The war in the Ukraine is impossible to ignore. The news talks of bombings of civilians, refugee counts and aid being negotiated. Asked, what countries border the Ukraine (Russia, Belarus, Poland, Slovakia, Hungary, Romania, and Moldavia), how big it is (2nd largest country in Europe) or how many people live there (44 million) – few would have known the answer just mere month ago.
While in the US concerns about oil prices are rising, countries around the world worry about basic food supply shortages. Russia and Ukraine account for 14% of global wheat production and rank 1st and 5th, in the world, respectively. Both countries are prominent exporters, providing nearly 30% of global wheat exports. Gambia, Lebanon, Moldova, Djibouti, Libya, Tunisia, and Pakistan import about 40% of their wheat from these two countries. Afghanistan, Armenia, Belarus, Kazakhstan, and Kyrgyzstan, which also depend heavily on wheat imports, are already feeling the effects of shortages. The next ripple effect will be pricing and demand for corn and rice, which are wheat substitutes,
Sunflower oil is the world’s third-most traded vegetable oil after palm and soybean oil. Ukraine accounts for 46.9% of the global exports. Together with Russia they account for almost 3/4 of the worlds exports.
Some 400 U.S. and other multinational firms have pulled out of Russia, either permanently or temporarily, with BP, Shell, ExxonMobile, Dell, IBM, Apple, Google, Facebook, Twitter, McDonald, Starbucks, Coca-Cola leading the way. Still, many have not… Koch Industries, LG Appliances, Reebok, BrooksBrothers, Avon, Pirelli Tires are some of them. Before you bite into a Cinnabon, add Truvia to your coffee or enjoy an Auntie Anne’s pretzel, be aware that their operations continue in Russia. How world leaders, consumers and corporations react to the war in the Ukraine will determine China’s view on the world and its level of aggression.