By Khalil Ben-Gacem
Economic sanctions on Russia entail a dangerous balancing act between stopping the war in Ukraine and protecting well-being outside of Asia. Forcing compliance with these sanctions has proven a far more difficult task, where China actively trades with and aids Russia during wartime but cannot be sanctioned as easily without damaging Western business. In particular, the agricultural sector faces not only an inelastic demand for oil but also a dependence on fertilizer from Russia and China. If the current food shortage compounds with reduced fertilizer access later in the year, those already struggling with the current recession may have little to no options for purchasing food. When so much of the West and Africa is dependent on Chinese and Russian fertilizer, it is apparent that the West cannot afford to place sanctions on China for its involvement with Russia.
Russia and China are the leaders in global fertilizer production, producing roughly 40% of the world’s supply combined. If countries sanction China for aiding Russia, the West would face the burden of having to produce a sudden and infeasible amount of fertilizer. Should Europe attempt to develop self-sufficiency, an analysis of inputs to fertilizer production reveals the same problem: 41% of Nitrogen is imported from Russia and China, which are also the largest phosphate exporters, and 46% of Potash is produced by Russia and Belarus. The absence of key resources in fertilizer production renders the West essentially incapable of self-sufficiency. Since the farming industry is already one of the most affected by high oil prices, the bottleneck of resources from abroad may precipitate a mass food shortage around the world.
More importantly, many developing and third-world countries rely heavily on imported food and fertilizer, meaning they will not be able to provide for themselves during a shortage. For example, Morocco was struggling to feed itself before the war began, when the average household spent over 50% of its income on food, much of which was imported from Ukraine. When grain prices are already heightened due to Ukraine’s absence, the combination of a lack of oil and fertilizer may induce severe food-related stresses among the Moroccan population.
Across Africa, millions are already facing starvation, and a 7% decline in fertilizer is expected during the next season – the largest drop since 2008. Agnes Kalibata, leader of the African Green Movement, has suggested the need for self-sufficient fertilizer production, but the current lack of natural resources has made such a challenge almost impossible. Even Europe has cut fertilizer production by 400,000 to 500,000 tonnes per month, “operating less than half of its installed capacity to produce these products” according to Argus Insight’s Fertilizer Report.
While the future of food security in the near future does not seem bright, the possibility of losing imports from China seems unlikely. However tensions may evolve or diminish, China is the world’s largest importer of agricultural produce, meaning a plague on Europe’s food supply could amplify problems for China. In the same way that global superpowers prevent all-out wars using mutually assured destruction, the Western and Eastern superpowers are deadlocked in their ability to raise economic sanctions by mutually assured starvation.
Yet, if sanctions on China are regarded as destructive, the question remains of what can be done to reduce its involvement with Russia. Western supply chains are also tied up with China’s through energy, technology, medicine, and many other sectors. Perhaps the current stalemate is evidence that diplomacy is a better tool than sanctions when confronting countries upon which you depend for economic stability. Regardless, the uniquely dependent relationship between opponents is likely to encourage more self-sufficiency in the future.