CBC.ca has a decent story with some links in it here.
CBC.ca has a decent story with some links in it here.
Sic Bisquitus Disintegrat...
Marc W.D. Tyrrell, Ph.D.
Institute of Interdisciplinary Studies,
Senior Research Fellow,
The Canadian Centre for Intelligence and Security Studies, NPSIA
Carleton University
http://marctyrrell.com/
Today's Wash. Post front pager on the Philippines rice issue referenced these folks: http://www.philrice.gov.ph/ and the lead article there provides some interesting context. Rice production, for wxample, is having problem keeping up with the "three babies a minute" birthrate.
But there's news afoot with worldwide rice production.
Link to InformationFAO expects rice production to rise by 1.8 percent in 2008
Market situation remains difficult in the short-term – lower rice trade
2 April 2008, Rome – World rice production is expected to increase in 2008 by 12 million tonnes or 1.8 percent, assuming normal weather conditions, FAO said today. Production increases would ease the current very tight supply situation in key rice producing countries, according to the first FAO forecast for this year. International rice trade is expected to decrease, mainly due to restrictions in main exporting countries.
Sizable production increases are expected in all the major Asian rice producing countries, especially Bangladesh, China, India, Indonesia, Myanmar, the Philippines and Thailand, where supply and demand are currently rather stretched. Governments in these countries have already announced a series of incentives to raise production.
Well, yes and no. A 1.8% worldwide growth in rice production is certainly better than what has occurred for the last several years, but not good enough. And remember, this is just an advance prediction by FAO - it has to actually come true.
The one thing it (an actual production increase) might do is alleviate some price increases on the futures market, but not for short term deliveries.
The other issue here is that UN crop "predictions" tend to be treated as somewhat suspect, at least to players in the commodities market. The term "wishful thinking" tends to come to mind.
But, we sure can use the increased worldwide production, if it comes true.
Btw, the very recent US futures market in grains (particularly corn) is showing some interesting trends. Farmers are seeing a very, very strong market for grains up through May/June, but not so much for future deliveries past that. Why the discount? Interesting question there.
World Bank echoes food cost alarm
The rapid rise in food prices could push 100 million people in poor countries deeper into poverty, World Bank head, Robert Zoellick, has said.
So, we have a new deal coming, but no money to fund it ?
Some intriguing video links such as this police raid in the Philippines at a warehouse suspected of hoarding rice. Doesn't appear to be much of a rice shortage, the rice is just not getting to anyone.The World Bank and the IMF have held a weekend of meetings that addressed rising food and energy prices as well as the credit crisis upsetting global financial markets. Zoellick's proposal for a "new deal" to tackle the international food crisis was endorsed by the World Bank's steering committee of finance and development ministers at a meeting in Washington.
He also urged wealthy donor countries to quickly fill the World Food Programme's estimated $500m (£250m) funding shortfall.
Then finally this tidbit:There is no rice shortage,
and the country’s rice supply is stable enough to last for 57 days, said Philippine Department of Agriculture Secretary Arthur Yap. If there’s no rice shortage, why is rice price abnormally high?
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In reference to the Argentine issue and others, two weeks ago The Economist published this brief piece on the impacts of export restrictions:
Another piece is the same issue states that, "...most pundits, agree that the world now has plenty of food: last year saw a record cereal harvest. And the investments spurred by today's high prices promise even more food in future. Even if one allows for rising demand from Asia's middle classes, the real challenge is not the volume of food available; it is the problem of food being in the wrong place and at a price the poorest cannot afford.".In the past two weeks Cambodia, Indonesia, Kazakhstan, Russia, Argentina, Ukraine and Thailand have taken the easy option, restricting food exports in an attempt to shore up domestic supplies.
Such curbs may be politically expedient, but they are economically self-defeating. They demotivate farmers, push them into growing the wrong crops and jeopardise their future access to markets. Moreover, the restrictions on supply send prices even higher on world markets.....
