Warfare: Food Supply/Access

[Stan]

Great. Just what we need - to become dependent on Russia for food and energy. I'm sure they're also stockpiling women for the growing gender deficit...

Hey Eric ! There are some intriguing links at the Moscow Times, and it wasn't too long ago that Nashi Summer camps were advertising pro-creation

Anyhoo, back to the thread. Now here's a unique opinion from Konstantin Sonin, a professor at the New Economic School and a columnist for Vedomosti.

You should not worry too much about the 1.5 billion Chinese people. If the increase in prices is caused primarily by the increase in meat consumption in China, this means that the quality of life has improved there. If things had gotten worse for them because of their increased meat consumption, they would have ceased to eat meat. In that case, prices would have dropped, and they would have gone back to living as before.

You also should not worry about the people in the United States or Europe. All the U.S. government has to do to solve the problem is to reduce subsidies to its farmers, including payments for non use of farmland, and prices will drop substantially. To be sure, the agriculture lobby in the United States is very powerful, and even touching the issue is dangerous for Congressmen, but the overwhelming majority of Americans are not producers of grain, but consumers.

At some point, the rise in food prices will pressure the government to stop fulfilling the lobbyists' requests to limit agricultural supply. In this case, an increase in competition and production among producers will lead to sharply lower grain prices.

For countries that significantly depend on food imports -- including Russia -- this logic does not apply.

[Stan]

Consider the case of Uganda. The country’s rice output has risen 2½ times since 2004, according to the Ministry of Trade.

Uganda’s importers, seeing the shift, have invested in new mills in the country, expanding employment and creating competition for farmer output, thereby improving prices. New mills, meanwhile, lowered the cost of bringing domestic rice to market. While people in developing countries across the globe are clamoring about the sharp rise in food prices, Ugandans are still paying about the same for rice as they always have. And Uganda is poised to start exporting rice within East Africa—and beyond.

The secret of Uganda’s homegrown success? Ignoring decades of bad Western advice.

[Watcher In The Middle]

From Foreign Policy article:

One of the leaders of Uganda’s rice revolution is Gilbert Bukenya, the country’s vice president and its leading advocate for the commercialization of agriculture. I first met Bukenya at his home on the shores of Lake Victoria, where he laid out the basic philosophy. “By farming smarter, Ugandans not only can grow more, they can earn more money,” he told me. An advocate of food self-sufficiency, Bukenya wants Ugandans to eat more homegrown rice, boosting local farmers and rice millers while at the same time freeing hard cash for other uses. Bukenya has long promoted a new African rice that grows in “uplands” (as opposed to wetland “paddies”) and requires less water.

Embracing a new variety is only part of the working-smarter formula. Once rice output began to expand, Bukenya and other Ugandan politicians played another card: They stumped for a duty of 75 percent to be imposed on foreign rice. The legislature passed the duty, which stimulated domestic rice production further.

There's the real meat of the article. The pols didn't create restrictions on imports until AFTER the output started to expand. Vital point, there, that at least IMHO, the article didn't do sufficient justice to. That's a lesson our pols here in the US need to learn.

You have to expand supply first, then you have got all sorts of options available to you. Good for Uganda for what they are doing - it's working for them, and probably will continue to do so. Now the key for them is to keep expanding/improving their infrastructure (roads, rail, mills, ports, storage facilities), so they can not just feed their own population, but also process exports.

Looks like they have some good, thoughtful leadership in place. Just be wise enough to use the tariffs on imported goods sparingly.

[bourbon]

The Last Bite: Is the world’s food system collapsing?, by Bee Wilson. The New Yorker, May 19, 2008.

Like Malthus, Roberts sees humanity increasingly struggling to meet its food needs. He predicts that in the next forty years, as agriculture is threatened by climate change, “demand for food will rise precipitously,” outstripping supply. The reasons for this, however, are not strictly Malthusian. For Malthus, famine was inevitable because the math of human existence did not add up: the means of subsistence grew only arithmetically (1, 2, 3), whereas population grew geometrically (2, 4, 8). By this analysis, food production could never catch up with fertility. Malthus was wrong, on both counts. In his treatise, Malthus couldn’t envisage any innovations for increasing yield beyond “dressing” the soil with cattle manure. In the decades after he wrote, farmers in England took advantage of new machinery, powerful fertilizers, and higher-yield seeds, and supply rose faster than demand. As the availability of food increased, and people became more prosperous, fertility fell.

