Anew world food crisis is being predicted because weather conditions, especially in the US, have damaged current food crops, in particular corn and soybeans.
The world price index for food commodities jumped an alarming 6 percent in July (compared to June) while cereal prices jumped an average of 17 percent, according to the UN Food and Agriculture Organization (FAO).
There is great likelihood of a repeat of the food price crisis of 2008 that led to riots and demonstrations in over 30 countries.
Another concern is that the warnings by scientists that climate change can lead to a decline in food production are already becoming a reality.
The extreme weather events, such as the heat wave and drought in the US and the floods in China, the Philippines and Pakistan, have been linked to climate change as well as being the driving force behind the spike in prices of foods.
This month, the US Department of Agriculture lowered its estimates of this year’s corn output by 2.2 billion bushels to 10.8 billion bushels.
It also estimated that domestic corn price would be $7.50 to $8.90 per bushel after the harvest. The June price was about $6.
Corn is a vital crop because it is used not only as food itself, but also as the main part of animal feed and an ingredient of many foodstuffs. The prices of poultry, red meat, milk and many processed foods are predicted to go up.
Another crop affected by the US drought is soybeans. Prices have already shot up.
The severe deterioration of maize crop prospects in the US pushed up corn prices by almost 23 percent in July, according to the FAO report.
International wheat price quotations also surged by 19 percent amid worsening of production prospects in Russia and expectations of more demand for wheat as animal feed because of the fall in corn supplies.
FAO also reports that the price of soybeans has soared to record levels.
Fortunately, the price of rice has been stable so far. The supply and stocks of rice have been abundant, but the future direction of rice prices remains uncertain, warns FAO.
FAO’s forecast of global rice production for this year has been lowered by 7.8 million tons, mainly because of the reduced rains in India. South Korea, Nepal and Cambodia will also have reduced rice output, while Thailand is expected to sharply reduce its rice exports.
But output is expected to rise in other countries such as China, Indonesia and Australia.
The bleak or uncertain prospects for supplies and prices of some foods have revived the controversy of the increasing use of crops for biofuels instead of food.
The new head of FAO this month called on the US to change its policy by temporarily lifting its present mandate that 40 percent of its corn be used for making ethanol.
An immediate suspension of the ethanol mandate would allow more of the crop to be channeled towards food and feed uses, said Jose Graziano da Silva.
Many organizations have been critical of the diversion of land to produce crops to be used for biofuels, diverting from the use of land for food.
This conflict in alternative uses of land is bound to be more acute when food supplies are reduced due to weather conditions and climate change, while the demand for food increases.
The higher prices of imported foods and the uncertainty of supplies will also catalyze food-importing countries to again consider greater food self-sufficiency as a priority.
Many countries that had produced their own food and were even net exporters experienced an agricultural decline as their governments withdrew support for farmers and the food sector as a condition for obtaining structural adjustment loans from the World Bank and International Monetary Fund.
They had to also reduce their agricultural tariffs to very low levels, thus allowing a surge of cheap and often subsidized imports, which damaged local production.
The looming crisis in food prices and supplies is likely to prompt food-dependent countries to reconsider their definition of food security and give priority to local production.
The Star, Asia News Network.