[HN Gopher] Global rice shortage is set to be the biggest in 20 ...
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Global rice shortage is set to be the biggest in 20 years
Author : Paul-Craft
Score : 145 points
Date : 2023-04-19 12:29 UTC (10 hours ago)
(HTM) web link (www.cnbc.com)
(TXT) w3m dump (www.cnbc.com)
| sremani wrote:
| There is nuance to be had when it comes to rice. There is no ONE
| rice, there are many varieties of Rice and people and cultures
| are very specific about 'their' rice. Right at the time of
| planting you are deciding which market you are targeting.
|
| The consumption pattern of Ponni rice is very different from
| Basmati, and these are differences in Indian subcontinent, we are
| not even talking about South East Asia, China or Japan.
|
| Rice is a complex market and by its nature fragmented. Also, it
| is very hard crop to harvest given that you have to flood the
| field twice. If Ukraine was rice bowl of the world, we would
| already have large scale famine kicked in right now.
|
| The wheat shortages will come and will become apparent by the end
| of this year or early next.
| chrisco255 wrote:
| According to the Rice Outlook published by USDA, total global
| rice supply is 691.4 million tons [1][2]. If there is a shortage
| in production (of 8.7m) this year, it will simply debit against
| that total. Rice is stored for long term.
|
| As of now that 8.7m figure is simply a forecast. The weather
| could turn favorable for the season and there could be a surplus.
| No, we cannot predict the weather beyond two weeks from now.
|
| [1] https://downloads.usda.library.cornell.edu/usda-
| esmis/files/... [2]
| https://usda.library.cornell.edu/catalog?utf8=%E2%9C%93&loca...
| spaceman_2020 wrote:
| Why does it feel that so many trends that were "emerging" are now
| all suddenly converging? I've gone through a lot of macro data
| and everything from climate change and fertilizers to food and
| automation and monetary policy seems to be breaking down at the
| same time.
|
| Is there a whitepill scenario for the remaining years in this
| decade?
| SuoDuanDao wrote:
| This decade might be asking a lot.
|
| This century I like Schmachtenberger's take.
| spaceman_2020 wrote:
| I've never heard of Schmachtenberger but this is what chatGPT
| had to say about his take. Accurate?
|
| ===
|
| Daniel Schmachtenberger is a philosopher, systems thinker,
| and futurist known for his work in global systems change and
| the development of a more resilient and sustainable
| civilization. His take on this century can be characterized
| by the following key points:
|
| Existential risks and global catastrophic risks:
| Schmachtenberger emphasizes that humanity faces a range of
| existential and global catastrophic risks, including nuclear
| war, pandemics, climate change, artificial intelligence, and
| others. He argues that we need to address these risks
| comprehensively and proactively to ensure a sustainable and
| thriving future.
|
| Game theory and rivalrous dynamics: Schmachtenberger
| highlights the importance of understanding game theory and
| the rivalrous dynamics that drive competition and conflict.
| He argues that many of our current challenges stem from win-
| lose dynamics that incentivize short-term thinking, self-
| interest, and resource depletion.
|
| Comprehensive sense-making: Schmachtenberger stresses the
| need for better sense-making and information processing to
| navigate the complex, interconnected challenges we face. He
| advocates for interdisciplinary approaches that can provide a
| more accurate and nuanced understanding of the world.
|
| Civilizational resilience: Schmachtenberger advocates for
| building a more resilient and adaptive civilization by
| fostering cooperation, developing better decision-making
| systems, and focusing on long-term, sustainable solutions.
|
| A vision for a sustainable and thriving civilization:
| Schmachtenberger envisions a future where humanity transcends
| its current challenges and embraces a more cooperative,
| sustainable, and equitable global society. This includes the
| development of regenerative economic systems, effective
| governance structures, and cultural shifts that prioritize
| collective well-being over individual gain.
| gretch wrote:
| Maybe things are actually pretty okay, and it's just the
| information we get makes it seem like everything is falling
| apart.
|
| Remember Y2K? Everyone thought we would have mass system
| failure across the world. And while some systems did fail and
| some people had to work diligently against the clock to make
| patches, for the most part, it was just okay.
|
| I suspect this rice shortage is probably similar to the Y2K
| situation
| spaceman_2020 wrote:
| I mean, we just came out of once in a lifetime
| pandemic...sometimes, things actually do happen.
| gretch wrote:
| I'm not saying that rice production won't be short or that
| there won't be some small hiccups, but is it worth the
| attention of all these lay-people.
|
| The news about this rice production is not going to have
| more of an impact on your personal life than e.g. taking
| the time to call your mom and tell her you love her. We all
| sit around worrying about the rice production and don't
| actually work on the things that are immediately applicable
| to all of us.
| michael1999 wrote:
| 2027 is likely to be better that 2035.
| Paul-Craft wrote:
| Many people, myself included, think we're headed for global
| societal collapse. Or, more to the point, things have
| deteriorated to the point where collapse has already started to
| happen and is now accelerating, which accounts for the
| convergence of trends you're seeing.
| bannedbybros wrote:
| [dead]
| torcete wrote:
| In the meantime I am facing a loss of 31% on my wheat ETF. When
| Russia invaded Ukraine it was said everywhere how much it was
| going to affect the price of wheat. I guess there are better
| speculators than me that can influence media and create a buying
| sentiment.
|
| I also deserve it, not only I learnt a lesson, but there's
| something fundamentally wrong about speculating with food. For
| some reason I didn't even think about that and at some point I
| was like what am I doing?
| ManuelKiessling wrote:
| Well I assume it was solidly in the plus for a while? If yes,
| then the assumption was right at least for a while -- which
| might be just another instance of market timing working out or
| not working out.
| diebeforei485 wrote:
| > When Russia invaded Ukraine it was said everywhere how much
| it was going to affect the price of wheat.
|
| The UN, and large wheat-exporting countries, took action here.
| For example, exports of wheat through the Black Sea were
| prioritized. Fertilizer export and transport was fast-tracked
| around the world. Wheat-exporting countries said they won't
| sell to traders, only directly to other governments.
|
| It took a lot of effort (which didn't get a lot of media
| publicity) to prevent a wheat shortage.
| [deleted]
| chrisco255 wrote:
| The lesson in the first part of your comment is very important,
| but the second paragraph is a miss: "there's something
| fundamentally wrong about speculating with food".
|
| Absolutely not. Besides being one of the oldest types of
| speculation, speculation on food provides farmers with a
| guaranteed sale price for their product months in advance.
| Without futures contracts speculation, farmers would have to
| assume ALL the price risk. And more of them would fail as a
| result of market fluctuations. As it stands, the futures
| markets allows for expansion of finance and insurance in the
| industry, which ultimately improves stability in the entire
| food supply chain.
| antonvs wrote:
| The issue is more whether the profits from an activity like
| that are reasonable. One could imagine taxing such profits at
| a much higher rate, just to pick a simple change that's
| compatible with the current system.
| SuoDuanDao wrote:
| But price discovery is a public good.
| chrisco255 wrote:
| There is no objective formula for determining what is
| _reasonable_. That 's an entirely subjective thing.
| Everyone tries to buy low and sell high for anything they
| produce. A manufacturer will try to get the cheapest price
| for all of the raw materials that goes into their goods and
| they will try to charge the highest price they can. They
| are only ever kept in check by competition and alternative
| choices in the marketplace. And the market functions to
| regulate profits by producing more supply whenever there's
| an imbalance.
| dmfdmf wrote:
| The Tonga Eruption in Dec/Jan of last year is probably a factor.
| xyst wrote:
| Rice is a very thirsty crop. Water is becoming scarce as the
| effects of global warming/climate change worsen the effects of
| natural weather events.
|
| Not sure why we are surprised. We have been warned for decades
| yet governments around the world continue to let O&G industry to
| pollute the planet with no repercussions. Eating habits of rich
| countries have not changed much as meat is still heavily
| consumed.
|
| The ultra rich continue to pollute with reckless abandon with
| super cars, private jets, yachts, and other GHG heavy activities.
|
| The average US consumer is buying SUVs and trucks at alarming
| rates and for the most part are just hauling air or carrying 1-2
| people in a single vehicle.
|
| Public transportation and more efficient modes of transportation
| (walking, biking) are replaced by inefficient car centric
| transportation, parking lots, parking garages, street parking in
| most the US.
|
| I don't know how we are going to reach the goal of reducing our
| carbon footprint.
|
| What's next is: world wide famines, commodity wars
| mattwest wrote:
| If you read the article, it states the shortage has to do with
| flooding, not drought.
|
| While most of your points are true, they are skewed toward some
| resentment toward the West.
|
| The eating habits of rich countries, relative to developing
| countries, has become much more sustainable. Look at meat
| consumption by source, over time, in USA. Chicken, which has
| the highest feed conversion ratio, leads the pack by a huge
| margin since the late 90s/early 2000s.
