- The head of Ukraine's biggest food producer, MHP, says the food crisis could become catastrophic.
- "I see no clear path to light in the tunnel," John Rich, MHP's executive chairman, told Insider.
- Without the opening of Ukraine's blocked ports, millions of tons of MHP's harvest could spoil.
Catastrophe. Apocalypse. These are the words on the tip of John Rich's tongue as he oversees operations for MHP, Ukraine's biggest food producer, as the war in the country rages on.
The World Food Programme (WFP) — the food-assistance branch of the United Nations — hasn't gone as far as saying that the situation could be apocalyptic, but it does believe the war's effect, especially due to curtailed exports of key grains, could spell a "hunger catastrophe." According to an April WFP report, up to 323 million could become food insecure in 2022 due to the conflict, up from a prewar baseline of 276 million people.
"I see no clear path to light in the tunnel," Rich, MHP's executive chairman, told Insider, adding that without a resolution to the food crisis, he believes that "hundreds of millions of people across the planet" will be impacted.
The solution is glaringly obvious but bottlenecked by geopolitical strife. Ukraine's ports along the Black Sea are blocked by Russia, peppered with mines, and otherwise unsafe to pass through due to fighting. But they're key to ensuring the flow of Ukraine's commodities that feed large swathes of the world, including by providing 12% and 17% of the global supply of wheat and corn.
Rich sits at the helm of the crisis and echoed the rallying cry of global food security experts since the start of the conflict: open the ports. He fears that his company's production of key grains could go to waste otherwise.
The London-listed company produces poultry and cultivates grain. Its workers have adjusted to the "new normal" of making essential food deliveries in a warzone, with missiles flying above them.
"We won't be exporting much out of Ukraine this year," said the chairman. "God knows how long it will take us because it is extremely difficult."
In fact, 45 million tons of MHP's harvest could sit in storage this year, a harvest that normally "feeds the Middle East, North Africa, Turkey, everybody," according to Rich.
Certain crops, Rich pointed out, oxidize faster than others, such as sunflower seeds, a crop that is among those stranded in Ukraine's seaports, including its largest, the Port of Odessa.
Spoiled crops are a worry because MHP's production of harvest hasn't been impacted by the war, Rich said. This is because most of the company's operations are in the West and southwest of Ukraine, where not much fighting has happened. Additionally, MHP had all of its inputs for the 2022 season purchased and stored in 2021.
So MHP is on track to produce a quarter of a million tons of wheat this summer. But due to a combination of difficulties in exporting it and lower consumption within Ukraine due to fleeing residents, a bulk of it could end up sitting in storage.
On May 26, a senior Russian government official said the Kremlin would allow ships carrying food to leave Ukrainian ports in exchange for the lifting of sanctions, per Interfax news agency. Ukraine called the suggestion "clear blackmail," according to CNN.
With ports blocked, exports out of Ukraine to ease the growing food crisis will have to take place by rail. According to Rich, that solution poses a number of challenges due to changing rail gauges between Ukraine and the EU. It will also be slow because of customs processes, and sanitary and veterinary checks between borders, he added.
The pandemic and China's subsequent zero-COVID policy, as well as climate change ravaging crops through droughts and storms worldwide, was already threatening food security for millions prior to the war, Rich said.
"The war was really what broke the camel's back," he added.