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Briefing: Lessons from past food crises

World leaders gather in Rome Tuesday for a UN food crisis conference. What does history teach about how to handle such shortages?

from the June 2, 2008 edition

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Longer term, some analysts say the subsidies and tariffs that Europe and the US have used to protect their farmers must be reduced. Some experts note that the Nixon administration boosted US subsidies (instead of loans) to farmers as the "solution" to the 1970s grain crisis.

Today, "France is arguing that subsidies are even more necessary than before" [to ensure food security and build up domestic stockpiles], says Prof. Wyn Grant, a food and agricultural policy expert at Warwick University in England. "But these are blanket, nontargeted subsidies which have little to do with what is produced. The higher tariff protection also makes it very difficult for third world producers to break into world agriculture."

For example, the US charges a 54-cents-per-gallon import tariff on Brazil's sugar-cane ethanol, which is cheaper to produce than corn ethanol. If the tariffs were lifted, US Federal Reserve Chairman Ben Bernanke argued in February, it would ease demand (and lower prices) for corn. He saw it as a way to fight inflation.

What needs to happen in the long run to feed the world?

UN Secretary-General Ban Ki Moon noted recently that the world had consumed more than it had produced in the past three years, but this need not provoke alarm. It didn't produce as much because stockpiles were high, prices were low, and farmers had little incentive to plant. With that situation reversed, supply will increase.

The FAO is already predicting a 2.3 percent rise in rice output this year. Abbassian says production for most cereals will be much higher in 2008 than in 2007. The World Bank says high prices will persist through 2009, before declining slightly "as supply and demand respond to high prices."

Other are skeptical, however, that this crisis will be buried under copious volumes of bumper grain harvests.

Brown says the first step is "to reduce the amount of US grain going into ethanol. In an effort to reduce our oil insecurity we have increased global food insecurity big time," he laments. He adds that both population growth and climate change will have to be stabilized to mitigate the affect of future food price shocks.

And then there is water. "We need to launch an international effort to raise water productivity in much the same way that in the 1950s we concentrated on raising land productivity," Brown says.

Professor Grant calls for greater public funding for research into food technology. "Advances made by multinational companies [alone] are not trusted," he says, and governments need to step in, particularly in the area of genetically modified foods, which could promise greater yields.

Ms. Barry says that global trade rules need reforming to help developing countries maintain a range of tools that will benefit domestic farmers. "Decades of trade liberalization have removed trade policy tools from the hands of developing country governments, which essentially means they are in a more vulnerable position," she says.

And Lang agrees with Brown that water is a crucial factor: scarce, critical to production, yet woefully underpriced. In fact, he ventures a counterintuitive thought: "Our food prices are too cheap," he says, the current situation notwithstanding. "They do not include the full cost of production."

The current model that emerged from the dark days of the 1930s and '40s, he says, has led in many parts of the world to overproduction and overconsumption. As a result, he says, we're dealing with obesity, health problems, water stresses, environmental degradation, and contamination.

It's time, he says for a new agricultural model, based on different standards of excellence: nutritional content, carbon footprint, water use, land use, biodiversity, animal welfare, social justice, and locally grown produce. "I can get green beans at Tesco [a British grocery chain] from Kenya, but each one has four litres of 'embedded water' from a water-stressed country," he says. "That is a disaster. I think that water should stay in Kenya."

 

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