Home > NewsRelease > Strategic Grain Shortages to Provoke Global Social Instability
Strategic Grain Shortages to Provoke Global Social Instability
Albert Goldson Albert Goldson
For Immediate Release:
Dateline: New York, NY
Monday, May 16, 2022



War & Weather | Agricultural Global Markets ina Vise

The Russia’s war of aggression in Ukraine has profoundly accelerated thedramatic spike in wheat – classified as a strategic grain - and other agriculturalprices due to Russia’s blockade of exports with resultant shortages in theworld market.


With respect to Ukraine, the wheat planting and harvesting season arepractically lost because of the on-going war, particularly in the wheatproducing area where hostilities are currently most intense. The followingchart entitled Ukraine: Wheat Production provided by the ForeignAgricultural Service, US Department of Agriculture, provides a superb visual ofUkraine’s wheat producing region located in & around present-dayhostilities.

For the readership who seek to view corresponding maps from theaforementioned data source for other Ukrainian agricultural productsspecifically corn, barley, sunflower seed and soybeans, one access them in my articleentitled AgriculturalSuper Cycle on Steroids published on March 9, 2022.

For this reason wheat exports have been blocked since the war’s outbreakin late February 2022.


Although draconian sanctions have been imposed onRussia, the west has “carved out” exceptions by allowing the export of Russianfood and fertilizer. The problem is that restrictions on financial transactionswith Russia have delayed, and sometimes prevented altogether, export shipmentsand delivery as importing countries try creative ways to do a legal workaround.

The criticality of agricultural exports from Ukraine and Russia isarticulated in the following chart entitled Why theWar in Ukraine Threatens Global Food Security as provided by the Foodand Agricultural Organization of the United Nations.

Alternative Sources: Wheat Shortfalls

Countries heavily dependent on Ukraine and Russia for their wheatsupplies are in a tight spot because of severe shortages elsewhere whether ininventory or harvest projections because of weather. Other large wheatproducers are encountering difficult weather-related problems deleteriouslyimpacting wheat production and consequently are unable to provide surplus wheatto countries heavily dependent on Ukraine and Russia exports.

India’s March heat wave was one of the hottest in theirhistory. According to government sources, they estimate that the heat wave mayhave damaged upwards of an estimated 25% of their wheat crop. For this reason,the Indian government banned wheat exports. This extreme protectionist policyeliminates wheat exports as a stop-gap relief for many import-dependent andpoor countries that would have received exports from Ukraine and/or Russia.

Because India is the world’s second largest wheatproducer, this removes a considerable amount of additional wheat from the worldmarket. For this reason wheat and other agricultural foodstuffs may no longerbe considered fungible and could wreak havoc in the global markets.

Furthermore, as a major wheat producer, India hasset a precedent in banning the export of a strategic agricultural commoditycaused by weather-related circumstances. Because of India’s huge market share,this could trigger a protectionist domino effect for all other wheat andagricultural exporters.

France is the EU’s largest wheat exporter and was alsocounted upon to supplement the shortfall in Russian and Ukrainian wheatexports. Because France’s agricultural sector faces near-drought conditions, anormal wheat crop yield is in doubt.

USA: Many agricultural states aresuffering droughts especially California, notably in Central Valley, theagricultural heartland. California produces 33% of the nation’s vegetables and67% of the fruits and nuts. Canada is also experiencing drought-likeconditions in the agricultural regions.

China is the one of the world’s largest producers andconsumers of wheat. Winter wheat is to be harvested in June however the cropyield is uncertain due to drought and flooding occurrences during the plantingand harvesting season.

To make up for any domestic consumption shortfall,China has the world’s largest foreign currency reserves and can push up worldmarket prices by crowding out and outbidding poorer countries for the import ofagricultural foodstuffs.

Global Wheat Inventory Quality & Realpolitik

Globally government agencies announced that theyhave sufficient food inventories to weather the shortages, or at least buy timeto secure additional foodstuffs. Understandably governments may not beforthright with their inventory figures in order to avoid public panic andcivil unrest.

What governments may not know is the quality of thosestorage facilities. Degraded food inventory may be unfit for human consumption butcan be used as animal feed. If this is the case, once again governments mayresort to mixing the good with questionable quality foodstuffs to avoid civilunrest.

The Super Cycle Ride

During the aforementioned 30-day period I believe that despite themeteoric rise in wheat prices, the market repeatedly failed to fully factor inthe ominous geopolitical realities and global collapse of climate-relatedagricultural production.

This trend has been supported by a plethora of highly credible privateindustry and governmental data including public statements by their respectiveleadership, and even anecdotal information by farmers themselves that precededthe official governmental and private industry reports.

The Global Socio-Economic Powder Keg

The Russo-Ukrainian conflict and India’s ban on wheat exports has jammedthe modern historic agricultural safety valve for import-dependent countries inrapidly securing alternate sources of essential grains. This safety valve oftenbought time for governments regardless of political bent, to mitigate or evenavoid massive social unrest. This dilemma places many countries in a lose-lose quandaryin seeking food for their increasingly hungry and hostile citizenry. Not evenregime change is a panacea if there are no alternate food sources.

The global food crisis and subsequent famine will undo the socio-economicrise of hundreds of millions of citizens in developing and emerging countriesfrom poverty during the past decades into middle class. Not only may this groupfall to its previous impoverished condition, it may be worse than theconditions from whence they arose. Furthermore, they’ll have more “company” throughthe collapse of the multi-generational middle class into impoverishment.

Social unrest will be far more intense. Firstly, the first and second generationof the newly arrived middle class from their parents’ and grandparents’ impoverishedcondition have “tasted” a civilized, middle class (albeit humble by westernstandards) lifestyle. Now suddenly they’re forcibly returned to the underclass.

Secondly, the multi-generational middle class has the mindset that it’stheir “right” to have a civilized, reasonably comfortable middle-class lifestyle.Suddenly they’re confronting the unthinkable of competing for food and possiblylosing their shelter.


The worsening cascade of events along the agricultural farm-to-tablesupply chain has impacted every node along the critical compounding the crisis.The removal of agricultural exports due to the Russo-Ukraine war and Indian policyreduces the fungibility of grains triggering market seizures and chaos. India’sofficial ban of wheat exports may trigger a protectionist domino effect thatwill compound the global food shortage and inflation.

The ultimate result occurring sooner than later will be simultaneous civilunrest in developing, emerging and developed countries this summer into fall, asocietal crisis government will be unable to avert or resolve with a checkbook.

© Copyright 2022 Cerulean Council LLC

The Cerulean Council is a NYC-based think-tank that provides prescient,beyond-the-horizon, contrarian perspectives and risk assessments ongeopolitical dynamics and global urban security.

News Media Interview Contact
Name: Albert Goldson
Title: CEO
Group: Cerulean Council
Dateline: Brooklyn, NY United States
Cell Phone: 917-710-7209
Jump To Albert Goldson Jump To Albert Goldson
Contact Click to Contact
Other experts on these topics