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World governments are beginning to take actions to protect domestic food supplies by limiting exports due to rising inflation and disrupted supply chains resulting in part from the war in Ukraine and the COVID-19 pandemic.
Food shortages and soaring prices often lead to discontent prompting citizen protests and threatening general stability. This, for example, now occurs in Indonesia as the price of food products, especially palm oil, surges. Governments in response then seek to protect domestic food supplies by restricting exports.
For example, after the 2007-2008 financial crisis, major grain exporters, including Ukraine, protected prices by limiting grain exports attempting to insure ample supply. Similarly, India, Vietnam and other major rice producers also limited exports to help protect domestic supply and control inflation.
Experts now fear global and systemic food supply protectionism which especially would harm countries that depend on foreign food supply. Recent actions include the following.
1. Argentina. Argentina supplies 6% of world beef exports. Its rate of inflation rose to 50.9% in 2021. Argentina limited beef exports spring 2021. It’s eased some restrictions since then, but still bans seven cuts of beef from export until 2023.
2. Indonesia. Indonesia supplies the world with the greatest level of edible-oil exports. The war in Ukraine resulted in globally rising prices for vegetable oils boosting Indonesian exports. A domestic shortage then arose with oil prices within Indonesia increasing 40% on an annual basis. Indonesia subsequently implemented a ban on all palm oil exports this spring.
3. Kazakhstan. Kazakhstan’s wheat exports comprise 4% of the worldwide total with neighboring countries especially dependent. Since the start of Russia’s war in Ukraine, Russia ceased wheat exports to the country and domestic wheat prices have increased 30%. Accordingly, Kazakhstan now restricts exports of wheat and wheat flower until early summer attempting to balance the need for export revenue with internal food security.
4. Russia. Russia’s wheat exports comprise 20% of the worldwide total. In response to food price inflation within the country, Russia restricted exports and imposed additional taxes on them. After its invasion of Ukraine, Russia imposed new export restrictions on wheat, ceased sugar exports, and imposed limits on the export of sunflower oil.
5. Ukraine. Ukraine’s wheat exports comprise 9% of the worldwide total. Since its invasion by Russia, the country ceased all exports of wheat, oats, and food staples to protect its domestic supply. Ukraine also is the world’s largest exporter of sunflower oil and continues to export that oil despite supply chain disruptions due to Russia’s invasion.
