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Starving in the age of artificial intelligence: why 839 million people cannot eat with dignity


Armed conflicts, climate change and the increase in the cost of inputs exert great pressure on the food chain

When you have finished reading the lines of this paragraph, at least 10 people in the world will have died.

They will do it in one of the cruelest ways we have ever allowed ourselves: starvation.

Because every 4.25 seconds, according to the calculation of 238 humanitarian organizations in 2022, someone loses their life due to lack of food.

In the middle of the 21st century —the one with the greatest technological development we have ever seen, in which we have taught machines to speak, in which the existence of water on Mars has been discovered, in which we have been able to observe giant planets outside our solar system-, we have not yet found the key to prevent millions of human beings from going to bed with an empty stomach.

Some 839 million people on the globe could not feed themselves with dignity last year, and there are 10.7 million more than in 2021, according to the first forecasts made by the United Nations Food and Agriculture Agency (FAO).

The increase only contemplates the impact that the Russian invasion has had on Ukraine, but, according to the experts consulted, it is expected to go higher when the poisonous effects of droughts and floods, export restrictions, the high levels of debt of the poorest countries, the increase in interest rates, energy costs and the blow of other armed conflicts.

"The situation is not improving, on the contrary, it is getting worse," says Máximo Torero, FAO's chief economist.

“We are getting further and further away from a world without hunger”,

The scenario was already bleak before the pandemic broke out.

In 2019, there were more than 618 million hungry people around the globe.

But with the arrival of the covid, the number skyrocketed to between 702 and 828 million, according to the FAO.

The picture worsens if we consider all those who live with the uncertainty of getting food or who cannot afford a healthy diet, that is, they are food insecure.

More than 2.3 billion people lived in this condition in 2021: one in four in the world.

Of all these, some 205 million people (in 45 countries) face a very serious situation, with little access to food and means, for which their lives are in danger, according to the World Bank.

The forecast is that all these figures will rise in 2022, a year that Jason Channell, head of sustainable finance at Citi Global Insights, describes as the "perfect storm in the fight against hunger". synchronously, it was recovering from covid-19, environmental, social, political and economic problems were making their way onto the map, leaving their mark on the price of food (which accumulated a series of historical highs or levels that we had not seen since a decade ago), and a trail of people with increasingly difficult access to food.

The Russian invasion of the Ukraine was the icing on the cake.

“The biggest impact on current food prices is due to the war,” says Hiral Patel, global head of Sustainable Research at Barclays.

The order from Moscow to kyiv has added fuel to the fire.

“It complicated agricultural market rebalancing efforts that would likely have materialized sometime in 2022,” say experts at Citi Global Insights in a recently published report.

In March 2022, immediately after the Russian invasion began, the FAO Food Price Index—which includes the weighted average of export imports of meat, dairy products, cereals, oils, fats, and sugar— reached its historical maximum: 159.7 points.

The most significant increases occurred in sunflower oil, wheat and corn.

As of the end of 2022, the index ended at an average of 143.7 points, an increase of 18 points or 14.3% compared to 2021. “Fears of a period of sustained high world food prices have diminished a little,” says Rob Vos, director of the Division of Markets and Trade at the International Food Policy Research Institute (IFPRI).

All components fell at the end of last year.

In particular, vegetable oil, which showed the strongest decline in the second half of 2022: 33% between June and December, but is still a third above pre-pandemic levels.

"Prices are at pre-war levels," says Torero.

“But they are not yet at precovid levels.”

The agreement reached in July 2022 between the countries in conflict, Turkey and the UN,

to resume food exports from Ukraine's Black Sea ports helped contain the escalation.

Ukraine - its cereals provide the necessary calories for more than 400 million people worldwide - was able to increase its foreign sales to 4.6 million tons in September, compared to 1.2 million obtained in June.

80% left by sea.

Bad crops

The initiative was renewed in November, which has lengthened the lull in international prices.

Before the Russian invasion, access to food was already difficult.

The world was coping with poor harvests in South America—where Brazil and Argentina are big players in the markets for soybeans, corn, wheat, and rice—a growing global demand for seeds, rising costs of fuels and supply chain problems, which had reduced inventories of grains and oilseeds.

Uncertainty increased when the availability of food from two of the large granaries was called into question.

Some 50 countries import at least 30% of their cereals from Russia and Ukraine, in 20 of them the percentage is more than 50%.

So those who could took shelter from the coming storm.

To guarantee their supplies, some of the main food producers imposed a brake on their sales to other countries.

Argentina, for example, banned the export of soybean meal and oil.

