, Secretary of State Antony Blinken has not attempted any conversations with his counterpart, Russian Foreign Minister Sergei Lavrov, since the start of the conflict last month.

The real reason the Russian military leadership has allegedly shunned maintaining high-level contacts with the Pentagon’s top brass appears to be the duplicitous and treacherous role played by the transatlantic NATO alliance of significantly escalating the conflict…

…click on the above link to read the rest of the article…

EU Considers Massive 100 Billion Euro Energy Relief Fund For Companies

EU Considers Massive 100 Billion Euro Energy Relief Fund For Companies

Europe faces an unprecedented energy crisis that requires extraordinary policy action, such as a possible 100 billion in relief funds to businesses hit the hardest by soaring energy prices.

Bloomberg cites MF daily that said the European Union on Wednesday is considering a massive 100 billion euro bond issuance for a new relief program that would provide relief funds to businesses hit hardest by rising gas and electricity prices, as criticism soars about out of control commodity inflation and the bloc’s inability to tame prices.

MF didn’t cite sources, though it said the issuance could be approved within the next 15 days.

The news comes as the European Commission has proposed a plan to make Europe independent from Russian fossil fuels following the invasion of Ukraine. Even before the invasion, many European countries were facing extraordinarily high natural gas, electricity, and fuel costs. There’s even risks of a diesel shortage emerging. The latest developments from Ukraine have exacerbated the situation.

On Tuesday, a working group of Germany’s coalition parties agreed on a relief package to strengthen Germany’s energy independence and help alleviate the burden of high energy costs sources, told Reuters. This comes as Europe’s biggest economy is attempting to decouple from Russian gas and oil due to the invasion of Ukraine.

Italian Premier Mario Draghi recently said the invasion of Ukraine had sparked high volatility for the markets for commodity markets, which were already at elevated prices before the conflict. He said, “We must intervene right away.”

Spanish Prime Minister Pedro Sanchez said, “committing ourselves to diversify energy sources as fast as possible” is necessary. He said “small businesses and citizens can’t bear” soaring gas and electricity costs.

European politicians are awakening to the fact that high energy costs could “re-awakening the nightmare of populism” on the European continent, Greek Prime Minister Kyriakos Mitsotakis warned.

That’s why the European Union is likely to pass some kind of energy relief package for businesses and households in the near term.

Russia-Ukraine War and the Changing Energy Landscape.

Russia-Ukraine War and the Changing Energy Landscape.

The can of worms that is our global use of energy, has been levered open yet further by the escalating war in Ukraine. Prices of all types of energy had already been hiked dramatically as a result of a strong economic rebound post-covid, but with limited capacity to meet additional demand. As a result of a potential embargo on Russian fuels, the UK price of natural gas briefly hit 800p per therm, or sixteen times that of March 2021. Oil prices too, are at a high not seen since just before the Great Recession of 2008, with Brent crude spiking at $128 a barrel, and driving record prices for petrol and diesel. Since energy underpins everything we do, its cost sets the baseline for all other commodities, including food, whose prices are also surging globally.

Europe is dependent on Russia for around 40% of its gas, thus making any supply restrictions extremely problematic, to put it mildly: for example, if Russia were to carry out its threat to cut off the gas. Similarly, refusals by the West to buy Russian oil beg the question of whether matching quantities can be secured from elsewhere. Given that oil is the lifeblood of industrial civilization, and we run the risk of a demand/supply gap, leading to soaring prices – $200 a barrel has been suggested – the economic consequences would almost certainly be catastrophic.

The European Commission has now pledged to curb massively its purchase of Russian gas: by some two thirds by the end of this year. The proposed mechanism for this includes establishing a greater diversity of suppliers, biomethane production, and energy efficiency strategies for buildings, including behavioural changes such as turning down thermostats to curb energy demand. Indeed, demand reduction must be a salient part of any viable future energy blueprint.
…click on the above link to read the rest of the article…

Chris Hedges: Waltzing to Armageddon

Chris Hedges: Waltzing to Armageddon

The Dr. Strangeloves, like zombies rising from the mass graves they created around the globe, are once again stoking new campaigns of industrial mass slaughter.

Bus burning on a road from Kharkiv to Kiev as Russia invades Ukraine on Feb. 24. (Yan Boechat/VOA)

The Cold War, from 1945 to 1989, was a wild Bacchanalia for arms manufacturers, the Pentagon, the C.I.A., the diplomats who played one country off another on the world’s chess board, and the global corporations able to loot and pillage by equating predatory capitalism with freedom. In the name of national security, the Cold Warriors, many of them self-identified liberals, demonized labor, independent media, human rights organizations, and those who opposed the permanent war economy and the militarization of American society as soft on communism.

That is why they have resurrected it.

The decision to spurn the possibility of peaceful coexistence with Russia at the end of the Cold War is one of the most egregious crimes of the late 20th century. The danger of provoking Russia was universally understood with the collapse of the Soviet Union, including by political elites as diverse as Henry Kissinger and George F. Kennan, who called the expansion of NATO into Central Europe “the most fateful error of American policy in the entire post-Cold War era.”

This provocation, a violation of a promise not to expand NATO beyond the borders of a unified Germany, has seen Poland, Hungary, the Czech Republic, Bulgaria, Estonia, Latvia, Lithuania, Romania, Slovakia, Slovenia, Albania, Croatia, Montenegro and North Macedonia inducted into the Western military alliance.

This betrayal was compounded by a decision to station NATO troops, including thousands of U.S. troops, in Eastern Europe, another violation of an agreement made by Washington with Moscow…

…click on the above link to read the rest of the article…

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