World Warned of ‘Food Crunch’ Threat

Hundreds of millions more people could slip into hunger as a result of volatile food prices and increasing energy and water scarcity, according to two new reports that together detail the threats to global food security and expose the lack of adequate coordinated international action to tackle hunger.


26th January 09 - Javier Blas, Financial Times (UK)

Link to report (pdf): A Billion Hungry People (Oxfam)

Link to report (pdf): The Feeding of the Nine Billion - Global Food Security for the 21st Century (Chatham House)

The world faces “the real risk of a food crunch” if governments do not take immediate action to address the agricultural impact of climate change and water scarcity, according to an authoritative report.

Chatham House, the London-based think-tank, suggests that the recent fall in food prices is only a temporary reprieve and that prices are set to resume their upward trend once the world emerges from the current downturn.

“There is therefore a real risk of a ‘food crunch’ at some point in the future, which would fall particularly hard on import-dependent countries and on poor people everywhere,” the report states. “Food prices are poised to rise again,” it adds.

The warning is made as agriculture ministers and United Nations officials gather from Monday in Madrid for a UN meeting on food security likely to conclude that last year’s food crisis, with almost 1bn people hungry, is far from over.

The UN will warn ministers in Madrid that “as the global financial crisis deepens, hunger is likely to increase” under the impact of rising unemployment and lower remittances, according to three officials briefed ahead of the meeting.

The prices of agricultural commodities such as rice and wheat jumped to a record high last year, triggering food riots from Haiti and Egypt to Bangladesh and Cameroon and prompting appeals for food aid for more than 30 countries in sub-Saharan Africa.

The cost of food commodities had fallen since then, but Alex Evans, the Chatham House report’s author and an expert at New York University, said that “even at their somewhat diminished levels current prices remain acutely problematic for low-income import-dependent countries and for poor people all over the world”.

Josette Sheeran, head of the UN’s World Food Programme, said she was expecting that this year would be at least as “challenging” as last year, when the number of undernourished rose by 40m to 963m people. “We are not seeing an alleviation of the hunger pressure,” she told the Financial Times.

In addition, agricultural commodities prices have recovered in the past two months on the back of lower winter plantings in the US and Europe and a severe drought in Brazil and Argentina, two of the largest producers of food commodities.

Since December, wheat prices have risen 15 per cent, corn 17 per cent and soyabean 22 per cent. In contrast with other raw materials such as oil or aluminium which have plunged back to the levels of 2002-05, agricultural commodities are trading higher than they were just 12 to 18 months ago.

Over the medium term, the report states that “long-term resource scarcity trends, notably climate change, energy security and falling water availability” will put pressure on prices and production, together with “competition for land and higher demand resulting from increasing affluence and a growing population”.

The report recommends governments to invest more in agricultural production and an increase in international aid in this sphere, too.

Containing global warming will require an additional €175bn in annual investment by 2020, according to a European Union draft paper, writes Joshua Chaffin in Brussels.

The paper, which says much of the €175bn ($227bn, £167bn) investment will have to be borne by the developed world, also forecasts that tens of billions of euros in spending will be needed to help poorer countries prepare for even moderate warming.

Some of the ways that the EU proposes to raise those funds include requiring developed nations to pay for their annual carbon emissions, and levying taxes on aviation and maritime transportation. The EU should also expand its emissions trading system into a global carbon market and explore the establishment of a multilateral insurance pool to help deal with natural disasters that result from global warming.

The final paper, to be released by the European Commission, the EU executive body, on Wednesday, sets out the bloc’s position ahead of negotiations in Copenhagen this December aimed at creating a global agreement to fight climate change.

The Commission declined to comment on the draft, and people involved in negotiations said it was still under discussion.

The EU endorsed a plan in December to reduce the 27-nation bloc’s greenhouse gas emissions by 20 per cent from 1990 levels by 2020. Member states and other developed countries are urged to increase that figure to 30 per cent.

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Oxfam: global food crisis will worsen - 1bn hungry people need help now

26th January 09 - Journalism.co.uk

Urgent action is needed to prevent hundreds of millions more people slipping into hunger as a result of volatile food prices and increasing energy and water scarcity, said international agency Oxfam today. Decades of underinvestment in agriculture coupled with the increasing threat of climate change mean that despite recent price falls, future food security is by no means guaranteed, and in fact the situation could get worse, said Oxfam on the opening day of a UN conference in Madrid to address the issue.

Oxfam’s warning comes on the day that two new reports are published, detailing the threats to global food security and exposing the lack of adequate coordinated international action to tackle hunger.

The reports, A Billion Hungry People and The Feeding of the Nine Billion are published by Oxfam and the UK think tank, Chatham House respectively, and together are a call to action to politicians, and representatives from the private sector and civil society meeting to discuss the implementation of the UN Taskforce’s response.

Although global food prices have fallen in the last few months, they are not back to previous levels, and are likely to rise sharply again in the future. Furthermore, price volatility itself is a problem, and more needs to be done to address the underlying structural issues that cause the chronic hunger affecting 1 in 6 people in the world today, says Oxfam.

