Gro Intelligence CEO Sara Menker Credit - Courtesy of Gro Intelligence
Sara Menker runs a private company, Gro Intelligence, that uses data and AI to make predictions about climate change and food security, but when she appeared before the U.N. Security Council on May 19, she sounded more like an advocate. Gro’s data has found that, because of rising food prices around the world, 400 million people have become food insecure in the last 5 months alone. (Food insecurity, as Gro defines it, means people living on $3.59 a day or less.)
That’s the same number of people that China has taken out of poverty in the last 20 years, meaning two decades of progress have been undone in five months.
Speaking to the assembled world leaders on May 19, Menker said, “I come here today to share insights from our data, with the underlying hope that all of us here with the power to change the course of history will choose to do so.”
Menker, 39, who was chosen as one of TIME’s Most Influential People in 2021, was born in Ethiopia, attended college at Mount Holyoke, worked as a commodities trader on Wall Street, and left to start Gro to use technology to tackle challenges like hunger and climate change. Today, Gro works with governments and big food companies, analyzing hundreds of trillions of data points from satellites, governments, and private sources, to forecast the supply of agricultural products globally.
In recent months, as the war in Ukraine raged on, Gro’s systems started flagging problems that were putting a growing number of people at risk of going hungry. Some were worsened by the war, but many others have been building for longer, caused by the actions of other governments banning exports or imposing tariffs. Menker talked to TIME shortly after briefing the U.N.
(This interview has been condensed and edited for clarity.)
Gro shows that 400 million people have become food insecure in the last five months because the price of staples like wheat, corn, soybeans, and palm oil has risen so dramatically. Is there an easy way to explain what happened?
All of them are driven by different things, but I break it down into five major crises happening, any one of them on their own would actually be considered large. The five combined are truly unprecedented.
The first is the price of fertilizers has gone up by 3 times over the last two years. That’s driven by a combination of factors. War obviously adds fuel to the fire, but there’s a natural gas availability issue. There’s sanctions, and then there’s logistical bottlenecks of getting out. So even though fertilizer is not sanctioned from Russia, getting anything out of Russia is sort of difficult. So it’s a confluence of things.
Your second is climate. Wheat growing regions of the world are facing the worst drought they’ve ever faced combined for the last 20 years. And so climate shocks just keep getting in the way of production and productivity. Think of those two things as sort of inputs.
Then from the output standpoint, you have a crisis linked to cooking oils. The price of palm oil is up 3 times In the last two years, and that’s been driven by increased biofuel demand. That’s driven by increased demand from China. Brazil and Canada had droughts, and so produced less vegetable oils. And then Russia and Ukraine used to export 75% of the world’s sunflower oil. Indonesia, the world’s largest palm oil producer, banned exports. Today they just announced that they’re removing the ban. But once you’ve banned it, the prices don’t come down as fast as they’ve gone up.
The fourth is record low inventories of grains in general. If you look at government agency estimates, we have about 33% of annual consumption needs sitting in inventory around the world. We just need to move it around. Our data tells us that that number is closer to 20%, which is only 10 weeks of global inventory left. And that’s a really big deal.
And then your final fifth is logistics. You can’t get anything out of Ukraine. There’s talk about things moving through rail, but if you move everything you can through rail, you can maybe move 10%, so it’s just a drop in the bucket. And then you can’t move stuff out of Russia either, because of maritime hazards. The seas are mined.
If the Russia-Ukraine conflict ended tomorrow, how much of this supply problem would be solved?
I want to make it explicitly clear that this war did not start this crisis. It added fuel to a fire that was already burning, and one where tremors were felt even before the COVID-19 crisis, which exposed the fragility of our supply chains. So this has been a crisis in the making. And the reason I frame it that way is that it’s really important for global leadership to understand this is not a come and go [issue].
If the war ends, that is better than where we’re sitting today. But there’s also a lot of infrastructure that’s been destroyed during the war. So you have to rebuild that and it’s not like you go back to the volumes you are at right away.
