The 2022 food crisis: Big politics and market uncertainty

Cholpon Toktosunova; Karim Sattarov

The 2022 food crisis: Big politics and market uncertainty

Abstract

The purpose of this study was to analyse the political and economic factors that led to the aggravation of the global food crisis in 2022 and to assess the effectiveness of international mechanisms to overcome it. The study found that the Russian-Ukrainian war, the energy crisis, and macroeconomic instability were the key factors behind the crisis. It was found that the blocking of Ukrainian ports and restrictions on grain exports from Ukraine and Russia led to a significant shortage on the world market and a rapid rise in food prices. The analysis showed that rising energy prices led to an in- crease in production costs in the agricultural sector, especially for fertiliser production, which had a negative impact on the cost of agricultural production. High global inflation and exchange rate fluctuations were found to have put additional pressure on food markets, especially in developing countries. The study found that high market uncertainty and increased financial speculation in agricultural markets led to increased price volatility and a disconnect between stock prices and fundamental supply and demand factors. It was found that the introduction of export restrictions by many agricultural producing countries further increased market uncertainty and led to further price increases on the world market. The analysis of the effectiveness of policy decisions and international initiatives showed that national measures, such as increased public food purchases and expanded social support programmes, helped stabilise internal markets, but their effectiveness varied depending on the economic capacity of each country. It was found that international organisations played a key role in coordinating global efforts to overcome the crisis, but the effectiveness of their actions was often lim- ited by the difficulty of access to conflict zones and insufficient funding. The practical significance of the obtained findings lies in the possibility of their use for forecasting the political and economic situation in the context of future food crises

Keywords

global security; agricultural production; export restrictions; energy crisis; macroeconomic instability; inflation; currency fluctuations

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Suggested citation

Toktosunova, Ch., & Sattarov, K. (2024). The 2022 food crisis: Big politics and market uncertainty. Foreign Affairs, 34(4), 55-67. https://doi.org/10.46493/2663-2675.34(4).2024.55