Monday, April 21, 2008

Rumblings of social unrest



During seven of the past eight years, grain consumption exceeded output. After seven years of drawing down stocks, world grain carryover stocks this year have fallen to 55 days of world consumption, the lowest on record.


A FAST-UNFOLDING food shortage is engulfing the entire world, driving food prices to record highs.

Over the past half-century, grain prices have spiked from time to time because of weather-related events - such as the 1972 Soviet crop failure that saw a doubling of world rice, wheat and corn prices.

Today's situation is entirely different. The current doubling of grain prices is trend- driven, the cumulative effect of some trends that are accelerating demand and others that are slowing supply.

The world has not seen anything quite like this before. In the face of rising food prices and spreading hunger, the social order is starting to break down in some countries. In several provinces in Thailand, for instance, rustlers steal rice by harvesting fields during the night. In response, the villagers have taken to guarding their ripe rice fields at night, armed with loaded shotguns.

In Pakistan, where flour prices have doubled, food insecurity is a national concern. Armed troops have been assigned to guard grain elevators and to accompany trucks that transport supplies.

Food riots are now becoming commonplace. In Egypt, the lines at bakeries that distribute state-subsidised bread are often the scene of fights. Morocco has jailed 34 food rioters. In Yemen, food riots have turned deadly, taking at least a dozen lives. In Cameroon, dozens of people have died in food riots and hundreds have been arrested.

Other countries with food riots include Ethiopia, Haiti, Indonesia, Mexico, the Philippines and Senegal.

The doubling of world rice, wheat and corn prices has sharply reduced the availability of food aid, putting the 37 countries that depend on the UN World Food Programme (WFP) at risk. Last month, the WFP issued an urgent appeal for US$500 million (S$678 million) of additional funds.

Around the world, a politics of food scarcity is emerging. Most fundamentally, it involves the restriction of grain exports by countries that want to check the rise in their domestic food prices. Russia, Ukraine and Argentina are among the governments that are restricting wheat exports. Countries restricting rice exports include Cambodia, Egypt and Vietnam. These export curbs simply drive prices higher in the world market.

This chronically tight food supply is driven by the cumulative effect of several trends that are affecting both global demand and supply.

On the demand side, the trends include the continuing addition of 70 million people per year to the world's population, the desire of some four billion people to move up the food chain and consume more grain-intensive livestock products as well as the sharp acceleration in the use of grain to produce ethanol for cars in the United States.

Since 2005, this last source of demand has raised the annual growth in world grain consumption from 20 million tonnes to 50 million tonnes.

Meanwhile, on the supply side, there is little new land to be brought under the plough unless it comes from clearing tropical rainforests in the Amazon and Congo basins and in Indonesia, or from clearing land in the Brazilian cerrado, a savannah-like region south of the Amazon rainforest.

Unfortunately, this has heavy environmental costs: the release of sequestered carbon, the loss of plant and animal species as well as increased rainfall runoff and soil erosion. And in scores of countries, prime cropland is being lost to industrial and residential construction and to the paving of land for roads, highways and parking lots.

New sources of irrigation water are even more scarce than new land to plough. During the last half of the 20th century, the world's irrigated area nearly tripled, expanding from 94 million ha in 1950 to 276 million ha in 2000. In the years since, there has been little, if any, growth. So irrigated area per person is shrinking by 1 per cent a year.

Meanwhile, the backlog of agricultural technology that can be used to raise cropland productivity is dwindling. Between 1950 and 1990 the world's farmers raised grainland productivity by 2.1 per cent a year. But from 1990 until 2007 this growth rate slowed to 1.2 per cent a year. And the rising price of oil is boosting the costs of both food production and transport while at the same time making it more profitable to convert grain into fuel for cars.

Beyond this, climate change presents new risks. Crop-withering heatwaves, more-destructive storms and the melting of the Asian mountain glaciers that sustain the dry-season flow of that region's major rivers are combining to make harvest expansion more difficult.

In the past, the negative effect of unusual weather events was always temporary; within a year or two things would return to normal. But with the climate in flux, there is no norm to return to.

The collective effect of these trends makes it more and more difficult for farmers to keep pace with the growth in demand.

During seven of the past eight years, grain consumption exceeded output. After seven years of drawing down stocks, world grain carryover stocks this year have fallen to 55 days of world consumption, the lowest on record.

The result is a new era of tightening food supplies, rising food prices and political instability. With grain stocks at an all-time low, the world is only one poor harvest away from total chaos in world grain markets.

Business-as-usual is no longer a viable option. Food security will deteriorate further unless leading countries can collectively mobilise to stabilise population, restrict the use of grain to produce automotive fuel, stabilise climate, stabilise water tables and aquifers, protect cropland and conserve soils.

Stabilising population is not simply a matter of providing reproductive health care and family planning services. It requires a worldwide effort to eradicate poverty.

Eliminating water shortages depends on a global attempt to raise water productivity similar to the effort launched a half-century ago to raise land productivity, an initiative that has nearly tripled the world grain yield per hectare. None of these goals can be achieved quickly, but progress towards all is essential to restoring a semblance of food security.

This troubling situation is unlike any the world has faced before. The challenge is not just to deal with a temporary rise in grain prices, as in the past, but rather to alter those trends whose cumulative effects collectively threaten the food security that is a hallmark of civilisation.

If food security cannot be restored quickly, social unrest and political instability will spread and the number of failing states will likely soar, threatening the very stability of civilisation itself.

The writer is president of the Earth Policy Institute.

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