|
| Developing countries' demand for meat has exploded and will
| continue to rise as incomes go up.
|
| What percent of the global population lives in a developing
| country? ~85%.
|
| Over time, these countries will be responsible for most meat
| consumption. And emissions.
|
| Regarding pollution, you are focusing on the wrong things.
| Sure, private jets are inefficient. What is their contribution
| to GHGs? Less than 0.05%. Super car and yachts? Come on..
|
| As energy infrastructure is built out for this 85% of the
| population, the emissions per nation will flip on its' head.
| photochemsyn wrote:
| This article is interesting as it's from the perspective of a
| major exporter, India, (rather than a commodities trader):
|
| https://indianexpress.com/article/business/economy/india-ric...
|
| > ""We can't resume broken rice exports just because somebody in
| China or any other country wants it as a raw material to make
| ethanol or cattle feed. We'll rather prefer our domestic industry
| consuming it... We don't want to take a chance. We've limited
| wheat stocks but ample rice stocks, which we can use if the
| weather throws any big surprises."
|
| Incidentally, much of the research into how rice production
| responds to rising CO2 and rising global temperatures was based
| on greenhouse studies in which CO2 and temperate was artificially
| manipulated, for example:
|
| https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6751296/
|
| However, it's turning out that the increasingly random and
| extreme incidences of droughts and floods is what's impacting
| agricultural production the most. India's approach seems the most
| rational: build bigger domestic buffers against future
| uncertainties.
|
| Also, the future of biofuels and meat production looks quite
| poor, as crop production is going to be needed to feed humans
| directly.
| feedsmgmt wrote:
| I hope that areas producing a lot of cotton and tobacco have
| strong enough ethics to switch to food producion to help those
| most in need rather than those seeking luxuries.
| selimthegrim wrote:
| The system of domestic buffers existed before for public
| distribution system inherited from British in both India and
| Pakistan who were told to get rid of it by IMF. Pakistan did so
| with alacrity in 80s but still has utility stores at province
| level IIRC.
| omeid2 wrote:
| A lot of livestock feed is produced in environments where rice
| or wheat is out of question.
| littlestymaar wrote:
| It used to be the case, when cattle was grazing hills too
| steep for culture (without terraces at least). But nowadays,
| most cattle is fed from cultivated grains instead of grazing.
| akiselev wrote:
| Do you have a source on that?
|
| My understanding is that most cattle are _finished_ on
| grain but most of that feed is distillers grains [1], which
| is an industrial waste from ethanol and biofuel production.
| The majority of cattle spend most of their lives
| _brackgrounding_ [2] in pasture. They 're not put on the
| feedlots until the last six or so months of their life to
| fatten them up for butchering.
|
| [1] https://en.wikipedia.org/wiki/Distillers_grains
|
| [2] https://en.wikipedia.org/wiki/Backgrounding
| chrisco255 wrote:
| It's not even true that most cattle are finished on
| grain. Feed lots utilize hay and silage as often as
| grain.
| nomel wrote:
| And sometimes candy corn [1].
|
| [1] https://www.nifa.usda.gov/feeding-candy-cattle-helps-
| produce...
| Broken_Hippo wrote:
| Which I wholeheartedly support.
|
| I worked as seasonal help in a local chocolate and candy
| factory. Any chocolate not fit for sale for whatever
| reason went to sheep (and possibly pigs?) It is a good
| way to lessen food waste.
| chrisco255 wrote:
| I used to own a horse and would regularly feed her sugar
| cubes. I guess that works too!
| littlestymaar wrote:
| From the perspective of this discussion, hay and silage
| are indistinguishable from grain: if you can grow and
| harvest them, you could have make human food directly off
| that land.
| littlestymaar wrote:
| Maybe in the US, where there's plenty of available space,
| but that's definitely not the case everywhere in Europe
| for instance. Also in the US, I wonder which part of that
| space in unsuitable for growing grain...
|
| By the way, even your Wikipedia link about backgounding
| mention that the animals are being given grain even in
| that period...
| robocat wrote:
| A lot of the world production is grazing on land. Even in
| the US perhaps a huge percentage of the cattle growth is
| by grazing: Beef cattle production is
| done within a system that includes grazing on large
| amounts of land per cow; being fed high-calorie diets for
| a few months in large populations immediately prior to
| slaughter; long gestation and growth periods so that
| animals are sold for food 2-3 years from the time they
| were conceived; and, in most situations, more than two
| changes of ownership from birth to being sold for food.
|
| I would like to see some figures, but my presumption is
| that your understanding is correct.
|
| https://beef2live.com/story-world-beef-production-
| ranking-co...
| marcosdumay wrote:
| A lot of people just get the data from the largest
| companies in developed countries, and pretend it applies
| everywhere. You can't talk about agriculture around here
| without one of them popping up.
| neovialogistics wrote:
| Wheat can reliably grow pretty much anywhere except
| nonirrigated clearcut former jungle, it's just not
| economically competitive (on the global market) when it has
| to be harvested from any kind of sloped terrain.
| ren_engineer wrote:
| I mean this is the whole point of the US ethanol industry and
| farm subsidies in general(that many people complain about
| online), better to have people growing too much corn than not
| having enough. If the US did have some drought or disaster that
| damaged a huge amount of crops, we just stop making ethanol and
| use the stockpiles and reduced crop to feed ourselves. In the
| meantime we use the excess for ethanol production, even if it's
| technically a net loss
| SaintGhurka wrote:
| >> this is the whole point of the US ethanol industry and
| farm subsidies in general
|
| Interesting. I never saw it as a food security program.
|
| I saw it as a way to advantage corn at the expense of oil on
| the global commodities market because we had lots of corn but
| we were short oil (at the time). So the solution was to, in
| effect, turn our corn into oil.
|
| You can see its effect in the price of corn in 2006, which
| jumped about 80% and never went back down.[1]
|
| [1] https://www.macrotrends.net/2532/corn-prices-historical-
| char...
| singleshot_ wrote:
| If the disaster that damaged the crops was "we used up all
| the soil" I'm not so sure this would work as a strategy. Is
| using up all the soil by growing ethanol a concern?
| voldacar wrote:
| The whole point of the US ethanol industry and farm subsidies
| in general is, like any form of government welfare, to give
| money to a special interest group (farmers) in exchange for
| their political support. It's not some kind of benevolent
| 4-dimensional chess to make the food supply more reliable.
| The type of corn grown for ethanol is not suitable for human
| consumption.
| shard972 wrote:
| [dead]
| quantum_magpie wrote:
| Aren't ethanol, animal feed, and human food corn all
| separate, non-interchangeable species? Usually ethanol stuff
| and animal feed stock are completely inedible, at least in my
| EU country.
| tomatotomato37 wrote:
| That's mostly inedible for direct consumption, like corn on
| the cob. Processing into something like cornmeal though is
| open to much more species, including the original maize
| that all corn was essentially bred from.
| jandrese wrote:
| Yes, but the farm equipment that plants and harvests it is
| the same. Planting different seeds is easy, buying new
| equipment is not.
|
| Also, as the transportation sector transitions to electric
| vehicles the demand for corn ethanol should drop off so if
| we need to produce more edible corn there should be excess
| capacity available.
| stevehawk wrote:
| might be separate, non-interchangeable species (I don't
| know) but they require the same farmers, equipment,
| logistics, etc, to be in place and as everyone learned the
| last few years those things don't just scale up and down
| like _latest cloud tech here_.
| cnntth wrote:
| The land is interchangeable, and 'human food corn'
| encompasses a lot more than just corn eaten directly by
| humans. Almost every processed food in the US uses some
| corn derived product; and animal feed is still part of the
| supply chain for human food.
| dividedbyzero wrote:
| I'm not sure how that works with corn, but quite a few
| things that aren't fit for human consumption in times of
| plenty are quite edible in a famine, or can be made so.
| MichaelZuo wrote:
| I don't think it's that but that most human digestive
| systems will catastrophically fail trying to digest
| ethanol-corn or animal feed-corn.
| AlotOfReading wrote:
| You can eat field corn just fine. You shouldn't eat it
| raw at maturity because of the high starch content, but
| the solution to that is simply to harvest a bit earlier
| before all the starch is formed. It's not very sweet, but
| it's perfectly edible.
| fwungy wrote:
| If weather could be modified on a global scale it would be one of
| the greatest weapons of all.
|
| There are hundreds of patents for weather modification
| techniques, many filed recently.
|
| The unusually warm Winter in Ukraine has hurt the Russian war
| effort, and protected Europe from economic devastation.
|
| The timing was quite fortuitous.
| mattwest wrote:
| Example of one of these techniques please
| nocsi wrote:
| Capturing comets to cool the earth. Triggering volcanic
| eruptions to heat the earth
| fwungy wrote:
| https://patents.justia.com/search?q=weather+modification
| r3trohack3r wrote:
| See sibling comment. All non-government weather modification
| projects in the U.S. must file form 17-4(a) with the NOAA.
