[ALOCHONA] Food Crisis : Shifting the blame

Food Crisis : Shifting the blame Without even hinting at the inherent flaws of the prevailing international food trade regime distorting prices across the world, the global north points its fingers at the wrong causes and recommends quick fixes overlooking the deeper issues at stake...writes Tanim Ahmed       US president, George W Bush, said in May this year that the reason behind the global food crisis was that the emerging Chinese and Indian middle classes were now eating more, which led to a global shortage of food.    He had (in)famously said, answering a question on the food crisis, on May 2, 'Just as an interesting thought for you, there are 350 million people in India who are classified as middle class. That is bigger than America. Their middle class is larger than our entire population. And when you start getting wealth, you start demanding better nutrition and better food. And so demand is high, and that causes the price to go up.' A week before, the US secretary of state, Condoleezza Rice, had also ascribed the current food crisis to the 'improvement in the diets of people, for instance, in China and India'.    A month later there was a high-level conference on food security under the auspices of the United Nations Food and Agriculture Organisation. The declaration stressed on increasing food production and in order to achieve that end, delegates called for increased investment in agricultural technology and improved inputs. There were also mention of assistance and emergency relief for poor countries with vast populations at risk of starvation.   The prevailing food crisis has increased the number of malnourished people by some 119 million between 2007 and 2008 to almost a billion according to the Wold Bank as prices of food staples have increased between 30 per cent and 150 per cent during that time. During the same time there have been food riots in varying degrees in almost 30 countries across the world.    Although more recently much of the attention has shifted to the financial crisis and plummeting stock markets, the food crisis does remain an immediate issue. It also brings up a host of issues at the global level as well as at that national level with serious policy implications for the governments of developing countries, but more importantly for net food importing countries like Bangladesh.    Going back to the reasons behind the current food crisis one could agree with the US president only partially. Because if the food crisis is indeed a reason for people eating more then Bush's countrymen should be the first to blame, followed by Europeans. Based on projections of the US department of agriculture, as of April 2008, the average American will be eating about 88 kilograms of beef and broiler this year, the average European will eat 34.41kgs, the Chinese will eat 15.31kgs and the Indian only 3.87kgs. Including pork the figures come to about 78kgs for the European, 49kgs for the Chinese and 119kgs for the American. As for food grain-rice, wheat and corn-approximate per capita consumption according to the same data sources show that it is 282kgs for China, 159kgs for India, 372kgs for Europe (accounting for wheat and corn only). In the case of the United States, the figure shoots up to a mind-boggling 998kgs!    It is not that the average American eats almost one tonne of cereals every year, but a substantial portion of that consumption is accounted for by 'industrial consumption'. This industrial consumption that appears to be emerging as an ever stronger phenomenon in the North is essentially biofuel production-ethanol in the United States.    Federal US subsidies to corn growers to bolster its ethanol programme-apparently there are more than 200-cost some $7 billion in 2007. Reports in international and American media point out that corn production has been on a dramatic increase for a few years registering almost 22.5 per cent increase of maize acreage in the United States reaching 86.5 million acres in 2007/08 while maize production has increased by 25 per cent reaching some 332 million tonnes with a 24 per cent increase according to the US Department of Agriculture. It is this sudden increase of 'industrial' demand for grain that has put pressure on global grain supplies unlike food habits that have grown steadily and in proportion with population increase over the past few years. As per an energy bill supported by the Democratic Congress, which only strengthened an older bill backed by the Republican Congress, about 10 per cent fuel for American cars would have to come from ethanol by 2015, which would be well over 50 billion litres of ethanol with about 35 billion litres produced in 2007.    This single act of US legislation would deprive about 350 million people from a year's sustenance. It is unlikely that there would be any substantial change to the US policy regarding ethanol since it is backed by the presidential hopefuls of the Democratic and Republican parties largely because of the commercial interests behind it. Already in the United States, companies are investing billions of dollars in corn-based ethanol plants and ethanol pipelines that would carry it from major production sites like Iowa to commercial centres like New York.    