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Why is the increase in every single food item tied to the war in Ukraine? Is that legitimate, or is that just timely excuse making?
by Loughla 4y ago
Why is the increase in every single food item tied to the war in Ukraine?
Is that legitimate, or is that just timely excuse making?
- AlecSchueler 4y agoThe war in Ukraine drives up prices of fuel which has a knock on effect to just about everything else.
- illiarian 4y agoI wouldn't be surprised if it's also overlapping long tails of everything: from COVID global trade and shipping disruptions to war in Ukraine affecting grain shipments to rising fuel prices to...
- Paul-Craft 4y agoLet's not forget natural gas is the main source of methane used to make synthetic fertilizers. Since Russian natural gas isn't flowing the way it used to, I can imagine that would increase the price of food.
- CannisterFlux 4y ago"Climate change" is probably the long tail of everything you could add to the list. The flooding in Pakistan in 2022 for example. Remember that one? It destroyed crops and then there's the draining and fixing the land afterwards, infrastructure damage making planting for the next season more difficult, and so on. Pakistan was the 3rd global exporter of rice after India and Thailand in 2021.
- qbasic_forever 4y agoSaudi Arabia effectively sets the price of oil. Ukraine doesn't produce any of it. Some tanks banging around the countryside there are not major consumers of oil, one oil tanker crossing the ocean is burning and blasting through orders of magnitude more oil.
- tekla 4y agoWho said that Tanks in Ukraine are the main drivers to oil price increases?
- qbasic_forever 4y agoThe person I'm directly replying to said the war in Ukraine is causing oil prices to increase. What else would be using major amounts of oil in a war? But like I said it's beside the point. The price of oil is effectively set by the production volume of Saudi Arabia. Ukraine does not factor into it at all.
- Retric 4y agoRussia is a major oil exporter ~10 million barrels per day, and they are impacted by the war.
- qbasic_forever 4y agoTheir exports are humming along just fine as they've made new agreements with China and other countries to get out of the petro-dollar hegemony. It's been over a year and the sanctions against Russian oil exports appear to have done nothing.
- politician 4y agoIf I posted as frequently within the short amount of time as you have on this topic, my account would have been throttled. My account is frequently throttled for posting more than 5-7 times per hour, and yet, your recent history shows a far higher rate of posts in defense of Russia with no evidence of throttling. That's very interesting. I wonder if limits are relaxed above 8k karma.
- qbasic_forever 4y agoI'm an American that's fed up with the continued support of sanctions and this useless war in Ukraine. We have flushed billions of dollars into this conflict and enacted pain on the world for zero gain. It's time for the west to admit failure on this and push Ukraine to bargain for a cease fire, even if it costs them contested territory like Crimea or Donbas. The history of conflict in those regions is quite complicated and zero concern for the US--we have far bigger problems at home to worry about.
- maerF0x0 4y agoAlso the cost/availability of fertilizer on the other side of the conflict https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukraine-is-affecting-the-worlds-supply-of-fertilizer https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukr...
- chaostheory 4y agoIf you read further down in the article, China is suffering from a drought that’s been the worse in decades Edit monsoon not drought. Thanks s1artibartfast “In the second half of last year, swaths of farmland in the world’s largest rice producer China were plagued by heavy summer monsoon rains and floods. The accumulated rainfall in the country’s Guangxi and Guangdong province, China’s major hubs of rice production, was the second highest in at least 20 years, according to agriculture analytics company Gro Intelligence. Similarly, Pakistan — which represents 7.6% of global rice trade — saw annual production plunge 31% year-on-year due to severe flooding last year, said the U.S. Department of Agriculture (USDA), labeling the impact as ‘even worse than initially expected.’” Reading further, I’m not sure why Ukraine is mentioned either since their major food export is wheat and not rice
- s1artibartfast 4y agoPoint of clarification, China is suffering from monsoon, not drought
- neverartful 4y agoThe country's land mass is big enough that it's possible for both to be true, no?
- s1artibartfast 4y agoPossible, but article actually supports one reason and not the other. >The accumulated rainfall in the country’s Guangxi and Guangdong province, China’s major hubs of rice production, was the second highest in at least 20 years,
- hef19898 4y agoOne thing I could think of spontaniously is this: Ukraine is exporting less (they seemed to recover, but markets and the bullwhip effect don't care rigjt away), so shortfall of Ukrainian grain has to be compensated and rice is one such alternative. As a result some of the grain shortages are causing rice shortages. Throw in problems in China and the situation gets really confusing and complex.
- coliveira 4y ago[flagged]
- tekla 4y agoImpressive how absolutely no evidence is given by such a massive claim. At least attempt to refute the article which makes multiple separate claims as to why there is a shortage.
- maerF0x0 4y agoThe supply is obvious, but the wise/stupid judgement is still up for debate. https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukraine-is-affecting-the-worlds-supply-of-fertilizer https://www.npr.org/2022/09/28/1125525861/how-the-war-in-ukr...
- FredPret 4y agoCan't obliterate even the tiny Russian economy without some knock-on effects on the rest of the world. Between Russia and Ukraine, they produce some vital materials including lots of fertilizer, despite making almost no money. So while we're all taking a small financial hit right now, there are odd things like this as well.
- f6v 4y ago> Can't obliterate even the tiny Russian economy without some knock-on effects on the rest of the world. Maybe the GDP isn’t the best and only measure then.