....Because of export quotas, Ukrainian growers, after harvesting more than they could sell at home, were forced to toss $100m-worth of rotten grain into the Black Sea earlier this year—just when world markets were desperate for supply. The measures can also be counter-productive, forcing growers to switch into new crops to avoid the export curbs. That can make local food shortages even worse.....
Ted,Another piece is the same issue states that, "...most pundits, agree that the world now has plenty of food: last year saw a record cereal harvest. And the investments spurred by today's high prices promise even more food in future. Even if one allows for rising demand from Asia's middle classes, the real challenge is not the volume of food available; it is the problem of food being in the wrong place and at a price the poorest cannot afford.".
Once upon a time I was married to a USAID officer who worked PL480 (Food for Peace) in Sudan and again in Haiti. The above point was widely in play in 1984 during the Sudanese drought of that period (which by the way was every bit as bad as the drought in Ethiopia; it just did not get the coverage as the Sudanese government clamped down on access). The same held true in the 1990s with Haiti; food was available if someone could pay for it and if the population at risk could either pay for it or get someone else to do the same.
There was a glib SOB on CNN this morning--I forget his name--and he had written a book on food. They had coverage on the screen about the Haiti food riots and this guy said we have to help the poor countries produce more food. I almost threw my cup at at the screen; we (the West)--despite all the BS spouted about using assistance to maintain dependency--have been trying to do just that since WWII. (Does anyone really think the US wants Haiti as a dependant?) Haiti is a stellar example; one only has to look at overhead imagery and see what has happened to Haiti to understand why they might not be such great farmers.
My point in this ramble/rant is two fold:
A. Saying we have food, we just need to move it is to me much like saying we need to readjust post-colonial borders to reduce ethnic warfare. It sounds simple because it is in its heart simplistic. It completely ignores reality as in political and/or economic reality.
B. Saying we need to help the Third World develop food production is another simple statement that is simplistic. They know how to produce food in Sudan. They know how to produce food in Ethiopia. What they do not know how to do is adjust their political, economic, and social structures to the reality of the Sudan or Ethiopia. The Haitians ar another matter; the oldest black republic and the second oldest repblic in the Western Hemipshere, Haiti is very much the longest running crisis. At some stage, the Haitians either fix it or nature will. Nature is a harsh task master. Nature coupled with political/ethnic agendas is devastatingly cruel.
best
Tom
Hi Tom,
I'm often amazed at how many people forget that "reality", at least in the sense of operational social reality, is layered. Years ago I read a science fiction book that gave me a really great way of looking at it (David's Sling by Marc Steigler if I remember correctly) - for any given action, the first question is "is it technically feasible?" (i.e. can we do it?), followed (in order) by "is it economically feasible?" (i.e. can we afford to do it?") followed by "is it politically feasible" (i.e. do we want to do it?").Originally Posted by Tom Odom
The constant focus on production is, in many ways, a hangover from old worn-out Marxist economics. Production this, production that, but no freakin' consideration of distribution (a point that Karl Polanyi made which got him excommunicated from Orthodox Marxism). A lot of Orthodox capitalist economists make the same mistake, but at the level of money as an accountancy measure (they confuse the accountancy value of a crop with the supply and demand ["needs"] value of a crop).
To make matters worse, and Zimbabwe is an excellent example of this, the hierarchy of questions is actually in a reverse order of "power"!
Charles Darwin beats Adam Smith any day of the week!
Tom, you are absolutely correct when you say that these cultures know how to produce food. A lot of the crises in food production stem from socio-cultural changes imposed on them during the past 150 years. Consider, for example, the effects of introducing late Victorian public sanitation measures in Nigeria and, at the same time, stopping clan feuds (massive increase in birth rates and decrease in death rates). Adapting to changes like that is a long and hard process, especially when your agriculture has been set towards one or more forms of mono-cropping for export.
Sic Bisquitus Disintegrat...
Marc W.D. Tyrrell, Ph.D.
Institute of Interdisciplinary Studies,
Senior Research Fellow,
The Canadian Centre for Intelligence and Security Studies, NPSIA
Carleton University
http://marctyrrell.com/
Iowa corn etc...