|
| All submissions have been indexed and are viewable on their
| webpage.
| mattwest wrote:
| Every submission in there has to do with precipitation. I
| was curious which techniques are used to sustained warming
| throughout the winter
| fwungy wrote:
| The atmosphere is enclosed. You can't change the weather,
| but you can move things around. Europe had an unusually
| warm Winter. The US had an unusually cold one. It was
| just amazing timing for the Ukranian war effort.
|
| With a normal European Winter NATO would have fallen
| apart as the EU cracked on the Russian energy sanctions
| to warm themselves, and the Russian army would have had
| massively increased mobility options with frozen ground
| in the Ukraine.
| r3trohack3r wrote:
| A friendly reminder that in the U.S., as a non-government
| organization, if you'd like to modify the weather you need to
| fill out the NOAA form 17-4(a).
|
| This is required by U.S. Code 15SS 330a as per Public Law
| 92-205 (1972): https://www.law.cornell.edu/uscode/text/15/330a
|
| All weather modification projects that have been filed with the
| NOAA under this law can be found here:
| https://www.library.noaa.gov/Collections/Digital-Collections...
|
| It's important to note that religious ceremonies are exempted
| from this law. NOAA form 17-4(a) does not need to be submitted
| for rain dances or other religious ceremonies intended to
| change the weather. This, however, is likely to change if the
| success rates of your weather ceremony become statistically
| significant.
| fwungy wrote:
| Except the ones that are done under high secrecy for national
| security purposes.
|
| Weather is a huge factor in warfare and the economy. If it
| could be manipulated to put an enemy in a bad position that
| would be a powerful weapon indeed, best yet it would be one
| with plausible deniability.
| jutrewag wrote:
| _It's important to note that religious ceremonies are
| exempted from this law. NOAA form 17-4(a) does not need to be
| submitted for rain dances or other religious ceremonies
| intended to change the weather. This, however, is likely to
| change if the success rates of your weather ceremony become
| statistically significant._
|
| What a beautiful way to put this.
| Loughla wrote:
| Why is the increase in every single food item tied to the war in
| Ukraine?
|
| Is that legitimate, or is that just timely excuse making?
| coliveira wrote:
| [flagged]
| eatsyourtacos wrote:
| What a selfish take.
| Animatronio wrote:
| Yes, a selfish take from some IT guy making significantly
| more $$ than the average Brit or EU citizen. It's nice to
| be insulated from the rising COL bc you can lecture others
| from the safety of your home.
| pb7 wrote:
| We pay good money for that home to be safe, something
| Europeans constantly chide us for. Maybe Europe shouldn't
| have been relying on cheap resources.
| yamtaddle wrote:
| We? As in the US?
|
| The oceans keep us safe. The money we spend is to
| maintain hegemony.
| pb7 wrote:
| Are you sure its just the oceans and not the massive navy
| we have in them?
| yamtaddle wrote:
| Yes. Invasion is basically logistically impossible
| without the assistance of Canada or Mexico, and _with_
| their assistance, would require a large, obvious, and
| vulnerable preparation lasting at least many months.
|
| Of course our having a navy is a good idea. I'm obviously
| (and I think you know this) not advocating complete
| disarmament. We probably don't need a navy large enough
| to project force to the literal other side of the world
| _in multiple places at the same time_ , though. Nor a
| standing army large enough to invade and occupy 2+ weaker
| countries at the same time.
|
| The vast majority of our military spending is about
| hegemony maintenance and the ability to impose our will
| around the world, not defending ourselves. Our oceans _do
| in fact_ put us on easy mode, for simply defending
| ourselves--we don 't need the world's strongest military
| to do it.
| mrguyorama wrote:
| Aircraft carriers are basically by definition not
| defensive.
| pb7 wrote:
| A navy is an effective mobile border when you don't have
| a Hawaii everywhere. It's easier to defend your castle
| when your first wall is 2000 miles from your natural
| border.
|
| Plus the best defense is a good offense. Nukes aren't a
| defensive weapon and yet they're an effective deterrent.
| Animatronio wrote:
| Well, since EU is most definitely NOT safe from Russia
| I'd say you either don't pay enough or the money's
| squandered on something else.
| pb7 wrote:
| EU's safety is the EU's problem. It has long been
| underinvesting in security hoping that the US would be
| its bodyguard. Time to see how little money you have left
| over for social safety nets when you're not buying cheap
| resources from the same enemy you need protection from.
| Animatronio wrote:
| If EU's safety is its problem then why are we not allowed
| to take an independent stance in any matter? As to the
| cheap resources, I'm sorry we didn't invade Iraq, Libia,
| Syria to get oil for pennies. The EU bought at market
| price from Russia, what's your point? Was US oil cheaper
| and we said no?
| pb7 wrote:
| >If EU's safety is its problem then why are we not
| allowed to take an independent stance in any matter?
|
| The EU pushed for sanctions just as much as the US did,
| you just don't like the outcome.
|
| >As to the cheap resources, I'm sorry we didn't invade
| Iraq, Libia, Syria to get oil for pennies.
|
| Well, first, you need a military to be able to do that.
| Second, we don't get oil for pennies anymore but we're
| not under existential crisis as to the future of cost of
| living.
|
| >The EU bought at market price from Russia, what's your
| point?
|
| You built a dependence on a country you're now scared of
| and that manages to get by without your money and that
| was a strategic mistake. The US has and is making a
| similar mistake with China. If the China situation pops
| off, it'll be the same thing here (and Europe is going to
| feel the pain of that because it's reliant on China for
| cheap tchotchkes too).
| Animatronio wrote:
| The US has plenty of useful idiots in positions of power
| in the EU, yes. They knew precisely what sanctions meant
| for the populace but went ahead anyway.
|
| As to the military I'd like to refer you to this:
| https://www.politico.eu/article/europe-nato-problem-
| defense-...
|
| A couple of quotes:
|
| "Opposition comes not only from the U.S., which despite
| Trump's browbeating of allies to spend more, is intent on
| preserving a 70-year-old framework that lets Washington
| call the shots and put its interests first."
|
| "Under the guise of avoiding "duplication" and demanding
| "complementary" capabilities, the U.S. and NATO's
| political leaders continue to put up strong resistance to
| the EU ever developing the command-and-control
| capabilities that would allow it to operate outside of
| the alliance's existing umbrella."
|
| At least on the China situation we seem to agree...
| tekla wrote:
| Impressive how absolutely no evidence is given by such a
| massive claim.
|
| At least attempt to refute the article which makes multiple
| separate claims as to why there is a shortage.
| maerF0x0 wrote:
| The supply is obvious, but the wise/stupid judgement is
| still up for debate.
|
| https://www.npr.org/2022/09/28/1125525861/how-the-war-in-
| ukr...
| FredPret wrote:
| Can't obliterate even the tiny Russian economy without some
| knock-on effects on the rest of the world.
|
| Between Russia and Ukraine, they produce some vital materials
| including lots of fertilizer, despite making almost no money.
| So while we're all taking a small financial hit right now,
| there are odd things like this as well.
| f6v wrote:
| > Can't obliterate even the tiny Russian economy without
| some knock-on effects on the rest of the world.
|
| Maybe the GDP isn't the best and only measure then.
| FredPret wrote:
| I'm partial to total net worth measurements, but in case
| of war, you have to take into account things like scarce
| materials and growing seasons of crops.
|
| Like how in Age of Empires you had gold as well as wood
| and food, if memory serves.
| risyachka wrote:
| I can buy you a ticket to Ukraine so you can check yourself
| if this is actually more harm or maybe less
| turingnerd wrote:
| I agree. I'll gladly help buy OP a ticket to Ukraine. Those
| of us that have family who have died in this war and others
| who are still suffering are more than proof that the cost
| of this war has a far greater toll on humanity than short
| term price increases. And, yes, I say that fully aware that
| economics impact and starve other humans, too. But lets
| remember who STARTED this war, and that the world has a
| moral obligation to do anything it can short of
| obliterating the earth with nuclear war to stop it and
| deter it.
| Animatronio wrote:
| Why would "the world" have any moral obligations? And why
| would the citizens of EU&UK have to suffer more than say
| those of US, AU, NZ, SK and so on?
| pb7 wrote:
| Why does everyone have to suffer from what happens in
| your backyard?
| Animatronio wrote:
| Nobody has to suffer, it's just that the sanctions don't
| work as intended and need to be lifted. Find other ways
| to help Ukr, don't f*k EU over.
| distances wrote:
| Sanctions do work, albeit not as well as everyone hoped.
|
| I don't think they should be lifted until Russia reforms.
| Not even when the war is over, unless accompanied with a
| regime change that takes serious steps to undo the
| imperialism.
|
| I think it's completely reasonable to expect Russia to
| get the same treatment as Iran and North Korea.
