- 2007–2008 world food price crisis
The years 2007–2008 saw dramatic rises in world food prices, creating a global crisis and causing political and economical instability and social unrest in both poor and developed nations.
Systemic causes for the world-wide increases in food prices continue to be the subject of debate. Initial causes of the late 2006 price spikes included unseasonable droughts in grain producing nations and rising oil prices. Oil prices further heightened the costs of fertilizers, food transport, and
industrial agriculture. Other causes may be the increasing use of biofuels in developed countries (see also food vs fuel), [ [http://www.inform.kz/showarticle.php?lang=eng&id=162989 "Biofuels major cause of global food riots"] , "Kazinform" (Kazakhstan National Information Agency), April 11, 2008] and an increasing demand for a more varied diet (especially meat) across the expanding middle-class populations of Asia. [ [http://news.bbc.co.uk/2/hi/in_depth/7284196.stm The cost of food: facts and figures] ] [ [http://business.timesonline.co.uk/tol/business/industry_sectors/consumer_goods/article3701347.ece Fear of rice riots as surge in demand hits nations across the Far East] ] These factors, coupled with falling world food stockpiles have all contributed to the dramatic world-wide rise in food prices. Long-term causes remain a topic of debate. These may include structural changes in trade and agricultural production, agricultural price supports and subsidies in developed nations, diversions of food commodities to high input foods and fuel, commodity market speculation, and climate change.
Drastic price increases
Between the start of 2006 and 2008, the average world price for rice rose by 217%, wheat by 136%, maize by 125% and soybeans by 107%. [http://globalresearch.ca/index.php?context=va&aid=8794 Financial speculators reap profits from global hunger] ] In late April 2008,
riceprices hit 24 cents a pound, twice the price that it was seven months earlier.
Several factors contributed to the rising food price. Analysts attributed the price rises to a "
perfect storm" of poor harvests in various parts of the world, increasing biofuelusage, lower food reserves, the US Federal Reserve decreasing interest rates so that money is no longer a means to preserve wealth over the long term (people invest in food commodities which causes an increase in demand and therefore price), growing consumer demand in Asia, oil price rises, and changes to the world economy. [ cite news | title = Food Prices Soaring Worldwide | url = http://abcnews.go.com/International/wireStory?id=4514257 | date = 2008-03-24 | publisher = Associated Press | last = Corcoran | first = Katherine ] Agricultural subsidies in developed nations are another long-term factor contributing to high global food prices. [cite web|url=http://www.guardian.co.uk/commentisfree/2008/may/10/food.unitednations |title=Leader: The rocketing price of food Comment is free The Guardian |publisher=The Guardian |date= |accessdate=2008-10-03]
Impact of food for fuel
One systemic cause for the price rise is held to be the diversion of food crops (
maizein particular) for making first-generation biofuels. [ [http://www.thehindubusinessline.com/2008/04/19/stories/2008041950260800.htm Paying the price for ignoring the real economy G. CHANDRASHEKHAR] , The Hindu, 2008-04-18.] An estimated 100 million tonnes of grain per year are being redirected from food to fuel. [cite web|url=http://www.planetark.com/dailynewsstory.cfm/newsid/43377/newsDate/31-Jul-2007/story.htm |title=Planet Ark : Biofuels to Keep Global Grain Prices High - Toepfer |publisher=Planetark.com |date= |accessdate=2008-10-03] (Total worldwide grain production for 2007 was just over 2000 million tonnes. [cite web|url=http://www.worldwatch.org/node/5539 |title=Grain Harvest Sets Record, But Supplies Still Tight Worldwatch Institute |publisher=Worldwatch.org |date= |accessdate=2008-10-03] ) As farmers devoted larger parts of their crops to fuel production than in previous years, land and resources available for food production were reduced correspondingly. This has resulted in less food available for human consumption, especially in developing and least developed countries, where a family's daily allowances for food purchases are extremely limited. The crisis can be seen, in a sense, to dichotomize rich and poor nations, since, for example, filling a tank of an average car with biofuel, amounts to as much maize(Africa's principal food staple) as an African person consumes in an entire year. [http://www.theglobeandmail.com//servlet/story/LAC.20080412.FOOD12/TPStory/International/ "How the cupboard went bare"] , " Globe & Mail", April 12, 2008]
Since late 2007, "
Agflation," caused by the increased diversion of maize harvests to biofuels, the tying of maize to rising oil prices by commodity traders, and a resulting price rise, has caused market substitution, with price rises cascading through other commodities: first wheat and soy prices, then later rice, soy oil, and a variety of cooking oils. Brazil, the world's second largest producer of ethanol after the U.S., is considered to have the world's first sustainable biofuels economyCitation | last = Inslee, Jay; Bracken Hendricks | title = Apollo's Fire | year = 2007 | pages=153-155, 160-161 | publisher = Island Press, Washington, D.C. | id = ISBN 978-1-59726-175-3 . "See Chapter 6. Homegrown Energy." ] [cite web|url=http://www.nytimes.com/2006/04/10/world/americas/10brazil.html?pagewanted=1&sq=Bush%20Brazil%20ethanol&st=nyt&scp=5 |title=With Big Boost From Sugar Cane, Brazil Is Satisfying Its Fuel Needs |author=Larry Rother|publisher=The New York Times|date=2006-04-10|accessdate=2008-04-28|language= ] cite news|url=http://www.economist.co.uk/world/americas/displaystory.cfm?story_id=11632886&CFID=15272549&CFTOKEN=63499038 |title=Biofuels in Brazil: Lean, green and not mean |author=|publisher= The Economist|date=2008-06-26|accessdate=2008-07-30|language= From "The Economist" print edition] and its government claims Brazil's sugar cane based ethanol industry has not contributed to the 2008 food crises.Cite news|url=http://veja.abril.com.br/300408/p_058.shtml|title=Ele é o falso vilão|author=Julia Duailibi|publisher=Veja Magazine|language=Portuguese|date=2008-04-27|accessdate=2008-04-28] A World Bankpolicy research working paper released in July 2008Cite web | url=http://www-wds.worldbank.org/external/default/WDSContentServer/IW3P/IB/2008/07/28/000020439_20080728103002/Rendered/PDF/WP4682.pdf|title=A note on Rising Food Crisis|publisher= The World Bank| author=Donald Mitchell|language=|date=July 2008|accessdate=2008-07-29Policy Research Working Paper No. 4682. Disclaimer: This paper reflects the findings, interpretation, and conclusions of the authors, and do not necessarily represent the views of the World Bank] concluded that "...large increases in biofuels production in the United States and Europe are the main reason behind the steep rise in global food prices", and also stated that "Brazil's sugar-based ethanol did not push food prices appreciably higher".Cite news|url=http://vejaonline.abril.com.br/notitia/servlet/newstorm.ns.presentation.NavigationServlet?publicationCode=1&pageCode=1&textCode=145568&date=currentDate |title=Etanol não influenciou nos preços dos alimentos |publisher= Editora Abril| author=Veja Magazine|language=Portuguese|date=2008-07-28|accessdate=2008-07-29] Cite news|url=http://www.alertnet.org/thenews/newsdesk/N28615016.htm|title=Biofuels major driver of food price rise-World Bank |author=|publisher=Reuters|language=|date=2008-07-28|accessdate=2008-07-29] A economic assessment report also published in July 2008 by the OECDagrees with the World Bank report regarding the negative effects of subsidies and trade restrictions, but found that the impact of biofuels on food prices are much smaller.
