Grain – crisis homemade by West

Western media, i.e. from Germany, is blaming President Putin for food shortages

by Ralph T. Niemeyer

Not surprisingly, we are now witnessing attempts to shift responsibility for the current situation in the global food market and the problems arising in this market onto Russia.

First, the unfavorable situation in the global food market did not start yesterday, or even when Russia launched its military operation in Donbass and Ukraine. That started in February 2020 when it came to dealing with the aftermath of the so called coronavirus pandemic when the world economy collapsed and the world economy needed to be restored.

The financial and economic authorities in the USA have come up with nothing better than making a lot of money available to the population, individual companies and entire sectors of the economy.

Broadly speaking, also Russia has done the same thing, but the Russians have been softer, having been more focused, having gotten the results they needed for the Russian economy, without these actions ending up in macroeconomic terms indicators would have weighed down, including a precipitous rise in inflation.

In the United States the situation was very different. In less than two full years, from February 2020 to the end of 2021, the US money supply increased by 5.9 trillion. This is an unprecedented work of the printing press. The total money supply has grown by 38.6 percent.

Apparently, US Treasury officials assumed that the dollar was still the world currency and that it would spread throughout the world economy as it used to and that it would not be felt in the US. As it turns out, that wasn’t the case. There are decent people in the US too, and the Treasury Secretary recently said they made a mistake. So it was a mistake by the financial and economic authorities of the United States, which had nothing to do with Russia’s actions in Ukraine.

And that was the first step, a very serious step towards the unfavorable situation in the food market, because first of all, food prices went up.

The second reason is the short-sighted policy of European countries, especially the European Commission, in the field of energy. We see what is happening there. Obviously many political forces, both in the US and in Europe, have started to speculate on people’s natural fear of climate change, and have started pushing this “green agenda”, including in the field of energy.

That’s all well and good, it’s just not good when unqualified and totally unfounded recommendations are made about what to do in the energy sector and when alternative energies are overrated: sun, wind, hydrogen – that is perhaps a perspective, but today it is not available in the necessary quantity, the necessary quality or at the necessary prices. At the same time, they began to downplay the importance of traditional forms of energy, especially fossil fuels.

What did that lead to? Banks have stopped lending because they are being pressured. The insurance companies have stopped insuring such transactions. Authorities have stopped providing land to expand production, and construction of transport capacity, including pipelines, has been curtailed.

All of this led to underinvestment in the global energy sector and, as a result, higher prices. Last year there wasn’t enough wind, the wind wasn’t as expected, the winter dragged on – and immediately prices exploded.

In addition, Europeans have ignored Russia’s urgent requests to maintain long-term gas supply contracts to European countries. Many contracts are still in place, but not to extend these has had a negative impact on the European energy market: prices have soared. Russia has absolutely nothing to do with it.

But once gas prices went up, so did fertilizer prices, since some of those fertilizers are also made with gas. Everything is connected. When fertilizer prices rose, many companies, including those in European countries, became unprofitable and began to cease operations. And so the quantity of fertilizers on the world market fell, while prices rose accordingly – dramatically, one might say unexpectedly for many European politicians.

But Russia had warned about it, and it has nothing to do with the Russian military operation in Donbass.

But the next step, when Russia started it’s operation, was that the European and US partners took measures that aggravated the situation in this area: both in the food and fertilizer sectors.

By the way, Russia has a 25 percent share of the world market for fertilizers, Russia and Belarus together have a 45 percent share of the world market for potash fertilizers.

But crop yield is determined by the amount of fertilizer put into the soil. As soon as it became clear that there were no more Russian fertilizers on the world market, the prices of fertilizers and food immediately began to rise, because if there are no fertilizers, there will not be the required quantities of agricultural products either.

Like a chain, one thing is connected to another, and Russia can’t do anything about it. Russia’s partners have made many mistakes themselves, and now they are looking for someone to blame. Of course, Russia is the most convenient candidate in this regard.

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