Egypt and India limited wheat sales.

Malaysia did the same with chicken trade in foreign markets, which has cut Singapore's poultry supply by a third.

China, the world's second largest exporter of fertilizers, after Russia, extended a series of restrictions on input exports that it had already put in place in 2021, in a context of rising crude oil and natural gas prices.

This trend, towards the limitation or prohibition of trade,

It peaked at the end of last May with almost 17% of world food and feed exports affected by the measures applied by 23 countries, according to IFPRI figures.

The data recorded has been similar to that of the food price crisis of 2007-2008, which led the world to raise the prices of basic products between 50% and 200%.

Many countries partially reversed the measures throughout 2022. By mid-July, the affected trade volume had fallen to 7.3%, and it remained that way for the rest of last year.

In December, according to the World Bank, there were still 19 countries with 23 food export bans and 8 more that had implemented measures to limit sales abroad.

"Restrictions increase the cost of food and the poorest countries are the ones that suffer the most," explains Vos.

The situation is further aggravated in an environment of interest rate hikes by the world's main economies (with which they seek to alleviate inflation), as the currencies of the less economically favored nations lose strength against the US dollar.

The participation of this last currency is relevant in world trade: 4 out of 10 exported products are made with the green ticket.

This proportion has not changed in the last 20 years, according to the International Monetary Fund (IMF).

Furthermore, for many of these countries that are struggling to lower inflation, the weakening of their currencies against the dollar is a headache.

"On average, the estimated transfer of a 10% appreciation of the dollar to inflation is 1%," says the international organization.

For those with high foreign currency debt commitments, the situation is more than challenging, as half of all cross-border loans and international securities are denominated in US dollars.

So many countries have little room to ask for a loan, given their high financial commitments.

“If you no longer have the capacity to borrow, your ability to purchase food is limited… We cannot separate the financial problem from the food crisis.

I think they are quite linked nowadays.

This is the most serious problem that we are going to experience in 2023," stresses Torero.

The FAO has counted some 62 countries that, given all these factors, are not only buying less food, but also paying more for it.

The import bill for them has risen by about 25.4 billion dollars in 2022, affecting about 1.

700 million people.

It is estimated, for example, that sub-Saharan Africa spends 4.8 billion dollars more on food imports, but that volumes decrease by 700 million dollars.

And they don't just buy smaller quantities, they also focus on the most basic.

Agricultural supplies

While high-income countries continue to purchase the full range of products, spending in developing regions is increasingly concentrated on importing the most basic items (rice, wheat, maize, millet).

Added to the cost of food is the cost of agricultural inputs: fertilizers, seeds, pesticides and energy.

The import bill for these products has skyrocketed by 50% in 2022, up to 424,000 million dollars.

The cost of fuels and fertilizers could have reached a record 86% of the global global input bill by 2022, according to the FAO.

Fertilizers —in which Russia occupies an important place in the arena: it is the first exporter of nitrogenous ones, the second of potassium ones and the third of phosphorous ones— and energy are especially important elements, since the reduction or lack of these translates into lower agricultural productivity.

“This year, we will see to what extent the increase in fertilizer prices affected decision-making on farms and what repercussions it will have on the next harvests, for example, were fewer crops planted?”, asks Patel, from Barclays.

The war has exacerbated the various problems in the food world.

“The conflict has revealed two clear things:

More than 40% of global caloric intake comes from just three crops (wheat, maize and rice), which are produced in just a few countries and dominate every step of the value chain.

Among them: India, Indonesia, Canada, China, the United States, Brazil, Argentina and Russia.

Ukraine, and others like Uruguay and Thailand always appear in the top 10 in the foreign sale of these foods.

The inequality is so great that just five countries account for more than two-thirds of the world's wheat and beef exports.

In the case of soybeans, the quota is 95%.

Brazil accounts for 45% of world sugar sales, Canada controls 54% of oilseeds and Thailand accounts for 56% of roots and tubers.

The competitive advantage is abysmal.

Eritrea, for example, bought 100% of its wheat consumption in 2021 from Russia and Ukraine.

Armenia, Georgia, Azerbaijan or Belarus acquired 90% only from Moscow.

Somalia – where, according to Oxfam estimates, more than 300,000 people are on the brink of famine – imported more than 90% of this grain to the two warring nations, which already controlled a quarter of foreign wheat sales before the the fire would start.

Russia and Ukraine are net exporters of other agricultural products, such as corn and barley.

In sunflower oil, their combined world export market share was over 70%.

In addition, together they supplied more than 50% of the imports of these cereals to North Africa and the Middle East.