A report released by
Oxfamin June 2008Cite web | url=http://www.oxfam.org/files/bp114-inconvenient-truth-biofuels-0806.pdf|title=Another Inconvenient Truth: Biofuels are not the answer to climate or fuel crisis|publisher= Oxfam| author=Oxfam|language=|date=2008-06-25|accessdate=2008-07-30 Report available in pdf] criticized biofuel policies of rich countries and concluded that from all biofuels available in the market, Brazilian sugarcane ethanol is "far from perfect" but it is the most favorable biofuel in the world in term of cost and GHGbalance. The report discusses some existing problems and potential risks, and asks the Brazilian government for caution to avoid jeopardazing its environmental and social sustainability. The report also says that: “"Rich countries spent up to $15 billion last year supporting biofuels while blocking cheaper Brazilian ethanol, which is far less damaging for global food security"."Cite web | url=http://www.oxfam.org/pressroom/pressrelease/2008-06-25/another-inconvenient-truth-biofuels-are-not-answer |title=Another Inconvenient Truth: Biofuels are not the answer to climate or fuel crisis|publisher= Oxfamweb site| author=Oxfam|language=|date=2008-06-26|accessdate=2008-07-30] [Cite web | url=http://www.bbc.co.uk/portuguese/reporterbbc/story/2008/06/080625_biocombustiveisrelatorio.shtml|title=ONG diz que etanol brasileiro é melhor opção entre biocombustíveis |publisher=BBCBrasil| author= |language=Portuguese |date=2008-06-25|accessdate=2008-07-30] (See Ethanol fuel in Brazil)
Angela Merkelsaid the rise in food prices is due to poor agricultural policies and changing eating habits in developing nations, not biofuels as some critics claim. [Cite web|url=http://www.reuters.com/article/environmentNews/idUSL1721113520080417?feedType=RSS&feedName=environmentNews |title= Bad policy, not biofuel, drive food prices: Merkel|author=Gernot Heller |publisher= Reuters|date=2008-04-17|accessdate=2008-05-01|language= ] On April 29, 2008, U.S. President George W. Bushdeclared during a press conferencethat "85 percent of the world's food prices are caused by weather, increased demand and energy prices", and recognized that "15 percent has been caused by ethanol". [Cite web|url=http://www.whitehouse.gov/news/releases/2008/04/20080429-1.html |title=Press Conference by the President |author= |publisher= The White House|date=2008-04-29|accessdate=2008-05-01|language= ] On July 4, 2008, The Guardianreported that a leaked world bank report estimated the rise in food prices caused by biofuels to be 75%. [Cite web|url=http://www.guardian.co.uk/environment/2008/jul/03/biofuels.renewableenergy | title=Secret report: biofuel caused food crisis| date=2008-07-04]
Second- and third-generation biofuels (such as
cellulosic ethanoland algae fuel, respectively) may someday ease the competition with food crops, as can grow on marginal lands unsuited for food crops, but these advanced biofuels require further development of farming practices and refining technology; in contrast, ethanol from maize uses mature technology and the maize crop can be shifted between food and fuel use quickly.
World population growth
Although some commentators have argued that this food crisis stems from unprecedented global
population growth, [ [http://www.thaindian.com/newsportal/world-news/world-in-grip-of-food-crisis_10035221.html World in grip of food crisis] . "IANS", Thaindian News. 2008-04-07.] [Burgonio, TJ. [http://newsinfo.inquirer.net/breakingnews/nation/view/20080330-127349/Runaway-population-growth-factor-in-rice-crisissolon Runaway population growth factor in rice crisis—solon] . "Philippine Daily Inquirer", 2008-03-30.] others point out that world population growth rates have dropped dramatically since the 1980s, [ [http://www.census.gov/ipc/www/idb/worldpopinfo.html World Population Information] . "United States Census Bureau". Data updated 2008-03-27.] [ [http://unstats.un.org/unsd/cdb/cdb_series_xrxx.asp?series_code=13670 Population annual growth rate, 229 countries 1955-2050 (UN Population Division's quinquennial estimates and projections)] . "United Nations". Last updated on 2007-07-17.] and grain availability has continued to outpace population . Aggregate food production per capita has risen from the 1960s to the 1980s but slightly declined since, at least for cereals. [UN-USDA figures quoted bu Earth-poicy http://www.earth-policy.org/Indicators/Grain/2006_data.htm#fig1] World populationhas grown from 1.6 billion in 1900 to an estimated 6.6 billion today. In Mexico, for example, population has grown from 13.6 million in 1900 to 107 million in 2007. [From Traitors to Heroes: 100 Years of Mexican Migration Policies [http://www.migrationinformation.org/Feature/display.cfm?ID=203 March 2004 ] ] Bureau figures show that the U.S. populationgrew by 2.8 million between July 1, 2004, and July 1, 2005. [ [http://www.smithsonianmag.com/people-places/presence-oct06.html?page=4 300 Million and Counting] ]
The actual annual growth in the number of humans fell from its peak of 87 million per annum in the late 1980s, to a low of 75 million per annum in 2002, at which it stabilised and has started to slowly rise again to 77 million per annum in 2007. [Ron Nielsen, "The little green handbook", Picador, New York (2006) ISBN 0312425813 ] The world's population, on its current growth trajectory, is expected to reach nearly 9 billion by the year 2042. [ [http://www.worldometers.info/population/ World Population Clock - Worldometers] ]
April 2008 analyses from the United Nations'
Food and Agriculture Organizationmaintained that while food consumption of grains has gone up one percent since 2006, most of this increase has gone to developed countries.Fact|date=May 2008
Increased demand for more resource intensive food
The head of the
International Food Policy Research Institute, stated in 2008 that the gradual change in diet among newly prosperous populations is the most important factor underpinning the rise in global food prices. [von Braun, "High and Rising Food Prices", 2008, p 5, slide 14] Where food utilization has increased, it has largely been in processed (" value added") foods, sold in developing and developed nations. [ [http://www.fao.org/docrep/010/ai465e/ai465e04.htm "World cereal supply could improve in 2008/09"] , FAO: Global cereal supply and demand brief, "Crop Prospects and Food Situation", No. 2., April 2008. The report notes that: " [O] n a per capita basis, wheat and rice consumption levels decline marginally in the developing countries, mostly in favour of higher intakes of more value-added food, especially in China."] Total grain utilization growth since 2006 (up three precent, over the 2000-2006 per annum average of two percent) has been greatest in non-food usage, especially in feed and biofuels. [ [http://www.fao.org/docrep/010/ai465e/ai465e04.htm Crop Prospects and Food Situation, No. 2, April 2008] : Global cereal supply and demand brief, Growth in cereal utilization in 2007/08. "Food and Agriculture Organization". United Nations. April 2008.] [ [http://www.globalpolicy.org/socecon/hunger/general/2008/0303foodcrisis.htm Are We Approaching a Global Food Crisis? Between Soaring Food Prices and Food Aid Shortage] . "Katarina Wahlberg Global Policy Forum: World Economy & Development in Brief". 2008-03-03.] One kilogram of beef requires seven kilograms of feed grain. [ [http://blogs.ft.com/wolfforum/2008/04/food-crisis-is-a-chance-to-reform-global-agriculture/#comment-11083 Comment] by Paul Collieron May 2, 2008 to the " Financial Times" "The Economists' Forum" blog post [http://blogs.ft.com/wolfforum/2008/04/food-crisis-is-a-chance-to-reform-global-agriculture "Food crisis is a chance to reform global agriculture] " by Martin Wolf, April 30, 2008] These reports, therefore, conclude that usage in industrial, feed, and input intensive foods, not population growth among poor consumers of simple grains, has contributed to the price increases.
