A bitter harvest from the war in Ukraine

Russia’s invasion of Ukraine in February last year raised food prices worldwide, disrupted industries and caused a shift towards renewable energies, The Guardian reports.

The invasion has “fundamentally changed” the world in the past year, the newspaper said in an assessment headlined “Bitter harvest for some in a global economy changed by Russia’s war”.

“Trends that were already in motion have accelerated, as the need to move away from fossil fuels to greener, renewable energy supplies became more urgent. Food prices have soared, increasing hunger in the developing world and forcing governments, businesses and people to adapt to lasting shifts.”

The surge in global energy prices since the invasion has pushed inflation across advanced economies to its highest levels in decades, the newspaper said, squeezing household incomes and weighing on economic growth.

Poor countries were particularly hard hit by the rise in energy, fertiliser and grain prices.

“Russia and Ukraine are, respectively, the world’s largest and fifth-largest exporters of wheat, accounting for almost a third of global exports. They are also significant producers of fertilisers and other essential commodities. As war disrupts these supplies, food prices have rocketed to unprecedented levels”.

Developing nations that are net importers of food were particularly exposed. Not only had the Ukraine war pushed up food prices, but a stronger dollar had made it additionally expensive to import food and to borrow on markets denominated in US dollars.

The report said Russian president Vladimir Putin had “unwittingly accelerated the transition to renewables” as Western countries reduced their reliance on Russian oil and gas.

It quoted a consultancy as saying, “The past year has seen a fundamental shift away from coal and gas power, with support for renewables taking on new urgency that shows no sign of waning”.