A leading U.S. grain market analyst does not put much stock in reports of a looming food crisis due to the war in Iran.
The United Nations is one of the groups issuing the dire warnings.
“The clock is ticking for global food systems as disruptions in the Strait of Hormuz threaten to choke off the flow of fuel and crucial fertilizers needed for the next planting season,” the UN stated in a recent article on its website.
That raises the risk of higher food prices and a new wave of inflation, it said.
UN chief economist Maximo Torero said 30 to 35 per cent of the world’s crude oil, 20 per cent of its natural gas and 20 to 30 per cent of its fertilizer are not moving out of the Middle East.
Much of the cargo that left the Persian Gulf before the war has already reached its destination, and the world is now entering a phase where supplies could start to tighten.
The Food and Agriculture Organization’s Food Price Index for March showed only modest increases.
“We have enough supplies and good stocks which allow the agri-food system to be resilient to this shock,” said Torero.
However, he warned that the buffer may be short-lived as farmers around the world reduce input use or shift crops.
That would result in lower yields, which will drive up food prices later in the year and into next year, he said.
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