President Vladimir Putin said on Tuesday that Russia must keep a close eye on its food exports to hostile countries because the West’s sanctions had fomented a global food crisis and spiralling energy prices.
The West’s sanctions over Putin’s Feb. 24 invasion of Ukraine have tipped Russia towards its worst economic crisis since the 1991 fall of the Soviet Union, though Moscow says the global impact of the sanctions could be much more significant.
The Kremlin chief cautioned that higher energy prices combined with a shortage of fertilisers would prompt the West to print money to buy up supplies, leading to food shortages among poorer countries.
“They will inevitably exacerbate food shortages in the poorest regions of the world, spur new waves of migration and in general drive food prices even higher,” Putin told a meeting on developing food production.
“In these current conditions, a shortage of fertilisers on the global market is inevitable,” Putin said. “We will have to be more careful about food supplies abroad, especially carefully monitor the exports to countries which are hostile to us.”
One of Putin’s allies warned last week that Russia could limit supplies of agriculture products to “friendly” countries only, amid Western sanctions imposed on Moscow.
Russia is the world’s largest exporter of wheat, supplying it mainly to Africa and the Middle East, and a major producer of potash, phosphate and nitrogen containing fertilisers – key crop and soil nutrients.
Russia produces more than 50 million tonnes a year of fertilisers, 13% of the global total. Phosagro PHOR.MM, Uralchem, Uralkali, Acron AKRN.MM and Eurochem are the biggest fertiliser players.
Sanctions, Putin said, had disrupted logistics for fertiliser supplies from Russia and Belarus while higher prices for natural gas was making fertiliser production more expensive in the West.
In a warning to European states, Putin warned that Moscow would respond in kind to any attempt to nationalise Russian assets, quipping that such action was a “a double-edged weapon”.
Putin was speaking a day after Germany said its energy regulator would take control of Gazprom Germania, a gas trading, storage and transmission business which Russia’s Gazprom GAZP.MM said it was exiting last Friday.
The British government may decide to step in and temporarily run Russian gas giant Gazprom’s British retail supply arm.
Putin says Russia’s “special military operation” in Ukraine is necessary because the United States was using Ukraine to threaten Russia and Moscow had to defend Russian-speaking people in Ukraine from persecution.
Ukraine has dismissed Putin’s claims of persecution and says Russia is fighting an unprovoked war of aggression.