Both the US and the European Union have plans to boost use of biofuels for their cars and given the high prices of fossil fuel. But although billed as a source of 'green' or cleaner energy, the carbon footprint-the amount of carbon dioxide emitted into the atmosphere, worsening global warming and hastening climate change-of corn ethanol production is in fact equal or more than that of fossil fuel consumption. Thus the net impact tends towards the negative environmentally, socially and economically.    As for the emerging middle classes demanding more and better nutrition, generally suggesting more protein, the demand for cereals rises almost exponentially. According to statistics one requires 3kgs of cereals to produce 1kg of pork and 8kgs of cereals to produce on 1kg of beef. Thus the emerging middle class of both China and India demanding better nutrition and eating more meat would naturally lead to a higher than expected demand on food-grains. But even then this demand would not have materialised overnight or in the space of just a couple of years. The rising trend would become obvious through a much longer time and as such could not possibly have jolted the world with a food crisis.    The solution to the current crisis, as has been suggested by the high-level food summit in Rome in June, is increased food production through higher investment, particularly in agricultural technology and a more liberalised global trade regime.    Ban Ki-moon, the UN secretary general, spoke on the opening day of the summit on June 3. 'The world needs to produce more food. Food production needs to rise by 50 per cent by the year 2030 to meet the rising demand. We have an historic opportunity to revitalise agriculture-especially in countries where productivity gains have been low in recent years.' He went on to share the key recommendations that are part of a 'Comprehensive Framework for Action' drawn up by a special UN taskforce formed by him last month. These include boosting smallholder farmer food production 'through urgent injection of key inputs (including seeds and fertilisers) in time for this year's planting seasons' and 'adjusting trade and taxation policies to minimise export restrictions and import tariffs, and helping the free flow of agricultural goods'.    This only means that countries will be increasingly barred from the blocking exports and in fact forced to sell their produce although it might not serve them best in terms of ensuring their food security. But the UN secretary general, or his taskforce, failed to recommend any measures to contain international oil prices or any set of regulations to govern the international oil producing cartel. Neither was there any mention of biofuels and the sharp rise in demand for food grain driven by the biofuel industry.    It appears that the solution has been envisaged to lie in agriculture alone. And the recommended fix, boosting production by a certain percentage by a certain time to meet the 'demand' would end up meaning that certain developed countries would continue to run their biofuel programme while farmers of poorer countries continue to toil even harder to produce more on their small patches of land. Although implicit from Ban Ki-moon's tone of urgency, there is enough food to go around-enough for feeding people and livestock that is. According to the latest Food Outlook (June 2008) published twice a year by the UN Food and Agriculture Organisation, its latest forecast for world cereal production in 2008 points to a record output at nearly 2,192 million tonnes, up 3.8 percent from 2007.    In spite of the strong growth in world cereal production in 2008, total cereal supplies will remain tight given the strong rise in demand says the Food Outlook. It states that 'total cereal utilisation' in 2008/09 is projected to rise by 2.3 per cent from 2007/08 to 2,176 million tonnes, which would be nearly two per cent over a ten-year trend. The curious usage of 'utilisation' instead of simply 'consumption' is because cereals are no more considered as human or animal feed alone but also an industrial raw material to produce biofuel and feed automobiles.    'The increase in world cereal utilisation reflects a sustained growth in food, feed and industrial utilisation of cereals. Maize-based ethanol production is likely to continue its strong growth in the new season, accounting for almost 20 million tonnes, or nearly one-half of the overall anticipated increase in total cereal utilisation in 2008/09.' According to the forecast, human consumption is estimated to accounted for just over a billion tonnes of cereals-1.002 billion tonnes to be precise. Livestock feed accounts for another 760 million tonnes while 'other uses' which obviously includes biofuel production accounts for 393.5 million tonnes, which was 329.3 million in 2006. The figures for human consumption and livestock feed were 994 million and 741.4 million tonnes that year. It becomes apparent from the figures that the rise in demand for human and livestock feed is not creating the food shortage. It is the industrial demand for food that has contributed substantially to the prevailing crisis.    