Saturday, July 12, 2008

Food Crisis Future

Where's the global food crisis taking us?

02 Jul 2008 17:58:00 GMT Written by: Ruth Gidley

In five years' time, we could be living in a world where millions are dying in famines with no food aid to hand, regular storms and droughts wipe out acres of crops, and skyrocketing food prices have created global political panic, food experts say.
But there might be a way out. Or a combination of ways. "(The) tectonic plates are shifting on food... the fundamentals are changing."

Timothy Lang, a researcher for British-based foreign policy think tank Chatham House, said at a talk in London this week.
Food costs have shot upwards so quickly that even a consumer in a rich country who doesn't usually keep track of the price of bread will have noticed it. And anyone who counts the pennies has been feeling the pinch already, as global food prices have risen 83 percent over the last three years.

The food crisis is intimately linked to energy factors and environmental issues, Lang and his colleagues argue, and they need to be tackled together.
Consumers might have a stake in pushing companies and governments towards change. Lang suggests there might come a point where customers are as concerned about their "grain footprint" as their "carbon footprint" and will want to buy products safe in the knowledge they're not inadvertently taking food out of someone else's mouth. "It puts the Western diet in question," Lang says.

Cutting down on inappropriate consumption of meat and dairy foods would be in everyone's interests. It's the least efficient kind of food production, and these are the foods that create
health problems when people eat too much of them. Getting away from intensive meat production and back to seasonal farming would make a big difference, Lang argues. Obesity is costing the developed world more and more, and it's not just a rich-world problem. Something like 5 percent of people in sub-Saharan Africa are obese too, Lang's colleague Alex Evans says.

When it comes to tackling the amount of food we waste, Japan and South Korea are already working on this, Lang says. But everyone else needs to follow.
JUST A BLIP? Politicians are also going to have to back off biofuels to avoid descending into the worst-case food crisis scenario. Lang argues they not only compete with food for land use, but require more energy to produce than they generate. And there'll need to be some major changes to international trade and to the humanitarian system.

As hunger becomes endemic, he argues development experts will have to move away from the concept of short-term emergency relief.
But maybe this food crisis is just a blip? The Organisation for Economic Cooperation and Development (OECD) suggests prices will spike and then fall again. Sadly, that's unlikely, Chatham House's experts say. Evans says the OECD prediction underplays climate change and energy prices, and the factors that have led us here are only going to get bigger. Oil prices - which hit the food industry hard, not just in transport costs but in fertilisers too - are unlikely to fall as we get closer to using up the world's reserves.

India and China's growth shows no sign of slowing, and the hunger for meat among their growing middle classes is a major factor in pushing grain prices up.
It's not just that demand is getting bigger, but there are limits on how much it's possible to increase supply. Climate change is a major factor, reducing land that's available for cultivation and generating more weather disasters that wipe out food crops. And the amount of land that could be cultivated with food is finite.

The Chatham House researchers quote estimates from the U.N. Food and Agriculture Organisation that at most 12 percent more of the world's land could be planted with crops to eat.
WORLD POPULATION Speculation on commodity markets as investors look for a safe bet away from the weak dollar and falling equity and bond markets has contributed to price rises, but probably not that much, Evans says.

The world's population is rising, of course, although Lang says that's not really a big issue in the long term. It will probably stabilise mid-century at around 8 to 12 billion, which is nonetheless an increase on our current size of around 6.2 billion.
The biggest issue isn't really food production, either - there's enough to go round if it's distributed fairly. Evans says that as inequality between countries is falling, it is rocketing within them, particularly within developing countries, and above all in emerging economies such as China, where the difference between the top 20 percent and the bottom 20 percent has grown by 40 percent over the last three years.

And when water shortages really start to hit, Lang says it could affect food costs even more than oil prices have. So 60 years of low food prices have come to an abrupt end. What happens if the world doesn't adapt, and food costs just keep on rising? In the worst-case scenario, humanity will be struggling to cope with wars and deadly famines, new diseases, water shortages, and storms and droughts that wipe out crops.

Oil will cost something like $200 a barrel, and there will probably be a global recession as food prices keep on rising.
How will governments respond to citizens' anger about the cost of food? Evans points out that this is the year humanity becomes predominantly urban. "Consumers are more visible in cities, especially when they riot," he says. There were demonstrations or riots over food in 37 countries last year, and governments mostly responded by shutting down exports and trying to protect their own supplies.


Even in wealthier countries, unrest could be on the cards. In Britain, for example, we've had 90 years with no trouble about land. "That might be coming to an end," he says. So far, governments have tended to react to political crises in their own countries with short-term economic policies that are ultimately counterproductive.

Right now it's hard to see how governments, world bodies, corporations and ordinary people in both developing and developed countries can come together to tackle this crisis, even if analysts identify the steps we'd need to take. Evans says: "We may well reach a situation in which relative inequality can have absolute implications for the world's poor, and in which a burgeoning middle class inadvertently takes food beyond the purchasing power of the world's poorest people. Indeed, we may already be there."

Chatham House briefing papers are online: Rising food prices by Alex Evans, from the Centre on International Cooperation, New York University
# Thinking about the future of food - by Tim Lang and colleagues on the Chatham House Food Supply Project - outlines four possible scenarios for the future

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