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Food for thought: how global crises are affecting food security in Africa

Part one of a three-part series on the state of food security in South Africa.

The COVID-19 pandemic; outbreak of war in Ukraine; a looming European energy crisis – 2022 has been a difficult year. How are global troubles affecting food security in South Africa and the rest of the continent?

While the pandemic put pressure on international supply chains, the Russia-Ukraine war has disrupted the global food production system. Between them, Russia and Ukraine produce about a third of fertiliser’s essential ingredients, 30% of global wheat and barley exports, 65% of sunflower seed oil, and 15% of corn. In Ukraine, it is projected that grain harvest will be well below their annual average for 2022 – 2023 by approximately 30 million tonnes. Although some relief was attained with the release of 20 million tonnes of grain from the Black Sea ports in July this year, there are still significant inland bottlenecks affecting the supply chain. 

Rising prices linked to the war threaten many (mostly developing) countries, including in Sub-Saharan Africa. According to experts from McKinsey speaking on the global management consultants’ podcast, food challenges will probably be significant. This compounds complications arising from as early as 2020 when the COVID-19 pandemic began and the price of corn and wheat rose to 40 – 50% higher than the average price over the last decade. 

“This conflict (is) shaking important pillars of this system in an already disturbed context… (creating) a whiplash effect in the food supply chain. It’s hard to fully project the implications, but this crisis will have clear secondary effects,” says Daniel Aminetzah, leader of McKinsey’s Chemicals and Agriculture Practices.

The problem with wheat

Over 80% of wheat is primarily used for flour, making it critical to global food security. Skyrocketing wheat prices have naturally increased the price of bread. “Bread is an important factor in social unrest in many emerging markets. Over a decade ago, for example, wheat prices were considered one of the main sources for the Arab Spring,” notes Aminetzah.

The possibility of social unrest was also raised by Akinwumi Adesina, African Development Bank Group president. He said that Africa is facing a shortage of at least 30 million metric tons of food – mostly wheat, maize, and soybean imported from Russia and Ukraine. Adesina predicted the possibility of a catastrophic famine affecting some 30 million people: “(This food insecurity) could deepen economic stress and political unrest. With millions struggling to buy food, fuel, and fertiliser, anti-government protests are a real possibility.”

Is South Africa at risk?

The World Economic Forum (WEF) has warned of “dire human consequences from the fragmentation of the global economy”. In this context sub-Saharan Africa is one of the regions facing the worst food insecurity in recent history, as well as the risk of a debt crisis resulting from the need to secure food and fuel. However, Wandile Sihlobo, chief economist at the Agricultural Business Chamber of South Africa, believes that South Africa is less at risk than other African countries: “South Africa is in a relatively fortunate position because of its vibrant agricultural sector, which cushions the country against food shortages in the foreseeable future.” 

Sihlobo admits that consumers will still feel price increases, conceding, “There are rising concerns about the 2022/23 global grains and oilseeds supply amid dryness in parts of the US, and Europe, where planting remains behind the usual pace.” He also notes that African countries, including South Africa (albeit to a lesser extent) will be vulnerable to prices already elevated by relatively poor South American and Asian harvests. This is exacerbated by growing Chinese demand for grains and oilseeds.

Sihlobo says that the chamber does not foresee food supply shortages in South Africa, but notes that the risks of price variations and increases are compounded by higher fuel prices. Food insecurity is, regardless, a major problem for many South African households, “the results not only of higher food prices but the general absence of household income. This is a question of socio-economic policy, not merely agriculture and the food industry,” he explains.

Echoing this is a report by the Centre for Economic Policy Research (CEPR). The report suggests that net importers of energy and agricultural commodities will suffer the most, and South Africa is among them. Real incomes in South Africa may decline by as much as 3.39% with poorer households bearing the brunt.  

According to a report released by Statistics South Africa, almost a quarter of South Africans were affected by moderate to severe food insecurity between 2017 and 2020, with almost 15% suffering from severe food insecurity. Since the start of the pandemic, food insecurity has remained high. One-quarter to one-third of South African households were affected by hunger almost daily

Ripple effects from the European energy crisis

The Ukraine war has sparked an impending European energy crisis. In August, speculation about an imminent cut-off of Russian gas flows resulted in record-breaking prices on the Title Transfer Facility (TTF). This virtual marketplace based in the Netherlands is the European gas trade hub, and soaring prices threaten the whole European Union.

Because natural gas accounts for 70% of fertiliser production (phosphates), this too will become more expensive. An International Fertilizer Association report, meanwhile, warned of a shortfall in Sub-Saharan Africa’s fertiliser use (as much as 23% compared to last year). 

Despite Sihlobo’s optimistic outlook, higher fertiliser prices may impact Africa’s food supply by making food less abundant and more expensive. Africa still has a limited fertiliser usage – approximately 25kg/ha in comparison to the world’s 121kg/ha. A decrease in fertiliser use could thus result in much lower production for the continent, with serious food security consequences.

These massive disruptions are having ripple effects internationally, but all is not lost. “I hope it’s a wake-up call to policymakers around just what’s at stake when it comes to food security and the impact and intersection between food and climate,” says Sam Kass, partner at sustainable agriculture investment specialists Acre Venture Partners. “Food’s been left out of the dialogue almost entirely: it’s the number two driver of emissions globally, it’s also the system most directly affected by climate itself. What’s emerging in our food system is an opportunity to help solve the climate crisis… there are very few sectors that can have a net-positive result on sequestering carbon.”

Coming up: later this month, we will discuss what future implications these food insecurity issues may have for South Africans and others around the world, including the opportunity the food sector presents to have a positive impact on climate change and global emissions. 

Agricultural supplier development, boost food production, energy crisis, food crisis, Food garden, food insecurity, food security, , state of food security
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