The Truth About The Current Food Crisis
Through all these wonderful media efforts, the majority now believe that due to the affluence and ‘good life’ provided by the discovery of oil, the human population of this planet is growing beyond the planet’s ability to produce enough food to meet the future head on...
Look a little deeper though into the recent food riots in several African countries, Indonesia or Haiti - and beyond to the UN Food and Agricultural Organiser’s warning of another 37 countries also facing food shortage - and you’ll soon see that (as FAO Director General, Jacques Diouf put it…) …
"This is not Greek tragedy where fate is decided by the gods and humans can do nothing about it. No, we have the ability to influence our futures with good solutions bought about by good management.”
Hmmm ... modern day governments and good management? Seems to have become an oxymoron, especially when you hear words like 'kickback' and a rarely mentioned … *erghm* … deregulation.
Yep, pundits across the 1st world have exhausted us all with endless 'air-time cliché’s' describing '...the deregulated financial markets that sparked the mortgage crisis,' bla bla bla ... but the regulatory state of global agricultural markets is something most policymakers and share-invested consumers, don't want to think about at all, let alone try to understand ... and strangely absent from the media’s ever eager eye. Almost taboo, even .. however, the dynamics at play in the collapse of both markets is the same, although the ‘scale of deregulation, proportionate to the scale of consequences,’ varies.
Global ‘commodity agreements,’ ‘price supports for local farmers,’ and other mechanisms which had previously helped maintain stability in global supplies and prices were suddenly dismantled. The World Trade Organization's Agreement on Agriculture, together with multi-lateral and bilateral agreements - including the North American Free Trade Agreement (NAFTA) - slashed agricultural taxes in the developing world, opening up markets for a new global “agribusiness industry.”
Current World Annual Wheat Production
In the U.S., the 1996 Farm Bill eliminated the last vestiges of 'domestic price supports' for the independent farmer, whilst cheaper (imported) feed crops fuelled industrial-level livestock production, increasing meat consumption and driving out many small producers completely.
As one economist in the Organic Consumers Association puts it,
“Thanks to non-existent anti-trust enforcement and rampant vertical integration, we've reached a level of concentration in our global agriculture system that would make Standard Oil blush. Three companies-Cargill, Archer Daniels Midland, and Bunge-control the vast majority of global grain trading, while Monsanto controls more than one-fifth of the global market in seeds. Consumers from Sioux City to Soweto are more and more dependent on fewer and fewer producers.
By eliminating the breadth and diversity of the system, it seems we've also eliminated its ability to withstand shock, or (worse) manipulation.”
By eliminating the breadth and diversity of the system, it seems we've also eliminated its ability to withstand shock, or (worse) manipulation.”
In this way, when market prices are high due to bad growing conditions, ‘grain reserves’ can be released on the market, keeping the prices down for consumers. So too, when prices are low, “reserve (storage) systems” buy up the cheap grain, bringing prices back up… also ensuring ‘rainy day’ supplies for the next spike.
Alarmingly, in the last two decades, however, most ‘free trade’ governments have foolishly allowed ‘reserve systems’ to wither. They have placed full faith in free market imports from poorer third-world countries to self-correct imbalances, totally eliminating a last minute “emergency response mechanism.”
Too bad if there are floods, fire or drought, right … the consumer can starve?
Meanwhile, back on the farm...
All this too, despite an alredy volatile market and full knowledge that grain reserves were well depleted. The ‘mega-giant, grain traders” once again started withholding supply in hopes of higher prices for their annual profit margins. '..They played off currency differentials, and quickly exploited shifting production and investments in search of greater ‘bottom line returns,’ all made possible by deregulated markets.
While farmers in the U.S. may have seen the price for a bushel of corn go from US$2 to $6 in the last two years, in Australia fruit farmers are still only getting the few cents per piece of fruit they did 10 years ago. In the meantime, everything from seeds to fertilizer; and from diesel for tractors, has almost tripled in price, severely deflating any increase in income to the farmer at all.
Falls In Australian Wheat Production
We’ve all heard the catchy phrases that explain the difference between a ‘short windfall’ and a ‘long term profit shift’ but either way, the truth of lies in the farmers profit and his ability to pass on price increases to consumers, in order to cover his cost of production and living. Thanks to deregulation, that is a term that – these days - only the “big guys” have the market power to do…
Last year’s financial reports showed that Mega-agri-companies like Cargill's third-quarter, increased in profits of over 86%. General Mills' were up 61%, and Monsanto's margin rose by a nice tidy 45% ... none of it to be donated to the recent call by World Bank President, Robert Zoellick’s for governments to help make up the US$500 million aid shortfall of the World Food Program.
