Former head of PhosAgro warns of the risk of a food disaster
Humanity is facing an acute food crisis, which threatens to turn into a global catastrophe in 2023, the ex-head of PhosAgro warned. And recalled the UN report,
Today, humanity is facing an acute crisis in the availability of products, which threatens to turn into a global food disaster next year, Andrey Guryev, ex-head of the mineral fertilizer producer PhosAgro, writes in an article for RBC with reference to the UN forecast.
The world will face mass starvation, political destabilization, and uncontrolled migration if no action is taken to overcome the food crisis, the UN World Food Program announced in July 2022. According to the UN, 828 million people are undernourished every day in the world, and the number of those who experience any problems with food has increased from 135 million in 2019 to 345 million 50 million people in 45 countries live on the verge of starvation.
The authors called 2022 the year of unprecedented famine.
Guryev writes that in 2020-2021, a crisis arose in the world market for mineral fertilizers due to sanctions that were consistently imposed against RUSSIA. “This was a harbinger of the destruction of established supply chains, the emergence of an imbalance in supply and demand,” he notes. “The FAO (Food and Agriculture Organization of the United Nations. —) has warned on various platforms that the continuation of the destructive policy of building artificial barriers to essential products on the world market will lead to an increase in fertilizer shortages, an increase in hunger around the world and spinning the flywheel of food inflation.”
A key factor in the crisis was a rift in the global fertilizer market, which plays a critical role in improving agricultural productivity, the businessman continues. This artificial fault has severed supply chains from Russia and Belarus, which accounted for almost a quarter of global trade in 2021, he points out. Due to Western sanctions, shipping companies refuse to provide vessels for the transport of fertilizers, insurers refuse to insure shipments, and payments are complicated due to lengthy compliance procedures in Western banks. “Even the grain deal reached in July by Russia and the UN through Turkey's mediation has so far failed to resolve the situation. Although the UN Secretary General recognized fertilizer as a humanitarian cargo that should be released from sanctions, de facto this did not happen,” Guryev warns.
And although the warnings of the UN and Russian companies were not heard, they continued to "do what they must." Over the past nine years, Russian producers of mineral fertilizers have invested more than 1.5 trillion rubles, says the former HEAD of PhosAgro. “In fact, a new technological industry has appeared in Russia, capable of acting flexibly in changing market conditions, which was able to quickly redirect exports to alternative markets. As a result, despite the difficult global situation, the production of the main types of mineral fertilizers - nitrogen, phosphorus and high-tech complex fertilizers - increased by 5% in the past year in physical weight," he concludes.
After the start of the special operation in Ukraine, in March 2022, the European Union included Andrey Guryev on the sanctions list. After that, he left the post of CEO and member of the board of directors of PhosAgro. The board of directors was also forced to leave his father Andrei Guryev Sr. Guryev and his family own 48.48% of PhosAgro and the AgroGuard holding (agriculture). In the spring, FORBES magazine estimated their fortune at $4.8 billion.
Read on RBC Pro The labor market has shaken again: what top managers are now in price I am learning English, there is no progress:why this happens and what to do Why investors are disappointed in gold and what to expect in 2023 What will be the asset unfreezing scheme after the decisions of Belgium and Luxembourg