Although the vast majority of the population in Asia remains rural and poor, the growth of the
middle classin the region has been dramatic, and is projected to continue to be so. For comparison, in 1990, the middle class grew by 9.7 percent in India and 8.6 percent in China, but by 2007 the growth ratewas nearly 30 percent and 70 percent, respectively. The corresponding increase in affluence has also brought with it a change in lifestyle and eating habits, particularly a demand for greater variety and more meat in the diet, leading to greater demand for agricultural resources. [ [http://news.bbc.co.uk/2/hi/in_depth/7284196.stm "The cost of food: facts and figures"] , " BBC News Online", April 8, 2008] [http://research.cibcwm.com/economic_public/download/smay08.pdf (hamburgers replacing rice bowls)] This demand exacerbates dramatic increases in commodityprices, such as oil.
Another issue is that rising affluence in India and China is reducing the `shock absorber' of poor people who are forced to reduce their resource consumption when food prices rise (e.g. by switching back from meat to vegetarian diet).Fact|date=October 2008 This has reduced price elasticity and caused a sharp rise in food prices during some shortages. In the media, China is often mentioned as one of the reasons for the increase in world food prices, but China has to a large extent been able to meet its own demand for food.Fact|date=October 2008 It is, however, uncertain whether this will continue to be the case in the future.
Impact of petroleum price increases
The rise in the price of oil has heightened the costs of
fertilizers (in some instances doubling the price within the six months before April, 2008 [ [http://www.sunherald.com/business/story/493854.html "Fertilizer cost rising sharply: Result will be higher food prices"] , " Associated Press", April 16, 2008] ), the majority of which require petroleumor natural gasto manufacture. Although the main fossil fuel input for fertilizer comes from natural gasto generate hydrogen for the Haber-Bosch process(see: Ammonia production), natural gas has its own supply problems similar to those for oil. Because natural gas can substitute for petroleum in some uses (for example, natural gas liquidsand electricity generation), increasing prices for petroleum lead to increasing prices for natural gas, and thus for fertilizer.
Costs for fertilizer raw materials other than oil, such as
potash, have themselves been increasing [ [http://biz.yahoo.com/nytimes/080430/1194770341872.html?.v=6] Shortages Threaten Farmers’ Key Tool: Fertilizer] as increased production of staples increases demand. This is causing a boom (with associated volatility) in agriculture stocks.
Oil also provides most energy for mechanized food production and
transport. [ [http://www.chicagotribune.com/news/opinion/chi-oped0506fuelmay06,0,481881.story Food vs. fuel a global myth -- -- chicagotribune.com] ] Higher prices for liquid fuels from petroleum increase the demand for biofuels, which may result in diverting some crops from food to energy. Even though per-capita petroleum consumption among the world's poorest people is very low, what petroleum the poor do consume is disproportionately in the form of fossil fuel inputs to the food they eat, especially to any food imported from industrial agriculturepowerhouses such as the United States. People who were already living at a subsistence level when oil was relatively cheap are extremely vulnerable when oil prices rise, and may simply lack the means to afford enough daily food calories to survive. Some farmers have mitigated the effect of oil on mechanized agriculture by actually using biofuelsto power their farm equipment, such as tractors.
Declining world food stockpiles
In the past, nations tended to keep more sizable food stockpiles, but more recently, due to the pace at which food could be grown and the ease with which it could be imported, less emphasis was placed on keeping high stockpiles. Therefore, for example, in February 2008 wheat stockpiles hit a 60-year low in the United States (see also
Destabilizing influences, including indiscriminate lending and real estate speculation, led to a crisis in January 2008, and eroded investment in food commodities. The United States, specifically, has been facing an economic crisis which is likely to lead to recession. [ [http://news.bbc.co.uk/2/hi/business/7176255.stm Recession in the US 'has arrived'] ] [ [http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/01/07/bcnuseco107.xml "US recession is already here, warns Merrill"] ] [ [http://www.usatoday.com/money/economy/2008-02-10-economypoll_N.htm Poll: "Majority of people believe recession underway"] ]
Financial speculation in commodity futures following the collapse of the financial derivatives markets has contributed to the crisis due to a "commodities super-cycle." Financial speculators seeking quick returns have removed trillions of dollars from equities and mortgage bonds, some of which has been invested into food and raw materials.cite news | first= | last= | coauthors= | title=The trading frenzy that sent prices soaring | date= | publisher= | url =http://www.newstatesman.com/200804170026 | work =
New Statesman| pages = | accessdate = 2008-04-28 | language = ] That American commodities speculation could have a worldwide impact on food prices is reflected in the globalization of food production. It represents the concentration of wealththroughout the world which Frances Moore Lappéequates to a weakening in fundamental democracy. In a recent article for " The Nation", she suggests that there is no food shortage but that "as long as food is merely a commodity in societies that don't protect people's right to participate in the market, and as long as farming is left vulnerable to consolidated power off the farm, many will go hungry, farmers among them--no matter how big the harvests." [Frances Moore Lappé, [http://www.thenation.com/doc/20080407/lappe "The Only Fitting Tribute"] , "The Nation", April 7, 2008]
Impact of trade liberalization
Some theorists, such as
Martin Khorof the Third World Network,Khor, Martin. " [http://www.twnside.org.sg/title2/books/Ghanarevised.htm The Impact of Trade Liberalisation on Agriculture in Developing Countries: The Experience of Ghana] ", Third World Network(2008) ISBN 9789832729310] point out that many developing nations have gone from being food independent to being net food importing economies since the 1970s and 1980s International Monetary Fund(and later the World Trade Organisation's Agreement on Agriculture) free market economicsdirectives to debtor nations. In opening developing countries to developed worldfood imports which continue to be subsidised by Western governments, developing nationshave become dependent upon food imports which are cheaper than those which can be produced by local smallholders agriculture, even in the poorest regions of the world.
While developed countries pressured the developing world to abolish subsidies in the interest of trade liberalization, rich countries largely kept subsidies in place for their own farmers. In recent years United States government subsidies have been added which pushed production toward biofuel rather than food.
Biofuel subsidies in the US and the EU
World Banklists the effect of biofuels as an important contributor to higher food prices. [ [http://go.worldbank.org/3YYF4BOSN0 "The Effects of High Food Prices in Africa – Q&A"] , World Bank(accessed May 6, 2008)] The FAO/ECMB has reported that world land usage for agriculture has declined since the 1980s, and subsidies outside the United States and EU have dropped since the year 2004, leaving supply, while sufficient to meet 2004 needs, vulnerable when the United States began converting agricultural commodities to biofuels. [ [http://ap.google.com/article/ALeqM5hY6QytGQclZ5k8yFlaDr0VZin6IwD8VJULF00 Food Prices Soaring Worldwide] , KATHERINE CORCORAN, Associated Press, March 24, 2008] According to the United States Department of Agriculture, global wheat imports and stocks have decreased, domestic consumption has stagnated, and world wheat production has decreased from 2006 to 2008. [ [http://www.fas.usda.gov/psdonline/psdgetreport.aspx?hidReportRetrievalName=BVS&hidReportRetrievalID=686&hidReportRetrievalTemplateID=8 Regional Wheat Imports, Production, Consumption, and Stocks (Thousand Metric Tons)] , United States Department of Agriculture Foreign Agricultural Service 3/11/2008.]