| [deleted]
| Atreiden wrote:
| Refusing to sanction an aggressive nation empowers that
| nation to continue its aggression.
|
| Sanctions can be painful in the short term, sure, but they're
| a necessary evil. They heavily disincentivize violence
| without the need for more violence.
|
| War is arguably the greatest source of human suffering in
| history.
| ihatepython wrote:
| Can you name one time in history where sanctions have
| actually worked?
| hef19898 wrote:
| The Iranian nuclear deal, until some stable genius ripped
| it appart.
| sneed_chucker wrote:
| It definitely put pressure on Rhodesia and South Africa,
| both of which eventually experienced regime change.
| FpUser wrote:
| No idea about Rhodesia but for SA I think it was mainly
| doing of ANC
| notch898c wrote:
| [flagged]
| f6v wrote:
| Sanctions are not designed to change the regime. Look at
| the French president complaining how it's "not fair" the
| the US seize the moment to lure European manufacturers to
| the USA.
| mrguyorama wrote:
| Cast your mind back to WW2, where the Allies' sanction of
| Japan basically set the wheels in motion for their
| collapse.
| kneebonian wrote:
| So there's a big long video by Petar Zeihan at the Iowa Pork
| Conference but the TL;DR is that the Ukraine and Russia are 2
| or the world's 3 leading producers of nitrogen.
|
| This is a critical component of fertilizer. Because of
| fertilizer we weren't just able to make land good for crops
| better for crops we were able to make land that was marginal
| for crops good for crops.
|
| Because of this we could farm a lot more land; however with
| less fertilizer suddenly that land can't be farmed. What this
| means is less arable land = less food.
|
| As a result the supply decreases while demand increases,
| leading to a price increase.
|
| So yes it is a real excuse, and the problem is that many
| nations in the world import more than 50% of their calories and
| almost no nations on earth are calorically self sufficient.
| deelowe wrote:
| Ukraine isn't called the breadbasket of europe for no reason.
| It's hard to grow crops for export when you're at war.
| Scoundreller wrote:
| Still only responsible for 3% of global production, and there
| are bigger European producers:
|
| https://www.weforum.org/agenda/2022/08/top-10-countries-
| prod...
| deelowe wrote:
| Wouldn't it make sense to combine Ukraine with Russia given
| the sanctions?
| Scoundreller wrote:
| No, because Russia has enough willing buyers for its
| production.
| qwytw wrote:
| But the problem now is that there is way too much grain in
| Europe to the extent that neighboring countries are banning
| imports from Ukraine to protect their farmers...
| qbasic_forever wrote:
| Didn't Poland decide they didn't actually need Ukraine's
| grain and it's just sitting in ports rotting?
| https://www.cnn.com/2023/04/16/europe/poland-bans-grain-
| ukra...
|
| Doesn't seem like there is much demand for Ukraine grain.
| distances wrote:
| > Doesn't seem like there is much demand for Ukraine grain.
|
| Always with the disinformation.
|
| Ukraine's main exports for grain are obviously not in
| Europe. https://oec.world/en/profile/country/ukr/
| qwytw wrote:
| > Always with the disinformation.
|
| There is no need for accusations like this. There is a
| grain glut in Europe to the extent that Poland and other
| countries are closing their borders to imports (I think
| it has something to do with the fact that's it's
| difficult ship over the black sea due to obvious reasons
| and the land routes are lacking in capacity).
|
| https://www.theguardian.com/world/2023/apr/17/slovakia-
| joins...
| distances wrote:
| Yes, exactly. There's large need for Ukrainian grain
| elsewhere, but export via sea routes is obviously very
| hard with the war going on. My comment was about the
| parent trying to twist this to mean there's no demand for
| the grain, which obviously isn't true.
| deelowe wrote:
| Export would include sea exports of course. Where's the
| misinformation?
| FpUser wrote:
| War in Ukraine is being used by politicians all across the
| world to distract from their own fuck-ups, power grab,
| infringement on freedoms etc. etc.
| kasey_junk wrote:
| The article suggests is due to rice replacing other grains in
| the global diet.
|
| Between Russia and the Ukraine 27% of the worlds wheat supply
| is impacted by the war and another 15% of the worlds corn.
|
| It seems reasonable to conclude that would have an impact on
| the price of other grain staples.
| puzzlingcaptcha wrote:
| And yet wheat futures (ZW) have been falling steadily for the
| past six months and are now below the pre-invasion levels.
| hef19898 wrote:
| price =|= availability
| puzzlingcaptcha wrote:
| The very purpose of futures contracts is to ensure
| availability in the future at a predetermined price. I am
| not sure what your point is.
| hef19898 wrote:
| That there is no guarantee that the stuff will be
| available so, thing shappen. Also, just because futures
| are cheap, doesn't mean stuff is available now or in the
| near future. It only means the markets think grain will
| be plenty at one point, and thus cheap.
| ta1243 wrote:
| All a low futures price means is that money men are
| betting there won't be a shortage, it doesn't say
| anything about whether there will be a shortage or not.
| pfannkuchen wrote:
| Price is not solely determined by availability, but it is
| largely determined by availability, especially in the
| case of rapid shifts in availability (since other factors
| take time to adjust in response).
| kasey_junk wrote:
| That would imply that rice pressure would come down in the
| future easing the deficit (assuming global tastes haven't
| permanently changed).
|
| The article mentions a surplus next year is anticipated.
| andrepd wrote:
| Across the EU at least, margins of big-box retailers have gone
| through the roof. So producers are shafted because fuel and
| fertilisers are crazy expensive, and consumers are shafted
| because prices are going through the roof much faster than
| wages. The middle-man with enough bargaining power to
| effectively dictate purchasing prices to producers absorbs all
| the profit, using "the inflation" as a marketing cover.
| f6v wrote:
| Yet Poland, Hungary, Slovakia, and Bulgaria say Ukrainian grain
| is too cheap and upsets local farmers. Guys, but the EU said it
| was for feeding the poor, and not for making pierogi. I'm so
| confused at this point.
| [deleted]
| yamtaddle wrote:
| Both could be true. A glut of product trying to make its way
| through ports & other logistic routes that it usually
| doesn't, might drive down the price of the product _at those
| ports_ --while, globally, the supply might be lower and
| prices higher.
|
| Think up a toy case with some remote old-west town coming
| into a glut of some bulky, perishable good, but having only
| one train line to distribute it, and the potential for this
| effect becomes clear. Or an island, or whatever. The
| logistics systems in question aren't _that_ isolated,
| obviously, but they still have limited capacity that 's
| unlikely to go up much in response to anything perceived as
| only a temporary situation, so they absolutely _might_ see
| local prices (including for export) depressed even as global
| prices rise. It 's not implausible.
| f6v wrote:
| I think it's a lot of words trying to justify why the
| "grain deal" hasn't achieved the declared goals. I'm sure
| lots of profit has been made though.
| metaphor wrote:
| > _Is that legitimate, or is that just timely excuse making?_
|
| Arguably[1] a bit of both.
|
| [1] https://scholarworks.umass.edu/econ_workingpaper/343/
| legitster wrote:
| I mean, 1/4 of the world's grain and fertilizer sources are now
| in a war zone. It would take some hubris to assume we weren't
| going to feel that in some way.
| AlecSchueler wrote:
| The war in Ukraine drives up prices of fuel which has a knock
| on effect to just about everything else.
| illiarian wrote:
| I wouldn't be surprised if it's also overlapping long tails
| of everything: from COVID global trade and shipping
| disruptions to war in Ukraine affecting grain shipments to
| rising fuel prices to...
| Paul-Craft wrote:
| Let's not forget natural gas is the main source of methane
| used to make synthetic fertilizers. Since Russian natural
| gas isn't flowing the way it used to, I can imagine that
| would increase the price of food.
| CannisterFlux wrote:
| "Climate change" is probably the long tail of everything
| you could add to the list. The flooding in Pakistan in 2022
| for example. Remember that one? It destroyed crops and then
| there's the draining and fixing the land afterwards,
| infrastructure damage making planting for the next season
| more difficult, and so on. Pakistan was the 3rd global
| exporter of rice after India and Thailand in 2021.
| qbasic_forever wrote:
| Saudi Arabia effectively sets the price of oil. Ukraine
| doesn't produce any of it. Some tanks banging around the
| countryside there are not major consumers of oil, one oil
| tanker crossing the ocean is burning and blasting through
| orders of magnitude more oil.
| tekla wrote:
| Who said that Tanks in Ukraine are the main drivers to oil
| price increases?
| qbasic_forever wrote:
| The person I'm directly replying to said the war in
| Ukraine is causing oil prices to increase. What else
| would be using major amounts of oil in a war?
|
| But like I said it's beside the point. The price of oil
| is effectively set by the production volume of Saudi
| Arabia. Ukraine does not factor into it at all.
