The disruptions from the Ukraine crisis, and sanctions come atop pre-existing dysfunctions in the Western “market” economy, in which there are already shortages in food, electronic components, chemicals, and shipping breakdown, as well as fuel crises, etc. Nations are scrounging for food.
Look at the dire situation in Middle East-North Africa, a region import dependent for wheat, and now it’s nearly not to be had. For example, Egypt. In 2021, Egypt imported 6.1 million metric tons of wheat, over 80% from Russia and Ukraine. By Feb. 24, Egypt had to withdraw an international tender for wheat (to be delivered April 13-26) because there was only one bidder, and by Egypt law, there must be more than one offer for a tender to be valid. A new tender was then put out, and three bids did show up (two French, and the other, very unusually, U.S.) by the Feb. 28 deadline. In contrast, an Egyptian tender earlier in February had 17 bids. Besides locating grain for sale, the question is whether it can be shipped.
Egypt has a stockpile which could see it through for nine months, but for security it has to keep lining up imports. Russia last year provided Egypt with 4.2 mmt of wheat, worth $1.2 billion, representing 69.4% of total Egypt wheat imports. Ukraine sent 651,400 tons, worth $649.4 million, accounting for 10.7% of total imports. The remainder of Egypt’s wheat imports came from Australia and Romania.