In the United States, government subsidies for ethanol production have prompted many farmers to switch to production for biofuel. Maize is the primary crop used for the production of ethanol, with the United States being the biggest producer of maize ethanol. As a result, 23 percent of United States maize crops were being used for ethanol in 2006-2007 (up from 6 percent in 2005-2006), and the USDA expects the United States to use 81 million tonnes of maize for ethanol production in the 2007-2008 season, up 37 percent. [ [http://www.globalpolicy.org/socecon/hunger/general/2008/0303foodcrisis.htm Are We Approaching a Global Food Crisis? Between Soaring Food Prices and Food Aid Shortage] . Katarina Wahlberg Global Policy Forum: World Economy & Development in Brief, March 3, 2008.] This not only diverts grains from food, but it diverts agricultural land from food production.
Nevertheless, supporters of ethanol claim that using
cornfor ethanol is not responsible for the worst food riotsin the world, many of which have been caused by the price of riceand oil, which are not affected by biofuel use but rather by supply and demand.
World Bankpolicy research working paper released in July 2008 says that biofuels have raised food prices between 70 to 75 percent. The study found that higher oil prices and a weak dollar explain 25-30% of total price rise. The "month-by-month" five year analysis disputes that increases in global grain consumption and droughts were responsible for price increases, reporting that this had had only a marginal impact and instead argues that the EU and US drive for biofuels has had by far the biggest impact on food supply and prices. The paper concludes that increased production of biofuels in the US and EU were supported by subsidies and tariffs on imports, and considers that without these policies, price increases would have been smaller. This research also concluded that Brazil's sugar cane based ethanol has not raised sugar prices significantly, and suggest to remove tariffs on ethanol imports by both the US and EU, to allow more efficient producers such as Brazil and other developing countries to produce ethanol profitably for export to meet the mandates in the EU and the US.
Renewable Fuel Association(RFA) published a rebuttal based on the version leaked before the formal release of the World Bank's paper. [Cite news|url=http://www.guardian.co.uk/environment/2008/jul/03/biofuels.renewableenergy|title=Secret report: biofuel caused food crisis|author=Aditya Chakrabortty |publisher= The Guardian|language=|date=2008-07-04|accessdate=2008-07-29] The RFA critique considers that the analysis is highly subjective and that the author "estimates the impact of global food prices from the weak dollar and the direct and indirect effect of high petroleum prices and attributes everything else to biofuels"." [Cite web|url=http://www.ethanolrfa.org/objects/documents/1812/lecg_work_bank_critique.pdf|title=Critique of World Bank Working Paper “A Note of Rising Food Prices” |author=John M. Urbanchuk|date=2008-07-11|publisher=Renewable Fuel Association|language=|accessdate=2008-07-29]
An economic assessment report also published in July 2008 by the
OECDcite web|url=http://www.oecd.org/dataoecd/19/62/41007840.pdf|title=Economic Assessment of Biofuel Support Policies |author=Directorate for Trade and Agriculture, OECD |publisher= OECD|date=2008-07-16|accessdate=2008-08-01|language= Disclaimer: This work was published under the responsibility of the Secretary-General of the OECD. The views expressed and conclusions reached do not necessarily correspond to those of the governments of OECD member countries.] agrees with the World Bank report regarding the negative effects of subsidies and trade restrictions, but found that the impact of biofuels on food prices are much smaller. The OECD study is also critical of the limited reduction of GHG emissions achieved from from biofuels produced in Europe and North America, concluding that the current biofuel support policies would reduce greenhouse gas emissions from transport fuel by no more than 0.8 percent by 2015, while Brazilian ethanol from sugar cane reduces greenhouse gas emissions by at least 80 percent compared to fossil fuels. The assessment calls on governments for more open markets in biofuels and feedstocks in order to improve efficiency and lower costs.cite web|url=http://www.oecd.org/document/28/0,3343,en_2649_37401_41013916_1_1_1_1,00.html|title=Biofuel policies in OECD countries costly and ineffective, says report |author=Directorate for Trade and Agriculture, OECD |publisher= OECD|date=2008-07-16|accessdate=2008-08-01|language=]
According to the "New York Times" on April 9, 2008, the United States government pays farmers to idle their cropland under a conservation program. This policy reached a peak of convert|36800000|acre|km2 idled in 2007, that is 8% of cropland in United States, representing a total area bigger than the state of New York. ["As Prices Rise, Farmers Spurn Conservation Program" New York Times April 9, 2008. ]
The global food crisis has renewed calls for removal of distorting agricultural subsidies in developed countries.. [ [http://www.euractiv.com/en/sustainability/food-crisis-set-weigh-cap-reform/article-172484 Food crisis set to weigh on CAP Reform] , EurActiv, 20 May 2008] Support to farmers in OECD countries totals 280 billion USD annually, which compares to official development assistance of just 80 billion USD in 2004, and farm support distorts food prices leading to higher global food prices, according to OECD estimates. [ [http://www.oecd.org/document/45/0,2340,fr_2649_201185_35738477_1_1_1_1,00.html Doha Development Round, Understanding the Issues] OECD, Doha Development Round] The US Farm Bill brought in by the Bush Administration in 2002 increased agricultural subsidies by 80% and cost the US taxpayer 190 billion USD.. [ [http://www.foodfirst.org/node/52 Giving away the farm, the 2002 Farm Bill] Food First, July 8 2002] In 2003, the EU agreed to extend the
Common Agricultural Policyuntil 2013. Former UNDP Administrator Malloch Brown renewed calls for reform of the farm subsidies such as the CAP. [ [http://www.guardian.co.uk/commentisfree/2008/may/10/food.unitednations Perfect Storm, The Rocketing Price of Food] Guardian, May 10 2008]
Distorted global rice market
Japan is forced to import more than 767,000 tons of rice annually from the United States, Thailand, and other countries due to WTO rules. This is despite the fact that Japan produces over 100% of domestic rice consumption needs with 11 million tonnes produced in 2005 while 8.7 million tonnes were consumed in 2003-2004 period.Fact|date=October 2008 Japan is not allowed to re-export this rice to other countries without approval. This rice is generally left to rot and then used for animal feed. Under pressure, the United States and Japan are poised to strike a deal to remove such restrictions. It is expected 1.5 million tonnes of high-grade American rice will enter the market soon. [" [http://business.timesonline.co.uk/tol/business/industry_sectors/consumer_goods/article3948493.ece "Japan's silos key to relieving rice shortage" by Leo Lewis, "
The Times", May 17, 2008 ]
Crop shortfalls from natural disasters
Several distinct weather- and climate-related incidents have caused disruptions in crop production. Perhaps the most influential is the extended drought in Australia, in particular the fertile
Murray-Darling Basin, which produces large amounts of wheat and rice. The droughthas caused the annual rice harvest to fall by as much as 98% from pre-drought levels. [ [http://www.nytimes.com/2008/04/17/business/worldbusiness/17warm.html?n=Top/News/Science/Topics/Global%20Warming Drought in Australia reduces Australia’s rice crop by 98 percent.] The New York Times, April 17, 2008.] Australia is historically the second-largest exporter of wheat after the United States, producing up to 25 million tons in a good year, the vast majority for export. However, the 2006 harvest was 9.8 million. [ [http://news.bbc.co.uk/2/hi/asia-pacific/7289194.stm "Australia's food bowl lies empty"] , "BBC News", March 11, 2008] Other events that have negatively affected the price of food include the 2006 heat wave in California's San Joaquin Valley, which killed large numbers of farm animals, and unseasonable 2008 rains in Kerala, India, which destroyed swathes of grain. Scientists have stated that several of these incidents are consistent with the predicted effects of climate change. [ [http://abcnews.go.com/WNT/GlobalWarming/Story?id=2277893&page=1 Food Prices Could Rise as Farmers in California's Prolific San Joaquin Valley Feel the Effects of Global Warming] ABC News, August 5, 2006.] [ [http://economictimes.indiatimes.com/Economy/Rs_39333_cr_in_crops_lost_due_to_rains/articleshow/2935708.cms Crops lost due to unseasonal rains in Kerala] The Economic Times, April 8, 2008.]