| Retric wrote:
| Russia is a major oil exporter ~10 million barrels per
| day, and they are impacted by the war.
| qbasic_forever wrote:
| Their exports are humming along just fine as they've made
| new agreements with China and other countries to get out
| of the petro-dollar hegemony. It's been over a year and
| the sanctions against Russian oil exports appear to have
| done nothing.
| politician wrote:
| If I posted as frequently within the short amount of time
| as you have on this topic, my account would have been
| throttled. My account is frequently throttled for posting
| more than 5-7 times per hour, and yet, your recent
| history shows a far higher rate of posts in defense of
| Russia with no evidence of throttling.
|
| That's very interesting. I wonder if limits are relaxed
| above 8k karma.
| FpUser wrote:
| >"My account is frequently throttled for posting more
| than 5-7 times per hour"
|
| Same here.
|
| Possible answer:
| https://news.ycombinator.com/item?id=29718710
| [deleted]
| qbasic_forever wrote:
| I'm an American that's fed up with the continued support
| of sanctions and this useless war in Ukraine. We have
| flushed billions of dollars into this conflict and
| enacted pain on the world for zero gain. It's time for
| the west to admit failure on this and push Ukraine to
| bargain for a cease fire, even if it costs them contested
| territory like Crimea or Donbas. The history of conflict
| in those regions is quite complicated and zero concern
| for the US--we have far bigger problems at home to worry
| about.
| phpnode wrote:
| Your biggest adversary, one that's cast a dark shadow
| over your country and it's allies, one that's consumed
| trillions of dollars of defence spending over the last 75
| years, is now being ground down and exhausted with
| approximately zero of your countrymen's lives at risk and
| all for a mere few billion dollars. You're getting a
| bargain.
| Retric wrote:
| The USSR was a major adversary for roughly 45 years, 1946
| to 1991. The US provided them major economic aid in WWII
| which they leveraged into a massive expansion and had
| minimal interaction before the war.
|
| Russia is a politically distinct fragment of that empire,
| just like Ukraine.
| selimthegrim wrote:
| Indeed "glavniy protivnik/glavniy vrag" is what USSR used
| to call USA!
| thriftwy wrote:
| Nope. It wasn't. It was the _most likely_ adversary.
| Veroiatnyi.
| [deleted]
| distances wrote:
| This war is catastrophic to Ukraine, but relatively costs
| pennies to western countries. They absolutely should
| continue armaments as long as Ukraine is willing to
| fight. Not doing so would mean allowing fascism and
| outright genocide to spread on European soil, and _that_
| would have an astronomical cost in the long run.
|
| US and EU would be very, very shortsighted with their own
| interests if they didn't ship everything Ukraine wants.
| Animatronio wrote:
| Well, Ukr really wants foreign soldiers on the front
| line. Please tell me you're already there, or else I
| might suspect you're rooting for Putin!
| [deleted]
| jdmichal wrote:
| The best response I've heard to this is: Tell me which
| part of the US you would willingly give up to Russia if
| it threatened to attack. If your response would be for
| them to pound sand, why should we expect or want any
| different for the Ukraine?
| qbasic_forever wrote:
| The US doesn't launch artillery into its own states like
| Texas for example. This is why I say the history of
| conflict in Crimea, Donbas, etc. is complicated--Ukraine
| government for years has done much aggression against
| ostensibly its own people (including firing on them with
| artillery!).
|
| This is not a cut and dry, "Russia bad!! Russia
| invade!!". Some people in those contested regions
| welcomed Russia as protectors against Ukraine extremist
| aggressors.
|
| As an American I have no skin in this fight and nor
| should I, this is a conflict for Ukraine and Russia to
| sort out hopefully through diplomacy. Russia has been a
| world power for decades post USSR fall and clearly have
| not been on a megalomaniacal quest for world domination.
| I see no reason to assume they want to start another
| world war.
| HWR_14 wrote:
| The US most certainly has launched artillery into its own
| states, including Texas [1]. There's no benefit to doing
| so now, but if Mexico were to occupy all of Texas
| tomorrow, I guarantee the US would bomb inside Texas.
| Similarly, if Mexico just supplied support to get Texas
| to secede, there would also be violence.
|
| [1] https://en.wikipedia.org/wiki/American_Civil_War
| qbasic_forever wrote:
| The southern states started the civil war in protest
| against moves to end slavery which they profited from
| directly. It was not northern states deciding to be
| aggressors against the southern states for no good
| reason. The circumstances were completely different and
| you know it (it's in the wikipedia article you cite!).
| ImPostingOnHN wrote:
| the history may be complicated, and that's why it's up to
| the UN, or bilateral negotiation between russia and
| Ukraine, to resolve the issue, rather than russia using
| force and trying to genocide Ukraine because russia is
| mad they don't get everything they want
|
| indeed, as soon as russia abandoned the former,
| diplomacy, and resorted to the latter, force, they lost
| all benefit of the doubt and all rights to anything they
| wanted
|
| and that's to say nothing of the fact that russian
| soldiers rape, torture, and murder men, women, and
| children in areas of Ukraine they control, so ceding
| control means allowing that to happen, which obviously
| means it wouldn't actually lead to peace, because who
| would be peaceful sacrificing THEIR friends, family, and
| countrypeople to that? You?
| glogla wrote:
| I also wonder why what is basically Russian propaganda
| account has no limits and how it got to 8k karma, when it
| has basically nothing to say.
|
| I know there is practice of buying established accounts
| with bunch of karma / followers to use for both marketing
| and propaganda purposes so that might be this case.
| qbasic_forever wrote:
| Respectfully, you are delusional if you think I've been
| on HN for years, posting in lots of unrelated threads,
| etc. to be some apparatus of Russian propaganda.
|
| It's time to realize real, normal people are fed up with
| this useless conflict. That's the takeaway here that you
| refuse to see.
| glogla wrote:
| I know some people want Russia to win, and they are real.
| They are either ignorant or they are horrible and evil
| people.
| Animatronio wrote:
| Yes, people who don't think like you do are horrible
| human beings.
| baremetal wrote:
| "Everyone who disagrees with my point of view must be
| ignorant or evil" is a terrible argument and only
| strengthens his point.
|
| What a juvenile and reductive way to view people and
| relationships. Have you ever self-reflected and
| considered maybe you might be wrong about anything, ever?
| Have you ever extended any generosity of argument?
|
| How about people are genuinely tired of the bs.
| glogla wrote:
| We are talking about genocidal war where the first thing
| the occupiers establish in occupied territories are
| torture rooms. Just last week, Russian soldiers admited
| on camera they had orders to murder children and went
| along with it.
|
| What kind of self reflection would make people who are ok
| with that not complete filth I wonder?
| ImPostingOnHN wrote:
| Maybe some people don't realize that russian soldiers
| rape, torture, and murder men, women, elderly, children,
| in areas of Ukraine they control (as confirmed by UN war
| crimes investigations)?
|
| Maybe these people are simply okay with that happening
| because they are 'tired'?
| [deleted]
| AlecSchueler wrote:
| But the price of oil and gas is still up in Europe.
| ta1243 wrote:
| In the UK I was filling up the other day and reflecting
| how I'd being paying the exact same price 10 years ago.
|
| My current car costs me 15p/mile to drive. Back in 2000 I
| remember it was costing me about 13p/mile -- that was in
| a car with worse mpg, but either way it feels it's never
| been cheaper to drive in the UK.
|
| In 2004 it was 80p a litre, or PS1.57 in today's money
| [1]. I filled up for well under PS1.49 - I don't recall
| exactly.
|
| In 2008 petrol peaked at PS1.20 or PS2.05 in today's
| money, about the same peak as last year's PS1.90 a litre.
|
| In real terms petrol today is well below 2018 levels
|
| [0] https://www.racfoundation.org/data/uk-pump-prices-
| over-time
|
| [1]
| https://www.in2013dollars.com/uk/inflation/2004?amount=80
| hardware2win wrote:
| I'd argue that there is shitton of logistics around war
| which requires a lot of transportation
| Paul-Craft wrote:
| I believe the fuel being referred to is natural gas, much
| of which has historically come from Russia.
| theandrewbailey wrote:
| Russia is a major producer of oil and gas, which has been
| extremely sanctioned. Oil and gas that used to come from
| Russia need to come from somewhere else, raising demand
| (and thus, prices) for other producers.
| qbasic_forever wrote:
| No Russia made new agreements with China, India, etc. and
| their oil and gas is being "laundered" through sales to
| those countries and back out to the west. The sanctions
| have failed to do anything.
| andreygrehov wrote:
| Not only failed, but backfired. All these
| Russia/China/India deals is the result of the sanctions.
| Heck, even Japan is now ignoring the price thresholds and
| buys from Russia.
| qbasic_forever wrote:
| Yup, and no one is paying for oil in dollars anymore. The
| global value of the dollar is going to be destroyed over
| time. It's really breathtaking how quickly the west has
| decided to shoot itself in the foot with nothing to show
| for it.