What, not a cent to help the world's poorest regions, where hundreds of thousands are threatened with starvation?
Sacry, but true... the Agri-giants have become more than just food producers to feed (or not feed) people, they have become common traders - similar to financial traders - but in livestock, commodity and human futures. In an un-regulated global market, these ‘big guys’ have '...gained enough market share that through buying and selling, they can play off both supply and demand' .. and their actions now set the direction of global prices.
They can send shockwaves through the entire system, whenever they want.
The problem with “booms” is they're almost inevitably followed by busts. Worse news is that the experts say that what we're seeing right now - skyrocketing food prices and growing hunger - are still the effects of the last ‘forced’ biofuel boom.
What if the weather should turn bad now?
If the domestic rural farm economy collapses completely; we’re not only set to see more farm foreclosures and another banking crisis, but much more global hunger that will make the sub-prime mortgage effects look like a single grain of wheat in an entire wheatfield ... not to mention the old adage that he who controls the food, controls the world.
So what are the UN and world leaders doing about this impending crisis, having so nicely removed themselves from the equation since implementing deregulation …
So far?
Nothing.
In the US the architects of the failed free market system are now prescribing more of the same, and with nowhere left to go, the policymakers are swallowing it part and parcel. However, rather than workable solutions to the problems, Bush's $200 million food aid proposal looks as ineffective as his $300 tax returns, in terms of actually fixing economic malfunction, or widespread malnutrition.
At its root, hunger today is not about lack of food; it's about poverty and inequity, and the inability to access available food because of the core origin of the current free market system and those who control it.
Sources :
Organic Consumers Association Really Long Link
UN Food and Agriculture Organisation http://www.fao.org/
The Daily Reckoning Really Long Link
Business Spectator Really Long Link
www.ennnews.com
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A lot of research went into this.
There has always been plenty of food around to feed people but just as much self interest to stop the flow of food.
Speculation on properties hurts the lowest income people first.
Speculation on fuel creates inflation.
Speculation on food....?
Cut people from 3 meals a day to 2.
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I totally do not understand the situation, I had a farmer on my site the other day complaining about not making money... I think you have partially solved the mystery of where it is all going, deep into the pockets of the financial engineers.....I have a feeling as you said this could just be the tip of the ice berg, or the grain in the wheatfield.
thanks again, Louie
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Nice to know that you're still reading, and that it 'makes sense'
Thank you.
Lilla ...
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Indeed, not that most in the 1st world couldn't loose a few pounds ... but that doesn't make for good nutritional value either, does it? ... as Mrs M's recent post revealed <<here>>
At least this takes the guess work out of where it's likely to go before enough pressure is bought to bear and revolution once again makes the necessary changes (?) .. *laughs* so what's new?
Lilla ...
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I am thrilled that I could offer you a perspective to understanding the farmers complaint... it was probably very justified, no doubts about it.
The current system is 'wrong, wrong, wrong' no matter how I look at it ... and without the safety protocols, a disaster in the making as the water in the third world peeters out altogether due to their own population booms... but maybe that is the plan?
Global Schmobal, I say.
"wheatfield' is the word I was looking for, thank you.
Hope your day is wonderful,
Lilla ...
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You are not wrong, and yet all I can hear here, is the constant belly-aching of people already so affluent by comparison, as to make me want to scream something obscene at them and walk away in disgust at their endless whinging.
...going now to interpret 'the other level' (profoundly sorry for the delay)...
Lilla ...
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Any grain that is imported into third world countries isn't even given to humans there but to the cattle to fatten them up for us to eat. It's unbelievable. There's enough food in the world to feed 8-10 million people amonget a population of 6 million.
Nice article!
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I read recently that, the 'big boys' realized some time ago, that the most effective weapon in the world was FOOD!!!!....supply equals control...and not a shot need be fired!
cheers
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Very good points indeed. Thanks for the compliment; I am glad you enjoyed the article.
I hear the truth of your words, no doubts about it; we are being as force fed on meat, as the ‘meat’ itself.
I spent a bit of time researching some of the horrific, almost unbelievable facts, relating to the modern meat industry in two previous posts, the worst without doubt, the nightmare and abuse of Intensive Meat Farms {LINK}; and their pollution (as you say).
The other about how the cattle are trampling us out of forests faster than you can say Sizzler ... and I have not even started to look at the methane and toxic effects they are having on our immune systems, either.
Other issues around meat, include the inefficient amounts of water needed to produce one ‘quarter pounder’ of beef and other intensive meat products, as opposed to natural vegetable crops {LINK}
Here is one example from my “Shrinking Earth” article {LINK}
With the food needs of its people exceeding the carrying capacity of its grasslands for livestock, the country is quickly turning to desert.
