Rising food prices receive global attention
YUSUFF ALI Sunday, September 2 2012
Miranda La Rose’s recent article in Newsday on an increase in the prices of eggs, chicken and cakes has led me to take a closer look at the whole question of rising food prices in the wider context. Some of what I found took me by surprise.
The Vatican, no less, has accused grain speculators of “hampering the poorest and the neediest” and has called on the G20 group of leading industrialised economies to convene an emergency summit on global food prices.
Its permanent observer at the UN in Geneva, Archbishop Silvano Tomasi, said in a Vatican Radio interview that the worsening crisis in food price volatility “will have social consequences”. He added, “Poor countries require not only urgent help but also investment to change the realities of life and make them more human.”
The moral pressure from the Vatican on the G20 follows widespread condemnation of giant commodities trading companies for regarding drought and allied global food insecurity as profitable business opportunities.
The worst drought in the United States in 50 years, coupled with poor harvests in Central Asia, has raised fears of global food riots and has led to increased scrutiny of commodities traders who profit by exploiting volatile prices.
South Korea’s president, Lee Myung-bak, has also called on the G20 for joint action to stabilise grain prices, warning that the soaring cost of food threatened the survival of the poor and vulnerable in developing countries.
The International Grains Council has already warned that the world’s maize stocks were on course to hit a nine-year low, with Russia’s wheat crop falling to levels last seen during the major drought of 2010.
The United Nations and some of its key member states are now urging the presidency of the G20, currently held by Mexico, to schedule a mini-conference on the global food crisis before the end of the year. The organisation could summon its Rapid Response Forum, which was created at its summit in Paris last year, to prevent market crises.
Here in the UK, families are facing punishing food price rises triggered mainly by the US drought. Experts say the American crisis is forcing up the global price of crops used to make staples such as bread and pasta. Meat is also tipped to cost much more because animal feed costs have soared, again because of the drought.
A miserable summer in the UK so far has made the situation worse because even everyday vegetables, including potatoes and peas, now have to be imported from as far away as South Africa, Guatemala and Israel. British farmers say heavy rain and lack of sunshine have decimated or delayed their harvests.
The United States picture is worse than some of us imagined. More than 35 states have declared disaster areas due to drought. Arable land covering an area larger than Belgium and Luxemburg combined has been abandoned.
Laura Sandys, an MP whose constituency contains pockets of severe deprivation, has warned that high food prices were already having a severe impact on millions of families, with some parents being forced to skip meals so that their children could eat. Their incomes have been under huge pressure from inflation that has been above the official target for months.
Stephen Robertson, director general of the British Retail Consortium, gave a bit of hope but with serious reservations. He said food price rises have slowed over the past year compared with a high of 10 percent in 2008. But he warned that this slight relief may not last because the poor US harvests are creating a build-up of inflationary pressures.
Jose Graziano, director general of the UN’s food and agriculture organisation, said, “We need coordinated action and I believe the G20 is responsible enough for this action.” He said he would not characterise the situation as a crisis but it could reach that level next year if harvests in the southern hemisphere are disappointing.
Senior figures from the G20 have actually been discussing food price rises these past weeks but any decision on what action to take is unlikely before the middle of this month. In the meantime, suffering families, I am afraid, will have to carry on as best they can.