Year of the PotatoUnderreported Humanitarian StoriesDroughts and Heatwaves

Effects of the 2008 Food Crisis

Prices for basic foods such as rice, wheat, and corn have risen 83% since 2005. Compared to the first half of 2007, food prices in 2008 have risen even more dramatically: 130% increase for wheat and an 87% increase for soy. Between March 3rd and April 23rd, 2008, the price for a metric ton of rice rose from $460 to $1,000. This almost doubling in price caused riots in Egypt and Haiti. Other nations (Cameroon, Ivory Coast, Mauritania, Ethiopia, Uzbekistan, Yemen, the Philippines, Thailand, Indonesia, and Italy) have experienced violent protests in reaction to the increased cost of food staples. During the summer months, twenty-nine countries have cut back on food exports to ensure their populations have enough to eat. India, Vietnam, China, and more have limited or banned exports of rice. Pakistan and Bolivia have severely capped wheat exports. Kazakhstan has even restricted exporting sunflower seeds.

Causes of the Food Crisis

Increased demand on the food supply has caused the price of food to rise. The numerous contributors to the rise in cost and the reduction in supply include biofuels, bad weather, the historically high cost of oil and transportation, increased demand for meat and dairy, and population growth.

Biofuels

Plant material, or biomass, is used to produce biofuels in the form of gas or liquid fuel. Energy and environmental concerns have helped promote biofuels as a way to replace oil and natural gas. Unfortunately, biofuels seem to be exacerbating the problem of food shortage. Farmers in many industrialized nations, such as the United States, have been encouraged by their governments to switch to growing fuel crops, such as corn and soy. This reduction in domestic farming means food must be imported, which increases the overall cost of food production worldwide.

Natural Forces

Drought in Australia

Australia is normally the second largest exporter of grain, after the U.S. The continent, though, is experiencing an ongoing drought that has been described as the worst in a century. Grain yields have shrunk and many silos remain empty. Australia’s drought is a major factor in global wheat stocks being at their lowest since 1979. In fact, many wheat and rice farmers are switching to crops that demand less water, such as wine grapes.

Desertification

In 2008, 110 countries on every continent (excluding Antarctica) are experiencing widespread drought and desertification. Imagine the fertile, moist soil on a farm turning into the dry, blowing sand of a desert, which is what the term desertification is describing. It happens when the soil has been ruined and can no longer support life. Overgrazing by farm and herd animals confined by fences is a big contributor to desertification. Fencing restricts the amount of land available for animals to graze, which in turn prevents the soil and plants from recovering after being trod upon and eaten. Deforestation, slash-and-burn agriculture, and the use of trees and plants as fuel have also contributed to the increasing spread of desertification, especially in semi-arid and arid regions.

Oil and Transportation

The price of a barrel of oil exceeded $100 in 2008. Oil provides the energy needed for farmers to plant and harvest their crops. The more money it costs to grow an ear of corn translates into an increase in the cost to sell it. For instance, energy is needed to produce fertilizer, keep equipment like tractors running, and provide the fuel to transport the finished crops all over the world. Many industrialized nations no longer produce enough of their own food, which means food must be imported from elsewhere. The increase in oil and fuel prices has made the transport of food prohibitively expensive for some nations.

Meat and Dairy

Economic growth in many countries has allowed people to expand their diets, especially in China and other Southeast Asian nations. More and more people have been adding meat and dairy to the menu. Cows must eat more grain in order to supply enough meat and milk to meet demand. For instance, 700 calories of animal feed must be consumed in order to produce a 100-calorie piece of beef.

Population Growth

The human population has grown significantly in the first decade of the 21st century. As of April 2008, the global population reached 6.6 billion people, up from 6 billion in 1999. The increase in the number of people means greater competition for resources.

What is being done?

There is no simple answer to the causes of the food crisis. Biofuels are getting a lot of attention, due in part to the newness of the technology, the use of food as fuel, and whether the march toward switching energy resources over to biofuels is intensifying, if not causing, the food crisis. Rich nations are being asked to reconsider many recently passed laws and policies that promote biofuels as an alternate energy source. The United Nations is also urging rich countries to increase the amount of money they give to poorer nations for food aid. In April 2008, President Bush ordered $200 million in emergency food aid to be made available to “meet unanticipated food aid needs in Africa and elsewhere.” The World Bank intends to increase its agricultural lending to Africa in 2009 to $800 million. The United Nations Secretary General Ban Ki-moon announced the establishment of a task force to handle the global food crisis. One of the priorities of this task force is to close the funding gap for the UN’s World Food Program (WFP) this year. By May 1st, the size of the funding gap had reached $755 million. Mr. Ban also addressed the importance of helping farmers in poor countries who have been hurt by the increasing costs of fertilizer and energy. $200 million is being made available to help farmers in the worst affected areas to boost food production, as well as $1.7 billion is going to help nations in need buy seeds. Robert Zoellick, the head of the World Bank, worries about nations using export bans to protect their food stocks, expressing that such controls “encourage hoarding, drive up prices, and hurt the poorest people around the world.” In March India banned the export of non-basmati rice, and in late April decided to tax exports of basmati rice. 26 million Latin Americans are in danger of being pushed into extreme poverty, according to the Inter-American Development Bank. The bank has implemented a $500 million credit line to increase the amount of support to help agricultural productivity and anti-poverty programs. The Mexican government has also pledged to help offset increased food costs by increasing cash subsidies to its poorest citizens.

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