Malthus could not have imagined that demand might increase catastrophically even where populations were static or falling. The problem is not just the number of mouths to feed; it’s the quantity of food that each mouth consumes when there are no natural constraints. As the world becomes richer, people eat too much, and too much of the wrong things—above all, meat. Since it takes on average four pounds of grain to make a single pound of meat, Roberts writes, “meatier diets also geometrically increase overall food demands” even in those parts of Europe and North America where fertility rates are low. Malthus knew that some people were more “frugal” than others, but he hugely underestimated the capacity of ordinary human beings to keep eating. Even now, there is no over-all food shortage when measured by global subsistence needs. Despite the current food crisis, last year’s worldwide grain harvest was colossal, five per cent above the previous year’s. We are not yet living on Cormac McCarthy’s scorched earth. Yet demand is increasing ever faster. As of 2006, there were eight hundred million people on the planet who were hungry, but they were outnumbered by the billion who were overweight. Our current food predicament resembles a Malthusian scenario—misery and famine—but one largely created by overproduction rather than underproduction. Our ability to produce vastly too many calories for our basic needs has skewed the concept of demand, and generated a wildly dysfunctional market.

[JJackson]

Since it takes on average four pounds of grain to make a single pound of meat

From The New Yorker article.

I could not quickly find a correct figure to rebut this but I will take bets it is far too optimistic. I will give you a cow, pig or chicken and 12 pound of grain and I bet you can not increase their weight by a pound each - if you manage can a couple of ounces between them I will be very impressed. My money says the cow will eat all 12 pounds and all you get in return is an impressive cow pat.

Edit:
I can not paste this in but the link is to Agroecology: The Ecology of sustainable food systems and on page 256 it gives a conversion factor of 1 to 5% for 'confined livestock' i.e if they do nothing but eat to put on weight.

[Ron Humphrey]

From The New Yorker article.

I could not quickly find a correct figure to rebut this but I will take bets it is far too optimistic. I will give you a cow, pig or chicken and 12 pound of grain and I bet you can not increase their weight by a pound each - if you manage can a couple of ounces between them I will be very impressed. My money says the cow will eat all 12 pounds and all you get in return is an impressive cow pat.

Edit:
I can not paste this in but the link is to Agroecology: The Ecology of sustainable food systems and on page 256 it gives a conversion factor of 1 to 5% for 'confined livestock' i.e if they do nothing but eat to put on weight.

How did cows, pigs, or chickens ever survive without farmers growing grain to feed them??

[JJackson]

eating what ever they could find, just like all their wild relatives still do. Our domesticated versions just get a helping hand to get fat - and dead - quicker.

[Jedburgh]

Fortune, 29 May 08: Wal-Mart Puts the Squeeze on Food Costs

With gas, grain, and dairy prices exploding, you'd think the biggest seller of corn flakes and Cocoa Puffs would be getting hit by rising food costs. But Wal-Mart has temporarily rolled back prices on hundreds of food items by as much as 30% this year. How? By pressuring vendors to take costs out of the supply chain.

"When our grocery suppliers bring price increases, we don't just accept them," says Pamela Kohn, Wal-Mart's general merchandise manager for perishables. To be sure, Wal-Mart isn't the only retailer working to cut fat from the food chain, but as the largest grocer - Wal-Mart's food and consumables revenue is nearly $100 billion - it has a disproportionate amount of leverage. Here's how the retailer is throwing its weight around.....

Wal-Mart is not just the largest single importer into the U.S. - it is also the largest single grocery importer. And the price impacts of pressuring vendors to reduce unnecessary packaging costs, etc. are not just felt in the US - Wal-Mart is present and similarly active in Mexico, Canada, all of Central America, Argentina and Brazil in South America, the UK, China, Japan, and is just entering the Indian market. However, even given all that leverage, the supply-chain is still hit hard by increasing transport costs. That is driving the concomitant rapid expansion of the locovore concept (global, not just in the US - as illustrated by the Guatemalan farmer project), despite the impact on selection and quality:

....Wal-Mart has been going green, but not entirely for the reasons you might think. By sourcing more produce locally - it now sells Wisconsin-grown yellow corn in 56 stores in or near Wisconsin - it is able to cut shipping costs. "We are looking at how to reduce the number of miles our suppliers' trucks travel," says Kohn. Marc Turner, whose Bushwick Potato Co. supplies Wal-Mart stores in the Northeast, says the cost of shipping one truck of spuds from his farm in Maine to local Wal-Mart stores costs less than $1,000, compared with several thousand dollars for a big rig from Idaho. Last year his shipments to Wal-Mart grew 13%....

