Implications of Russia-Ukraine War on Uganda’s Fertilizer and Wheat Supply

The war between Russia and Ukraine has caused disruptions in food and input markets worldwide. The prices for fertilizers and wheat continue to rise, raising energy and food security concerns. Uganda imports most of her wheat and fertilizer. Due to the war, domestic wheat and fertilizer prices have increased and supply limited. In addition, incomes of both small and large farmers using fertilizer and producers of wheat products have been affected. This article relies on desk reviews of literature; secondary data from ICT/Trademap, FAOSTAT, Uganda Bureau of Statistics (UBOs); and Key Informant Interviews with local farmers. Finds show that Uganda’s wheat and fertilizer prices and volumes have become increasingly volatile due to the spillover effects of the war between Russia and Ukraine. The article recommends the need to strengthen the manufacture of fertilizers for domestic use, to increase access and use by farmers. Government intervention is critical through bulk importation of fertilizers to meet immediate demand and the need to design and operationalize the national food reserves, as a mechanism to stabilize Uganda’s food supplies and prices; efforts to boost local wheat production and productivity are equally important to offset supply shocks or spikes in prices. Background Since February 2022, the war between Russia and Ukraine has caused disruptions in both food and input markets worldwide (FAO, The importance of Ukraine and the Russian Federation for global agricultural, 2022; Hassen and El Bilali, Foods 11(15): 2301, 2022). Partly, this is because Russia and Ukraine are major global exporters of grains, fertilizers, oil, and energy (ibid). The two countries together account for 25–30% of global wheat exports (Nhemachena et al., Russia-Ukraine conflict: implications of disruptions in global supply chains for food in Africa. AGRA policy brief, No. A01, 2022). Uganda is no exception due to its heavy reliance on imports from both countries. Over the past 12 months, the prices of various commodities including fuel, cooking oil, soap, fertilizers, and cereals soared to unprecedented levels, increasing the Consumer Price Index (CPI) from 117 in March 2022 to 125 in January 2023. For wheat and fertilizers, Uganda is a net importer, where over 96% of wheat and 100% of fertilizers are imported (MAAIF, Ministry of Agriculture, Animal Industry and Fisheries: Draft Annual Performance Report-Financial Year 2019/2020, 2020; Diao et al., Uganda: impacts of the Ukraine and global crises on poverty and food security. Country brief 12. Produced by International Food Policy Research Institute, 2022). In the year 2021, Uganda imported 40% and 20% of wheat and NPK fertilizer, respectively, from Russia and Ukraine (ITC Trade Map, Trade statistics for international business development, 2022), making Uganda vulnerable in the event of shocks in these countries. Moreover, Uganda had experienced price shocks and disruptions in the supply chain of the aforementioned commodities due to the COVID-19 pandemic. The war has further increased pressure on an already strained economy. Given the fact that food expenditure comprises the largest percentage of household expenditure (41%) in Uganda, compared to other costs such as housing, water, electricity, gas, fuel, and education (UBoS, Uganda National Household Survey 2019/2020, 2021), unsustainable wheat supply is likely to constrain food consumption. On the other hand, both commercial and smallholder farmers face uncertainties because they cannot afford to buy and access fertilizers due to increased prices and limited supply. By the virtue of Uganda’s position “a net importer” of both fertilizers and wheat, global crises such as the war between Russia and Ukraine has had implications on Uganda’s trade flows in terms of commodity prices and import volumes in Ugandan markets. The war effects are directly transmitted to Uganda due to its reliance on imports from crisis-affected countries. This article specifically examines the implications of the Russia and Ukraine crisis on Uganda’s wheat and fertilizer prices and imports. Findings show that wheat and fertilizer prices have increased in Uganda since the civil war began in March 2022, and there is evidence of similar changes globally. Measures to deal with future crises are also recommended.