The Coming Famine
Experts are predicting a global food crisis. No one will be left unscathed. Get ready.
As we’ve documented from the very beginning, Russia’s invasion of Ukraine threatens the world’s crops because not only do both countries produce a great deal of grain, but they also export much of the world’s fertilizer and the natural gas required to produce it.
The war has cut off nearly 1/5 of the world’s nutrient exports.
As fertilizer prices skyrocket and availability dwindles, farmers around the world are being forced to slash their fertilizer use. From Bloomberg:
For the first time ever, farmers the world over — all at the same time — are testing the limits of how little chemical fertilizer they can apply without devastating their yields come harvest time. Early predictions are bleak.
For the billions of people around the world who don’t work in agriculture, the global shortage of affordable fertilizer likely reads like a distant problem. In truth, it will leave no household unscathed. In even the least-disruptive scenario, soaring prices for synthetic nutrients will result in lower crop yields and higher grocery-store prices for everything from milk to beef to packaged foods for months or even years to come across the developed world.
If you thought grocery prices were high after the initial waves of COVID-19, they’re about to get a lot worse. A US index of food costs jumped 13% in March and the World Bank predicts that wheat prices will rise by more than 40%.
Experts are predicting a global food crisis, in part due to Russia, but a number of other factors are coalescing to exacerbate the situation. Ultimately, everyone will be affected, and you can’t count on governments to take the action necessary to prevent it.
No One in Power
Samantha Power has a B.A. from Yale University and a J.D. from Harvard Law. She won a Pulitzer Prize in 2003, and Time named her one of the most influential people in the world in 2004. She served under President Obama during both of his terms and ended up as ambassador to the UN for the past four years of his administration. In 2016, Forbes noted her as being the 41st most powerful woman in the world.
Power now serves as head of the United States Agency for International Development (USAID), which is the agency that distributes foreign aid.
She acknowledged the crisis on ABC’s This Week: “Fertilizer shortages are real now.”
Her solution? Manure and compost. She also remarked, “Never let a good crisis go to waste.”
Sri Lanka made a sudden change from chemical fertilizers to manure and compost last year. How did that work out?
Foreign Policy: In Sri Lanka, Organic Farming Went Catastrophically Wrong
The New York Times: Sri Lanka’s Plunge Into Organic Farming Brings Disaster
Modern Farmer: Sri Lanka’s Organic Experiment Went Very, Very Wrong
Sri Lanka is the future.
Sri Lanka Offers a Glimpse of the Future
In April 2021, Sri Lanka’s president Gotabaya Rajapaksa banned all imports of chemical fertilizer and ordered the country’s two million farmers to go organic overnight.
Production of Sri Lanka’s crucial rice crop fell 20% in the first six months, and the country went from producing all of its own rice to importing $450 million of it. Prices surged by 50%. The price of vegetables like carrots and tomatoes shot up five-fold.
The plan was sold on environmental grounds, but the main reason was that Sri Lanka’s financial reserves had been drained by the pandemic. But the sudden organic switch devastated Sri Lanka’s chief exports like rubber and tea, which only made things worse.
The United States tried to warn them. In 2021, the USDA cautioned:
The lack of organic fertilizer productive capacity, coupled with the absence of a formalized plan to import organic fertilizers in lieu of chemical fertilizers, raises the potential for an adverse impact on food security. There has been no mention by the government yet as to how it would tackle a food security crisis brought about by drops in crop yields.
By September, Sri Lankans had to line up for basics like kerosene and powdered milk, and President Rajapaksa declared a state of emergency. The country was forced to relent after seven months, but the damage was done. Sri Lankan farmers piled up huge debts and just the losses from the tea crop alone amounted to $450 million.
Now, a year later, Sri Lanka is in shambles. NPR reports:
The unraveling of Sri Lanka's economy has been swift and painful. Imports of everything from milk to fuel have plunged, spawning dire food shortages and rolling power cuts. People have been forced to queue for hours every day to buy essentials. Doctors have warned of a crippling shortage of life-saving drugs in hospitals, and the government has suspended payments on $7 billion in foreign debts due this year alone.
And now Sri Lanka’s problems are about to become the world’s problems.
