Food Riots Spread

Food Riots Could Spread, Un Chief Warns

By Gary Cleland, Telegraph.Co.Uk | 12 April 2008

Rising food prices could threaten political stability around the world, the UN's leading humanitarian official said yesterday. Sir John Holmes, the undersecretary general for humanitarian affairs and the UN's emergency relief co-ordinator, was speaking after two days of rioting in Egypt over the soaring cost of basic foodstuffs.

He told a conference in Dubai that rising prices would spark unrest across vulnerable nations. Average prices have risen 40 per cent across the world in less than a year. Sir John said: "The security implications should also not be underestimated as food riots are already being reported across the globe.

"Current food price trends are likely to increase sharply both the incidence and depth of food insecurity." As well as the riots in Egypt, rising food costs have been blamed for violent unrest in Haiti, Ivory Coast, Cameroon, Mauritania, Mozambique and Senegal. Protests have also occurred in Uzbekistan, Yemen, Bolivia and Indonesia. China, India, Pakistan, Cambodia and Vietnam have curbed rice exports to ensure there is enough for their own people.

Experts believe food insecurity should be treated as seriously as climate change.



Demand For Rice Threatens Global Food Supplies

By Telegraph.Co.Uk | 12 April 2008

The run on rice is threatening to disrupt world food supplies as much as banks' lack of confidence in each other has seen global credit markets dry up. Rice is the staple food for half the world's population. China, Egypt, Vietnam and India, representing more than a third of global rice exports, curbed sales this year, and Indonesia says it may do the same.

The price of rice, the staple food for half the world, rose 2% to a record $20.910 per 100lbs in Chicago, double the price a year ago and a fivefold increase from 2001. "Rice will gain substantially over the next two years," said Roland Jansen, chief executive of Switzerland-based Mother Earth Investments, which holds 4% of its $100m funds in the grain.

He believes governments will maintain curbs on exports as they "want to be able to continue to feed their own populations". The World Bank in Washington says 33 nations from Mexico to Yemen may face "social unrest" as food and energy costs have risen for six straight years. "High and volatile food prices will be with us for years to come," according to World Bank president Robert Zoellick, who urged wealthy nations to cut agricultural subsidies and open markets for food imports.

Rice-growing nations are driving up prices for producers that want to sell abroad. The Vietnam Food Association last week asked members to stop signing export contracts in June, following China, which has imposed a 5% tax on exports. Egypt banned rice shipments until October. Record grain prices are stoking inflation. Wholesale costs in India rose 7% in the week ending March 22, the fastest pace in more than three years, underscoring the threat from rising food costs, the ministry of commerce and industry in New Delhi said.

The increase may boost profits for suppliers. Shares in Padiberas Nasional, Malaysia's only licensed rice supplier, rose the most in seven years on the Kuala Lumpur stock exchange last week. Goldman Sachs forecasts that all agricultural commodities it covers, except sugar, will rise during the next six months. Global cereal demand will expand 2.6% this year, 1.6 percentage points above the 10-year average, according to the Food and Agriculture Organisation in Rome.

The UBS Bloomberg Constant Maturity Commodity Index of 26 raw materials has gained for six consecutive years and advanced 15% this year. "We have some very serious problems developing globally for food and energy," said Greg Smith, executive director of Global Commodities in Adelaide, Australia. World rice stockpiles are at their lowest levels since the 1980s, and the UN forecasts that exports will drop 3.5% this year.

"A constant price rise of rice can't be viewed as sustainable," said Abah Ofon, a commodities analyst with Standard Chartered in Dubai. "As with any staple commodity, there's a risk of social tension when prices begin to rise."



Price Shock In Global Food
Riots Over Grain Prices Call For A Rethink Of Global Stability Based On Better Farming.

By The Christian Science Monitor | 12 April 2008

Americans may fret that Wheat Thins cost 15 percent more than a year ago but in poor nations, such price hikes aren't taken lightly. In Ivory Coast last week, women rioted against higher food costs, leaving one person dead. In Haiti, four people were killed in protests last week over a 50 percent rise in the cost of food staples in the past year. From Egypt to Vietnam, price rises of 40 percent or more for rice, wheat, and corn are stirring unrest and forcing governments to take drastic steps, such as blocking grain exports and arresting farmers who hoard surpluses. The UN International Fund for Agriculture predicts food riots will become common on the world scene for at least a year. The World Bank says 33 countries face unrest from higher prices in both food and energy.

Even in grain-rich America, wholesale food prices are rising at a rate not seen in 27 years. The most acute "ag-flation," however, is in Asia and Africa, where food costs take up a higher proportion of family income. And the face of hunger is now seen more in cities as a historic shift takes place with more than half of the world's population soon to be living in or near urban areas. The food price hikes may not be temporary, according to the UN World Food Program, which sees long-lasting causes, such as spreading deserts and more demand for grain-fed meat. The WFP itself, which feeds about 73 million of the most destitute people, warns its rich donor nations that it will require more money for some time to come. Its latest need: $500 million more by May 1.

The food price crisis has created a welcome stir about government policy. Last week, World Bank President Robert Zoellick called for increased agricultural production in poorer nations while warning rich countries not to set up more trade protection and subsidies for farmers. "This economic isolationism signals a defeatism that will reap losses, not the gains, of globalization," he said.

Indeed, a government's attempt to control food markets, either for farmers or for urban dwellers, often creates the kind of distortions that contribute to higher prices. One of the worst examples is a rush by Europe and the US to devote more farmland to growing biofuels— a dubious action to curb greenhouse gases. In 2008, about 18 percent of grain in the US will go to make ethanol and, according to the Earth Policy Institute, such production over the past two years could have fed nearly 250 million people.

UN officials are split over their high priority given to biofuels in the fight against climate change, with Secretary-General Ban Ki Moon now suggesting a review of that policy. But international bodies also need to review reduced investment in agricultural productivity. A second "green revolution" from scientific research, like that seen during the 1960s, could transform farming once again. In Asia, where two-thirds of the poor live, growth in farm productivity is down to 1 percent a year compared with 2.5 percent two decades ago. More money needs to go toward research in creating new strains of grain and toward better irrigation. Too many nations are rushing to industrialize and urbanize at the expense of farmers.

Food riots signal the need to rethink global stability and the critical role of those who till the land and feed us all.

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Normxxx    
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