United Nations Secretary-General, António Guterres has warned that the whole world might face food insecurity next year if the fertiliser market is not stabilised.
In a Twitter post seen by Pindula News, Guterres urged “all countries” to ensure the exportation of fertilisers from Russia is done without any hindrance. He said this Friday:
If the fertilizer market is not stabilized, next year the world may run out of food. It is essential that all countries remove every remaining obstacle to the export of Russian fertilizers. We need to get them to farmers at a reasonable cost & on to fields as soon as possible.
Some context:
Western countries imposed sanctions on Russia early this year following the Kremlin’s invasion of Ukraine on 24 February this year making it impossible for Russia to export its product.
Meanwhile, the United Nations has proposed that Russia resume exporting ammonia via Ukraine raising hopes that a global shortage of fertilizer could be eased, and in turn alleviate world food shortages exacerbated by the conflict in Ukraine.
The United Nations proposed that ammonia gas owned by Russian fertiliser producer Uralchem be pumped by pipeline to the Ukrainian border, where it would be bought by the U.S.-based commodities trader Trammo.
The pipeline is designed to pump up to 2.5 million tonnes of ammonia per year from Russia’s Volga region to Ukraine’s Black Sea port of Pivdennyi, near Odesa. It was shut down after Russia invaded Ukraine.
Part of the pipeline runs through the Mykolaiv region in Ukraine where there is regular shelling, though it has to date avoided any damage.
Why is this important:
Ammonia is a key ingredient in the manufacture of nitrate fertiliser, which farmers including wheat producers need when they sow crops in autumn and spring, for good yields and protein content.
A steep rise in European gas prices has triggered a global shortage of nitrogen fertiliser. The Russian fertiliser industry estimates that up to 70% of European ammonia plants have suspended or reduced production.
Farmers in France are currently 20 percentage points behind the level of fertiliser cover seen a year ago and are concerned about 2023 crops.
Western sanctions imposed on Moscow since February 24 have not directly targeted fertiliser exports, but Russian producers lost access to the Baltic Sea ports that they had used, along with the pipeline, to ship their ammonia.
Uralchem is considering building an export terminal for ammonia in Russia’s Black Sea port of Taman, but this would take more than a year, according to Reuters.
Russia used to export 4.4 million tonnes of ammonia a year – 20% of the global seaborne trade. Some 2.5 million tonnes went through the pipeline and 1.9 million via Baltic ports.
The Russian ammonia used to go mainly to fertiliser producers in Morocco, Turkey, Southeast Asia and Africa, whose output the United Nations is keen to restore to help ease the global food crisis.
WHAT NEXT?
Ammonia is part of a U.N.-brokered deal that Ukraine, Russia and Turkey signed in July to re-establish grain exports from Ukraine’s Black Sea ports that Russia had blockaded.
Moscow’s agreement is needed for the deal to be extended beyond late November, giving it a lever to ensure it can export ammonia.
A fortnight ago, the president of Russia, Vladimir Putin complained about the deal saying Russian fertiliser exports were still being hindered.