A Pile of Manure
We’re big fans of manure and compost here at Unprepared. For small gardens, they can work just fine and help you close dependency loops. I’m fertilizing my garden this year with nothing but compost, rabbit manure, and some homemade liquid fertilizers.
But for massive farm operations, manure and compost don’t cut it. To know why you need to understand the three key plant nutrients:
Nitrogen (chemical symbol N)
Phosphorus (chemical symbol P)
Potassium (chemical symbol K)
Those are often combined as NPK. Fertilizer selection is complicated and can change throughout the planting season. For instance, the Utah State University Cooperative Extension recommends 16-16-8 early in the season and 46-0-0 later in the season.
Let’s look at the NPK of various organic fertilizers:
Chicken manure: 1.1-0.8-0.5
Cow manure: 0.6-0.4-0.5
Rabbit manure: 2.4-1.4-0.6
It doesn’t take a math whiz to see that the numbers for the organic fertilizers are a lot smaller than the ones for the chemical fertilizers. And a sudden switch to manure and compost will lead to a disaster, as we witnessed in Sri Lanka.
A Perfect Storm
Unfortunately, the Ukrainian crisis isn’t the only factor at play here. Many other conditions are lining up to create a perfect storm around our global food supply:
Extreme weather and drought: Many areas of the world are seeing droughts and extreme heat. Drought in France is threatening its wheat production.
The heatwave has already had a devastating impact on crops, including wheat and various fruits and vegetables. In India, the yield from wheat crops has dropped by up to 50% in some of the areas worst hit by the extreme temperatures, worsening fears of global shortages following Russia’s invasion of Ukraine, which has already had a devastating impact on supplies.
It’s also happening here in the United States. In Idaho — the place where they grow all the potatoes — more than 3/4 of the state is already in a drought. They usually announce drought declarations per county and haven’t issued a blanket declaration in 10-15 years. Utah is in the same boat.
Avian flu: The Avian flu is wrecking poultry producers around the world, and you’re probably already seeing it reflected in chicken and egg prices. It’s wiped out over 19 million layers in the United States this year, or about 6% of our flock. France has had to cull 8% of its flocks. From Reuters:
“The product industry is in a general panic,” said Marcus Rust, chief executive of Rose Acre Farms, the second-largest U.S. egg producer. The company lost about 1.5 million egg-laying chickens at an Iowa farm infected by bird flu, which also sidelined a processing plant, he said.
Ethanol production: On top of everything else, President Biden is expanding the use of ethanol to alleviate high gas prices, which means that more farmland is going to be growing fuel and not food. That might sound like a bad idea on the surface right now, but Doomberg (a great account to follow for this stuff) explains why it’s a really bad idea.
Nations pausing exports: Many countries have paused food and fertilizer exports as a result of the war between Ukraine and Russia. Examples:
The New York Times reported:
Export restrictions are making grains, oils, meat and fertilizer — already at record prices — more expensive and even harder to come by. That is placing an even greater burden on the world’s poor, who are paying an ever-larger share of their income for food, increasing the risk of social unrest in poorer countries struggling with food insecurity.
But this was already happening before the war broke out. As Doomberg wrote last October:
We’ve written extensively about how the market for energy in Europe broke and how the ripple effects will snap through our delicate supply chains like a whip. When the supply of critical goods goes short, countries implement protectionist policies in a futile attempt to minimize the impact at home. A cascading series of retaliatory moves usually follows, leading to economic vapor lock. We are seeing that pattern play out now in agriculture.
Yes, It Can Happen Here
As I’ve watched this situation slowly unfold, I’ve been sounding the alarm as much as possible. A lot of people don’t want to believe it and offer objections that, quite frankly, expose their ignorance. Let’s address a couple here:
“But I don’t eat corn/soy/wheat!” Whenever I mention one of these big grain crops being at risk, someone always insists they don’t eat the stuff. Except yeah, you probably do. Or the animals you eat do. Or the animals that produce your eggs and milk do. And if you’re a vegan, you almost certainly eat soy. Soybeans make up 10% of the calories eaten by Americans, and the average American eats so much corn that a scientist once tested Sanjay Gupta’s hair and found that it was 69% corn. The average American is a walking Frito.
