Scarce food beginning to cost the Earth

[Heracles 417]

Scarce food beginning to cost the Earth

Russell Blinch, Washington

April 2, 2008

Whither wheat? Global wheat stocks are at a 30-year low, raising the cost of staples such as bread.

Photo: Reuters

FOOD prices are soaring as the world faces a food shortage.

Around the globe, people are protesting and governments are responding with often counterproductive controls on prices and exports — a new politics of scarcity as ensuring food supplies becomes a major challenge.

Plundered by severe weather in producing countries and by a boom in demand from fast-developing nations, the world's wheat stocks are at 30-year lows. Grain prices have been on the rise for five years, ending decades of cheap food.

Drought, a declining US dollar, a shift of investment money into commodities and use of farm land to grow fuel have all contributed to food woes. But population growth and the growing wealth of China and other emerging countries are more enduring factors.

This week the US Agriculture Department sent shudders through the food industry when it released estimates that showed farmers would plant 8% less corn this year.

With the cost of corn already pushing up food prices, a spokesman for the Grocery Manufacturers Association called the projection alarming. "Food prices are rising twice as fast as inflation, placing significant pressure on American families who are already suffering from economic uncertainty," spokesman Scott Faber said. "It's time for Congress and the Administration to offer families some relief and stop food inflation."

The world's population is set to hit 9 billion by 2050, and most of the extra 2.5 billion people will live in the developing world. People there are demanding dairy and meat, which require more land to produce.

"This is an additional setback for the world economy, at a time when we are already going through major turbulence," said Angel Gurria, head of the Organisation for Economic Co-operation and Development. "But the biggest drama is the impact of higher food prices on the poor."

In Mexico, tens of thousands took to the streets last year over the cost of tortillas, a national staple whose price rocketed in tandem with the price of corn.

In Hong Kong, shoppers are stocking up on rice amid rocketing global food prices, a major retail chain said yesterday. The Government is trying to prevent panic-buying of the staple food.

Global food prices, based on United Nations records, rose 35% in the year to the end of January, accelerating an upturn that began in 2002. Since then, prices have risen 65%.

In 2007 alone, according to the UN Food and Agriculture Organisation's world food index, dairy prices rose nearly 80% and grain 42%.

"The recent rise in global food commodity prices is more than just a short-term blip," British think tank Chatham House said in January. "Society will have to decide the value to be placed on food and how … market forces can be reconciled with domestic policy objectives."

Many countries are already facing these choices.

After long opposition, Mexico's Government is considering lifting a ban on genetically modified crops to allow its farmers to compete with the US, where high-yield, genetically modified corn is the norm.

A number of governments, including those of Egypt, Argentina, Kazakhstan and China, are limiting grain exports to keep more of their food at home.

This response can result in farmers producing less food and threatens to undermine efforts to open up international trade.

In the next decade, the price of corn could rise by 27%, oilseeds such as soybeans by 23% and rice 9%, according to forecasts by the OECD and UN.

The emergence of China's middle class is adding hugely to demand for corn, soybeans and wheat, and also for meat, milk and other high-protein foods.

The Chinese ate 20 kilograms of meat per capita in 1985. They now eat 50 kilograms a year.

Each kilogram of beef takes about seven kilograms of grain to produce.

- Agencies

http://www.theage.com.au/news/environment/...ge#contentSwap1

Edited April 1, 2008 by Boo-Yah!

[melusine 5]

date : 2nd of april 2008 ???

oh, australia...

[Heracles 417]

date : 2nd of april 2008 ???

oh, australia...

lol. I see the future..

[melusine 5]

you know it's a first of april...somehow... for a sec i wondered