Some 26 economies (such as Uruguay, Norway, Colombia, Albania, Brazil, Mexico, Guinea, Congo, Mozambique and even the European Union as a whole) depend on Russian inputs for 20% or more of their imports.

The most extreme cases are in Mongolia, Kazakhstan, Moldova, Serbia, Honduras and Ghana, which buy more than 50% of this product from Moscow.

"Food affordability continues to be a macro challenge, but also among households," Vos emphasizes.

Domestic food price inflation remains high, despite international costs being at pre-war levels.

At the end of last year, according to World Bank data, in 83.3% of low-income nations, in 90.5% of those with lower-middle income and in 91% of those with an upper-middle income had registered inflation rates above 5%, with many of them reaching double digits.

The proportion of high-income countries with an increase in the price of products is not far behind: around 85.7% experience “high inflation”, says the institution in its Food Security report, from the end of January.

However, the most affected countries are in Africa, North America, Latin America, South Asia, Europe and Central Asia.

Displaced women and children sit next to sacks of wheat during a food distribution in Ethiopia on January 10.EDUARDO SOTERAS (AFP/ Getty Images) (AFP via Getty Images)

But if there is a place where all the horsemen of the apocalypse ride at ease, it is in the Horn of Africa.

Armed conflicts, trade blockades, the effects of climate change and the pandemic have brought the population to its knees.

There, the worst drought in the last 40 years is faced, caused by a lack of rain during the last five years.

Currently, an estimated 27.6 million people in Somalia (5.6 million), Kenya (4.4 million), Ethiopia (9.9 million) and South Sudan (6.6 million) are at levels hungry critics.

“These figures will increase in the first quarter of 2023, which is very worrying, since the consequences of the hunger crisis are immense,” says Margret Mueller, Regional Humanitarian Coordinator for the Horn of Africa, Eastern and Central Africa at Oxfam Intermón. .

Climate change is making extreme weather events more frequent in East Africa.

“It's one of the main drivers of hunger,” Mueller points out.

The area is facing its third drought since 2011. In previous decades, there was an intense one in 2005, another from 1996 to 1998 and then that of the 1980s, when more than a million people died in the Ethiopian famine.

Climate-induced hunger is a stark demonstration of global inequality.

Half of the population, the poorest, about 3.5 billion souls, is responsible for less than 10% of carbon emissions.

armed conflicts

Ten of the world's worst climate hotspots — Somalia, Haiti, Djibouti, Kenya, Niger, Afghanistan, Guatemala, Madagascar, Burkina Faso and Zimbabwe — have seen a 123% increase in acute hunger in the past six years alone, according to Oxfam.

In Yemen, in the Middle East, the situation is also alarming.

The various armed conflicts that have plagued the country for decades have left it devastated.

The latest confrontation, which has its roots in 2011, the product of the Arab Spring, and escalated into a civil war in 2015, has put some 21.6 million people in need of humanitarian aid.

A truce — which began in April 2022 and has lasted for nine months between Saudi Arabia and the Iranian-backed Houthi rebels — has allowed some respite.

“It has had a positive impact because import restrictions have been eased, the Sanaa airport has been opened to certain flights and gasoline is coming in more easily.

But the situation continues to be dramatic”, comments the director of Oxfam Intermón in that country.

"We have lost a decade in the fight against poverty," says Torero, from the FAO.

This expert indicates that, if the war were to continue, the world would have a problem of access and not of availability as it is now, since Russia and Ukraine would considerably reduce their exports.

“In 2023,

We expect food prices to remain high and the risk of rising again is still high,” Patel adds.

“We are facing a hunger crisis like we have never seen before,” concludes Mueller.

Arif Husain pictured in 2018 in Nigeria.Inger Marie Vennize (WFP) (© WFP/Inger Marie Vennize)

Arif Husain (UN): "For many years we have not seen a famine like the current one"

Arif Husain, chief economist of the UN World Food Program (WFP), is less optimistic about the food future of the planet.

Above all, he is concerned about a new rise in the international prices of the main foods.

“I still don't see the structural reasons why prices are going down now,” he says.

In a videoconference interview, Husain spoke from Rome about the growth in acute hunger, the price of rice (which he recommends monitoring) and food exports, in the hands of a dozen countries: "We have laid eggs in very few baskets”.


What is the hunger situation in the world?


Regarding hunger, we are talking about two types.

The chronic, which is when people go to bed hungry, because they don't have enough money to buy enough food to allow them to have a more or less reasonable diet.

The second is acute hunger.