As for the declaration out of the high-level summit, the official global 'response'-so to speak-to the sufferings of the millions, was predictably the most commercially lucrative response where corporations of the North would see their markets expanded and business furthered. With precious on biofuel production, or any hint at regulating the oil market, there is much talk about the importance of increased food production and the necessity of newer technologies to do so. These technologies, namely terminator technology and genetically modified crops will be advanced as the new alternatives that typically require more fertilisers and high end management of agriculture that farmers in the poor countries know little about or could hardly afford. The UN recommendations require purchasing expensive technology and agricultural inputs 'including seeds and fertilisers' from multinational corporations. In fact these corporations are already reaping the benefits of the food crisis and will continue to do so.    According to compilations by GRAIN, an international non-governmental organisation promoting sustainable management and use of agricultural biodiversity based on people's control over genetic resources and local knowledge, some companies have made a killing out of the food crisis. In the current context of tight food supplies, the small clique of corporations that control the world's fertiliser market can charge what they want, and according to GRAIN, they are doing exactly that.    Profits of Cargill's Mosaic Corporation, which controls much of the world's potash and phosphate supply, more than doubled last year. The world's largest potash producer, Canada's Potash Corp, made more than $1 billion in profit, up more than 70 per cent from 2006. Panicking about future supplies, governments have become desperate to increase their harvests, giving these corporations additional leverage. In April 2008, the joint offshore trading arm for Mosaic and Potash hiked the price of its potash by 40 per cent for buyers from Southeast Asia and by 85 per cent for those from Latin American. India had to pay 130 per cent more than last year, and China 227 per cent more. Profits of China's Sinochem increased by 95 per cent in 2007 to cross the billion dollar mark and reach 1.1 billion dollars.    But fertilisers are only part of Cargill's business. Its biggest profits come from global trading in agricultural commodities, which is again a monopoly of just a handful of big traders. On April 14, 2008, Cargill announced that its profits from commodity trading for the first quarter of 2008 were 86 per cent higher than the same period in 2007. 'Demand for food in developing economies and for energy worldwide is boosting demand for agricultural goods, at the same time that investment monies have streamed into commodity markets,' said Greg Page, Cargill's chairman and chief executive officer. Profits for ADM of US increased by 67 in 2007 reaching $2.2 billion while the Noble Group of Singapore posted a 92 per cent increase on their 2006 profits.    The global effort to tackle food security only attempts at some quick fixes. The recommended measures also appear to be determined largely by corporate interests and not whether those measures would indeed provide for a sustainable solution to the prevalent mode of agriculture in the poorest countries. Despite repeated calls for international cooperation there is little indication or movement towards a globally binding arrangement for net food importing least developed countries. AGRO-ECOLOGICAL ZONES Bangladesh is divided into 30 agro-ecological zones on the basis of physiography, soils, land levels in relation to flooding and agro-climatology. An agro-ecological zone indicates an area characterised by homogenous agricultural and ecological characteristics. This map is reprinted courtesy of Bangladesh Agricultural Research Council       http://www.newagebd.com/2008/oct/16/foodcrisis/33.html

__________________________________________________
Do You Yahoo!?
Tired of spam? Yahoo! Mail has the best spam protection around
http://mail.yahoo.com __._,_.___

[Disclaimer: ALOCHONA Management is not liable for information contained in this message. The author takes full responsibility.]
To unsubscribe/subscribe, send request to alochona-owner@egroups.com

Your email settings: Individual Email|Traditional
Change settings via the Web (Yahoo! ID required)
Change settings via email: Switch delivery to Daily Digest | Switch to Fully Featured
Visit Your Group | Yahoo! Groups Terms of Use | Unsubscribe

__,_._,___