The coronavirus outbreak could disrupt global food supply chains and send prices soaring. According to the World Health Organization (WHO), the United Nations Food and Agriculture Organization (FAO) and the World Trade Organization (WTO), there is a serious risk of food shortages globally in April and May due to large-scale lockdowns, shortage of agricultural labourers during harvest season and disruption in food supply chain due to measures taken by Governments to stem the spread of coronavirus.
India has enough stock to tide over the coronavirus outbreak while the Ministry of Agriculture has asked farmers to delay the harvest till April 20 due to the lockdown.
Expressing concerns in a joint statement, the WTO, FAO and WHO said uncertainty about food availability can spark a wave of export restrictions, creating a shortage in the global market. The FAO said disruptions to food supply could occur during April and May if authorities fail to manage the continuing coronavirus outbreak properly.
“As the world is witnessing a lockdown in most parts of it, the food supply chain has suffered a severe disruption. This is also aggravated by panic buying and hoarding of essentials, which has demonstrated the fragility of supply chains in many countries,” the FAO said.
The FAO said the world risks a “looming food crisis” unless measures are taken fast to protect the most vulnerable, keep global food supply chains alive and mitigate the pandemic’s impacts across the food system.
“Harvests have been good and staple crops remain in demand, but a shortage of field workers brought on by the pandemic and a move towards protectionism — tariffs and export bans — could lead to problems in the coming weeks. Food processors, who handle the vast majority of agricultural products, could also be prevented from processing the farm products,” it said.
Panic-buying by people has already demonstrated the fragility of supply chains as supermarket shelves have been emptied in many countries. If agriculture workers are legally unable to harvest crops, it could cause a lapse in food flow.
“As of now, disruptions are minimal as food supplies have been adequate. But price spikes are more likely for higher value products like meat and perishable commodities rather than for major staples which are still in adequate supply,” said the FAO.
Kazakhstan, for instance, according to a report from Bloomberg, has banned exports of wheat flour, of which it is one of the world’s biggest sources, as well as restrictions on buckwheat and vegetables including onions, carrots and potatoes.
Vietnam, the world’s third biggest rice exporter, has temporarily suspended rice export contracts. Russia, the world’s biggest wheat exporter, may also threaten to restrict exports, as it has done before, and the position of the US is in doubt given Donald Trump’s eagerness for a trade war in other commodities.
Australia, which is a net food exporter, is already facing difficulty keeping food on store shelves, as panic buying in the face of the pandemic has increased demand, social research house McCrindle said.
India already has a buffer stock of 30 lakh tonnes of sugar, which the Government is planning to raise to 40 lakh tonnes this fiscal. In the cases of pulses, the Ministry of Food and Consumer Affairs has been trying since December to offload 8.47 lakh tonnes from its buffer stock of pulses.
The UN Committee on World Food Security sounded an even stronger warning that “disruptions at borders and in supply chains may cause an echo in the food system with potentially disastrous effects”.
In another report the “World Economic Situation and Prospects: April 2020”, the United Nations Department of Economic and Social Affairs (UNDESA), said the global economy could shrink by almost one per cent in 2020, as a result of the COVID-19 pandemic. According to the update, the COVID-19 pandemic could cause global Gross Domestic Product to shrink by 0.9 per cent in 2020, instead of growing 2.5 per cent as originally projected.
