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    US may tap reserve fund as Ukraine war worsens global food insecurity

    The U.S. Agency for International Development, U.S. Department of Agriculture, and World Food Programme have warned Congress about a global food crisis on the horizon.

    By Teresa Welsh // 07 April 2022
    A man carries a sack of wheat flour to beneficiaries at a camp for internally displaced people on the outskirts of Sanaa, Yemen in March 2021. Photo by: Khaled Abdullah / Reuters

    The U.S. Agency for International Development and U.S. Department of Agriculture are in discussions to tap into a humanitarian reserve fund as the war in Ukraine exacerbates a global food crisis, representatives from the agencies told Congress on Wednesday.

    Sarah Charles, assistant administrator at USAID’s Bureau for Humanitarian Assistance, told the House Agriculture Subcommittee on Livestock and Foreign Agriculture that USAID and USDA are considering how to deploy money from the Bill Emerson Humanitarian Trust, a special authority in the Agricultural Act of 2014 to provide flexible funding for responding to “unanticipated food crises abroad.” It grew out of a wheat reserve that Congress established in 1980 and hasn’t been tapped since 2014.

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    “We are considering all factors, including commodities and countries that could benefit from these U.S. food commodities, with the intent to bolster existing emergency food operations in countries acutely impacted by this crisis,” Charles said.

    The trust currently holds more than $260 million, according to USAID. The secretary of agriculture authorizes the release of its funds, at the request of the USAID administrator, to purchase U.S. commodities. The funds allow a quick response to a humanitarian crisis without drawing money away from existing Food for Peace programming, a mechanism for U.S. food aid.

    In Wednesday’s hearing, food aid and agriculture experts, along with members of Congress, expressed alarm over the global food crisis caused by the Russian invasion of Ukraine, as well as the stress that humanitarian organizations are experiencing as the number of hungry people continues to rise. Prices of key staples are spiking in places such as Lebanon and Yemen, where agencies already do not have enough funds to meet needs.

    Rep. Glenn Thompson, the Republican leader of the House Agriculture Committee, said it was in the interest of U.S. national security to provide swift assistance to stave off the worst of the food insecurity amid the war in Ukraine.

    “Everything we’ve heard really leads to a pretty grim conclusion that, by this fall, we’re going to see a significant increase in hunger, starvation, and death by famine — and with that, a destabilization that can result in violence and probably an increase in terrorism,” Thompson said. “There are so many simultaneous emergencies at the moment.”

    Both Ukraine and Russia are major exporters of grains and other key commodities such as sunflower oil. Russia is also a major exporter of fertilizer.

    USAID is working with Ukraine’s agriculture authorities to provide assistance to farmers there, Charles said. Current estimates indicate that the country will have about 50% of a typical yield in its spring wheat crop, she said. Ukraine accounts for 9% of the global wheat export market.

    With the Horn of Africa currently experiencing its worst drought in four decades, $114 million in assistance will go to Ethiopia, Kenya, and Somalia, Charles said. Funds will go toward food and nutrition assistance, medical supplies, and clean water.

    Even before the war, USAID’s purchasing power had fallen 11.4% from the prior year due to rising transportation costs, Charles said. This means USAID can serve 10 million fewer people with the same level of funding, she added, noting that the agency expects purchasing power to decrease further still because of the war.

    This stretching of funds is one reason that USAID is calling for increased flexibility in Title II food aid under the farm bill, as U.S. commodities are currently being shipped to countries requiring food assistance as part of Food for Peace efforts. With the current legislation set to expire in 2023, Charles said the agency would like the next farm bill to better allow USAID to provide a mix of commodities and cash assistance, depending on specific country contexts. Supplying cash instead of U.S. commodities would save on increasing transportation costs, she said.

    “For example, in a place like Somalia or like Yemen, we may be pairing U.S.-sourced wheat, lentils, soy, or vegetable oil with cash and vouchers that allow people to purchase things like vegetables to supplement those U.S.-sourced commodities,” Charles said during the hearing. “The reauthorization of the farm bill at this time of global crisis provides a critical opportunity for Congress to ensure that the U.S. government has the most effective tools at its disposal to meet the humanitarian challenges of the day.”

    The farm bill legislation covers a range of agriculture-, food-, and nutrition-related programs, from crop insurance and land conservation to the McGovern-Dole International Food for Education and Child Nutrition Program. The 2018 bill had 12 titles, or sections, governing different aspects of the food system.

    “Everything we’ve heard really leads to a pretty grim conclusion that … we’re going to see a significant increase in hunger, starvation, and death by famine.”

    — Rep. Glenn Thompson, Republican leader of the U.S. House Agriculture Committee

    World Food Programme Chief Economist Arif Husain told members of Congress that his agency also seeks to find the right balance between commodities and cash assistance, providing the latter where food markets are still functioning to help support the local economy even during a crisis.

    Some 276 million people in the countries where WFP operates are already facing severe hunger, Husain said, and the war “could easily” push another 47 million people into acute hunger. That would bring the total to 323 million acutely food insecure people this year alone.

    WFP is seeking funding to assist 145 million people in 2022, up from 128 million in 2021 and 115 million in 2020. The price tag is approximately $20 billion, but that is only about 50% funded so far, Husain said. This comes at a time when monthly costs are up $71 million from 2019 because of increased transportation costs.

    “The costs of humanitarian inaction are tremendous,” Husain said. “What is happening in Ukraine has huge ramifications for the rest of the world, where in country after country, 44 million people [are] one step away from famine. … This is not going to go away until we sort out the root causes. What is the biggest root cause? It is conflict.”

    Come fall, the world is in for “some very nasty things” if the war continues, he said.

    More reading:

    ► Ukraine says war damage exceeds $100B, warns of food crisis

    ► Ukraine crisis expected to deepen Horn of Africa's drought devastation

    ► Opinion: Amid the Ukraine invasion, we must avert the next food crisis

    • Agriculture & Rural Development
    • Humanitarian Aid
    • Trade & Policy
    • United States
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    About the author

    • Teresa Welsh

      Teresa Welshtmawelsh

      Teresa Welsh is a Senior Reporter at Devex. She has reported from more than 10 countries and is currently based in Washington, D.C. Her coverage focuses on Latin America; U.S. foreign assistance policy; fragile states; food systems and nutrition; and refugees and migration. Prior to joining Devex, Teresa worked at McClatchy's Washington Bureau and covered foreign affairs for U.S. News and World Report. She was a reporter in Colombia, where she previously lived teaching English. Teresa earned bachelor of arts degrees in journalism and Latin American studies from the University of Wisconsin.

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