In what way does climate change make it more difficult to deal with these crises?
Climate disruption leads to a lack of predictability and stability of our food supplies. It just throws my mind off when last year we were writing about how North Dakota was suffering from a record drought and so its corn and soybean yields were going to drop and they did— by like, 24%. This week we’re writing about how it’s too wet there and farmers can’t plant. That’s climate change, this lack of predictability, this lack of stability itself that makes our food systems very, very fragile.
Then you’ve had record demand growth. Economic growth and population growth in places like Sub Saharan Africa, and Asia where populations are still young.
You run a private company but you also spoke at the U.N. calling for countries of the world to come together to solve the impending food crisis. Why step into this advocacy role and do you feel like there are any solutions that you can help on?
So, we are a private company, but we work with financial institutions, we work with very big and very small companies. We also work with governments to help them think about food security. I started Gro to avoid something like this. I wish people would have paid attention to us when we were ringing alarm bells in 2017. Because it’s always about preventative medicine versus ending up in the ER.
We’re a mission driven company. We set up this company to help tackle serious challenges that humanity faces. We believe business has a huge role to play in it because that’s how you make it sustainable. That’s how you fund it. But you know, also, I think these are not normal times. To know this and to not say anything would be a crime
What could have been done earlier to prevent this?
Re-examining what trading in agriculture looks like is a very big part of it. There’s no version of a country that actually has any and all natural resources it needs in one place. You can’t grow everything you need in a country. You actually need the world to function in a particular way, but the world became more isolationist in the last five years—not more connected—as politics and policy came into play. And so that itself has damaged diversification of trading partnerships.
We could have invested a lot more in climate climate adaptation. It’s only now that adaptation is sort of a core and becoming a bigger part of the agenda. It was all about transition and transition risks, whereas we are living the consequences of actions we took 20 to 30 years ago.
Have there been any governments or companies that have used your data to change what they were doing in regards to food insecurity?
I can give you an example without naming countries. One country was about to ban the export of corn because rains were not normal. But that causes all sorts of issues for people on the downstream side, people who have contractual obligations for exports now are defaulting on contracts, which creates issues with their banks.
We heard about it from one of the large institutions and we pulled up the data very quickly and looked at rainfall and they were absolutely right. It was pretty dry. But we also looked at things like crop health and soil moisture and it looked healthy. It started the season off with sufficient soil moisture, that the crop was being resilient to sort of the dryness, it had enough fuel in the tank per se.
And if you looked at domestic prices in that country, and you look at it in all the different cities, prices weren’t going up, they were going down, which is not a signal for when you’re short of anything. So we put that together and the ban was removed.
Where do we go from here if there are no major changes? Does the 400 million number keep growing?
Where do we go from here? Lots of political instability around the world. Prices won’t continue to go up. You’ll just start losing demand, and demand destruction means more poverty, which means more instability and lack of economic growth. If we don’t do something about this, we are in for a real economic crisis around the world and no country is going to be immune.
You’ll see it manifests itself in many, many different ways. I keep seeing headlines of Netflix losing subscribers. Netflix is losing subscribers because the average price of a grocery basket in America is two times the price it was in April 2020. Something’s gonna give—you’re going to buy fewer shoes—and that’s why I said it will manifest itself in completely unrelated industries as well.
Who is benefiting from the increase in prices?
Nobody. There are countries who are net exporters who are obviously making more money. American farmers are certainly making more money as a result of it. Is America as a country benefiting? Absolutely not, because the economic shocks are global. We live in a very globally intertwined financial system, period.
So if you think of decades of economic progress and what drove that, it was the number of people coming out of poverty and the number of people becoming consumers of all these different products of all these different companies that are global in nature. They’re having their products bought in Nairobi and in Addis and Jakarta. All that starts to dwindle, and nobody wins. That’s why I really think that there has to be some level of difficult decision-making around what the right actions to take are.
Correction May 31
The original version of this story misstated the age of Gro Intelligence CEO Sara Menker. She is 39, not 40.