The negative impact on global food security of sanctions against Belarusian potash fertilizers
08.08.2023The Republic of Belarus has repeatedly raised the issue that sanctions against Belarusian potash fertilizers, including Lithuania’s illegal ban on the transit of Belarusian potash, threaten to cause world hunger and endanger global food security. Aides-mémoires from Belarus on this matter have been issued as official documents of the United Nations General Assembly (A/76/513, A/76/677 and A/77/809).
However, Lithuania continues to claim that Belarus’ contribution to global food security is supposedly insignificant, despite Belarus having a 20 per cent share in the global trade in potash fertilizers up until 2022.
The shortage of potash fertilizers as a result of the restrictive measures imposed against Belarusian potash has led to a shortage of potash fertilizers on the world markets and to an increase in their price and, consequently, a reduction in their use, lower crop yields and higher food prices. The situation is particularly dangerous in the least developed countries of the world, with the potential for widespread hunger.
The following conclusions have been drawn by reputable international organizations and agencies.
1. The briefs of the Global Crisis Response Group on Food, Energy and Finance established by United Nations Secretary-General Guterres, issued on 13 April 2022 and 8 June 2022, note that, together, Belarus and the Russian Federation export around a fifth of the world’s fertilizers. In addition, a loss of fertilizer supply from the Russian Federation and Belarus has led to fertilizer prices rising even faster than food prices. Many farmers, and especially smallholders, are thus squeezed to reduce production, as the fertilizers they need become more expensive than the grains they sell. Furthermore, because of this key fertilizer issue, global food production in 2023 may not be able to meet rising demand. It is also noted that one out of every two people worldwide depend on agricultural products that use fertilizers.
2. According to the joint recommendations of the Food and Agricultural Organization of the United Nations (FAO) and the World Trade Organization to the Group of 20, entitled “Global fertilizer markets and policies”, dated 14 November 20221:
- Global fertilizer prices have risen significantly;
- The price increase has been facilitated by the reduction of fertilizer supplies to the world markets;
- Exports of potash fertilizers from Belarus declined sharply from 3.62 million tons in the first quarter of 2021 to 1.95 million tons in the first quarter of 2022. Import statistics for the most recent months suggest that the decline in supplies from Belarus has accelerated;
- Africa only accounts for 3 to 4 per cent of global fertilizer use, of which approximately 50 per cent of its fertilizer supplies nutrify Africa’s all-important cash crops. Consequently, contractions in fertilizer use would have severe ramifications, including undermining the food security of some agrarian-based communities;
- Every effort should be made to keep international trade in fertilizers open to meet domestic and global demand.
3. According to an article from the International Food Policy Research Institute (IFPRI) dated 9 November 20222:
- As a result of the sanctions, Belarusian potash fertilizer exports decreased from 9.1 million tons (1 December 2021) to 3.9 million tons (1 December 2022);
- Potash importers may refuse to buy from Russia and Belarus due to the additional costs and risks associated with doing business with the countries subject to sanctions.
4. From a World Bank article dated 5 January 20233:
- Global potash prices were $562 per ton as at 1 December 2022, compared to $221 per ton as at 1 January 2022;
- Potash exports from Belarus have fallen by more than 50 per cent due to the restriction on using European Union territory for transit purposes. In particular, Lithuania has halted the use of its railway network to transport Belarusian potash to the port of Klaipeda, which typically handles 90 per cent of Belarusian exports.
5. From the concluding observations of the Committee on Economic, Social and Cultural Rights on the third periodic report of Lithuania, dated 30 March 20234:
- The Committee remains concerned by recent measures taken by the State party that have prevented transportation of potash from Belarus destined for third countries in Africa and Latin America, leading to a shortage of fertilizer and adversely affecting food security in those countries;
- The Committee recommends that the State party review the recent measures that have had an adverse effect on the price of fertilizer and on food security in third countries.
This is far from an exhaustive list of such publications.
In 2021, Belarus and Russia almost equally accounted for more than 40 per cent of potash supplies, with 35.9 per cent covered by Canada and 5.8 per cent by the United States of America.
