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The impact of global food chokepoint pressures on Asia’s food security

Posted By on February 13, 2024 @ 12:34

In the last few years Asia’s food security has suffered a series of crises induced by conflict, climate change and the Covid-19 pandemic, causing great disruptions to food supply systems and increasing  the number of people experiencing food insecurity. Now, pressure at four global ‘food chokepoints’—in the Red Sea and the Suez Canal due to geopolitical unrest, and the Panama Canal and the Mississippi River [1] due to drought—are threatening Asia’s food security even more.

Disruptions in the global flow of goods have wide impact. They affect the trade of agricultural products, with delayed delivery times, rising prices and product shortages distorting competition between markets. Longer shipping times can make certain perishable foods unsellable. And changes to shipping schedules can increase pressure [2] on cargo handling and road transport.

For Asian countries that rely on food exports and imports, the potential consequences are worrying. Those that produce and export food may experience shrinking profit margins prompting lower wages for workers, while those that import food could suffer higher prices due to increased transportation costs and greater price volatility, leading to changes in consumption.

Countries across Asia, many of whom are net food importers, are hit particularly hard by food chokepoint disruptions because they rely on European and Black Sea markets for key agricultural products such as soybeans, corn, wheat and edible oils. Notably, Singapore and Hong Kong [3], who have limited natural resources, import more than 90% [4] of their food and are already vulnerable [5] to export restrictions and global food price fluctuations. There is also ongoing concern about stable food supply in Japan, where more than 60% [6] of food is imported.

In poorer countries, disruptions to food imports and subsequent food and energy price inflation could bring about a cost-of-living crisis [7], increase poverty and stall socioeconomic growth. This would be a heavy blow for those already rocked by crises such as Pakistan (extreme weather events), Bangladesh and Myanmar (conflict) and Sri Lanka (economic turmoil). It would also disproportionately affect households in the Philippines [8] who spend 31% of their income on food, and low-income families in Indonesia [9] who spend up to 64% of their budget on food, increasing the risk of undernutrition and malnutrition.

Sustained disruptions to supply chains and key trade routes could exacerbate geopolitical tensions across Asia, where fears of countries weaponising food and fertiliser supplies against each other, as demonstrated by the Ukraine-Russia conflict, are already amplifying food insecurity concerns. This makes it imperative for governments across the region to implement significant reforms to build resilience in supply systems and be better prepared for food shortages.

To start with, Asian governments should implement food import diversification strategies to avoid overreliance on any one market. Singapore, for instance, has already done this, increasing [10] the number of food import sources from around 140 countries in 2004 to 180 in 2022. This may be one reason why in 2022 Singapore ranked second [11] in the world for having the most affordable food, behind Australia, with the average household spending around 20% of their monthly expenditure on food.

To further increase resilience, Asian countries should coordinate investment in regional food supply chains and work together to implement early warning systems [12] for climate monitoring. Having clearer oversight on food chokepoints, price volatility and extreme weather events can help countries in the region respond quickly and effectively to sudden changes.

Lastly, agricultural powerhouses in the region such as Australia and New Zealand could contribute to stabilise food security in Asia by increasing exports of grains [13] and edible oils to the region.

Asia’s food supply systems are particularly vulnerable to both external shocks and domestic pressures. Disruptions increase food price inflation and the risk of malnutrition in countries already affected by both. Asian governments must urgently build resilience in their food trade routes through policies such as food import diversification, so that the region is better prepared for future food security challenges.

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URLs in this post:

[1] the Mississippi River: https://www.usni.org/magazines/proceedings/2023/july/shallow-waters-climate-change-and-world-shipping

[2] increase pressure: https://www.euromonitor.com/article/shipping-disruptions-impact-on-the-global-supply-chains-and-economies

[3] Hong Kong: https://www.legco.gov.hk/research-publications/english/1516fsc14-regulation-of-imported-food-in-hong-kong-20160226-e.pdf

[4] more than 90%: https://www.sfa.gov.sg/food-for-thought/article/detail/levelling-up-singapore-s-food-supply-resilience

[5] vulnerable: https://www.frontiersin.org/articles/10.3389/fsufs.2021.740780/full

[6] more than 60%: https://eastasiaforum.org/2023/11/15/japanese-agricultural-policy-in-disarray/#:~:text=Above%20all%2C%20there%20are%20concerns,during%20the%202024%20Diet%20session.

[7] cost-of-living crisis: https://www.imf.org/en/Blogs/Articles/2022/09/30/global-food-crisis-demands-support-for-people-open-trade-bigger-local-harvests#:~:text=In%20many%20places%2C%20even%20though,growth%2C%20potentially%20fueling%20political%20instability.

[8] the Philippines: https://newsinfo.inquirer.net/1652149/filipinos-spend-a-third-of-their-budget-for-food-says-study

[9] Indonesia: https://www.theindonesia.id/news/2022/04/03/232733/indonesias-low-income-family-spends-64-income-on-food-research

[10] increasing: https://www.sfa.gov.sg/food-farming/sgfoodstory/diversification-of-import-sources

[11] second: https://impact.economist.com/sustainability/project/food-security-index/explore-countries/singapore

[12] early warning systems: https://www.rsis.edu.sg/wp-content/uploads/2015/05/PB150529_Impact-of-Climate-Change-on-Food-Production.pdf

[13] exports of grains: https://www.reuters.com/markets/commodities/australia-set-harvest-bigger-crops-after-rains-defy-el-nino-2024-01-23/

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