The effects of
Cyclone Nargison Burmain May 2008 caused a spike in the price of rice. Burma has historically been a rice exporter, though yields have fallen as government price controls have reduced incentives for farmers. The storm surgeinundated rice paddies up to convert|30|mi|km inland in the Irrawaddy Delta, raising concern that the salt could make the fields infertile. The FAO had previously estimated that Burma would export up to 600,000 tons of rice in 2008, but concerns were raised in the cyclone's aftermath that Burma may be forced to import rice for the first time, putting further upward pressure on global rice prices. [ [http://www.washingtonpost.com/wp-dyn/content/article/2008/05/07/AR2008050700642.html?hpid=topnews "Scant Aid Reaching Burma's Delta"] by Amy Kazmin and Colum Lynch, " The Washington Post", May 8, 2008] [http://news.bbc.co.uk/2/hi/business/7387251.stm "Cyclone fuels rice price increase"] , "BBC News", May 7, 2008] Stem rustreappeared in 1998http://www.wheatrust.cornell.edu/about/backgroundandrationale.cfm Durable resistance in wheat] in Uganga (and possibly earlier in Kenya) [http://22.214.171.124/search?q=cache:90Abfa92iBwJ:www.globalrust.org/uploads/documents/SoundingAlarmGlobalRust.pdf+UG99+100%25+loss&hl=en&ct=clnk&cd=29&client=opera An assessment of race UG99 in Kenya and Ethiopia and the potential for impact in neighbouring regions and beyond] . By expert panel on the stem-rust outbreak in Eastern Africa. 29 May 2005.] with the particularly virulent UG99 fungus. Unlike other rusts, which only partially affect crop yields, UG99 can bring 100% crop loss. Up to 80% yield losses were recently recorded in Kenya.Effect of a new race on wheat production/use of fungicides and its cost in large vs small scale farmers, situation of current cultivars. Kenya Agricultural Research Institute, 2005. Njoro. Cited in [http://126.96.36.199/search?q=cache:90Abfa92iBwJ:www.globalrust.org/uploads/documents/SoundingAlarmGlobalRust.pdf+UG99+100%25+loss&hl=en&ct=clnk&cd=29&client=opera| CIMMYT 2005 study] .] As of 2005 stem rust was still believed to be "largely under control worldwide except in Eastern Africa". But by January 2007 an even more virulent strain had gone across the Red Sea into Yemen. FAO first reported on 5 March 2008 that Ug99 had now spread to major wheat-growing areas in Iran.http://www.fao.org/newsroom/en/news/2008/1000805/index.html First report of wheat stem rust, strain Ug99, in Iran] These countries in North Africa and Middle East consume over 150% of their own wheat production; the failure of this staple crop thus adds a major burden on them. The disease is now expected to spread over China and the Far-East. The strong international collaboration network of research and development that spread disease-resistant strains some 40 years ago and started the Green Revolution, was since slowly starved of research funds because of its own success and is now too atrophied to swiftly react to the new threat.
Soil and productivity losses
Sundquist [cite web|url=http://home.alltel.net/bsundquist1/se0.html |title=Soils and Croplands Degradation |publisher=Home.alltel.net |date= |accessdate=2008-10-03] points out that large areas of croplands are lost year after year, due mainly to
soil erosion, water depletion and urbanisation. According to him "60,000 km2/ year of land becomes so severely degraded that it loses its productive capacity and becomes wasteland", and even more are affected to a lesser extent, adding to the crop supply problem.
Additionally, agricultural production is also lost due to water depletion. Northern China in particular has depleted much of its non-renewables
aquifers, which now impacts negatively its crop production [cite web|url=http://www.skmconsulting.com/news/2006/Managing+Chinas+Shrinking+Groundwater+Reserves.htm |title=Managing China's Shrinking Groundwater Reserves |publisher=Skmconsulting.com |date= |accessdate=2008-10-03] . Urbanisationis another, smaller, difficult to estimate cause of annual cropland reduction [cite web|url=http://home.alltel.net/bsundquist1/se6.html |title=Chapter 6 - Urbanization-caused topsoil loss |publisher=Home.alltel.net |date= |accessdate=2008-10-03] .
Rising levels of ozone
One possible environmental factor in the food price crisis is rising background levels of ozone in the atmosphere. Plants have been shown to have a high sensitivity to ozone levels, and lower yields of important food crops, such as wheat and soybeans, may have be a result of ozone levels. Ozone levels in the
Yangtze Deltawere studied for their effect on oilseed rape, a member of the cabbage family that produces one-third of the vegetable oil used in China. Plants grown in chambers that controlled ozone levels exhibited a 10-20 percent reduction in size and weight ( biomass) when exposed to elevated ozone. Production of seeds and oil was also reduced. [ [http://newswise.com/articles/view/541362/ Lower Crop Yields Due to Ozone a Factor in World Food Crisis] Newswise, Retrieved on July 15, 2008.]
From the beginning of 2007 to early 2008, the prices of some of the most basic international food commodities increased dramatically on international markets. The international market price of
wheatdoubled from February 2007 to February 2008 hitting a record high of over USD$10 a bushel. [ [http://news.bbc.co.uk/2/hi/business/7148374.stm Wheat breaks through $10 a bushel] , BBC, 17 December 2007.] Riceprices also reached ten year highs. In some nations, milkand meatprices more than doubled, while soy(which hit a 34 year high price in December 2007 [ [http://news.bbc.co.uk/2/hi/americas/7149079.stm Corn's key role as food and fuel] , Adam Brookes BBC News, 17 December 2007. ] ) and maizeprices have increased dramatically.
Total food import bills rose by an estimated 25% for developing countries in 2007. Researchers from the
Overseas Development Institutehave suggested this problem will be worsened by a likely fall in food aid. As food aid is programmed by budget rather than volume, rising food prices mean that the World Food Programme(WFP) needs an extra $500 million just to sustain the current operations. [http://www.odi.org.uk/publications/briefing/bp37-april08-rising-food-prices.pdf Rising Food Prices: A Global Crisis] , Overseas Development Institute, 22 April 2008.]