- FredPret 4y agoI'm partial to total net worth measurements, but in case of war, you have to take into account things like scarce materials and growing seasons of crops. Like how in Age of Empires you had gold as well as wood and food, if memory serves.
- risyachka 4y ago
- kasey_junk 4y agoThe article suggests is due to rice replacing other grains in the global diet. Between Russia and the Ukraine 27% of the worlds wheat supply is impacted by the war and another 15% of the worlds corn. It seems reasonable to conclude that would have an impact on the price of other grain staples.
- puzzlingcaptcha 4y agoAnd yet wheat futures (ZW) have been falling steadily for the past six months and are now below the pre-invasion levels.
- hef19898 4y agoprice =|= availability
- puzzlingcaptcha 4y agoThe very purpose of futures contracts is to ensure availability in the future at a predetermined price. I am not sure what your point is.
- hef19898 4y agoThat there is no guarantee that the stuff will be available so, thing shappen. Also, just because futures are cheap, doesn't mean stuff is available now or in the near future. It only means the markets think grain will be plenty at one point, and thus cheap.
- ta1243 4y agoAll a low futures price means is that money men are betting there won't be a shortage, it doesn't say anything about whether there will be a shortage or not.
- pfannkuchen 4y agoPrice is not solely determined by availability, but it is largely determined by availability, especially in the case of rapid shifts in availability (since other factors take time to adjust in response).
- deelowe 4y agoUkraine isn't called the breadbasket of europe for no reason. It's hard to grow crops for export when you're at war.
- Scoundreller 4y agoStill only responsible for 3% of global production, and there are bigger European producers: https://www.weforum.org/agenda/2022/08/top-10-countries-produce-most-wheat/ https://www.weforum.org/agenda/2022/08/top-10-countries-prod...
- deelowe 4y agoWouldn't it make sense to combine Ukraine with Russia given the sanctions?
- Scoundreller 4y agoNo, because Russia has enough willing buyers for its production.
- qbasic_forever 4y agoDidn't Poland decide they didn't actually need Ukraine's grain and it's just sitting in ports rotting? https://www.cnn.com/2023/04/16/europe/poland-bans-grain-ukraine-intl/index.html https://www.cnn.com/2023/04/16/europe/poland-bans-grain-ukra... Doesn't seem like there is much demand for Ukraine grain.
- kelipso 4y agoJust an aside but wheat grain lasts basically forever so it's not exactly rotting.
- distances 4y ago> Doesn't seem like there is much demand for Ukraine grain. Always with the disinformation. Ukraine's main exports for grain are obviously not in Europe. https://oec.world/en/profile/country/ukr/ https://oec.world/en/profile/country/ukr/
- f6v 4y agoYet Poland, Hungary, Slovakia, and Bulgaria say Ukrainian grain is too cheap and upsets local farmers. Guys, but the EU said it was for feeding the poor, and not for making pierogi. I’m so confused at this point.
- deleted 4y ago[deleted]
- yamtaddle 4y agoBoth could be true. A glut of product trying to make its way through ports & other logistic routes that it usually doesn't, might drive down the price of the product at those ports—while, globally, the supply might be lower and prices higher. Think up a toy case with some remote old-west town coming into a glut of some bulky, perishable good, but having only one train line to distribute it, and the potential for this effect becomes clear. Or an island, or whatever. The logistics systems in question aren't that isolated, obviously, but they still have limited capacity that's unlikely to go up much in response to anything perceived as only a temporary situation, so they absolutely might see local prices (including for export) depressed even as global prices rise. It's not implausible.
- f6v 4y agoI think it’s a lot of words trying to justify why the “grain deal” hasn’t achieved the declared goals. I’m sure lots of profit has been made though.
- metaphor 4y ago> Is that legitimate, or is that just timely excuse making? Arguably[1] a bit of both. [1] https://scholarworks.umass.edu/econ_workingpaper/343/ https://scholarworks.umass.edu/econ_workingpaper/343/
- kneebonian 4y agoSo there's a big long video by Petar Zeihan at the Iowa Pork Conference but the TL;DR is that the Ukraine and Russia are 2 or the world's 3 leading producers of nitrogen. This is a critical component of fertilizer. Because of fertilizer we weren't just able to make land good for crops better for crops we were able to make land that was marginal for crops good for crops. Because of this we could farm a lot more land; however with less fertilizer suddenly that land can't be farmed. What this means is less arable land = less food. As a result the supply decreases while demand increases, leading to a price increase. So yes it is a real excuse, and the problem is that many nations in the world import more than 50% of their calories and almost no nations on earth are calorically self sufficient.
- legitster 4y agoI mean, 1/4 of the world's grain and fertilizer sources are now in a war zone. It would take some hubris to assume we weren't going to feel that in some way.
- FpUser 4y agoWar in Ukraine is being used by politicians all across the world to distract from their own fuck-ups, power grab, infringement on freedoms etc. etc.
- andrepd 4y agoAcross the EU at least, margins of big-box retailers have gone through the roof. So producers are shafted because fuel and fertilisers are crazy expensive, and consumers are shafted because prices are going through the roof much faster than wages. The middle-man with enough bargaining power to effectively dictate purchasing prices to producers absorbs all the profit, using "the inflation" as a marketing cover.