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Climate change and fuel shortages begin to bite

Empty shelves in Caracas. Food riots in Mexico. Warnings of hunger in Jamaica, Nepal, the Philippines, and sub-Saharan Africa. Soaring prices for basic foods are beginning to lead to political instability, with governments being forced to step in to artificially control the cost of bread, maize, rice, and dairy products.

Record world prices for most staple foods have led to 18 per cent food price inflation in China, 13 per cent in Indonesia and Pakistan, and 10 per cent or more in Latin America and Russia, according to the United Nations Food and Agricultural Organisation (FAO). Wheat has doubled in price, maize is nearly 50 per cent higher than a year ago and rice is 20 per cent more expensive, says the U.N. Next week the FAO is expected to say that global food reserves are at their lowest in 25 years and that prices will remain high for years.

Last week the Kremlin forced Russian companies to freeze the price of milk, bread, and other foods until January 31, for fear of a public backlash with a parliamentary election looming. “The price of goods has risen sharply and that has hit the poor particularly hard,” said Oleg Savelyev, of the Levada Centre polling institute.

Yemen, Mexico, Burkina Faso, and several other countries have had, or been close to, food riots in the last year, something not seen in decades of low global food commodity prices. Meanwhile, there are shortages of beef, chicken, and milk in Venezuela and other countries as governments try to keep a lid on food price inflation.

Boycotts have become commonplace. Argentineans shunned tomatoes during the recent presidential election campaign when they became more expensive than meat. Italians organised a one-day boycott of pasta in protest at rising prices. German left-wing politicians have called for an increase in welfare benefits so that people can cope with price rises.

“If you combine the increase of the oil prices and the increase of food prices then you have the elements of a very serious [social] crisis in the future,” said Jacques Diouf, head of the FAO, in London last week.

The price rises are a result of record oil prices, U.S. farmers switching out of cereals to grow biofuel crops, extreme weather, and growing demand from countries India and China, the U.N. said on Friday.

“There is no one cause but a lot of things are coming together to lead to this. It’s hard to separate out the factors,” said Ali Gurkan, head of the FAO’s Food Outlook programme, on Friday. He said cereal stocks had been declining for more than a decade but now stood at around 57 days, which made global food supplies vulnerable to an international crisis or big natural disaster such as a drought or flood. “Any unforeseen flood or crisis can make prices rise very quickly. I do not think we should panic but we should be very careful about what may happen,” he warned.

Lester Brown, president of the Washington-based Worldwatch Institute thinktank, said: “The competition for grain between the world’s 800 million motorists, who want to maintain their mobility, and its 2 billion poorest people, who are simply trying to survive, is emerging as an epic issue.”

Last year, he said, U.S. farmers distorted the world market for cereals by growing 14 million tonnes, or 20 per cent of the whole maize crop, for ethanol for vehicles. This took millions of hectares of land out of food production and nearly doubled the price of maize. President George W. Bush this year called for steep rises in ethanol production as part of plans to reduce petrol demand by 20 per cent by 2017.

Maize is a staple food in many countries which import from the U.S., including Japan, Egypt, and Mexico. U.S. exports are 70 per cent of the world total, and are used widely for animal feed. The shortages have disrupted livestock and poultry industries worldwide. The outlook is widely expected to worsen as agro-industries prepare to switch to highly profitable biofuels. according to Grain, a Barcelona-based food resources group.

This week Oxfam warned the European Union that its policy of substituting 10 per cent of all car fuel with biofuels threatened to displace poor farmers.

The food crisis is being compounded by growing populations, extreme weather, and ecological stress, according to a number of recent reports. This week the U.N. Environment Programme said the planet’s water, land, air, plants, animals and fish stocks were all in “inexorable decline.” According to the U.N.’s World Food Programme (WFP), 57 countries, including 29 in Africa, 19 in Asia and nine in Latin America, have been hit by catastrophic floods. Harvests have been affected by drought and heatwaves in south Asia, Europe, China, Sudan, Mozambique and Uruguay. — ©Guardian Newspapers Limited, 2007

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