Sunday, March 20, 2022

Russia Sanction Endgame: Famine Edition

The Ukrainian War and the American sanctions are blocking much of the world from Ukrainian and Russian wheat, corn, and sunflower seed oils, and from Belarus potash and other Russian fertilizers. Many countries are dependent on Russian and Ukrainian wheat, and now facing rising prices. Others, such as Brazil, depend on Russian fertilizers and will have to cut production. This is especially serious because planting season, and fertilizer season, is now. The Ukrainians took fuel away from all the farmers for the war, so Ukrainians can't harvest the current crops nor sown the next.

Now we see the endgame for Russian sanction, assuming that America does not end them as part of peace negotiations. Brazil, at this point, will definitely join the Chinese currency settlement system. If only to buy Russian and Belarus fertilizers. Unless America gives Armenia emergency wheat aid, the current West-friendly government will also have to join the Chinese system and break the American sanctions, just to buy wheat. Same with all the other 3rd world governments.

Turkey is definitely the key state to watch. Erdogan is already shaky politically. If food prices keep rising, he will get voted out. America cannot pay for Erdogan's wheat, even if they want to. So Erdogan is very likely to break sanctions.

More basically, the last food inflation brought the Color Revolutions, and ushered in that wave of West-friendly regimes around the world. It is beyond ironic that the current food inflation, boosted by the American sanctions, will sweep in an era of anti-West regimes.

Case in point, Tunisia is having riots. Again. As Nightwatch said, governments don't usually know how to deal with food riots.

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