Belarus’ share in the global potash trade in 2022 decreased to about 9 per cent and Russia’s share was around 16.4 per cent. As a result of the drop-off in volumes from Belarus and Russia, potash fertilizer prices simultaneously increased.
The sanctions imposed on the potash industry of Belarus therefore became one of the main reasons for a significant rise in fertilizer prices in 2022, resulting in a sharp rise in the price of ready-to-eat food products.
For example, the price of potassium chloride in Brazil in 2022 reached an all-time high of $1,200 per ton. The impacts of this shock were felt for a long time by international buyers of Brazilian agricultural products, when the price of some types of ready-to-eat food products increased by almost five times.
In 2023, according to the World Bank’s April forecast, on average, the world price for potash fertilizers will roll back to $475 per ton, and to $425 per ton in 2024. However, potash prices in both 2023 and 2024 will be higher than in 2021 (the period when the restrictive measures were imposed on Belarusian potash).
It should be recalled that, according to the World Bank, global potash prices as at 1 January 2022 were $221 per ton. Despite a slight drop in prices, affordability for farmers is still low.
Vulnerable countries are the most affected by the sanctions.
Belarus’ share in Africa’s potash markets decreased from 41.7 per cent to 2.8 per cent in 2022. While Belarus supplied about 632,000 tons of potassium to 30 countries on the African continent in 2021, it supplied about 30,000 tons to six countries in 2022. Such countries as Cameroon, Kenya, Reunion, the United Republic of Tanzania, Zambia and Zimbabwe were supplied exclusively with Belarusian fertilizers. A number of countries, including Côte d’Ivoire, the Gabon, Madagascar, Malawi, Senegal and Sierra Leone, met 50 per cent of their fertilizer needs with Belarusian potash.
According to our calculations made based on FAO data, the almost complete disappearance of Belarus from the list of potassium suppliers in 2022 led to a 16.1 per cent drop in Africa’s cereal harvest.
In 2023, supplies to Africa have been completely paralysed because of Lithuania’s actions.
The widespread uncertainty about potash fertilizer supplies from Belarus among potash market players and related industries could have devastating impacts on agricultural supply chains and food security around the world.
The shortage of potash on the international market cannot be filled in the short term: it is difficult for existing producers to quickly increase their current production volumes and the entry of “new players” requires significant development costs and time. The construction of a new mine takes a minimum of 5 to 7 years from the time a decision is made until the first ton is produced.
Thus, while the current food crisis is related to lack of access to fertilizer, it may be related to a lack of food in the coming years. This has been repeatedly stated by United Nations Secretary-General Guterres.
It should be borne in mind that the world’s population is projected to grow. According to United Nations experts, the world’s population is expected to increase by nearly 2 billion in the next 30 years, from the current 8 billion to 9.7 billion in 2050, and could peak at nearly 10.4 billion in the mid-2080s.
As the world population grows, there will be a further increase in potassium consumption owing to shrinking and impoverished arable land and rising disposable incomes in developing countries. At the same time, this will cause a deficit in the global potash supply.
Belarus had always made a substantial contribution to ensuring global food security. However, the illegal unilateral coercive measures against Belarus have brought the population of vulnerable countries to the brink of starvation and are leading to food insecurity in the countries initiating such measures.
Belarus once again urges the United Nations to harness its capacity to persuade Lithuania to refrain from political manipulation and abuse of its position as a transit State and to return to the implementation of its international obligations.
We call for the rejection of unilateral coercive measures, which not only contravene international obligations, including within the framework of the implementation of the 2030 Agenda for Sustainable Development, but also run counter to the provisions of the Charter of the United Nations and relevant United Nations General Assembly resolutions.
1 See www.wto.org/english/news_e/news22_e/igo_14nov22_e.pdf
2 See www.ifpri.org/blog/how-sanctions-russia-and-belarus-are-impacting-exports-agricultural-products-and-fertilizer
3 See blogs.worldbank.org/opendata/fertilizer-prices-ease-affordability-and-availability-issues-linger
4 E/C.12/LTU/CO/3
