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Russia’s invasion of Ukraine will deliver a catastrophic hit to global food supplies, the head of Norwegian fertiliser maker Yara International has said.
Svein Tore Holsether, chief executive of Yara, which operates in more than 60 countries and buys essential raw materials from Russia, said the international community must reduce its dependence on the Russians for food and described the war as "a catastrophe on top of a catastrophe".
With the global food supply chain already vulnerable to shocks, the war will increase food insecurity in poorer countries, Mr Holsether said. He spoke of an additional 100 million people suffering from hunger over the past two years.
The cost of fertiliser had already been high amid soaring wholesale gas prices but that situation will only worsen, he said.
“We were already in a difficult situation before the war … and now it’s additional disruption to the supply chain and we’re getting close to the most important part of this season for the Northern Hemisphere, where a lot of fertiliser needs to move on and that will quite likely be impacted," Mr Holsether said.
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Cars are left abandoned on a road as residents flee the town of Irpin, Ukraine after days of heavy shelling. Reuters -
A Ukrainian soldier helps a family fleeing from Irpin. Reuters -
A bus passes the Duke of Wellington statue, which has a traffic cone in the colours of the flag of Ukraine placed on top of it, in Glasgow, Scotland. AP -
Ukrainian children sleep at the reception point at the train station in Przemysl, Poland. Reuters -
Smoke rises as a Ukrainian soldier stands by the only escape route used by locals to flee from the town of Irpin. Reuters -
A man flees from Irpin. Reuters -
A screengrab from footage released by the Russian Defence Ministry shows a purported Russian tank unit advancement in the Kyiv region. AFP -
People walk on debris of residential buildings damaged by shelling in the Zhytomyr region. Reuters -
A damaged residential building after Russian multiple rocket launchers shelled the area in the southern city of Mykolaiv. AFP -
Ukrainian soldiers sit in their armoured vehicle after fighting against Russian troops and Russia-backed separatists near Zolote village, Luhansk region. AFP -
A woman offers accommodation for people fleeing Ukraine at the main railway station in Berlin, Germany. Getty Images -
A soldier holds a helmet as a wedding crown during the ceremony for members of the Ukrainian Territorial Defence Forces Lesia Ivashchenko and Valerii Fylymonov, at a checkpoint in Kyiv. AP -
Ukrainian soldiers carry a woman fleeing the town of Irpin. AP -
A factory and warehouse burn after being bombarded in Irpin. AP -
Ukrainian soldiers near Zolote. AFP -
A Ukrainian refugee boy, wearing a blanket on his shoulders, warms his hands with a gas heater shortly after crossing the Siret border into northern Romania. EPA -
People demonstrate against the Russian military operation in Ukraine in Buenos Aires, Argentina. EPA -
First responders work at the scene after a missile hit a building at Havryshivka Vinnytsia International Airport in Vinnytsia, Ukraine. Reuters -
A woman at a checkpoint on the road to Kyiv after her evacuation from a nearby town. AFP -
A placard in the Ukrainian colours is held up at an anti-war demonstration the Bebelplatz square in Berlin, Germany. Reuters -
A Ukrainian serviceman helps an elderly woman in Irpin, 20 kilometres north-west of the capital Kyiv. AP Photo -
Protesters cry during a demonstration in support of Ukraine at the Plaza Catalunya square in Barcelona. AFP -
A man walks past a machine gun at a checkpoint next to the last bridge on the road that connects the town of Stoyanka to the outskirts of Ukraine's capital Kyiv. AFP -
Ukrainian servicemen put a wounded man on a stretcher in Irpin. AP Photo -
People board a train to return to Ukraine after getting supplies in Zahony, Hungary. AP Photo -
Balloons in the colors of Ukraine during a demonstration against the Russian attack on Ukraine, in Mainz, Germany. AP -
A Ukrainian girl helps to weave a camouflage net for the Ukrainian army, in Odesa. EPA -
Molotov cocktails prepared by a group of volunteers in Odesa. Hundreds are made every day. EPA -
Ukrainian servicemen assist people fleeing the town of Irpin after crossing the Irpin River on an improvised path under a bridge that was destroyed by a Russian air strike. AP Photo -
A woman holds a dog while crossing the Irpin River on an improvised path under a bridge that was destroyed by a Russian airstrike, while assisting people fleeing the town of Irpin, Ukraine. AP Photo -