[Jedburgh]

Chatham House, 29 May 08: Thinking About the Future of Food: The Chatham House Food Supply Scenarios

This briefing paper continues the Food Supply Project’s work on the strategic influences and factors that are changing the world’s food supply. It explains four scenarios that have been developed in order to understand the conditions being created and their possible effects on the EU/UK. Based on publicly available information and statistics, the scenarios illustrate a range of circumstances that food supply actors in both developed and developing countries must expect to face in the years to come.

These are not predictions of the future. But they are reasoned depictions that are being used to provoke thinking and engage stakeholders in debate. They are already helping to highlight a need for all the sectors involved to be ready to respond to significant change.....

[JJackson]

http://maps.maplecroft.com/loadmap?t...ID=210&close=y

[Jedburgh]

http://maps.maplecroft.com/loadmap?t...ID=210&close=y

Since that site states that they obtain most of their info from the FAO, its interesting to compare their site with the data on FAO's Global Information and Early Warning System on Food and Agriculture

[Fuchs]

I had some professional contact with FAO and had a look at one specific portion of their data sets.

Some of its statistics are guesswork, other figures were copied from the previous year since many, many years. Different FAO departments had conflicting information. FAO experts are often just from large trading organizations an incapable to offer the full picture. Some statistics origin in national customs statistics, which have very varying degrees of sophistication and are collected by non-expert personnel (which often means that unknown product are incorrectly added to better known categories).

FAO statistics should only be used if there's absolutely no other statistic available.

[Watcher In The Middle]

Article from Monsanto's annual meeting:

Monsanto's 2030 Goals
By Rachel Melcer, ST. LOUIS POST-DISPATCH
Dated: 06/05/2008

Monsanto Co. is offering to help farmers produce more crops while using less water, energy and land for every bushel of corn, cotton and soybeans they harvest using its technology.

The question is: Will the Creve Coeur-based company have many takers?

To succeed, Monsanto must win over biotechnology skeptics, address extremely complex global social, political and economic challenges — and convince naysayers that it should be at the head of the table.

But the company's leaders say they are prepared.

"The question of how do you produce more and conserve more is at the heart of what we're about. … And it's increasingly what the global challenge is about as well," said Hugh Grant, president, chairman and chief executive.

He laid out a three-point plan Wednesday morning during an employee meeting.

•Monsanto will develop corn, cotton and soybean seeds that double crop yields by 2030 over the level of production in 2000.

For example, the weighted average yield in the United States, Brazil and Argentina would reach 79 bushels of soybeans per acre by 2030, up 92 percent from last year's U.S. production; corn, 220 bushels per acre, up 46 percent; and cotton, 1,344 pounds per acre, up 53 percent.

In addition, Monsanto is donating $10 million over five years to fund public-sector research for improving yields in rice and wheat crops.

•The company also will help farmers conserve natural resources by developing corn, cotton and soybean seeds that require less energy, fertilizer and water to produce the same yield. Its goal is to reduce by one-third the amount of resources required per unit of output in 2030, versus what was needed in 2000.

Link to Article

IF they can pull this off (and from what I'm hearing from talking to people in the community, they think it's likely, and it won't even take to 2030 to get it done), we're on the front edge of the Second Green Revolution.

Then there's the UN trying to horn their way into the debate:

United Nations Secretary-General Ban Ki-moon last week said the world needed to invest as much as $20 billion a year on agriculture to tackle soaring food prices.

Link to article

Now, that's typical UN thinking (throw bucketfull's of somebody else's hard earned money at the problem, because they can't possibly change the way they do things).

But in any case, it's going to be a hard year in the marketplace for this year. Look at the numbers for planting this year. It's way behind previous years, primarily because of weather.