To ensure that food remains available for their domestic populations and to combat dramatic price inflation, major rice exporters, such as China,
Brazil, India, Indonesia, Vietnam, Cambodiaand Egypt, have imposed strict export bans on rice. [ [http://www.navhindtimes.com/articles.php?Story_ID=04147 "The global food crisis and the Indian situation"] , " Navhind Times", April 14, 2008] Conversely, several other nations, including Argentina, Ukraine, Russia, and Serbiahave, as well, either imposed high tariffs or blocked the export of wheat and other foodstuffs altogether, driving up prices still further for net food importing nations while trying to isolate their internal markets. Finally, North Korea, is also suffering from the food crisis (to such extent that a North Korean official was quoted in June '08 with saying "Life is more than difficult. It seems that everyone is going to die").. [ [Time; Food Prices:What went wrong (16 June 2008)] This nation however is solely relying on food assistance to cope with the crisis. [http://news.bbc.co.uk/2/hi/asia-pacific/1921634.stm North Korea coping with the food crisis] ]
In developed countries
The global food price crisis has appeared in the
U.S.A.as the rice shortageFact|date=May 2008. The retail prices of food in the U.S. increased four percent according to the Consumer Price Indexin 2007, the largest increase in 17 years. The USDA Economic Research Service predicted that prices would increase another three to four percentage points throughout 2008. [ [http://www.fmi.org/docs/media/summary.pdf “Summary of Recent Retail Food Price Research and Trends”] , “ Food Marketing Institute”, 2008-02-26. Retrieved on 2008-06-18. ]
In April 2008
Sam's Clubinstituted a limit on how much long-grain white rice that restaurant and retail customers could purchase due to shortages. Purchases of other types of rice were not restricted. [cite news|title=Rationing of rice in US food shock|work= Irish Independent|date= 2008-04-24|accessdate=2008-04-24|page=32] [cite news|url=http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article3803738.ece|title=Food crisis: rationing introduced in bid to protect rice supplies|work= The Times|date= 2008-04-24|accessdate=2008-04-25] A May 2008 national survey found that food banks and pantries across the U.S. were being forced to cut back on food distribution as 99 percent of respondents reported an increase in the number of people requesting services. Rising food and fuel prices, inadequate food stamp benefits, unemployment, underemployment, and rent or mortgage costs were factors reported as forcing an average of 15-20 percent more people. [ [http://www.secondharvest.org/news_room/2008_press_releases/051208.html “New Survey Underscores Urgent Need For Farm Bill As Demands Are Up, Food Down”] , “ America’s Second Harvest”, 2008-5-12. Retrieved on 2008-6-18. ] Compounding this issue, USDA bonus foods have declined by $200 million and local food donations were down nationally about 9 percent over the same period. According to the California Association of Food Banks, which is an umbrella organization of nearly all food banks in the state, food banks are at the “beginning of a crisis.” [ [ http://www.cafoodbanks.org/docs/crisis/Food_Crisis_FB%20(2).pdf “International Food Crisis: Food Bank Clients in Peril”] , California Association of Food Banks, 2008-6. Retrieved on 2008-06-18.]
Impacts on farmers
If global price movements are transmitted to local markets, farmers in the developing world could benefit from the rising price of food. According to researchers from the
Overseas Development Institute, this may depend on farmers’ capacity to respond to changing market conditions. Experience suggests that farmers lack the credit and inputs needed to respond in the short term. In the medium or long term, however, they could benefit, as seen in the Asian green revolutionor in many African countries in the recent past.
Unrest and government actions in individual countries and regions
The price rises affected parts of Asia and Africa particularly severely with
Burkina Faso, [ [http://www.alertnet.org/thenews/newsdesk/L08851567.htm Burkina general strike starts over cost of living] Mathieu Bonkoungou: Reuters, April 8, 2008] Cameroon, Senegal, Mauritania, Cote d'Ivoire, [ [http://news.bbc.co.uk/2/hi/africa/7325733.stm Riots prompt Ivory Coast tax cuts] , BBC, 2 April 2008. [http://www.irinnews.org/Report.aspx?ReportId=77538 COTE D'IVOIRE: Food price hikes spark riots] , 31 March 2008 (IRIN) ] Egypt[ [http://news.bbc.co.uk/2/hi/middle_east/7288196.stm Egyptians hit by rising food prices] , BBC, 11 March 2008.
[http://www.alertnet.org/thenews/newsdesk/L08810639.htm Two die after clashes in Egypt industrial town] Gamal: Reuters, April 8, 2008.] and
Moroccoseeing protests and riots in late 2007 and early 2008 over the unavailability of basic food staples. Other countries which have seen food riots or are facing related unrest are: Mexico, Bolivia, Yemen, Uzbekistan, Bangladesh, [ [http://www.thetrumpet.com/index.php?q=5021.3306.0.0 "Soaring Food Prices Spark Unrest"] , " The Philadelphia Trumpet", April 11, 2008] Pakistan, [ [http://www.independent-bangladesh.com/200804013859/business/pakistan-heading-for-yet-anther-wheat-crisis.html "Pakistan heading for yet anther wheat crisis"] , "The Independent", April 1, 2008] Sri Lanka, [ [http://www.wsws.org/articles/2008/apr2008/sril-a11.shtml "Anger grows over rising prices in Sri Lanka"] , " World Socialist Web Site", April 11, 2008] and South Africa. [ [http://www.thetimes.co.za/PrintEdition/Article.aspx?id=747211 "SA must grow food on all arable land, says Manuel"] , " The Times", April 13, 2008]
10,000 workers rioted close to the
Bangladeshi capital Dhaka, smashing cars and buses and vandalising factories in anger at high food prices and low wages. Dozens of people, including at least 20 police officials, were injured in the violence. Ironically, the country achieved food self-sufficiency in 2002, but food prices increased drastically due to the reliance of agriculture on oil and fossil fuels. [ [http://news.yahoo.com/s/afp/20080412/wl_sthasia_afp/bangladeshtextile_080412095619 AFP] ]
Economists estimate 30 million of the country's 150 million people could go hungry. [ [http://www.azstarnet.com/sn/news/234144.php azstarnet.com] ]
In April 2008, the
Brazilian government announced a temporary ban on the export of rice. The ban is intended to protect domestic consumers. [Olle, N. 2008, [http://www.abc.net.au/news/stories/2008/04/25/2227615.htm?section=business 'Brazil halts rice exports as world food prices climb'] , "ABC News" (Aust.), 25 April. Retrieved on 28 April 2008.] [The Real News 2008, [http://therealnews.com/web/index.php?thisdataswitch=0&thisid=1408&thisview=item&renewx=2008-04-26+01%3A04%3A51 'Brazil bans rice exports, protests in Peru'] , "The Real News", 26 April. Retrieved on 28 April 2008. (Video.)]
One of the earlier food riots took place in
Burkina Faso, on February 22, when rioting broke in the country's second and third largest cities over soaring food prices (up to 65 percent increase), sparing however the capital, Ouagadougou, where soldiers were mobilized throughout strategic points. The government promised to lower taxes on food and to release food stocks. Over 100 people were arrested in one of the towns. [ [http://www.irinnews.org/report.aspx?ReportID=76905 "Burkina Faso: Food riots shut down main towns"] , " IRIN", February 22, 2008]
Cameroon, the world's fourth largest cocoaproducer, saw large scale rioting in late February 2008, in protest against inflating food and fuel prices, as well as the attempt by President Paul Biyato extend his 25-year rule. At least seven people were killed in the worst unrest seen in the country in over fifteen years. [ [http://www.iht.com/articles/2008/02/27/africa/27cameroon.php "Anti-government rioting spreads in Cameroon"] , " International Herald Tribune", February 27, 2008] This figure was later increased to 24.Time; Food Prices:What went wrong (16 June 2008)] Part of the government response to the protests was a reduction in import taxes on foods including rice, flour, and fish. The government reached an agreement with retailers by which prices would be lowered in exchange for the reduced import taxes. As of late April 2008, however, reports suggested that prices had not eased and in some cases had even increased. [IRIN 2008, [http://www.irinnews.org/report.aspx?ReportID=77971 'CAMEROON: Lifting of import taxes fails to reduce food prices'] , 29 April. Retrieved on 30 April 2008.]
