Noodle diplomacy: the G20 and the politics of instant noodles
Discussions on global trade in food and agricultural products are likely to feature prominently at the 17th G20 Heads of State and Government Summit in Bali, November 15 and 16. The global food system has been greatly affected by Russia’s war against Ukraine. Both countries are major exporters of staple grains and fertilizers, and Intermittent Blockades of Ukrainian Ports by Russia disturbed food supply and farms around the world. The Covid-19 pandemic has also left a weakened global economy and the world is facing more frequent environmental disasters. Food is located in the center of this mess.
This world food crisis is different from the previous one, in 2007-2008, because it also implies an increase in international political tensions, in particular between NATO and Russia. This G20 summit brings together key members of both blocs, making it one of the most important meetings of 2022. G20 countries are among the largest food exporters and importers in the world. Whether the talks will succeed in resolving the food crisis largely depends on the trade agendas of member states.
One way to understand the politics of G20 trade relations is through the global production and consumption of instant noodles. This industry is now worth US$54.60 billion and is expected to reach US$81.84 billion by 2029. The growing global demand for instant noodles is also increasing trade in its two main ingredients: wheat and palm oil. Producing these two crops on an industrial scale also requires large amounts of fertilizer. All G20 countries are either major exporters or importers of these commodities, with the exception of South Africa.
Instant noodles are cheap and convenient. Despite their low nutritional value, instant noodles meet the needs of a food-insecure world. More than half of the world’s population lives in urban centers and do not have the means to be food self-sufficient. They rely on mass-produced foods with a long shelf life, such as instant noodles. The precariousness of work and income also encourages people to favor affordable food.
Global demand for instant noodles is dominated by seven of the G20 countries: China (1), Indonesia (2), India (4), Japan (5), United States (6), South Korea (8) and Brazil (10). Five of the G20 members are the top instant noodle exporting countries in the world: South Korea (1), Indonesia (3), China (4), India (6) and Japan (7). During this time, the largest importers of instant noodles G20 countries include the United States (1), India (4), Australia (9) and Canada (13). These four countries are also wheat exporters.
In fact, G20 member states are major exporters and importers of wheat. Eight of the nine countries in the world that provide the bulk of the wheat volume for international trade are members of the G20: Russia (1), the United States (2), Australia (3), Canada (4), France (6), Argentina (7), Germany (8) and India (10).
The other major wheat exporting country is Ukraine (5), which is the only one not a member of the G20. Wheat from Russia and Ukraine, sometimes called Black Sea wheat, is generally cheaper to produce than wheat in places like Australia, and was considered a threat to Australian wheat exports. In the unfortunate circumstances of war, Australia has seen its wheat exports increase.
The largest wheat importers in the world also include the G20 countries: Indonesia (1), China (3), Turkey (4), Italy (7) and Japan (10), followed not far from Brazil (11) and South Korea (14). China is actually the world’s largest producer of wheat but it does not produce enough to satisfy its domestic needs, hence the need to import.
Countries that produce surplus wheat for exports re-import it in the form of instant noodles. For example, Russia and Australia are both major exporters of wheat and are among the top 20 importers of instant noodles. This circular flow is typical of the globalization of food. But it is not sustainable due to countries’ reliance on commodities within the global food system.
As mentioned, the other major ingredient in instant noodles is palm oil. Indonesia is the world’s largest exporter of palm oil from afar, with market share of almost 60% of the world supply. It’s the only one major palm oil exporter in the G20. Eight G20 members rank in the top 20 palm oil importers: India (1), China (2), EU (3), United States (5), Turkey (14), South Korea (15), Japan (16) and Saudi Arabia (18). India, China, South Korea and Japan are also exporters of instant noodles.
The palm oil policy has often caused Indonesia headaches. The country faced severe international criticism on the links between palm oil production and deforestation, and The EU has taken steps to phase out palm oil of its renewable energy program. Yet the global food crisis has led to massive spikes in demand for Indonesian palm oil. When Indonesia briefly restricted palm oil exports in an effort to curbing the rise in domestic priceshe also saw heavy criticism for his impacts on international trade.
What is this interconnection mean?
The complex trade networks described above illustrate how interconnected the economies of all G20 countries are and how closely meeting the food needs of their citizens is tied to global politics. The specialization of G20 countries in imports and exports in particular has led to vulnerabilities and dependencies, which the world now sees playing out in the global food crisis.
The example of instant noodles shows how interdependent the members of the G20 are on the international trade in wheat and palm oil. South Korea, Indonesia, China and Japan are some of the biggest exporters of instant noodles in the world and they have been hard hit by war between Russia and Ukraine. That others wheat-exporting countries are able to step in to meet global demand remains in question, due to extreme weather conditions, such as floods in australia and drought in the United States.
Indonesia is particularly dependent on wheat imports, as it is the only wheat importing country in the G20 with a tropical climate unsuitable for any wheat crop. As the world’s second-largest consumer and third-largest exporter of instant noodles – indeed, the country considers Indomie is part of its national identity – Indonesia has been strongly affected by the soaring wheat prices. Many analysts have suggested that it was Indonesia’s dependence on Ukrainian wheat that provoked the visit of President Joko Widodo to Russia and Ukraine in June and July. Even the famous noodle chain Bakmi GM has started advertising rice noodles as an alternative.
As host of this year’s G20 summit, Indonesia can play a role in finding solutions to the global food crisis. Indonesia’s dominance in palm oil exports will allow it to play a leading role in negotiations with the EU and the United States, the two main players in NATO and major importers of oil. Indonesian palm oil. Indonesia must ensure that efforts to address the global food crisis do not result in benefits for countries in the North at the expense of countries in the South. For example, there have already been complaints of Ukrainian wheat hijacked to rich countries rather than to poor countries in a situation of food insecurity.
The G20 summit will likely be the last meeting this year that will bring together leaders from countries that play a central role in the global food system. As exporters or importers of key commodities in the highly complex global food system, G20 members hold the key to addressing the current food crisis, and Indonesia in particular. She must find solutions to the crisis for the good of the world, but her own future is also at stake.