“We are going to have a food crisis. It’s a question of how large,” said Svein Tore Holsether, the CEO of major fertilizer producer Yara International, the Wall Street Journal reported on Friday.
On March 11, Norway-based Yara International announced that, due to EU sanctions, it would no longer be sourcing supplies from Russia. But Holsether said he was weighing a moral dilemma even before sanctions hit, as he knew cutting Russian supplies would contribute to food inflation.
Russia accounted for almost one-fifth of 2021 fertilizer exports, according to Trade Data Monitor and Bloomberg’s Green Markets. Russia is also a top exporter in key fertilizer ingredients such as urea, ammonia, and potash, per trade outlet Argus Media.
The loss of Russian fertilizer supply is expected to cause severe strain to the supply of crop nutrient, which was already under pressure before the war as European fertilizer producers cut output due to high gas prices and as freight rates soared, according to Bloomberg. There are few alternatives available.
“Replacing their volumes would take nearly half a decade at the very best, and in some cases prove nearly impossible as Russia is a large source of mineral deposits found in few other global locations,” Alexis Maxwell, an analyst for Bloomberg’s Green Markets, said on March 5, per the media outlet.
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