World faces food crisis due to war in Ukraine, says Russian king of fertilizers and coal

LONDON — A global food crisis threatens unless the war in Ukraine is stopped because fertilizer prices are rising so fast that many farmers can no longer afford soil nutrients, Russia’s king of coal and fuels said on Monday. fertilizer Andrei Melnichenko.

Several of Russia’s wealthiest businessmen have publicly called for peace since President Vladimir Putin ordered the February 24 invasion, including Mikhail Fridman, Pyotr Aven and Oleg Deripaska.

The United States and its European allies have called Putin’s invasion an imperial-style land grab that has so far been poorly executed because Moscow underestimated Ukrainian resistance and Western willingness to punish Russia. .

The West has sanctioned Russian businessmen, including European Union sanctions against Melnichenko, frozen state assets and cut off much of Russia’s business sector from the global economy in an effort to force Putin to change course.

Putin refuses. He called the war a special military operation aimed at ridding Ukraine of dangerous nationalists and Nazis.

“The events in Ukraine are truly tragic. We urgently need peace,” Melnichenko, 50, Russian but born in Belarus and of a Ukrainian mother, told Reuters in a statement emailed by his spokesperson.

“Agriculture and food will be one of the casualties of this crisis,” said Melnichenko, who founded EuroChem, Russia’s largest ammonium nitrate producer, based in Zug, Switzerland, and SUEK, Russia’s largest coal producer.

Russia’s invasion of Ukraine has killed thousands, displaced more than 2 million and raised fears of a wider confrontation between Russia and the United States, the world’s two largest nuclear powers.

FOOD WAR?

Putin warned on Thursday that food prices would rise globally due to soaring fertilizer prices if the West created problems for Russian fertilizer exports – which account for 13% of global production.

Russia is a major producer of fertilizers containing potash, phosphate and nitrogen – the main nutrients for crops and soils. EuroChem, which produces nitrogen, phosphates and potash, claims to be one of the top five fertilizer companies in the world.

The war “has already led to a spike in fertilizer prices that are no longer affordable for farmers,” Melnichenko said.

He said food supply chains already disrupted by COVID were now even more distressed.

“Now this will lead to even higher food inflation in Europe and likely food shortages in the world’s poorest countries,” he said.

The Russian Ministry of Trade and Industry asked the country’s fertilizer producers to temporarily suspend exports earlier this month.

PHYSICS STUDENT

Melnichenko, who was just 19 when the Soviet Union collapsed, started trading foreign currencies while studying physics at the prestigious Moscow State University.

A gifted mathematician who once dreamed of becoming a physicist, Melnichenko dropped out of college to delve into the chaotic – and sometimes deadly – ​​world of post-Soviet affairs.

He founded MDM Bank, but in the 1990s he was still too minor to participate in privatizations under President Boris Yeltsin, which handed over the best assets of a former superpower to a group of businessmen who would become known under the name of oligarchs because of their political and economic weight. .

Melnichenko then began buying up often struggling coal and fertilizer assets. His fortune in 2021 was estimated by Forbes at $18 billion, making him the eighth richest man in Russia.

The European Union on Wednesday sanctioned Melnichenko for the Russian invasion. He said his participation in a Kremlin meeting with Putin and 36 businessmen organized by the Russian Union of Industrialists and Entrepreneurs showed that he was “one of the leading businessmen involved in the sectors economic”.

Melnichenko “has no connection with the tragic events in Ukraine. He has no political affiliation,” his spokesperson said.

“Drawing a parallel between attending a meeting by becoming a member of a works council, as dozens of businessmen from Russia and Europe have done in the past, and undermining or threatening a country is Absurd and senseless,” the spokesperson said, adding Melnichenko will challenge the sanctions.

On March 9, Melnichenko resigned as a board member and non-executive director of EuroChem and SUEK, and stepped down as a beneficiary, the spokesperson said.

Italian police last week seized Melnichenko’s yacht – the 143-metre (470ft) Sailboat A – which has a price tag of 530 million euros ($578 million).

(Reporting by Guy Faulconbridge; Editing by Kim Coghill and Raju Gopalakrishnan)

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