| boc wrote:
| Cite your sources for the claim that "no one is paying
| for oil in dollars anymore"
|
| The West has stood up to a blatant land-grab invasion and
| has armed Ukrainians with the means to defend themselves
| effectively. Decimating the Russian military without
| firing a shot is objectively a NATO victory, regardless
| of the ultimate outcome.
| ren_engineer wrote:
| the ham-fisted SWIFT ban was the real mistake and that is
| what's driving countries away from the dollar more than
| anything. Removing Russia from SWIFT was the financial
| equivalent of launching nukes and will be seen as a major
| mistake long term
|
| China's competitor to SWIFT has doubled in transaction
| volume since the sanctions and is growing fast - https://
| www.ft.com/content/6d5bbdbc-9f5d-41b2-ba80-7d8ac3973...
| boc wrote:
| Russia's economy is smaller and less diverse than the
| state of New York. People treat Russia as a near-peer
| when they are in reality a backwater gas station strapped
| to a cold-war era nuclear triad. The fact that their
| military can't defeat _ukraine_ is absolutely baffling,
| but indicative of how rotten that country has become.
|
| Cutting them off from SWIFT isn't a nuke in the new
| financial Cold War. It's the consequence of the path
| Russia chose when they started this incredibly stupid
| invasion.
|
| Framing western reactions to Russian stupidity as "the
| real mistake" shows that you aren't paying enough
| attention. The US threw down the gauntlet against an
| unimportant Russian invasion to ensure China gets the
| message that the United States is ready for economic
| warfare over Taiwan. If that action decreases the
| likelihood of invasion by just 10-20%, it's certainly
| worthwhile.
| simonh wrote:
| The Yuan has lost 7% of it's value against the Dollar in
| the last 3 months. The fact is the Dollar is incredibly
| strong, it's up over 6% on a year ago. Yes trade in
| marginal currencies like the Yuan is up because Russia is
| desperate, they will trade in anything right now, but
| this is all small change. It's easy to double
| transactions when they start from such a pitifully small
| level to start with. Demand for dollars is as high today
| as ever.
| andreygrehov wrote:
| https://www.wsj.com/articles/russia-turns-to-chinas-yuan-
| in-...
| kasey_junk wrote:
| Russia _has_ to use the yuan but that's a far cry from
| "everyone".
|
| China just paid for their first boat of yuan settled LG
| on the open market 20 days ago. After 6 years of offering
| it on their exchange. Their meeting with the Saudi's last
| month came with non-committal statements, again, 6 years
| after they first started.
|
| I think the yuan becoming more involved in the energy
| trade is inevitable, they are the largest energy importer
| in the world and a major economy. It may have even been
| accelerated by the sanctions on Iran and Russia. But to
| say that "no one is paying for oil in dollars anymore" is
| a ludicrous statement (probably one that comes from the
| posters hopes not the facts).
|
| And adding the petroyuan to the mix is more dangerous to
| the Chinese currency than to the dollar. It immediately
| becomes imminently arbitrage-able in ways it can't be
| currently due to currency controls. The Chinese
| government has been de-liberalizing their currency
| because they are worried what the markets will do to it.
|
| That's not to mention their treasury exposure, trade
| surpluses and the Middle Eastern states currency pegs.
|
| A de-dollarization of the energy market will make it less
| efficient and may cause some rebalancing of currency
| reserves, but it will drive all settlement currencies to
| free market parity which is good for western currencies
| and bad for Chinese and Russian ones.
| andreygrehov wrote:
| I agree that "no one is paying for oil in dollars
| anymore" is an overblown statement. However, the de-
| dollarization process was started in 2014 and will keep
| getting stronger. This matches the recent leaks (as well
| as the video confirmation by Francois Hollande - the
| former President of France), that the 2014 coup in
| Ukraine was staged and sponsored by the US. As a
| Ukrainian, I tend to believe that a good portion of the
| conflict between Russia and Ukraine is driven by the de-
| dollarization fears of the US. The global superpower
| country is basically losing its main leverage, which is,
| in my personal opinion, a _huge_ deal.
|
| While the mainstream media keeps it all super positive, I
| think the US did a lot of miscalculations within the past
| several years. And honestly, something tells me that
| Putin will outplay them all. The guy is extremely smart
| and it's foolish to downplay him and say he is not. We
| shall see.
| kasey_junk wrote:
| I'm not going to comment on your other opinions as I
| don't have relevant experience. But de-dollarization was
| a common refrain in my field (finance) going back to
| before I was involved in it (2001).
|
| I've seen everything from Nixon in China to the current
| Russian sanctions being used as reasons for it. I suspect
| the real reason it will happen is that people can make
| more money trading in yuan (or rupee) than in usd. Sadly,
| Russia and Ukraine just aren't important enough to make a
| dent.
|
| My personal opinion is that the dollar is the reserve
| currency (and thus the petro currency) is due to much
| less conspiratorial reasons. It spends all over the
| world. It isn't debased frequently and it isn't volatile.
|
| China could introduce a currency that had all those
| properties tomorrow. That they haven't is an indictment
| of using the yuan as a reserve currency. It would take a
| significant change to Chinese economics to make that
| true.
|
| But! If China did that it wouldn't save Russia. Modern
| currencies hate autocracy and despotism because it runs
| counter to their premise. It doesn't help Russia for
| China to liberalize, the only thing that helps them is
| their own liberalization.
| andreygrehov wrote:
| Thanks for the common sense response.
|
| > My personal opinion is that the dollar is the reserve
| currency (and thus the petro currency) is due to much
| less conspiratorial reasons.
|
| Agreed. There is zero conspiracy around that, which is
| why I believe the US loosing the natural power of the
| Dollar is a logical fear.
|
| > It would take a significant change to Chinese economics
| to make that true.
|
| ..which is what BRICS aiming for? If that is one of their
| goals, nothing is going to stop them. And honestly,
| that's a good goal to have. Putting all the negative
| narrative around Russia/China aside and abstracting away
| from the US, why should a single country's currency
| dominate over the entire world? That's simply not fair.
|
| > If China did that it wouldn't save Russia
|
| I somewhat disagree. Russia is not looking to be saved by
| anyone. Putin's interest is a mutually beneficial
| partnership. He's a businessman. He's cool with yuan (or
| any other currency) being the new reserve currency. On
| the other hand, he is not cool with the US pushing to be
| the superpower dictating the rules, which obviously goes
| against the United States' goals and ambitions. I could
| be wrong, but that's my understanding of things.
| kasey_junk wrote:
| BRICS is not some counter balance to the US petro dollar.
| It is at best a coffee claque of countries with the most
| currency controls of any major economies and at worse a
| Chinese op to make the yuan more powerful. But the
| problem is that none of the BRICS nations want a market
| currency! They want a less dominant USD (which I
| personally think is understandable but short sighted) but
| they haven't offered a viable alternative.
|
| That is to say they each want their own currency to be as
| valuable as USD but haven't done the things it would take
| to make that happen.
|
| I don't think it is "fair" that the USD is dominant but I
| think that oil settlement in other currencies is much
| less detrimental to USD than many people think. Again, if
| you can settle oil in your currency, you've effectively
| put it in competition with USD. The Chinese government
| has been fighting that outcome for as long as there has
| been modern Chinese currency, and frankly every other
| currency besides INR doesn't matter for this conversation
| and INR also has been very controlled.
|
| People seem to have it backwards. Global trade attaches
| to liberal currencies because that's good for global
| trade. The US has the most liberal currency of all time
| (and the most liberal currency currently even with
| Russian sanctions) and that makes it the petro currency.
| If the yuan or the rupee liberalize enough to take over
| the petro trade then there won't be much impact on usd
| but if they don't then market forces will hurt them more
| than the US.
|
| The thing that might cause a USD fall is a default on usd
| debt or the us becoming more conservative on their
| currency controls but there is so far to go on that
| compared to their comps it's hard to extrapolate.
|
| I don't have opinions on Putins desires, it's outside of
| my understanding. But picking the Chinese in a
| relationship where they have more powers than the
| previous relationship with Europe seems crazy to me. But
| international politics is not my sphere.
| simonh wrote:
| It's getting hard to keep taking what you're posting here
| seriously. It's so wildly over the horizon from reality,
| it's hard to see the point of replying.
|
| There is zero threat to the dollar. Demand for dollars is
| higher than ever, and it's still the primary currency for
| the oil trade, and pretty much any international trade.
| The recent economic instability has, as always happens,
| lead investors to flee to stability. That's the dollar,
| which is why it's up 6.6% over the last year.
|
| What we have to show for the last year is utterly
| humiliating the Russian military, successfully helping
| Ukraine repel an assault on their capital, and push back
| the Russian army twice since in significant territorial
| losses. The west has never been more united, NATO is
| stronger than ever. The AUKUS pact and US-European
| alignment on Taiwan has solidified, despite typical
| French squirming, but they'll come around. They always
| do.