And even if you somehow don’t eat any of the world’s major staple crops, I have some news for you: there are other people! People that aren’t you! And if they can’t get their usual helpings of Doritos and Beyond Burger, they’re coming for whatever you usually eat.
“Prices might rise in the United States, but we won’t see a famine here.” I get this one a lot. First of all, it can happen here, and President Biden is warning about it:
“Ukraine and Russia are called the bread basket of Europe. They make 30-40% of the world’s wheat. A lot of different experts say it’s coming, that we will have a food shortage especially wheat and wheat-related products. My guess is probably two to three months out.”
So yeah, it can happen here. We likely won’t be hit as hard as the developing world, but expect products to become more limited and prices to rise even further.
The key thing to understand in all of this is that it won’t happen overnight. Growing food takes time, and it takes months for a bad crop to affect the market.
The other thing to understand is that much of our food isn’t grown in the United States. Take a look the next time you open the fridge or browse the produce section. You’re going to see a lot of stickers that say, “Product of Argentina,” “Product of Chile,” Product of Mexico,” and so on. How else do you think you can buy a tomato in the middle of winter? Like it or not, we live in a global economy.
As to the “only prices will rise, not a big deal comment,” prices are already high as hell, and they’re about to go parabolic. Do you know what happens when people can’t afford food? Revolution.
Remember the Arab Spring from about a decade ago? It didn’t start because people wanted “liberty,” it’s because people in Egypt couldn’t afford bread after its price rose by 37%. American food prices have climbed 8.5% over the past year and are already set to increase by 1% each month just from inflation alone.
The clock is ticking.
Two Scenarios and How to Prepare
We’ve charted out two possible scenarios.
In the best-case scenario, food prices will continue to climb, but food will still be readily available in the developed world. Things get worse in the developing world, but international aid organizations step in and avert a major humanitarian crisis.
In the worst-case scenario, there are food shortages in the developed world, including the United States. Food prices skyrocket past what many can afford. Governments fail to assist their citizens and developing countries — the latter of which is decimated, sparking a refugee crisis.
In either scenario, the plan is the same:
Build up a cash cushion
Prepare for civil unrest
You can expect food prices to continue climbing for the foreseeable future, and inflation is still far from under control. The single best investment you can make at the moment is food with a long shelf life. That doesn’t have to be weird survival food. Many common household foods can last years or even decades on a shelf if you store them well.
The best time to get started? Today. You can literally go to the Dollar Tree and stock up on beans and rice for not much money.
How much food should you store? At least two weeks’ worth for you and your family. Assume 2,000 calories per person per day. If you have the means and the space, a year’s worth is even better.
Gardening season is well underway, and if you have the means to do so, you need to be growing food not only to feed your family but to reduce strain on the system. It doesn’t take as much space as you think to get started.
Using the Square Foot Gardening method, and a single 4x8-foot raised bed I’ve planted:
24 bush bean plants
16 marigolds (they keep pests at bay)
6 tomato plants
6 basil plants
That won’t feed your whole family, but that’s only one bed! And with current food prices, it makes more financial sense than ever. On a recent grocery run, I noticed that green bell peppers were $1.29 apiece and large tomatoes were going for about a dollar. A single pepper or tomato plant can crank those out all summer long if you live in a warm climate.
And while you’re at it, you might consider livestock. Chickens are a great starter animal, but rabbits are hard to beat for urban and suburban farmers. They don’t take much space, they’re often allowed in places where other livestock isn’t, and they produce an endless supply of fertilizer.
And of course, once your garden starts coming in, you may have more food than you can eat at once. We’ll be talking about food preservation throughout the summer here at Unprepared.
Finally, you need to build up a cash cushion. Start budgeting right now as though food is double the current price. It’s time to tighten your belt and cut out unnecessary expenses. Have at least $1,000 in an emergency fund and work on building up to 3-6 months of income. Of course, inflation is a real bear right now, so your top priority should be food.
If the global food crisis is averted — and we hope it is — you’ll still be left with healthy gardens, stored food, and a nice chunk of change. Good preparedness should always make your life better, in good times and bad.