How Climate Change Is Impacting Food Supply Chain Trends

WThere is enough food for everyone. Cereal production has slightly dipped, but is still higher than recent years, based on United Nations’ Food and Agriculture Organization data. In addition, there is more production of meat and milk products this year than the previous one. But the world is facing an emerging food crisis. Due to rising food prices, millions are suffering from poverty. At least 19 countries placed restrictions on exports for agricultural goods as a way of fighting hunger.

According to the World Bank, wheat prices had increased 42% since January 2021 as compared with June 30. Over the same time, maize prices increased 47%. Most countries experience food inflation above 5%. The governments have responded by trying to prevent these shocks from happening and by curbing imports.

COVID-19 also contributes to the rise in food prices. Also, the Russia-Ukraine War. Ukraine is a major producer of some of the world’s most vital crops—wheat, corn, and sunflower—and the conflict has virtually cut off its links to the global food supply.

Continue reading: The Food Crisis Can’t Handle Ukraine War And Climate Change

Soaring food prices after Russia’s invasion of Ukraine have plunged some 71.5 million more people into poverty, according to a July estimate from the United Nations Development Programme. They are concentrated in countries such as the Balkans and sub-Saharan Africa.

According to David Laborde of the Washington-based International Food Policy Research Institute(IFPRI), weather events only exacerbate these issues. Laborde is a senior research fellow. “We have strong evidence that it’s also linked to climate change and global warming,” Laborde tells TIME.

One example is rising export restrictions. Malaysia placed restrictions in May on the export of chicken products to Malaysia because its hens are prone to producing fewer eggs during extremely hot temperatures. The recent wheat export ban by India—the world’s second largest producer—came after a heatwave in March and April slashed yields. The grain can be sensitive to extreme temperatures, so yields are lower.

On May 19, 2022, workers load wheat into a trailer in a New Delhi wholesale grain market.

Sonu Mehta/Hindustan Times via Getty Images

Multiple studies have shown that the global trend towards food insecurity is the same: the world’s crop yields will decrease as the climate warms. Experts predict that, as the climate changes worsens we will see more bans on exports as well as a shift in trading patterns to better suit national interests. Climate change increases the risks to food production and distribution, so countries will move toward more regional and “mini-lateral” trade agreements to offset any potential damage from disruptions, says Alex Capri, a researcher at the Hinrich Foundation, a Singapore-based philanthropic organization that supports sustainable global trade. “Climate change is absolutely driving nationalistic behavior.”

Economic leaders will prefer to source goods from nearby countries over from continents even though the former is less expensive. It’s already happening, Capri says, pointing out that “mini-lateral” agreements between strategic and geopolitical allies could be more efficient at solving domestic food crises. The United Arab Emirates, for example, last month said India will export wheat again but for the Emiratis’ consumption only. Both countries have an existing trade agreement that reduces tariffs on all goods and allows them to grow their annual trade to $100 Billion within five years.

Export bans can have multiplier effects

Similar restrictions on food trade have been implemented around the world in previous crises. In 2008, many countries implemented export restrictions for staples to maintain domestic supply amid the oil shock and other disturbances that led to a food shortage.. After trade restrictions drove world rice prices up nearly 1500% in one year, more than a billion were forced into poverty.

These measures can be costly. Although these measures may reduce prices, they also make it less attractive for farmers to start investing in agriculture.

The situation today is much worse. In the weeks that followed Russia’s invasion of Ukraine, data from the IFPRI showed an increase in food export restrictions, with at least 23 nations having issued either outright export bans or curbed export licensing by mid-July. Some countries like Indonesia were only forced to relax export restrictions after small-scale farmers protested.

Continue reading: Global Food Supply Will Be Devastated by Climate Change. But There’s Still Reason to Be Hopeful

As the world warms, there are more droughts and heat waves that can impact crops. Laborde points out that governments don’t always give aid to farmers badly hit by weather and climate shocks, which risks pushing them into bankruptcy.

“We really need more to have governments supporting the farmers and the food system rather than trying to basically punish farmers to protect consumers,” he tells TIME.

Lower food stocks due to weather shocks are more susceptible than ever before to fluctuations in prices. “[If] we had the same kind of crisis five years ago, the market would have reacted differently,” Laborde said, pointing out that since climate change is now constantly slashing crop yields around the world, governments have far less buffer than before.

How to solve the crisis of food prices

Responding to increasingly restrictive food trade policies by nation governments, ministers from 164 countries of the World Trade Organization (WTO), in June agreed to increase food flow across international markets and to remove export restrictions to emergency food aid. WTO Director General Ngozi Okonjo-Iweala says the agreement will help make food and agriculture trade “more predictable” amid “the worst food security crisis in decades.”

In order to provide humanitarian food aid, the member nations pledged not to place restrictions on foodstuffs bought by the World Food Programme. The member countries also pledged to inform the WTO about any restrictions on exports they intend to impose.

An Ukrainian soldier in his pòsition surrounded with wheat plants near the frontlines of the Zaporizhzhia province, Ukraine.

Celestino Arce/NurPhoto via Getty Images

While the WTO agreement is seen by many as historic, it’s still only a promise, as the organization has no enforcement mechanism for those who fail to follow the rules. Daniel Esty, professor of environmental law and policy at Yale University, says the WTO Secretariat isn’t positioned to do much more than convene the countries. “It’s really up to the national governments to step up and ensure that there is free trade broadly…and that there is a flow of food, in particular to the countries most in need of it,” he tells TIME.

The WTO’s recent agreement has been criticized for its benefiting countries that have large agriculture and big food corporations, while not supporting small and medium food producers. Corinna Haynes, Director of the Center for Food Policy at City University of London says that diversifying voices would help to improve food trade policy. The private sector influences national leaders’ decision making for food systems, but Hawkes says she believes inviting those who are directly hit by the crisis into the decision making process—small-scale farmers, women, and the youth—will result in more inclusive solutions.

Whether it’s tackling racial, gender, economic, or other social inequalities, “communities can find solutions that work for them if they are given the opportunity to co-design those solutions,” she tells TIME.

Future of global trade system

There may be unexpected environmental benefits as geopolitics and climate changes push countries to source food closer to their home.

India and the United States are major grain exporters. They use huge amounts of freshwater just to cultivate enough crops to export them to other countries. When crops are grown with climate-resilient technology, like precision agriculture or locally produced, they use less water. Reduced export distances mean that less transport fuel is required. Shorter supply chains mean more stakeholders, such as consumers and farmers, have access and can lead to greater sustainability.

Continue reading: Ukraine Crisis shows how fragile food systems can be

This shift toward regional trade pacts, however, doesn’t mean the end of globalization, say some experts. Hawkes believes international trade and globalization are in a transition phase. Countries will try harder to diversify food sources to increase their security.

“It appears to be deglobalization—in a way it is,” says Hawkes. “But increasingly trade is about not just trading goods, but trading services… finance… data. So, countries will still be making use of these forms of globalization, in producing food in their own countries.”

Read More From Time

Reach out to usSend your letters to


Related Articles

Back to top button