Restrictions on shipping through key global trade routes are stoking concerns of a coming worldwide food-price shock, with poor countries particularly ill prepared.
Rising fuel prices caused by the instability at the Hormuz and Bab el-Mandeb straits are hitting farmers in parts of the West just as harvest season opens. Meanwhile, escalating bombardments by Russia and Ukraine — which together account for a quarter of the global wheat supply — on each other’s shipping infrastructure are piling pressure on food prices.
Climate change is compounding the issue, with a UN index of food commodities up 2.5% year-on-year. “The risk premium is returning to food markets,” the chief economist of the UN’s Food and Agriculture Organization said.