On April 24, 2008, the government of Cameroon announced a two-year emergency program designed to double Cameroon's food production and achieve food self-sufficiency. [IRIN 2008, [http://www.irinnews.org/report.aspx?ReportID=77931 'Cameroon: Food self-sufficient in two years?'] , "IRIN", 25 April. Retrieved on 27 April 2008.]
On March 31,
Côte d'Ivoire's capital Abidjansaw police use tear gas and a dozen protesters injured following food riots that gripped the city. The riots followed dramatic hikes in the price of food and fuel, with the price of beef rising from $1.68 to $2.16 per kilogram, and the price of gasoline rising from $1.44 to $2.04 per liter, in only three days. [ [http://allafrica.com/stories/200803311850.html "Côte d'Ivoire: Food Price Hikes Spark Riots"] , " AllAfrica.com", March 31, 2008.]
Egypt, a boy was killed from gunshot to the head after Egyptian police intervened in violent demonstrations over rising food prices that gripped the industrial city of Mahalla on April 8. Food prices, and particularly the price of bread, have doubled over the last several months. [ [http://www.iht.com/articles/ap/2008/04/08/africa/ME-GEN-Egypt-Protest-Death.php "Egyptian boy dies from wounds sustained in Mahalla food riots"] , " International Herald Tribune". April 8, 2008]
Drought and the food price crisis are threatening thousands in
Ethiopia. [cite web|url=http://www.france24.com/en/20080603-45-million-drought-stricken-ethiopians-need-food-aid-govt |title=France 24 4.5 million drought-stricken Ethiopians need food aid: govt France 24 |publisher=France24.com |author=A malnourished Ethiopian infant is comforted by her mother at a relief camp in 2005. Addis Ababa says the number of Ethiopians in need of emergency food aid in drought-affected regions has risen to 4.5 million. © 2007 AFP Boris Heger |date=Tuesday, June 3, 2008 - 17:00 |accessdate=2008-10-03]
On April 12, 2008, the
Haitian Senate voted to dismiss Prime Minister Jacques-Édouard Alexisafter violent food riots hit the country. [ [http://afp.google.com/article/ALeqM5hL0HvIfNZQ2nMgFdy9dSKLZ7t2Gw "Haiti PM ousted over soaring food prices"] , "AFP", April 13, 2008] The food riots caused the death of 5 people. Prices for food items such as rice, beans, fruit and condensed milk have gone up 50 percent in Haitisince late 2007 while the price of fuel has tripled in only two months. [ [http://www.jamaica-gleaner.com/gleaner/20080413/focus/focus1.html "The world food crisis"] , " Jamaica Gleaner", April 13, 2008] Riots broke out in April due to the high prices, and the government is attempting to restore order by subsidizing a 15 percent reduction in the price of rice. [ [http://www.reuters.com/article/latestCrisis/idUSN15226767 "Price of rice prompts renewed anger in Haiti"] , " Reuters", April l5, 2008]
Food riots were reported in the Indian state of
West Bengalin 2007 over shortages of food. India has banned the export of rice except for Basmati types of rice which attract a premium price. [ [http://www.guardian.co.uk/environment/2008/feb/26/food.unitednations guardian.co.uk, 26 February 2008] ]
Street protests over the price of food took place in
Indonesia[ [http://www.iran-daily.com/1386/3041/html/ieconomy.htm#s287070 "Indonesia takes action over soyabeans"] , "Iran Daily", January 16, 2008] where food staples and gasoline have nearly doubled in price since January 2008. [http://www.theglobeandmail.com/servlet/story/LAC.20080412.FOODSIDE12/TPStory/TPInternational/Asia/ "Indonesia: Food beyond the reach of the poor"] , " Globe & Mail", April 12, 2008]
In April 2008, the
Latin American members of the United Nations' Food and Agriculture Organization(FAO) met in Brasíliain order to confront the issues of high food prices, scarcities and violence that are affecting the region. [ [http://www.laprensahn.com/index.php/ediciones/2008/04/14/latinoamerica_hace_frente_a_altos_precios_de_alimentos Latinoamérica hace frente a altos precios de alimentos] (Latin America faces high food prices) La Prensa, Honduras, April 14th, 2008]
President of Mexico, Felipe Calderón, with industry representatives and members of the Confederation of Industrial Chambers (Concamin), agreed to freeze prices of more than 150 consumer staples, such as coffee, sardines, tuna, oil, soup or tea, among others, until the end of December 2008. The measure was carried out in an attempt to control inflation, which stood at an annual rate of 4.95%, the highest increase since December 2004.
In mid February, rioting that started in the Mozambican rural town of Chokwe and then spread to the capital,
Maputo, has resulted in at least four deaths. The riots were reported in the media to have been, at least in part, over food prices and were termed "food riots." A biofuel advocacy publication, however, claimed that these were, in fact, "fuel riots", limited to the rise in the cost of diesel, and argued that the "food riot" characterization worked to fan "anti-biofuels sentiment." [ [http://www.biofuelsdigest.com/blog2/2008/02/19/mozambique-diesel-riots-reported-in-western-media-as-food-riots-fanning-anti-biofuels-sentiment/ "Mozambique diesel riots reported in Western media as “food riots”, fanning anti-biofuels sentiment"] , "Biofuel Digest", February 19, 2008]
Pakistan Armyhas been deployed to avoid the seizure of food from fields and warehouses. This hasn't stopped the food prices from increasing. The new government has been blamed for not managing the countries food stockpiles properly. [ [http://www.zawya.com/Story.cfm/sidANA145104100629 zawya.com] (need to be login first)]
Once the world's top rice producer,
Myanmarhas produced enough rice to feed itself until now. Rice exports dropped over four decades from nearly 4 million tons to only about 40,000 tons last year, mostly due to neglect by Myanmar's ruling generals of infrastructure, including irrigation and warehousing.On 3 May 2008 Cyclone Nargisstripped Myanmar's rice-growing districts, ruining large areas with salt water. U.N. Food and Agriculture Organization estimates that these areas produce 65 percent of the Southeast Asian country's rice. Worries of long-term food shortages and rationing are rife. The military regime says nothing about the rice crisis, but continues to export rice at the same rate. "...at least the next two harvests are going to be greatly affected and there’ll be virtually no output from those areas during that time. So we’re likely to see considerable food and rice shortages for the next couple of years. The damage to the economy is going to be profound." said economist and Myanmar expert Sean Turnell, of Australia's Macquarie University. (interviewed in "The Irriwaddy", Tuesday, May 27, 2008)
In Panama, in response to higher rice prices the government began buying rice at the high market price and selling rice to the public at a lower subsidized price at food kiosks. This rice is known as "El Compita", and is bought by using tax money.Fact|date=July 2008
Philippines, the Arroyo government insisted on April 13 that there would be no food riots in the country and that there could be no comparison with Haiti's situation. [ [http://www.sunstar.com.ph/static/net/2008/04/13/palace.assures.no.food.riots.in.rp.(7.03.p.m.).html "Palace assures no food riots in RP"] , "Sun Star Network Exchange (Sunnex)", April 13, 2008] Chief Presidential Legal Counsel, Sergio Apostolstated that: "Haiti is not trying to solve the problem, while we are doing something to address the issue. We don't have a food shortage. So, no comparison..." [ [http://news.xinhuanet.com/english/2008-04/13/content_7969073.htm "Official: Philippines not comparable with Haiti in food crisis"] , " Xinhua", April 13, 2008] Comments by the Justice Secretary, Raul Gonzalez, the following day, that food riots are not far fetched, were quickly rebuked by the rest of the government. [ [http://www.upiasiaonline.com/Economics/2008/04/14/food_riots_to_hit_manila_soon/6830/ "Food riots to hit Manila soon?"] , " United Press International", April 14, 2008]
On April 15, the Philippines, the world's largest rice importer, urged China, Japan, and other key Asian nations, to convene an emergency meeting, especially taking issue with those countries' rice export bans. "Free trade should be flowing," Philippine Agriculture Secretary Arthur Yap stated. [ [http://www.thestandard.com.hk/news_detail.asp?pp_cat=17&art_id=64446&sid=18492523&con_type=1 "Manila calls for Asian summit over food crisis"] , "
The Standard", April 15, 2008] In late April 2008, the Philippines government requested that the World Bankexert pressure on rice exporting countries to end export restrictions. [Al Jazeera 2008, [http://english.aljazeera.net/NR/exeres/84B4ED9E-DD71-4C2D-BA12-626A80052D09.htm 'Manila urges end to rice export ban'] , "Al Jazeera English", 29 April. Retrieved on 29 April 2008.]