What I hear (living in Iowa currently) is that the future (projected) cost of fuel to conduct harvesting and transport of corn and soybean will cut into the profit magin. The famers here are excited about increased value of the staple crops but are not looking forward to paying the fuel cost for combines and trucks.
Livestock farmers are likewise happy with increased value of their animals but are upset by the growing scarcity of feed grain. A lot of the corn and soybean farmers are going after the ethanol and bio-diesel markets that pay slightly higher at this time.
All this is subject to change as is always the case with commodities. However, increased commodity price seems to be the trend for now.
Last edited by Steve Blair; 04-14-2008 at 04:55 PM.
NPR had another spot about the issue on the air today. The systemic problem of the poor competing against ethanol production was highlighted. Anyone know what Brazil uses to produce it's fuel?
ISN Security Watch, 14 Apr 08: The Global Food Fight
....The facts are stark: The global price of wheat has risen by 130 percent in the past year, and dairy prices have doubled since 2005. A combination of factors is making basic food and fuel too expensive for people in poorer countries - even as projected world cereal production for 2008 is a record 2,164 million tonnes, up almost 3 percent from last year.
But with across-the-board world food price rises averaging at over 80 percent during the last 24 months, this volatility could acquire a dangerous political counterpart, in countries where 60-75 percent of people's income is spent on food.....
....Another stark fact: Over 240kg of corn would feed one person for a year. This same amount is required to produce just the 100 liters of ethanol needed to fill a SUV tank.....Sugarcane
global initiative on food security in the wake of violence linked to price rises
French push for EU food response
UN special rapporteur Jean Ziegler accused the EU of agricultural dumping in Africa.The European Union has set a target of providing 10% of its fuel for transport from biofuels by 2020, which its own environment advisers have said should be suspended.
There are fears that the use of farmland to grow crops for biofuels has reduced the scope for food production.
The EU is well aware of the risks of soaring food prices and, only last week, Development Commissioner Louis Michel warned of the crisis leading to a "humanitarian tsunami" in Africa.
France will take over the presidency of the EU in July and, in a statement on Friday, four ministers made it clear that the violent response to price rises in Haiti could easily be replicated in 30 other countries.
Protests because of a big increase in the cost of rice have led to a number of deaths in Haiti as well as the fall of the government.
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Sugar
Business Metrics
Bloomberg has website that provides a snapshot of commodities futures for those of you interested in keeping track. George Soros provided some predictions today on the commodities market...
April 17 (Bloomberg) -- Billionaire George Soros said the boom in commodities is still in a ``growth phase'' after prices for oil, wheat and gold rose to records.
``You have a generalized commodity bubble due to commodities having become an asset class that institutions use to an increasing extent,'' Soros said today at an event sponsored by the Centre for European Policy Studies in Brussels. ``On top of that you have specific factors that create the relative shortage of oil and, now, also food.''
Commodities are in their seventh year of gains, with oil rising to a record $115.54 a barrel today as the dollar plunged to an all-time low against the euro. Rice has more than doubled in a year, while corn has advanced 68 percent and wheat 92 percent. Investments in commodities rose by more than a fifth in the first quarter to $400 billion, Citigroup Inc. said April 7.
Sapere Aude
Bush officials defend ethanol as food prices rise
A key goal of the Bush administration has been to boost supplies of renewable fuels to reduce the country's dependence on foreign energy.
Ethanol makers will consume about one-quarter of the 13.1-billion-bushel U.S. corn crop this year, according to the Agriculture Department, a forecast that is increasingly alarming world governments and food aid workers.
But corn prices are rocketing to record highs, which will raise prices for a variety of products as corn is widely used as feed for livestock. Corn for delivery in May rose 15-1/4 cents to $6.07 a bushel at the Chicago Board of Trade Tuesday.
Asked about the food crisis and how it related to biofuels, U.S. Secretary of State Condoleezza Rice said the two were related but there were a host of other issues involved, such as high transportation costs of food.
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