Rice, fertilizer shortages, food costs, higher energy prices equal world crisis
Posted: April 01, 2008 8:59 pm Eastern
WASHINGTON - From India to Africa to North Korea to Pakistan and even in New York City, higher grain prices, fertilizer shortages and rising energy costs are combining to spell hunger for millions in what is being characterized as a global "silent famine".
Global food prices, based on United Nations records, rose 35 percent in the last year, escalating a trend that began in 2002. Since then, prices have risen 65 percent.
Last year, according to the U.N. Food and Agriculture Organization's world food index, dairy prices rose nearly 80 percent and grain 42 percent.
"This is the new face of hunger", said Josetta Sheeran, director of the World Food Program, launching an appeal for an extra $500 million so it could continue supplying food aid to 73 million hungry people this year. "People are simply being priced out of food markets. ... We have never before had a situation where aggressive rises in food prices keep pricing our operations out of our reach".
The WFP launched a public appeal weeks ago because the price of the food it buys to feed some of the world's poorest people had risen by 55 percent since last June. By the time the appeal began last week, prices had risen a further 20 percent. That means WFP needs $700 million to bridge the gap between last year's budget and this year's prices. The numbers are expected to continue to rise.
The crisis is widespread and the result of numerous causes - a kind of "perfect storm" leading to panic in many places:
- In Thailand, farmers are sleeping in their fields because thieves are stealing rice, now worth $600 a ton, right out of the paddies.
- Four people were killed in Egypt in riots over subsidized flour that was being sold for profit on the black market.
- There have been food riots in Morocco, Senegal and Cameroon.
- Mexico's government is considering lifting a ban on genetically modified crops, to allow its farmers to compete with the United States.
- Argentina, Kazakhstan and China have imposed restrictions to limit grain exports and keep more of their food at home.
- Vietnam and India, both major rice exporters, have announced further restrictions on overseas sales.
- Violent food protests hit Burkina Faso in February.
- Protesters rallied in Indonesia recently, and media reported deaths by starvation.
- In the Philippines, fast-food chains were urged to cut rice portions to counter a surge in prices.
- Millions of people in India face starvation after a plague of rats overruns a region, as they do cyclically every 50 years.
- Officials in Bangladesh warn of an emerging "silent famine" that threatens to ravage the region.
According to some experts, the worst damage is being done by government mandates and subsidies for "biofuels" that supposedly reduce carbon dioxide emissions and fight climate change. Thirty percent of this year's U.S. grain harvest will go to ethanol distilleries. The European Union, meanwhile, has set a goal of 10 percent bio-fuels for all transportation needs by 2010.
"A huge amount of the world's farmland is being diverted to feed cars, not people", writes Gwynne Dyer, a London-based independent journalist.
He notes that in six of the past seven years the human race has consumed more grain than it grew. World grain reserves last year were only 57 days, down from 180 days a decade ago.
One in four bushels of corn from this year's U.S. crop will be diverted to make ethanol, according to estimates.
"Turning food into fuel for cars is a major mistake on many fronts", said Janet Larsen, director of research at the Earth Policy Institute, an environmental group based in Washington. "One, we're already seeing higher food prices in the American supermarket. Two, perhaps more serious from a global perspective, we're seeing higher food prices in developing countries where it's escalated as far as people rioting in the streets".
Palm oil is also at record prices because of biofuel demands. This has created shortages in Indonesia and Malaysia, where it is a staple.
Nevertheless, despite the recognition that the biofuels industry is adding to a global food crisis, the ethanol industry is popular in the U.S. where farmers enjoy subsidies for the corn crops.
Another contributing factor to the crisis is the demand for more meat in an increasingly prosperous Asia. More grain is used to feed the livestock than is required to feed humans directly in a traditional grain-based diet.
Bad weather is another problem driving the world's wheat stocks to a 30-year low - along with regional droughts and a declining dollar.
"This is an additional setback for the world economy, at a time when we are already going through major turbulence", Angel Gurria, head of the Organization for Economic Co-operation and Development, told Reuters. "But the biggest drama is the impact of higher food prices on the poor".
According to the organization, as well as the U.N., the price of corn could rise 27 percent in the next decade.
John Bruton, the European Union's ambassador to the U.S., predicts the current trend is the beginning of a 10-15 year rise in food costs worldwide.
The rodent plague in India occurs about every half century following the heavy flowering of a local species of bamboo, providing the rodents with a feast of high-protein foliage. Once the rats have ravaged the bamboo, they turn on the crops, consuming hundreds of tons of rice and corn supplies.
Survivors of the previous mautam, which heralded widespread famine in 1958, say they remember areas of paddy fields the size of four soccer fields being devastated overnight.
In Africa, rats are seen as part of the answer to the food shortage. According to Africa News, Karamojongs have resorted to hunting wild rats for survival as famine strikes the area.
Supplies of fertilizer are extremely tight on the worldwide market, contributing to a potential disaster scenario. The Scotsman reports there are virtually no stocks of ammonium nitrate in the United Kingdom.
Global nitrogen is currently in deficit, a situation that is unlikely to change for at least three years, the paper reports.
South Koreans are speculating, as they do annually, on how many North Koreans will starve to death before the fall harvest. But this year promises to be worse than usual.
Severe crop failure in the North and surging global prices for food will mean millions of hungry Koreans.
Roughly a third of children and mothers are malnourished, according to a recent U.N. study. The average 8-year-old in the North is 7 inches shorter and 20 pounds lighter than a South Korean child of the same age.
Floods last August ruined part of the main yearly harvest, creating a 25-percent shortfall in the food supply and putting 6 million people in need, according to the U.N. World Food Program.
Yesterday, the Hong Kong government tried to put a stop to panic-buying of rice in the city of 6.9 million as fears mounted over escalating prices and a global rice shortage. Shop shelves were being cleared of rice stocks as Hong Kong people reacted to news that the price of rice imported from Thailand had shot up by almost a third in the past week, according to agency reports.
Global food prices are even hitting home in New York City, according to a report in the Daily News. Food pantries and soup kitchens in the city are desperately low on staples for the area's poor and homeless.
The Food Bank for New York City, which supplies food to 1,000 agencies and 1.3 million people, calls it the worst problem since its founding 25 years ago.
Last year, the Food Bank received 17 million pounds of food through the Emergency Food Assistance Program, less than half of the 35 million pounds it received in 2002. And donations from individuals and corporations are also down about 50 percent, according to the report.
High gas prices, increased food production costs and a move to foreign production of American food are contributing to the problem.