There are 860 million people (~13% of the world's population) who are suffering from chronic hunger. 90% of these people, reside in developing countries i.e: mostly in Africa, Parts of Asia, South America and Eastern Europe.
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According to the agenda of the June 2008 HIGH-LEVEL CONFERENCE ON WORLD FOOD SECURITY (centered on THE CHALLENGES OF CLIMATE CHANGE AND BIO-ENERGY):- 'During the first three months of 2008, international nominal prices of all major food commodities reached their highest levels in nearly 50 years, while prices in real terms were the highest in nearly 30 years!' Over the last year, the global mean price of food has risen by 56%, with wheat rising by 92% and the average price of rice rising by 96%.
- The global food crisis 'is provoking social unrest across the developing world'. For instance in Somalia, where thousands rioted during the first week of May 2008; protesting for food. Food riots have also occurred in Indonesia, Haiti, the Philippines and Ethiopia.
It is clear that the escalating prices (of food commodities) threaten to plunge millions into deep poverty. If unchecked, this crisis has the potential to trigger a chain of apocalyptic events: it may draw us closer to extinction...
That's how serious it is!
That's how serious it is!
Below is a graphical illustration showing real and nominal average food prices between 1961 and 2008:
Source: HIGH-LEVEL CONFERENCE ON WORLD FOOD SECURITY: THE CHALLENGES OF CLIMATE CHANGE AND BIOENERGY AGENDA. For more information see conference materials
Explanation of the graphical illustration: The vertical axis shows prices and the horizontal axis shows time in years (between 1961-2008). The navy-blue trajectory shows nominal price movements (of food commodities) between 1961-2008 and the lime-green trajectory shows price movements (of food commodities) in real terms, between 1961 and 2008. From the illustration you can see that real prices and nominal prices of food are equal in 2003. Between 2003 and 2008, both real and nominal prices increase at a pace that was last witnessed in 1974! In 2008 the nominal price of food is at its highest and the real price of food is at the same level it was in 1978.
...What's causing food prices to soar?
World Bank Agricultural Economist, Don Mitchell believes that bio-fuels are the chief cause of the upsurge of food prices. According to Mitchell, the growing use of food crops as raw materials for bio-fuel generation, combined with falling grain stocks, speculation in commodity markets and food export bans; contributed to approximately 75 percent of the 140 percent rise in food prices between January 2002 and February 2008. He also attributes 65 percent of the 140 percent increase in food prices, to the depreciating U.S. dollar, increasing energy prices and associated increases in fertilizer costs. Another factor that's fueling the price escalation, is climate change (caused by global warming). Climate change generally has an adverse effect on agricultural yields.
The above-cited factors generally have a 'reducing-effect' on the global supply of food, which generally causes food prices to increase (assuming constant food demand).
Below is a supply and demand model that illustrates the effect of the aforementioned factors on global prices of food:
The above-cited factors generally have a 'reducing-effect' on the global supply of food, which generally causes food prices to increase (assuming constant food demand).
Below is a supply and demand model that illustrates the effect of the aforementioned factors on global prices of food:
Explanation the Supply and Demand Model: The vertical axis represents the global averages of food prices. The horizontal axis represents quantity of food demanded globally and quantity of food supplied globally. The downwardly sloping lime-green line represents the global quantity of food demanded, at various prices. Global supply of food (at various prices) before the bio-fuel revolution is represented by the upwardly-slopping navy-blue line labeled S1. The global supply of food after the bio-fuel revolution has started, is illustrated by the upwardly-slopping navy blue line labeled S2. Point b (Q1;P1) is the point of equilibrium between demand and supply of food, before the bio-fuel revolution. Point a (Q2; P2) is the point of equilibrium between demand and supply of food, after the bio-fuel revolution has started. The bio-fuel revolution reduces the supply of food from S1 to S2 and the point of market equilibrium shifts from Point b to Point a. At point a the aggregate quantity of food supply is Q2 at an increased price denoted by P2....How do we mitigate the crisis?
