UK to hold international summit to tackle supply chain issues caused by Russian invasion of Ukraine

Mon 11 Sept 2023
Posted by: Danielle Keen
Trade News
Grain ship loading products in Ukraine

Prime minister Rishi Sunak has announced an international food summit to tackle food insecurity caused by Ukraine-Russia shipping disruption.

In an announcement on Friday (9 September), Downing Street said that the UK will host the event in November to coordinate the support effort.

The summit will feature government representatives, including delegations from countries more vulnerable to food supply chain shocks, policy experts and NGOs.

The Ministry of Defence (MoD) will also lead a surveillance and reconnaissance operation in the Black Sea to protect Ukrainian cargo ships.

‘Risk of escalation’

Assessing the UK’s proposal, Matt Vick, trade and customs specialist at Institute of Export & International Trade (IOE&IT), said:

“Having a UK military presence in the area should act as a greater deterrent to any aggression against Ukrainian shipping, but of course there are huge risks of escalation here that should be considered.

“Protecting these exports will help alleviate affected nations, like Egypt, Jordan, Kenya and Tunisia, which are already suffering with economic pressures and food shortages.”

BSGI breakdown                                                                                      

The government felt that intervention became necessary following the breakdown of the Black Sea Grain Initiative, which saw Russia agree to cease attacks on Ukrainian vessels.

The initiative was brokered by the UN and Turkey in July 2022 to ensure food and fertiliser could be exported safely.

However, Russia withdrew from the agreement in July, claiming clauses enabling the export of its own grain had not been honoured.

Both Moscow and Kyiv have since announced that all ships approaching Black Sea ports would be considered military vessels.

Food insecurity

Ukraine has been dubbed a ‘breadbasket of the world,’ capable of producing enough grain to feed 400m people during peacetime.

Pre-war, the country was the world’s 5th largest wheat exporter, 4th largest corn exporter and 3rd largest rapeseed exporter.

The UN’s World Food Programme (WFP) believes Ukraine’s diminished capacity to produce and ship grain has contributed to a rise in food insecurity. WFP reserach found that 349m people across 79 countries faced acute food insecurity, an increase of 200m from pre-pandemic levels.

Overdependence

However, as Vick noted, it’s not only Ukraine’s ability to ship grain internationally that’s prevented by the war:

“Farmland and equipment have been destroyed, and workers pulled into the conflict.

“This, in addition to the damage to infrastructure, like grain silos and ports, makes it unlikely Ukraine will be able to achieve the same volume of production or exports.”

Vick says that to properly address food insecurity, “the international summit should address the root causes leading economies to become reliant on Ukrainian grain exports, and work towards finding alternative sources.”