The Russian government pressured retailers to freeze food prices before key elections for fear of a public backlash against the rising cost of food in October 2007. [ [http://www.timesonline.co.uk/tol/news/world/europe/article2741064.ece timesonline.co.uk] ] The freeze ended on May 1, 2008. [ [http://www.sptimes.ru/index.php?action_id=2&story_id=25957 St. Petersburg Times] ]
On 31 March 2008,
Senegalsaw riots in response to the rise in the price of food and fuel. Twenty four people were arrested and detained in a response which one local human rights group claimed included "torture" and other "unspeakable acts" on the part of the security forces. [ [http://www.irinnews.org/report.aspx?ReportID=77539 "Senegal: Heavy handed response to food protesters"] , " IRIN", March 31, 2008] Further protests took place in Dakaron 26 April 2008. [Al Jazeera 2008, [http://english.aljazeera.net/NR/exeres/6239F12A-AE9B-44FC-A6CD-1A01A9F3586E.htm 'Food costs spark protests in Senegal'] , "Al Jazeera English", 27 April. Retrieved on 27 April 2008.]
Witnesses and officials in
Somaliasaid thousands of angry Somalis rioted on May 5, 2008 over rising food prices and the collapse of the nation's currency, culminating in clashes with government troops and armed shopkeepers that killed at least five protesters. [http://www.somalinet.com/news/world/Somalia/15416] The protests occurred amid a serious humanitarian emergency due to the Ethiopian war in Somalia.
Food riots in southern
Yementhat began in late March and continued through early April, saw police stations torched, and roadblocks were set up by armed protesters. The army has deployed tanks and other military vehicles. Although the riots involved thousands of demonstrators over several days and over 100 arrests, officials claimed no fatalities; residents, however, claimed that at least one of the fourteen wounded people has died. [ [http://www.inteldaily.com/?c=148&a=5876 "Food riots rock Yemen"] , "The Intelligence Daily", April 4, 2008.]
The UN (FAO) released a study in December 2007 projecting a 49 percent increase in African
cerealprices, and 53 percent in European prices, through July 2008. [ [http://news.bbc.co.uk/2/hi/business/7244382.stm Cereal prices hit poor countries] , BBC, February 14, 2008.
[http://news.bbc.co.uk/2/hi/in_depth/7148880.stm UN warns on soaring food prices] , 17 December, 2007.] In April 2008, the
World Bank, in combination with the IMF, announced a series of measures aimed at mitigating the crisis, including increased loans to African farmers and emergency monetary aid to badly affected areas such as Haiti. [ [http://news.bbc.co.uk/1/hi/business/7344892.stm World Bank tackles food emergency] , BBC, April 14th, 2008.] According to FAO director Jacques Diouf, however, the World Food Programmeneeds an immediate cash injection of at least $1700 million, far more than the tens of million-worth in measures already pledged. On 28 April, 2008, the United NationsSecretary-General Ban Ki-moonestablished a Task Force on the Global Food Security Crisis [http://www.un.org/issues/food/taskforce/] under his chairmanship and composed of the heads of the United Nations specialized agencies, funds and programmes, Bretton Woods institutions and relevant parts of the UN Secretariat to co-ordinate efforts to alleviate the crisis. [ [http://news.bbc.co.uk/2/hi/europe/7372393.stm UN Sets up food crisis task force] , BBC, April 29th, 2008.]
Actions by governments
IFADis making up to US$200 million available to support poor farmers boost food production in face of the global food crisis. [http://www.ifad.org/media/press/2008/25.htm]
On May 2, 2008 U.S. President
George W. Bushannounced an extra $770 million funding for international food aid. [cite web|url=http://news.bbc.co.uk/2/hi/americas/7378807.stm |title=BBC NEWS Americas Bush offers $770m for food crisis |publisher=News.bbc.co.uk |date=Page last updated at 08:29 GMT, Friday, 2 May 2008 09:29 UK |accessdate=2008-10-03]
The release of Japan's rice reserves onto the market may bring the rice price down significantly. As of May 16, anticipation of the move had already lowered prices by 14% in a single week. [cite web|url=http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article3943779.ece |title=Rice price dives as US and Japan set to unlock grain pact - Times Online |publisher=Business.timesonline.co.uk |author=Leo Lewis, Asia Business Correspondent |date= |accessdate=2008-10-03]
On April 30, 2008 Thailand announced the creation of the
Organization of Rice Exporting Countries(OREC) with the potential to develop a price-fixing cartelfor rice. [ [http://www.radioaustralia.net.au/news/stories/200804/s2232076.htm?tab=asia|Radio Australia|April 30, 2008|Mekong nations to form rice price-fixing cartel] ] [ [http://www.bangkokpost.com/News/01May2008_news07.php|Bankok Post|May 1, 2008|PM floats idea of five-nation rice cartel] ] This is seen by some as an action to capitalise on the crisisFact|date=June 2008.
In June 2008 the
Food and Agriculture Organizationhosted a High-Level Conference on World Food Security, in which $1.2 billion in food aid was committed for the 75 million people in 60 countries hardest hit by rising food prices. [ [http://news.bbc.co.uk/2/hi/europe/7435265.stm "UN increases food aid by $1.2bn"] , "BBC News", June 4, 2008]
In June 2008, has been required a sustained commitment from the
G8by some humanitarian organizations. [cite web|url=http://www.cgdev.org/content/general/detail/16244 |title=Center for Global Development : Food Crisis Requires Sustained Commitment from the G8 |publisher=Cgdev.org |date= |accessdate=2008-10-03]
2008 Central Asia energy crisis
Agreement on Agriculture
* Agriculture and petroleum
Commodity price shocks
Economic crisis of 2008
End of civilization
List of disasters
* Agricultural effects of Peak oil
* Impact of biofuels on developing countries
* List of countries by fertility rate
Food vs fuel
World Food Day
* [http://www.fao.org/worldfoodsituation Food and Agriculture Organization] (FAO) World Food Situation Portal
* [http://www.reuters.com/news/globalcoverage/agflation Reuters] — Special Coverage: Agflation
* [http://www.ifpri.org/themes/foodprices/foodprices.asp International Food Policy Research Institute] - Food Prices Portal
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