It is the consumer who must decide and stick to their decision.
For me it’s simple, meat was always a luxury to be savoured perhaps three times a month if you were lucky... and as you say, why not cut it out altogether, I never died being a vegetarian for 10 years.
Thanks again for your thoughtful response.
Lilla ...
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Too right you are... but the consumer is not without power in all this, perhaps only without will power?
Thanks for stopping in.
Lilla ...
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Thanks for your comment, as I said to Nathan 1 above there are so many truths in both your statements and perhaps the only way to reverse the damage is through this axiom... too bad it'll probably take world hunger in massive proportions to bring about the changes needed to fix it all...
We live in interesting times.
I have not heard the term 'flexitarianism' and am off to google some meaning, thanks for that
Lilla ...
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How prophetic ... much wisdom in your words... and what better way to cull a burgeoning world population? The Agri-giants will still have their markets, either way.
The only real changes and our ability to implement them, still lies with the consumer - who is not without power (as I said to Fog), only perhaps without will-power, self-control and the required discipline to start cooking again for themselves, growing some supplimentary home crops and resisting TV advertising to eat meat daily ...
Some food for thought there perhaps (?)
Thanks for your comment.
Lilla ...
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First up, thanks for the mention in your comments to Damo.
Secondly, perhaps not all is lost. Here is a link to an article I read today on the smh website.
LINK
Basically is says that over the past year sales for vegetable seeds have increased despite water restrictions because people are sick of paying high prices for food and also want a better, healthier product.
If everyone had a little vege patch happening......
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Mrs M
P.S. Still dislike 'the man'.
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Oh you are most welcome.
THANK YOU for the link... music to me ears and a feast for my eyes... those little words all spilled of the page into such coherent quatrains and stanzas of common sense and practicality, as to put tears in my eyes... too bad Monsanto owns 55% of the world’s seed production... but hey, who cares if we are growing our own. Personally, I send off to Canberra for mine because I know they are organic and not GM’d in any way.
I have grown my own veggies for years where possible, not always everything we need, but certainly a good portion of it and here in Queensland’s congenial climate, much is possible; it is about time Australian’s are getting the message.
Nothing bugs me more than to see gardens filled with useless trees and plants that do not provide one skerrig of edible anythings ... such a waste when vegetable patches and fruit trees, when companion planted with edible flowers and marigolds, etc can just about look like a picture.
I was so amazed yesterday, down on the Gold Coat at Warner Brothers Movie World, of all places, that in the corner near the looney tunes roller coast the entire gardens were filled with masses and masses of herbs and vegetables... loads of them? *laughs* ... quite the highlight to my day (please don;t ask how I ended up there, assured only that it was not by choice)...
As I said to Jeff and Fog, the consumer must take back their power, first be realising they still have it and – as you say – getting with the programme.
Wonderful news, thanks again.
Cheers
Lilla ...
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Tonight on Dateline (ABC @ 8.30pm) George Negus presents a doco on the food shortage crisis.
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I sometimes feel like this progressive world of ours is taking a slightly big step/several steps backwards in one way or more...
Mrs M...thanks for the heads-up on the doco
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Indeed. Two Giant Steps Backwards. One by the governments for allowing it to go this far, and perhaps a bigger one by consumers who sway to the TV programming and support it all.
How far back, is anyone's guess now, I guess?
Mrs M,
Thank you.
I will be watching for sure, to see where the 'party line' will take it, or will it be objective enough to surprise me, keeping in mind my journalistic 'appreciation'?
Thanks again for both your comments, much appreciated.
Lilla ...
food for thought since everyone else is just congratulating i'll be the bad guy
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Thank you for that link, it was very interesting reading, hope more of my readers follow it... I couldn't get past this;
OMG, these statistics are so loud, why have people become so deaf... it must be all that Heavy Metal?
Great to read/meet you, thanks for commenting.
Lilla ...
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I missed it, not thinking it was SBS, but rather the wrong night.... never mind, they usually repeat these things (or re-hash them with updated stats.)...
Was it any good?
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Sad yet true - how is this going to end?
Have a blessed day
Jessicca
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too true and who knows how it ends? But I do not think it will end well unless radical change is demanded by all people's, rich and poor.
The first world rich must realise that eventually if they do not take care of the third world poor, they themselves will also eventually become extinct. A symbiotic relationship must somehow be forged, not this current one which is based on mass exploitation...let's hope that 2012 brings some sort of shift to the planet to this end.
Always lovely to see you, I hope your day is special.
Lilla ...