Food imports are costing the poorer nations a fortune. There’s not only less of it, the prices of staples are rising fast. The World Food Program, which supports 73 million people, says it may have to reduce rations.
Food costs have risen by a third overall in the last year. Wheat prices are now 80% higher, and corn 25%. Just to add a further flavor to the mix, economic progress and population growth are making things worse.
(See
Bob Ewing’s article on this subject dealing with the FAO report in more detail, and a few policy ideas to stop the damage.)
The food chain is getting pressured by demand created by rising populations. It’s strange that anyone can avoid understanding that there are only so many people who can be fed, but it’s never been a real issue in policies around the world, except China.
As the New York Times explains, it’s also a particularly ironic result of the big economic boom:
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The world has faced periodic bouts when it looked as if population growth would outstrip the food supply. Each time, food production has grown to meet demand. This time it might not be so easy.
Population growth and economic progress are part of the problem. Consumption of meat and other high-quality foods —mainly in China and India— has boosted demand for grain for animal feed. Poor harvests due to bad weather in this country and elsewhere have contributed. High energy prices are adding to the pressures.”
Less easy to agree with, but certainly a factor in agricultural policies as well as more slash and burn opportunism in the poorer countries is this:
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Yet the most important reason for the price shock is the rich world’s subsidized appetite for biofuels. In the United States, 14 percent of the corn crop was used to produce ethanol in 2006 — a share expected to reach 30 percent by 2010. This is also cutting into production of staples like soybeans, as farmers take advantage of generous subsidies and switch crops to corn for fuel.”
This would make a lot more sense if the biofuels were overrunning the oil market, but they aren’t. People everywhere, from Indonesia to Brazil, are switching to biofuel production, and where are the user statistics?
Biofuels aren’t anywhere near the sort of volumes required to make a dent on oil usage, and there’s already chaos in food production?
NYT moves on to say that Congress should look at the subsidies and the policies, which is fine, but I see another situation:
If this level of production of biofuels can affect current food prices like this, what happens when we hit 9 billion people, in a few decades?
It would be impossible, even for the IMF and World Bank, who can usually inflict a thousand impossible things on the world before breakfast, to pretend that current population levels are receiving adequate food supplies, let alone rational price structures.
Agriculture is not meeting demand. On current stats, biofuels or no biofuels, it can’t. On population stats, it has no hope of meeting demand.
Nor do the poorer nations have a hope of paying for continual drastic price increases. Their economies just do not produce income on those levels.
Added to which, the battered growers in the wheat industry are just barely breaking even after years of severely depressed prices, droughts, and other sundry entertainments over the last decade.
I was once asked how to achieve a balanced diet. The answer was simple.
“Eat a vegetarian.”
Because there may be nothing else around.
At this rate, vegetarians will need to be pretty rich, too.