|
| It's not like the economic picture is all roses, far from
| it, but that was happening already. The main achievement
| is that the fantasies Putin had of rolling back NATO are
| dead in a ditch, and I think the chances of a Chinese
| attack on Taiwan in the coming decade are half or less
| what they were a year ago.
| kasey_junk wrote:
| It was big news this month when Russian oil exports
| finally made it back to prewar levels. Their revenue is
| still off by ~45% from prewar.
|
| The sanctions absolutely did something. Though I think
| it's reasonable to ask if they caused a net increase in
| the cost of oil after the initial shock given how big a
| discount Russian oil buyers are getting. Though even if
| exports stabilized it's possible the market is paying a
| risk premium.
| somenameforme wrote:
| The point of the sanctions was to impact Russia's
| economy. Remember whole 'ruble is rubble' thing? The IMF
| expects Russia's economy to see net growth this year [1]
| after seeing a total decline of -2.1% last year. Their
| inflation rate is currently 7%, expected to hit 4.6% by
| the end of the year.
|
| As for oil prices, it's important to remember that oil
| prices before the war were very high, and they got even
| higher in the early parts of it. In February 21, 2022
| (the invasion was on the 24th) prices were at $90/barrel.
| They hadn't been that high since 2014. [2] So it's easy
| to be somewhat misled just considering before/after
| scenarios.
|
| [1] - https://www.imf.org/en/Countries/RUS
|
| [2] - https://tradingeconomics.com/commodity/crude-oil
| 0xDEF wrote:
| The IMF is using the countries' own claims and numbers
| for their calculations. Russia's own economic numbers
| have been unreliable since Covid hit and blatantly cooked
| up since the February 2022 invasion of Ukraine.
|
| This paper gives a more correct view on the dire state of
| the Russian economy:
|
| https://papers.ssrn.com/sol3/papers.cfm?abstract_id=41671
| 93
| thriftwy wrote:
| That article is almost a year old now. Where's the
| collapse?
| kasey_junk wrote:
| I think it's entirely fair to suggest the sanctions did
| not achieve their desired goals.
|
| I think it's an entirely different thing to suggest it
| did "nothing".
|
| Oil revenues are off 45%. Its GDP was down 2% in 2022
| while the thing it exports was up. Saudi Arabia's and the
| UAE GDP set a record over the same time period as a point
| of reference. The OECD and World Bank anticipate GDP
| shrinkage this year as well.
|
| The ruble is at its lowest point in 20 years (if you
| remove the war shock). Thats even with the heroic
| activity of their central bank last year and current
| capital flight restrictions. Their sovereign wealth fund
| holds 16% less today than it did before the sanctions,
| because its being used to backstop the currency.
| s1artibartfast wrote:
| While partially true, you would still expect cost
| increases from oil flowing through China and India.
|
| I believe Russia is also a major fertilizer exporter and
| nitrogen fertilizers have more or less doubled in price
| hollerith wrote:
| Nitrogen fertilizer is made from natural gas, so maybe
| the nitrogen fertilizer plants in the EU were shut down
| to ensure adequate supplies for the EU's more inelastic
| demands for natural gas.
|
| (More precisely, the natural gas is a cheap source of
| hydrogen atoms that get combined with nitrogen in the air
| to produce the fertilizer.)
|
| Maybe Russia realized that it would be profitable to use
| some of the natural gas it could no longer sell to Europe
| to make nitrogen fertilizer, but it takes many months to
| build the capacity to produce and export it, and in the
| meantime of course the price remains high.
| [deleted]
| f6v wrote:
| The sanctions didn't fail. They probably complicated the
| oil transport logistics a lot. There's been stories of
| how uninsured Russian tankers offload oil bear Gibraltar.
| Then the oil goes somewhere in China(or India). I suppose
| it's going to find its way back to Europe as "Indian
| diesel".
|
| So, exactly as you describe. But all of this should add
| costs even if the crude oil prices are at the proposed
| ceiling.
|
| Who lost? Russia and the EU. But who said that wasn't the
| plan.
| qbasic_forever wrote:
| It's been a year, where is this collapse of the Russian
| economy? It looks like they're doing just fine and can
| continue to wage war near indefinitely. What are the
| sanctions even doing at this point??
| f6v wrote:
| The sanctions were supposed to sever the ties between
| Russia and the EU. That worked perfectly. Same as the
| refugee crisis. The two most active supporters of
| Ukraine(USA and UK) take almost no refugees from Ukraine.
| It's the EU that suffers from having to support them.
| qbasic_forever wrote:
| What? The US has taken an enormous amount of Ukraine
| refugees:
| https://www.nbcnews.com/politics/immigration/us-
| admits-27100...
|
| 271,000! That's over double their goal of 100k! They
| explicitly got rid of refugee restrictions put in place
| at the start of the pandemic so they could let in Ukraine
| refugees.
| f6v wrote:
| Bulgaria, Romania, Slovakia combined took twice more than
| that. 271k is nothing for US given their role in the
| conflict.
| ImPostingOnHN wrote:
| "given their role in the conflict" is pretty ambiguous,
| if you're referring to russia's war on, and latest
| genocide of, Ukraine
|
| could you elaborate on what role you're speaking of, and
| why you personally think it makes the admittances below
| your standards?
| qbasic_forever wrote:
| Those countries are next door to Ukraine, a refugee can
| literally walk to them vs. someone paying for a plane
| flight to the US. Of course neighboring countries will
| have more refugees...
| loeg wrote:
| The Russian economy absolutely cratered when sanctions
| were rolled out. What are you talking about?
|
| https://tradingeconomics.com/russia/stock-market
|
| https://www.consilium.europa.eu/en/infographics/impact-
| sanct...
| qbasic_forever wrote:
| Russia has bounced back and are continuing to wage war
| just fine despite the sanctions. What is the point of
| them now?
| loeg wrote:
| I don't think Russia has "bounced back." And coloring
| their war-making ability as "just fine" erases all
| differentiation in cost and effectiveness caused by
| sanctions.
|
| > What is the point of them now?
|
| I mean, I think they still impose cost and hinder
| Russia's war-making ability. So it's good to keep them if
| you like that impact?
|
| You have also moved the goalposts some from upthread[1]:
|
| > The sanctions have failed to do anything.
|
| [1]: https://news.ycombinator.com/item?id=35628560
| simonh wrote:
| Sanctions are greatly increasing the cost of the war to
| Russia, and reducing their industrial capacity to wage
| it. Their rate of shelling as been falling steadily, and
| they are losing armoured vehicles at twice their
| replacement rate. Their spring offensive was so futile
| there was actually a lot of confusion about whether they
| actually launched it yet. They had, and it got massacred.
|
| Easing sanctions would greatly increase the rate at which
| they could produce military equipment, particularly high
| tech guided munitions. That would equal more dead
| Ukrainians.
| fwungy wrote:
| Russia has $75T in known resource reserves. The US is
| second at $45T.
|
| Do you really think Russia can't afford to insure oil
| tankers if the West refuses to do it?
| badpun wrote:
| It's not about "afford" (insurance is, after all, a
| profit-generating business), it's about being able to.
| fwungy wrote:
| They have the resources to make their own insurance
| company.
| badpun wrote:
| The question is, will this company be recognized by all
| required players (ports, authorities etc.). If you're
| insuring something worth hundreds of millions of dollars,
| you really want the insurance company to meet certain
| standards, and have a good reputation of paying out. Can
| Russian achieve that? Probably. Can they do it quickly?
| That sounds much trickier.
| fwungy wrote:
| If Russia doesn't back its insurance it loses credibility
| around the world.
|
| Russia is a major player in the oil world. It has the
| relationships and experience to manage this.
| fauxpause_ wrote:
| This is extremely wrong. The pipes are not flowing. There
| is oil being transferred via ships, but this is a much
| smaller volume and is much more expensive. It is not
| possible to sell the same amount without the pipelines to
| Europe.
|
| Russian exports and revenues have fallen drastically.
| qbasic_forever wrote:
| You are not up to date on the reality of the situation,
| Russian oil exports are back to prewar levels:
| https://www.cnn.com/2023/04/14/energy/russia-oil-exports-
| iea...
|
| They sell oil to a lot more places than Europe!
| 0xDEF wrote:
| Do not conflate volume with value and oil with natural
| gas.
|
| Natural gas exports to Europe was Russia's _big_ thing.
| The value of their oil and natural gas exports to the
| rest of world has failed make up for this loss.
|
| Even for Russian oil your own link says there has been a
| 43% drop in revenue and a 21% drop in income.
| fauxpause_ wrote:
| It's still going to be a lot lower than it would have
| been. The important bit from a sanction perspective is
| that their revenue is down 43%.
