Rabat – Ukrainian crop production is estimated to decline by 35 to 45% for the upcoming harvesting season, according to consultancy firm McKinsey.
Forecasts show that Ukrainian crop exports are set to fall by 30 to 40 million metric tonnes, compared to prewar levels, for the 2022-23 marketing year, contributing to a 5-10% decline in global grain trade by the third quarter of 2023.
McKinsey explained the decline as the reduction in productive farmland, due to ongoing military operations and land mines, as well as the lack of farmers’ liquidity as they were unable to export a large share of last year’s harvest.
The current surge in fuel and fertilizer prices as well as logistics costs are also expected to contribute to the largest decline in Ukrainian agricultural output in the past decade.
Rising food prices resulting from the ongoing war are forecasted by McKinsey to accentuate inflation, budgetary and fiscal stress, as well as malnutrition and hunger in numerous countries including highly vulnerable ones such as Bangladesh, Ethiopia, Somalia, and Yemen.
“Historically, supply shocks within the food system have led to inflation, lower fiscal strength, and malnutrition—and in some cases, to periods of political instability and violence,” the company explained, adding that “the caloric requirements of 250 million people could be lacking from the global supply.”
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The consulting firm also noted that 1.4 billion people in Africa and Asia are highly vulnerable to supply shocks of corn or wheat, with this number potentially rising to 1.9 billion as reserves drain.
Earlier this week, Akinwumi Adesina, president of the African Development Bank (AfDB), said that the war in Ukraine has led to a food shortage of 30 million metric tonnes which was estimated to lead 30 million Africans into “catastrophic levels of food security.”
Adesina further warned of the heightening of economic crisis and political instability across Africa due to the surge in food and fertilizer prices, as well as the disruption of supply chains due to the war.
The recent reopening of Ukrainian ports is seen as a glimpse of hope for Africa, but the lingering consequences of the war as seen in the cut in Ukraine’s crop production are expected to be felt over the upcoming months and years.
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