Barbara Stocking, Oxfam Chief Executive, said: “This should be a wake-up call for all those who believe that the food crisis is over. World leaders have a window of opportunity to prevent a worse situation resulting from the triple crunch of the economic crisis, climate change, and energy and water scarcity. They must act urgently to turn their plans into coordinated action that addresses immediate needs and begins to implement long-term reforms. Failure to act will see millions more people falling into hunger."

Oxfam said current severe food shortages in Afghanistan, Ethiopia, Kenya, Mozambique and Zimbabwe are evidence that the global food crisis is far from over (see annex). Even before recent price rises, there were over 850m people classified as undernourished. Now, there are nearly a billion, as a result of the price rises, alongside other factors such as political instability and conflict.

“Not enough has been done to tackle the situation. There is a lack of coordination at all levels and the opportunity for root and branch reform of the aid system has not yet been taken. International institutions and donors must reverse decades of under-investment in agriculture and scrap blatantly distortionary polices such as biofuels mandates that make things worse,” said Stocking.

“The recent decision by the EU to reinstate export subsidies for dairy is the direct opposite of what’s needed: a retrograde step that calls into question their commitment to longer term reforms,” she added.

The Feeding of the Nine Billion, published by Chatham House and part-funded by Oxfam, predicts demand for food will increase as the world’s population grows by 2.5bn to 9.2bn by 2050. It also notes a UN prediction that climate change will increase the number of undernourished people worldwide by between 40m and 170m.

Meanwhile, Oxfam’s A Billion Hungry People includes recommendations for reform of the humanitarian aid system and makes a strident call to poor countries to do their bit by investing more in agriculture, targeting women and small-scale producers. Developing countries must increase social protection measures for vulnerable populations – including cash payments and employment creation schemes for those at risk of hunger. Rich countries must ensure long-term predictable funding to developing countries for investment in agriculture and climate change adaptation.

Annex 1 - The Food Crisis in Figures

  • One in six of the world’s population is hungry, almost a billion people.

  • 13 million children are born annually with intrauterine growth restriction meaning that stunting sets in even before children are born due to the hunger experienced by the mother

  • Between 50 and 60 % of all childhood deaths in the developing world are hunger related.

  • The risk of death is 2.5 times higher for children with only mild malnutrition than it is for children who are adequately nourished

  • The proportion of overseas development assistance spent on agriculture has fallen from almost a fifth in 1980 to just 3 per cent today.

  • Poor people are particularly vulnerable to changes in food prices with many spending up to 80 per cent of their income on food.

  • Even before the recent crisis:

  • More than 24,000 people died of hunger related causes every day

  • Five million children under the age of 5 died every year of hunger related causes

  • 16,000 children died every day of hunger-related causes – one every five seconds

Annex 2 – The Continuing Crisis

Afghanistan

Five million people are acutely affected by the food crisis in Afghanistan with a further 8.5 people suffering from chronic food insecurity.

Afghanistan is particularly vulnerable to fluctuations in global prices as the country’s agricultural production has dropped by half as a result of war, displacement of people, persistent drought and flooding.

Oxfam is helping to build grain banks for 31 communities in Daikundi province. These allow communities to buy in grain when it is cheap, and distribute it to those most in need to see them through the winter without taking loans or selling livestock. 1,814 households (approximately 9,000 people) are receiving grain.

Ethiopia

Surveys by NGOs reveal high and increasing levels of malnutrition and poor food security.

Despite falls in food prices on global markets, the cost of cereal in Ethiopia remains 54 to 338 per cent higher than at the same time last year. Recent price increases following the harvest are of particular concern as this should be when prices are at their lowest.

Despite these concerns the World Food Programme faces a $359 million shortfall for its relief programme. Oxfam is supporting more than 110,000 vulnerable women, men and children by providing water, food, and a means of earning a living.

Kenya

With 10 million people at risk of food shortages, the Kenyan government earlier this month (January 2009) declared a national emergency and appealed for $400 million in aid. The emergency has been caused by a combination of d rought; high food prices, and the effect of post-election violence in early 2008 that disrupted farming in the Rift Valley, the country's breadbasket.

After the severe drought in 2005-6, Oxfam's programme in Turkana and Wajir has been focusing on drought preparedness and improving people's resilience, including better access to water.

Mozambique

Seven out of 11 provinces in Mozambique face acute food problems because of poor harvests. The UN estimates that 350,000 people are in need of food aid after large areas of the country received less than half the usual rainfall since October.

The World Food Programme has warned that without additional money it will run out of food supplies next month. Oxfam supports poor farmers to improve their access to sufficient food by using different agricultural methods and diversifying their crops. The programme also supports farmers’ income opportunities by improving their access to markets.

Zimbabwe

Five million people, almost half the country’s population, are dependent on food aid. Another million people are in need of aid but are not receiving it because donors have not provided sufficient money. Rations given to hungry families have already been cut once and may have to be slashed further next month because there is not enough food to go around.

A recent survey by the World Food Programme found that one out of eight households had not eaten anything the previous day. In October 2008 Oxfam began a six-month food aid programme providing support to 165,000 vulnerable people in Midlands province. We are now expanding this to reach around 250,000 people. We are also providing farmers with seeds and fertiliser.

