Skirting Russian Black Sea Blockade To Feed The World’s Hungriest Is Mission Of Yemen’s Biggest Company

Food & Drink

Yemen’s civil war has killed hundreds of thousands and left many of the survivors without enough to eat. Now, Russia’s blockade of Ukraine’s food exports has made it even harder for the world’s hungriest to feed themselves.

The unprovoked war in Ukraine, known as Europe’s breadbasket, has severely pinched the world supply of grain and cooking oil, which has pushed up prices. Yemen, which relies on imports for 90% of its food, has already seen many of its people perish from malnutrition. Enter HSA Group, a multibillion-dollar, family-owned agribusiness conglomerate that was established in Yemen in 1938 and is the biggest corporation still operating in the war-ravaged country. As Yemen’s largest grain importer, HSA is helping to feed those who need help most.

“It takes us so much work and effort to get that bag of rice to the shelf of that shop,” says Mohamed Nabil Hayel Saeed, who heads HSA’s operations in Yemen and is a grandson of a founder. “It’s very tough for a country so vulnerable like Yemen to stand up against a crisis of this scale.”

Most of HSA’s competitors abandoned Yemen years ago amid the devastation of a war that Saeed says has caused death, infrastructure destruction, widespread unemployment and supply disruptions. But HSA, which started in Yemen as a small retail shop run by three brothers, remained. The company has had to scramble to source enough grain from new trade routes out of India, Romania and France.

Calling from Yemen’s capital city of Sana’a, Saeed told Forbes that the impacts are dire. “If this issue is left untended, especially in places like Yemen, the consequences will be so significant. Famine will continue to grow and migration will increase, especially to neighboring countries. We need to get together and solve this.”

Exports from Ukraine and Russia are essential to countries such as Yemen. Together the two European nations are responsible for exporting 30% of the world’s cereal grains and nearly 70% of its sunflower oil. They supply more than half the grain supplies to 36 countries, including Yemen. Prior to the conflict, 98% of Ukraine’s grain exports were transported via the Black Sea, which Russian ships have blockaded since February. Now the world’s hungriest countries are struggling to replace the missing shipments. African countries have even said they’d buy grain stolen from Ukraine by Russia to feed their people, Reuters reported on Monday.

“With the blockade and the sanctions, the war has made a bad situation much worse,” said Madhur Gautam, the World Bank’s lead agriculture economist. “There’s a shortfall in the global market. There’s a scramble to secure supply.”

HSA Group, named for Hayel Saeed Anam & Brothers, manufactures packaged food, which it began exporting in the 1970s. The U.K. became the first country to import HSA’s biscuits. Rapid growth through the 1980s and 1990s brought HSA to customers in the Middle East, Africa and Southeast Asia.

HSA is a major importer of staples such as flour, sugar, bread, dairy and cooking oil, while remaining one of the Middle East’s largest biscuit and snack makers as well as one of the largest cooking oil producers in Egypt. To combat rising malnutrition after the civil war erupted, HSA changed some of the ingredients in its signature biscuits to increase the nutritional value, in partnership with the World Health Organization. “We tried to make our food healthier,” Saeed said.

Today, around 80 members of the extended family work for HSA, of which roughly half were born and raised in Yemen. Each family member must sign a family constitution after graduating from university, which was one of the key reasons why, when war broke out in 2015, the family was united in committing to “remain a lifeline” and invest a large portion of earnings back into Yemen, where HSA employs 20,000. At least 46 HSA employees have died since the civil war started.

“We had to face these very tough choices,” Saeed said. “The decision was to step up for the people in their time of need. We were put to the test.”

The situation in Yemen is too big for any one company to tackle on its own. After more than seven years of civil war, there’s now a truce, but infrastructure like water tanks, roads and bridges are significantly damaged, and famine is spreading. Yet the United Nations has not been able to raise enough money, and its World Food Programme has had to cut back on the amount it can spend on Yemen as humanitarian crises are worsening in other countries as well.

Of the 13 million in Yemen facing acute hunger, 5 million exist in what’s classified as an “emergency” situation or, the worst-possible scenario: famine. That group will continue to receive full rations from WFP. Another 8 million are in “crisis,” and will start to receive reduced rations in July. Yemen has 30 million people and WFP touches 20 million with some kind of food intervention, from a school meal program to emergency rations.

Worldwide, the UN says that over the course of several years, the number of people “marching to starvation” around the world has ballooned to 323 million from 80 million, with 49 million people in 43 countries at risk of famine.

Yemen is still the world’s worst humanitarian crisis, and WFP’s biggest-ever humanitarian effort, amounting to $2.8 billion spent annually, or roughly 15% of WFP’s annual aid budget.

“We are in a market where we can’t afford not to participate,” said Richard Ragan, the WFP’s country director for Yemen. “People die if we don’t participate.”

That’s why Ragan and WFP work closely with HSA. WFP buys and mills grains locally, importing around 1 million tons to Yemen each year. “When you feed 20 million people, you are deeply in bed with the commercial sector,” Ragan said. “HSA is the main private sector player that does milling, transporting, building in Yemen, responsible for 50% of the private sector action.”

HSA owns “key side ports and mills” which have been crucial as “a real deterioration” has been occurring as famine-like conditions spread far beyond areas of civil war fighting, according to Ragan.

Saeed says HSA has restored 144 roads and bridges, connecting small villages with Yemen’s supply route, and has been investing in fixing damaged wells as well as funding water-drilling projects. The firm has paid for over 800 clean water projects. HSA also has trucked 1.5 billion liters worth of water over five years to one of Yemen’s most populous cities, Taiz, which has been facing a water crisis.

“The crisis in Ukraine has opened the aperture of what access really means and what happens when other countries aren’t able to get access to ports that ship food items,” said Abiola Afolayan, senior international policy advisor for the anti-hunger organization Bread for the World. “Food has been weaponized in a way that has made an impact on desperate people in need.”

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