Source: Securities Times

(Original headline: International financial institutions say the global food crisis may break out next year—will there not be enough food to eat?)

People’s Finance and News reported on August 21: Recently, international financial institutions including Goldman Sachs, HSBC, Bank of America, and JPMorgan have issued warnings one after another, saying that with multiple risks compounding, a new round of food inflation may be triggered. The capital markets responded instantly: China A-share markets saw a surge in the planting industry sector; several stocks including Nongfa Seed Industry hit the daily limit; and the Food ETF rose across the board.

JPMorgan’s latest report says that due to continued impacts from five major factors—war, weather, storage, water resources, and waste—the global food crisis may erupt next year.

A key reason behind JPMorgan Chase’s conclusion that a global food crisis may break out next year: repeated disruptions in shipping through the Strait of Hormuz, directly affecting roughly one-third of the world’s urea shipments and energy trade; combined with limited Russian natural gas exports, the supply of critical raw materials for fertilizer production becomes tight. As energy and fertilizer prices rise and ripple through the system, they ultimately push up the cost of food production.

Hu Bingchuan, a researcher at the Institute of Rural Development of the Chinese Academy of Social Sciences, said that in terms of global food reserves, the overall amount is still sufficient. In the short term, there is no situation of a global total crop failure or a depletion of physical food supplies. Overall, the foundation of global food security at present is relatively solid. The latest report from the UN Food and Agriculture Organization shows that in 2026 global food production will be around 3 billion tons, and reserves will be close to 1 billion tons, giving it strong capacity for emergency adjustment and buffering. Therefore, JPMorgan’s report is more of a risk warning. But in terms of what may happen in the future, it is still important to continue monitoring closely. Although this is a low-probability event, it cannot be taken lightly because the consequences could be very serious. Continuous tracking is needed of changes in weather, geopolitical developments, shifts in output in producing regions, and changes in the global agricultural supply chain, so as to keep the overall risk and potential impacts within a limited level.