Global Policy Forum

Unpredictable Weather Patterns, Diversion of Grain for Biofuels, Contribute to Growing Food Shortages


By Mira Kamdar*

September 28, 2007

Thanks to the booming biofuels market, wacky weather and increased world demand, global grain stocks have fallen to a scant 57 days of consumption, their lowest level in 34 years. Prices are up sharply. International aid organizations warn they will not have enough emergency food on hand to meet anticipated need. Even consumers in rich countries will have to pay significantly more for their food into 2008. This risks not only starvation and malnutrition among the world's poor, but also social and political unrest. Governments with the means have nervously shored up national grain stocks. Panic buying by India, which floated tenders to import 50,000 tons of wheat with an option to buy an additional 50,000 tons earlier this year, was blamed for sending the price of wheat to almost double what it commanded just a year ago. The European Union is so concerned, it recently eliminated its 10 percent grain set-aside entirely, and the Organizaton for Economic Cooperation and Development has warned that governments should end subsidies for biofuels.

There is reason for alarm. In recent decades when global grain stocks fell, the drop-off was temporary, the overall trend upward. That trend may be reversing. The weather has become increasingly unpredictable, making it hard for farmers to know when to plant or what will thrive. In 2007, producers faced a hot, dry spring followed either by more dry weather or an overly wet summer, depending on the region. In addition, the biofuels rush has tipped the fuel value of corn in the US above the food value of this staple; 16 percent of the US corn crop was diverted to ethanol production in 2007, and a full third is expected to go to producing ethanol in 2008. And a large sale of corn slated for human consumption redirected to animal feed instead by Cargill and Mexico's Gruma, partly owned by Archer Daniels Midland Co., didn't help. The price of tortillas in Mexico shot up 60 percent, sending angry citizens into the streets. Beyond Mexican tortillas, corn, as Michael Pollan so brilliantly points out in his recent book, "The Omnivore's Dilemma," has become the basis of the American industrial and processed-food chain. Corn is now used to produce most of the meat, poultry, dairy and eggs as well as a host of processed foods and soft drinks that Americans consume every day. Plus, more people in booming India and China can afford to add animal protein to their traditional diets, further driving up world demand for corn. In addition to corn and wheat, the price of rice is rising. Even soybeans and pulses are more expensive than last year. The upward trend means the poor aren't the only ones affected. The price of bread in the United Kingdom is up nearly a pound, or almost two dollars. The French, where high bread prices in 1789 provoked outright revolution, have been warned that they will have to pay more for their baguette. Italians look at pasta prices up 20 percent. In the US, people can expect to pay 10 percent more for chicken, 14 percent more for milk and 21 percent more for eggs. In Russia, the situation is dire: The price of bread is expected to be up 50 percent by the end of the year, cabbage up 30 percent, to name just two basic staples of the Russian diet.

As if this wasn't enough, a new report by William Cline of the Center for Global Development and the Peterson Institute for International Economics offers a grim, country-by-country assessment of the impact of climate change on agriculture by the 2080s. Since most developing countries, where the bulk of the world's poor live, happen to be located closer to the equator, they will be hit the hardest by crop damage related to climate change. Africa could see food production drop by as much as 28 percent; India's could fall by a whopping 38 percent, even as its population increases by another 400 million people. Richer countries will not be immune nor will potential gains in more temperate climes compensate for losses overall. On the whole, global food production is predicted to decline between 3 and 16 percent, even as another 3 billion people are added to the planet. Add to these alarming numbers the fact that world sea fisheries have already collapsed by one third and are predicted to be completely exhausted by the middle of the century. The future of food looks grim indeed. There are a few potentially positive variables. One is the possible impact of crops genetically engineered to withstand higher global temperatures. Another is the impact of so-called carbon fertilization, or of an atmosphere richer in the carbon plants love. Cline dismisses these as too speculative, arguing that it is dangerous to count on factors of unknown outcome to rescue us from otherwise certain food catastrophe.

It's no longer a matter of speculation: The era of cheap food is over. Increases in annual grain production have already fallen steadily off their Green-Revolution highs, declining from 2.8 percent in the 1960s and 1970s to 1.6 percent, during the past 25 years. While there will continue to be annual and regional fluctuations – India just announced it is holding off buying more grain in light of a bumper wheat harvest, causing prices to ease slightly – the year 2007 may represent a watershed moment in human food security, when the world tilted definitively away from growing abundance toward scarcity. Humanity has only itself to blame for this catastrophe, with the poor, as usual, paying more dearly than the rich. In addition to climate change, a finger can be pointed at rising consumption through population growth and changing food habits, environmental degradation including topsoil loss, acute water shortages, over-fishing, and the loss of agricultural land to urbanization and industrialization. Add to this the massive subsidies in the US and Europe that adversely affect food prices and production in developing countries, destroying the food-producing capacity of family farms around the world, and policies that have favored the development of monoculture-based industrial agriculture, entirely dependent on infusions of carbon-based synthetic fertilizers by the ton – and the world confronts the makings of a "perfect storm" of catastrophic food shortage.

If ever there was a time to take extremely seriously ever-louder alarm bells about climate change, it is now. Human activity as it is currently taking place is clearly not sustainable. Where is the leadership that will put into immediate effect an international emergency-response plan to cut carbon production dramatically, with the utmost speed possible, and to assist India and China with finding alternative energy to fuel their rapid development? Where is the leadership that can break the stranglehold over global agriculture of carbon-addicted monopoly agribusiness and put humanity on a path to sustainable food security? Where is the leadership with the spine to tell the people of the rich world that they can no longer afford to pursue a lifestyle of wanton consumption and pollution for which people in the developing world have to make the ultimate sacrifice?
In the prophetic words of Mahatma Gandhi, "Earth provides enough to satisfy every man's need, but not every man's greed." At this rate, we will consume ourselves to death.

About the Author:Mira Kamdar, an associate fellow of the Asia Society and a senior fellow at the World Policy Institute based in New York, is the author of "Planet India: How the Fastest Growing Democracy Is Transforming America & the World," published by Scribner in 2007.



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