Marina Yatsko and her boyfriend Fedor comfort each other at a hospital in Mariupol after her 18-month-old son Kirill was killed by shelling. AP Photo -
Ukrainian civilians receive weapons training in a cinema in Lviv, western Ukraine. AP Photo -
Residents flee the town of Irpin, near Kyiv, Ukraine. AP Photo -
Ukrainian soldiers carry a sick woman as civilians flee Irpin, on the outskirts of Kyiv, after Russian attacks. AP Photo -
Captured Russian soldiers at a press conference in the Interfax news agency in Kyiv, Ukraine. AP Photo -
Ukrainians beneath a destroyed bridge in Irpin. AP Photo -
A woman fleeing Ukraine on a bus near the border crossing in Korczowa, Poland. AP Photo -
A Ukrainian soldier and a militia man help a fleeing family on the outskirts of Kyiv, Ukraine, on March 5, 2022. AP Photo -
Smoke rises after shelling by Russian forces in Mariupol. AP Photo -
People at a hospital during shelling by Russian forces in Mariupol. AP Photo -
Displaced Ukrainians at the Resurrection New Athos Monastery in the western Ukrainian city of Lviv. AFP
Ukraine and Russia are major exporters of some of the world's most basic foodstuffs, together accounting for about 29 per cent of global wheat exports, 19 per cent of world corn supplies and 80 per cent of sunflower oil exports.
But Russia also exports crop nutrients as well as natural gas, which is critical for producing nitrogen-based fertilisers.
In total, 25 per cent of the European supply of nitrogen, potash and phosphate – vital ingredients in fertilisers, which enable plants and crops to grow – comes from Russia.
"With the geopolitical conditions out of balance, the biggest sources of raw material to Europe's food production are being subject to limitations and there are no short-term alternatives," Yara International said.
With half of the world’s population getting food “as a result of fertilisers”, Mr Holsether said if that product was removed from the field, agricultural yield would drop by 50 per cent.
“It’s not whether we are moving into a global food crisis, it’s how large the crisis will be,” he said.
The Norwegian company, which is one of the world's biggest fertiliser producers, supplies Ukraine's agricultural sector and is a big buyer of raw materials, such as phosphate and potash, from Russia, which also supplies Europe's nitrogen fertiliser plants with natural gas.
Sanctions against Russia are already affecting Yara’s operations, with the company finding it harder to secure deliveries due to shipping industry disruption.
Yara’s offices in Kyiv were hit by a Russian missile, though its 11 staff members were unharmed.
The Russian government has urged its producers to stop fertiliser exports, adding another layer of jeopardy to the global food supply.
Natural gas is vital for global agriculture as it is used to produce ammonia – another key ingredient in nitrogen fertiliser – and Yara has long been importing Russian gas to its European plants.
David Beasley, executive director of the World Food Programme, said last week that war in Ukraine would have a profound effect on the organisation's ability to reach the 120 million people it feeds. He said food, fuel and shipping costs would "skyrocket" in what he described in a Twitter post as "an absolute catastrophe".
Mr Holsether said the world must reduce its dependency on Russia in the long term for global food production.
Yara was already struggling before the Russia-Ukraine war started, suspending production at its plants in Europe when the surge in wholesale gas prices hit home and shipping rates escalated.
Meanwhile, wheat futures have soared in recent days on concerns that Russia's invasion of Ukraine, which began on February 24, will continue to disrupt grain shipments from the Black Sea region.
"One potential consequence is that only the most privileged part of the world population gets access to enough food," Yara said. While high prices may have a short-term positive effect on profit, they would lead to an unsustainable food system, leading to starvation and even conflict in the long term, the company said.
"It is therefore crucial that the international community comes together and works to secure world food production and reduce dependency on Russia, even though the number of alternatives today is limited," Yara said.
Fertiliser prices rose sharply in the final months of 2021, tracking soaring natural gas costs. This is leading to higher food prices, which could in turn result in famine for the most vulnerable, Yara said in October.