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The Feeding of the Nine Billion

26th January 09 - Alex Evans, Global Dashboard (Chatham House)

Today sees the launch of The Feeding of the Nine Billion, my Chatham House pamphlet on food prices and scarcity issues, which brings a year-long research programme to its conclusion.  This morning’s Financial Times has a piece on the report here, and there’s a BBC World Service interview with me here (scroll to 9.42; you need RealPlayer installed).

The report’s key diagnosis is that while food prices have fallen significantly from their peak last year, they remain acutely problematic for poor people and por countries at their current levels - and poised to resume their upwards climb when the world emerges from the downturn.  Accordingly, the last thing policymakers can do at this stage is to heave a sigh of relief - on the contrary, they need to treat the current easing in prices as a window of opportunity in which to agree the comprehensive, long-term collective action needed to ensure food security for all in the 21st century.

Long term demand drivers, above all a population set to reach over 9 billion by mid-century and the rising affluence and expectations of a growing ‘gloal middle class’ are half the story, with the World Bank forecasting 50% higher demand for food by 2030. 

On the other hand, scarcity issues will present increasing challenges on the supply side.  Oil prices are also set to resume their climb after the downturn, given that investment in new production has collapsed as oil prices have fallen, setting the stage for a future supply crunch; food prices can be expected to follow them, as biofuels, fertiliser prices and transport costs all play their part.  Climate change, water scarcity and competition for land will all also push prices upwards.

So what needs to be done?  The report sets out a ten point agenda for action at the international level and in developing countries, but overall I think of the challenge in four key areas.

The first is to get a 21st century Green Revolution underway, and fast.  Spending on agriculture by aid donors and developing country governments has collapsed over the last 25 years; it’s a similar story on R&D. At the same time, we need to move from today’s input-intensive model of agriculture to one that’s instead knowledge-intensive. People always ask whether that means GM crops, and I don’t rule out that they may have a part to play; but for equitability and social resilience, I think more ecologically integrated approaches (like integrated soil fertility management) often score higher. 

Second, we need to scale up social protection systems in developing countries. Today, nearly a billion people don’t have enough to eat.  But as you can see from the fact that about the same number of people are overweight or obese, the problem is not that there’s insufficient food to go around; rather, it’s that poor people find food prices beyond their reach. Social protection systems are a better bet for developing countries than price controls or economy-wide subsidies because they target help where it’s needed (and don’t break the bank) - but as yet, only 20% of the world’s people have access to them.

Third, we’ve got a lot to do in the trade context.  One option that policymakers ought to be thinking about is a globally coordinated system of food stocks -  a bit like the IEA’s emergency stocks in the oil context - as a way of building resilience to the spate of export restrictions we saw last summer when panic over food prices really set in.  They also need to think about ways of that trade rules can help manage the risk of export suspensions, given that WTO trade rules were really built to resolve disputes over market access, not security of supply.  But at the same time, it remains imperative for developed economies - above all the EU and US - to reform their iniquitous farm supprt policies, which structurally undermine developing country agriculture.

Finally, there remains the observation that (as Gandhi once put it), there’s enough for everyone’s need, but not for everyone’s greed. The global consumer class has barely begun to recognise that its western diet, rich in meat and dairy products, is far more resource intensive than everyone else’s diet - whether you’re looking at grain intensity, water use, energy consumption or greenhouse gas emissions.  That doesn’t mean everyone has to be vegetarian - but there are nonetheless fundamental issues of fair shares involved.  Exactly the same point applies on biofuels: not all biofuels are bad, but inefficient options like corn-based ethanol simply have no place in a sustainable or equitable agriculture system.

I finished this project with the conclusion that the worry that prompted me to do this work in the first place - that scarcity issues would make the future outlook for food much, much harder - is well supported by the data. But in spite of that, I’ve also come away feeling more hopeful than I did when I got started. 

Part of the reason is a deeper understanding of the astonishing story of innovation that lies at the core of the history of agricuture - without which there is no way on earth we could have increased our numbers from 5 million to 6 billion - and of the prospects for more such innovation in the future.  But at the same time, I also finished the project with a firm conclusion that technical innovation on its own isn’t sufficient.

Innovation always creates winners and losers. We saw that in the agricultural context with the 20th century Green Revolution (which despite huge improvements in yield also put huge numbers of agricultural labourers out of work; benefited larger farmers first and small farmers only later, if at all; and for the most part bypassed Africa altogether). So the other side of the coin is all about politics.  It’s not enough for the world’s food system to become more productive, more resilient and more sustainable, though it needs to do all of those things; it also needs to become more equitable.

Admittedly, I found little evidence so far of the political will needed to make that a reality, either in developing countries or at the global level. But the reason why even then, I still feel more hopeful now than when I started the project, is the realisation that creating the more equitable food system that we need isn’t that far out of reach

It wouldn’t take huge sacrifice; we know more or less what we need to do; with sleeves rolled up, I don’t think it’s remotely absurd to think that we could do it within a decade. And actually - in cheerful defiance of the gloomy clouds gathering overhead - I think we might actually do it.

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