Answer: By increasing food supply (which in turn reduces food prices) through any, or a combination of the following:
- Channeling an increasing proportion of bio-fuel feedstock to the food industry. However, this may undermine the productivity of bio-fuel projects, which would adversely impact Kyoto Protocol-sanctioned pollution-reduction initiatives. In the diagram below, the increase in food production from a reduction in bio-fuel production is illustrated by a movement from Point a to Point b.
- Development and wide-scale implementation of yield enhancing technologies. This would boost global food output. Effective yield enhancing technologies have the likelihood of emerging from the field of Biotechnology (specifically genomics and proteomics) in the form of; high yielding, nutrient-rich, pest resistant, 'all-weather' crops. In the diagram below the increase in food production that accrues from technological development is illustrated by a movement from Points a and b to either Point d or Point e.
- Development of 'food alternatives'. Recent advancements in the field of nanotechnology have given us the power to manipulate matter--at it's most basic level--with great precision. We could use this technology to create chemical substance equivalents of food, that mimic real food in terms of; taste, appearance, nutrition, texture and smell: I believe that in the near future, we'll be able to harness the power of light energy, carbon dioxide and synthetic chlorophyll; to create edible nutrient rich carbohydrate foods in labs (at a lower cost and at a faster speed than nature)... Also, currently, stem-cell technology is used to grow cartilage and skin (for medical patients who need replacements) in petri-dishes. We can use that technology to grow meat (parts of cows, fish, chicken etc) in labs. This will help conserve grain (and land), that would otherwise have been used as an input for animal husbandry projects (which are generally 'grain-intensive'). This would avail more grain for human consumption. (Side Note: Sounds like a florid, quixotic statement; embedded in deep romanticism? Wait and see! The passage of time will validate my assertion). In the diagram below this increase in food supply from food alternatives. is illustrated by a movement from Points a and b to either Point d or Point e.
Explanation of the graphical illustration: The illustration above is a Production Possibilities Frontier (transformation curve) model showing the maximal combinations of bio-diesel and food, that the global economy could efficiently produce during a specific time period, with the use of scarce resources. The vertical axis represents various quantities of bio-diesel and the horizontal axis represents various quantities of food. A northward movement from any point on the graph, means that more bio-diesel is being produced, whereas an eastward movement from any point on the graph, means that more food is being produced. The two concave slopes are called transformation curves. They show the various maximal combinations of food and bio-diesel that the global economy can produce efficiently. Each respective transformation curve represents a different level of technology utilization; with the navy-blue trajectory showing the maximal combination of bio-diesel and food that can be produced with the current level of technology. The green trajectory shows the maximal combinations of food and bio-diesel that can be produced if a technological advancement occurs. Point f lies lower than the navy blue trajectory; a movement from Point f to point either Point a or b, means that producers have scaled-up their operations--using the current level of technology--to (efficiently) produce maximal combinations of food and bio-diesel. A movement from Point a to b means that producers who are already producing maximal combinations of food and bio-diesel (using the current levels of technology), are increasing food production at the expense of bio-diesel production. A movement from Points a and b, to either Point d or e means that farmers are using new yield enhancing technology to (efficiently) produce greater quantities of food and bio-diesel.
...How do governments; channel an increasing proportion of bio-fuel feedstock to the food industry, facilitate development and wide-scale implementation of yield enhancing technologies, facilitate development of food alternatives?
I think that the Food and Agriculture Organization of the United Nations should encourage its membership to set voluntary, legally binding food production targets: a food production treaty. The treaty should be an adapted (to food security) 'reverse-engineered' model of the Kyoto Protocol, that among other things, sets specific targets and deadlines for food production. A treaty of this kind will provide the moral impetus for tackling the global food crisis.
A carrot and stick approach has to be implemented to encourage parties to the treaty to comply i.e reward compliance and punish non-compliance. Financial penalties should be set to punish signatories who don't meet targets, and, tradeable 'Food Production Credits' (similar to carbon credits) should be awarded to parties that increase food production beyond a set benchmark.
'Food production credits' have the added benefit of inspiring research into yield enhancing methodologies, and, will encourage producers to adopt yield enhancing technologies rapidly i.e 'food credits' will reduce the 'bottleneck' between (yield-enhancing) technology creation and (yield-enhancing) technology adoption.
And so on, and so on, etc, etc :-) . The academics can takeover from here.