[Jedburgh]

IMF, 30 Jun 08: Food and Fuel Prices: Recent Developments, Macroeconomic Impact, and Policy Responses

This report provides a first broad assessment of the impact of the surge in food and fuel prices on the balance of payments, budgets, prices, and poverty of a large sample of countries. It reviews countries’ macroeconomic policy responses to date and also discusses Fund advice for managing the price increases. Policies should (i) ensure that food and finance reaches the most affected countries as quickly as possible, (ii) include targeted and scaled-up social measures, and (iii) avoid high costs in terms of macroeconomic instability or loss in future agricultural production. Collaborating with international partners, the Fund also stands ready to provide balance of payments assistance. As the paper presents an initial assessment of a still-evolving situation, the somewhat tentative nature of the analysis should be borne in mind.....

[Watcher In The Middle]

Drought stricken, Iran buys US wheat for first time in 27 years
Dated: Aug 25 2008 10:44 PM US/Eastern

Wracked by drought, Iran has turned to the United States for wheat for the first time in 27 years, marking a setback for Tehran's search for agricultural self-sufficiency.

According to a recent US Department of Agriculture report, Iran has bought about 1.18 million tonnes of US hard wheat since the beginning of the 2008-2009 crop season in June.

The number, which has been growing steadily all summer, already represents nearly 5.0 percent of US annual exports forecast by the USDA.

The last time Iran imported US wheat was in 1981-1982.

Link to Article

This one has really hit the news Link

This was not an anticipated purchase - It's pretty clear that Iranian marketplace options for hard wheat (right now) were pretty limited. The interesting part is that the Iranian shortfall is estimated at around 4.5 mil metric tons, and this sale is for 1.18 mil metric tons. So it could grow even more. Depends on wheat harvests in places like Australia, which is still several months off.

I'd be interested in a geopolitical "read" on how this affects "other ongoing issues" between Iran and the US. Thoughts?

[Ron Humphrey]

Link to Article

This one has really hit the news Link

This was not an anticipated purchase - It's pretty clear that Iranian marketplace options for hard wheat (right now) were pretty limited. The interesting part is that the Iranian shortfall is estimated at around 4.5 mil metric tons, and this sale is for 1.18 mil metric tons. So it could grow even more. Depends on wheat harvests in places like Australia, which is still several months off.

I'd be interested in a geopolitical "read" on how this affects "other ongoing issues" between Iran and the US. Thoughts?

Can't hurt might help, might not, not so sure, too many other related and unrelated interactions happening right now which may serve to heighten or dampen the effects of it???

[bourbon]

Moscow to seize grain export controls, By Javier Blas. Financial Times, July 31 2008.

Russia plans to form a state grain trading company to control up to half of the country’s cereal exports, intensifying fears that Moscow wants to use food exports as a diplomatic weapon in the same way as Gazprom has manipulated natural gas sales.

[Ron Humphrey]

Moscow to seize grain export controls, By Javier Blas. Financial Times, July 31 2008.

Well wadya know if bullyin gets ya what ya want in one instance why stop there

Who'da thunk it

[Sergeant T]

Excellent article by Michael Pollan of The Omnivore's Dilema and In Defense of Food fame. Long but worth the time.

The impact of the American food system on the rest of the world will have implications for your foreign and trade policies as well. In the past several months more than 30 nations have experienced food riots, and so far one government has fallen. Should high grain prices persist and shortages develop, you can expect to see the pendulum shift decisively away from free trade, at least in food. Nations that opened their markets to the global flood of cheap grain (under pressure from previous administrations as well as the World Bank and the I.M.F.) lost so many farmers that they now find their ability to feed their own populations hinges on decisions made in Washington (like your predecessor’s precipitous embrace of biofuels) and on Wall Street. They will now rush to rebuild their own agricultural sectors and then seek to protect them by erecting trade barriers. Expect to hear the phrases “food sovereignty” and “food security” on the lips of every foreign leader you meet. Not only the Doha round, but the whole cause of free trade in agriculture is probably dead, the casualty of a cheap food policy that a scant two years ago seemed like a boon for everyone.

[120mm]

Excellent article by Michael Pollan of The Omnivore's Dilema and In Defense of Food fame. Long but worth the time.

Of course, it's entirely possible that expensive food might do something completely counter to Conventional Wisdom, and assist native economies in developing agriculture, providing MORE, not LESS food.

There is a certain line of thought that considers cheap food to be a major contributor to hunger in agrarian nations.