Here are the people who have no food due to an unforeseen event (an earthquake, a flood, a drought, a war), which has affected their economy and who suddenly became poor.

This last group has been on the rise since before covid.

In 2019 there were around 135 million people.

When the pandemic hit the world the number jumped to 276 million.

Then came the war and in 2022 the data rose to 349 million.

Of these, between 49 and 50 million live in a famine emergency.

That is, they are one step away from famine,

and they have joined the million who already suffered from it before the conflict.

Among them, Haiti, Somalia, Ethiopia, Yemen...


Are we in an emergency?


A famine like this has not been seen for a long time.

Various factors play a role: armed conflicts [beyond the Russian invasion];

climate change;

the covid.

On top of that, there is the war in the Ukraine.

So an increase in food insecurity should not surprise us.


What countries or areas are the most affected?


The famine has spread throughout the world.

People have difficulties to buy food in various areas.

There are 69 countries in which food inflation exceeds 15%, of these there are about four in which food inflation is in three digits: Zimbabwe, Lebanon, Venezuela and Sudan.

Then there are another 10 where it exceeds 50%, such as Argentina, Syria, Turkey, Sri Lanka, Cuba, Ghana, Rwanda, Myanmar, Haiti. Which have been the most affected?

Undoubtedly those who have a conflict import their food, fuel and fertilizers.


Is food control, in the hands of a dozen economies, a great challenge for the future of food security?


Very few nations depend on the world's exports, and even fewer have these vast reserves.

We can say that the eggs are laid in few baskets.

World food security is not diversified.

And the worst of all this is that it is not a new problem.

It was already in 2008 [in the last global food crisis].

And it is now.

Less than 10 countries control about 86% of wheat exports, 85% of corn, 78% of rice, and about 87% of soybeans.

It's also pretty scary when you look at the reserves of these crops: fewer than five countries have three-quarters of all of them.

Only two concentrate 82% of the corn reserves [China and the United States].

Less than five have 82% of the rice.

And fewer than four countries control 93% of soybeans.


What is the solution to this inequality?


Food security must be diversified, but it is not something that can be done in a day or a month, it takes years.

Importing countries need to rethink their agricultural policies, have alternative plans in case the main plan fails.

This has to be done not only from the point of view of economic and environmental security, but also for their national security.

I think the war in Ukraine has clearly shown us that we need to reconsider what happens to our food and our energy.


Have we already seen the biggest price increases in 2022?


There are two things that are happening right now.

The first: the prices of cereals (wheat, corn, sunflower oil and even fertilizers) have fallen.

They are at prewar levels in Ukraine.

But let's not forget that in 2021 food was at its highest level in the last 10 years.

The second is that demand is being destroyed.

That is, people are stopping consuming, because inflation is still there.

Therefore, if less is consumed, prices go down.

We are not out of danger at all.

There is still a lot of uncertainty.


What foods do we need to keep track of closely?


To rice.

Their prices have started moving late, they are gradually rising.

Let's remember that, in 2008, it was one of the cereals that increased the most [by 80%], and it was the one that hit African economies the most.

Why do you have to follow it?

Because its production has been lower [affected by the availability of fertilizers].

And, in general, because I still don't see the structural reasons why food prices are falling.

People are consuming less and that means we are inching towards a recession.

One thing that worries me a lot is that there are countries with high debt and that cannot buy food.

We have to find a mechanism by which they can get hold of food, fuel and inputs.

Because governments are spending more money to buy less food.


Should their debt be forgiven?


This is what I am promoting.

We have to start thinking about either alleviating the debt or alleviating people's hunger.

We have to make sure that governments have the resources to pay for their food and fertilizer.

But obviously this is for countries that are in a high level of stress.

Better manage waste

There is food for everyone in the world.

While food production has multiplied at least 3.6 times in the last 70 years, the population has done so only 2.5 times.

"The cause of hunger and malnutrition is poverty," says the OECD.

To achieve greater access, says the FAO, it is necessary to encourage the mobility of food, use new technologies to produce, have a more efficient consumption of inputs (up to 50% of fertilizers are wasted) and waste less.

About 1,300 million tons (useful to feed 3,000 million people) go to waste every year.

In poorer countries it is wasted in production and storage.

Single crop monocultures are very vulnerable to pests.

In global north it is done at the end of the chain.

“Consumers expect immaculate products,

always in season and perfect,” says Raj Patel, a scholar of the food crisis.

In Spain, each citizen throws away 28.21 kilos.

"This could be reduced by changing people's behavior," says Máximo Torero.

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Source: elparis

All business articles on 2023-02-05

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