| CameronNemo wrote:
| And oil&gas revenue make up a significant portion of the
| government's budget.
| [deleted]
| AlecSchueler wrote:
| But what about the price of gas and oil on Europe, isn't
| that the salient point?
| qbasic_forever wrote:
| The goal of sanctions wasn't to raise the price of oil,
| it was to crush the Russian economy which the west
| assumed depended on Russia exporting oil and gas directly
| to Europe. That goal appears to have failed as Russia
| just made new agreements to sell oil/gas to other
| countries (who then sell to Europe).
| distances wrote:
| On the contrary, that goal has worked pretty well. Russia
| has to sell crude now, plus at very low price points.
| It's a shame that China and especially India continue to
| buy, but at least they're taking advantage of the
| situation to pay a pittance so Russia isn't making
| profits with it.
|
| Russia's economy isn't crushed but it has now a massive
| budget deficit that isn't sustainable without some
| extreme adaptations.
| fauxpause_ wrote:
| Your own link cited a 43% drop in revenue, a 21% drop in
| income, and a large deficit.
| AlecSchueler wrote:
| Yes but the purpose of sanctions isn't important to me.
| My question is has the war increased the prices of fuel
| that the global supply chain relies on and, in turn,
| wholesale prices for goods.
| fauxpause_ wrote:
| Cool. But if you're only going to look out for yourself,
| don't be surprised when you're at the bottom of the list
| of concerns for people who are looking to cooperate for
| the common good.
| AlecSchueler wrote:
| That's such an uncharitable reading of my words that I'm
| struggling not to be offended.
|
| Of course the sanctions are important to me.
|
| But the original question was Does the war in Ukraine
| affect global prices for seemingly unrelated things.
|
| When I say the purpose of the sanctions aren't important
| to me I feel it's obvious that I mean only within the
| context of answering this question.
| fauxpause_ wrote:
| Sure. Sorry. Fwiw, I don't think that's implied at all
| however. I think it strongly implies that the purpose of
| the sanctions simply don't matter to you. Which is a
| common opinion
| simonh wrote:
| Cutting off Russian oil completely was never the plan, it
| would have lead to an extremely damaging spike in oil
| prices that would have hurt everybody. Rather, the
| objective was to keep Russian oil flowing, while
| dramatically reducing the extent to which Russia profits
| from it.
|
| This has worked, the prices Russia is getting for their
| oil are single digit dollars above their production
| costs, which are going up due to sanctions, while global
| oil prices remained fairly stable.
|
| India and such buying cheap Russian oil is an intended
| outcome, not a problem. Good for them. It also helps that
| India is processing this oil into value-add exports that
| are pricing out Russian alternatives.
| qbasic_forever wrote:
| [flagged]
| simonh wrote:
| Here's an actual quote: "The price cap is specifically
| designed to reduce Russian revenues and Russia's ability
| to fund its war of aggression whilst limiting the impact
| of Russia s war on global energy prices, particularly for
| low and middle-income countries," - Joint statement by G7
| finance ministers.
|
| A lot of breathless headlines got published early on by
| non-specialist journalists that have never had to cover
| anything like this, but nobody who actually understands
| the history and practice of sanctions in the modern era
| believed they would actually bring Russia to their knees
| any time soon. Read any of the coverage of these
| sanctions in The Economist from last year.
|
| North Korea has been under far more severe sanctions for
| generations and has even managed to develop nuclear
| weapons. Iran came under similarly severe sanctions and
| they're still a credible regional threat. The idea that
| Russia, a nuclear state with massive foreign reserves to
| draw on, even aside from the ones frozen in the west,
| would be beggared in a matter of months was always
| absurd. Sanctions have never in the modern era actually
| forced a state to capitulate.
|
| Wiping out on the order of 85% of Russia's oil profits
| while maintaining global prices is a major success. Yes
| Russian oil is still flowing, but the profits are now
| disproportionately going to countries outside Russia,
| like India. They're not suffering from the sanctions,
| they're making a killing Good for them. Even if you don't
| believe that this was the stated goal, though as you can
| see from the quote I opened with it was the actual stated
| goal, it's still obviously what's actually happened.
| maerF0x0 wrote:
| Also the cost/availability of fertilizer on the other side of
| the conflict
|
| https://www.npr.org/2022/09/28/1125525861/how-the-war-in-
| ukr...
| chaostheory wrote:
| If you read further down in the article, China is suffering
| from a drought that's been the worse in decades
|
| Edit monsoon not drought. Thanks s1artibartfast
|
| _"In the second half of last year, swaths of farmland in the
| world's largest rice producer China were plagued by heavy
| summer monsoon rains and floods. The accumulated rainfall in
| the country's Guangxi and Guangdong province, China's major
| hubs of rice production, was the second highest in at least 20
| years, according to agriculture analytics company Gro
| Intelligence. Similarly, Pakistan -- which represents 7.6% of
| global rice trade -- saw annual production plunge 31% year-on-
| year due to severe flooding last year, said the U.S. Department
| of Agriculture (USDA), labeling the impact as 'even worse than
| initially expected.'"_
|
| Reading further, I'm not sure why Ukraine is mentioned either
| since their major food export is wheat and not rice
| s1artibartfast wrote:
| Point of clarification, China is suffering from monsoon, not
| drought
| neverartful wrote:
| The country's land mass is big enough that it's possible
| for both to be true, no?
| s1artibartfast wrote:
| Possible, but article actually supports one reason and
| not the other.
|
| >The accumulated rainfall in the country's Guangxi and
| Guangdong province, China's major hubs of rice
| production, was the second highest in at least 20 years,
| hef19898 wrote:
| One thing I could think of spontaniously is this: Ukraine is
| exporting less (they seemed to recover, but markets and the
| bullwhip effect don't care rigjt away), so shortfall of
| Ukrainian grain has to be compensated and rice is one such
| alternative. As a result some of the grain shortages are
| causing rice shortages. Throw in problems in China and the
| situation gets really confusing and complex.
| photochemsyn wrote:
| It's really a combination of drought in some regions and
| monsoon in others, both being pushed to extremes by fossil-
| fueled global warming:
|
| https://www.gro-intelligence.com/insights/china-drought-
| thre...
|
| > "(Aug 22) China has issued a nationwide drought warning as
| the country copes with scant rainfall and one of the most
| severe heat waves in six decades. The harsh weather is
| stressing rice and wheat crops and could force China to
| increase imports of these important grains....In addition,
| soil moisture levels are at a 12-year low, and Gro's Drought
| Index reading is elevated. "
|
| https://www.gro-intelligence.com/insights/extreme-weather-
| me...
|
| > "(Jun 2022) Typically, China's rainy season occurs from May
| to September, and this year's season is already off to an
| extreme start. The accumulated rainfall in Guangxi,
| Guangdong, and Fujian is the second highest in at least 20
| years, and some regions, such as Guangdong and Guangxi, have
| experienced double the average daily precipitation for the
| May to June period..."
|
| These extreme fluctuations in drought and flood are not going
| away, of course, and will continue to get worse over the next
| 100 years.
| ta8645 wrote:
| So food will cost more. But nobody remembers the rice shortage of
| 20 years ago; and this one will also be largely irrelevant, in
| the big scheme of things.
| pessimizer wrote:
| Didn't it cause revolutions and riots? I'm sure people who were
| barely or not at all affected don't remember and think it was
| irrelevant, but why would you think that was universal?
| conroydave wrote:
| i feel as though these days prices fail to return back to
| normal after sharp spikes like they have in the past,
| anecdotally
| ta8645 wrote:
| Oh, they're never going back. We're all going to be less
| wealthy going forward. But it isn't because of a rice
| shortage.
| laverya wrote:
| Africa's population has nearly doubled since the year 2000.
| (819 million to 1.4 billion)
|
| Africa also imports a lot of rice.
| h1fra wrote:
| Probably because you are very far from the people actually
| dying from hunger?
| ta8645 wrote:
| There has always been enough food to feed the hungry, and
| there will continue to be enough with this rice shortage.
| That's not the reason people starve.
| deathgripsss wrote:
| There's always enough food to feed the hungry... Until
| there isn't. What makes you so sure that there will
| continue to be enough food indefinitely?
| ta8645 wrote:
| Oh, at some point we'll be hit by a meteor, and anyone
| who manages to avoid death in the initial impact will
| surely starve to death. But then, a dip in rice
| production, no worse than one from twenty years prior,
| won't be the issue.
| [deleted]
| 11235813213455 wrote:
| potatoes grow super easily and are the food with highest satiety
| (so it's highly nutritious)
| https://pubmed.ncbi.nlm.nih.gov/7498104/, so we could turn more
| to that
| badpun wrote:
| > potatoes grow super easily
|
| True dat. My neighbor threw some potato peelings into her
| compost heap, and later used that compost to fertilize her
| roses. Lo and behold, she had potatoes growing between the
| roses a couple months later.
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