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| Price hike casualty: The World Food Program stopped its free rice at Cambodia schools. Heng Sinith/AP |
Briefing: Lessons from past food crises
World leaders gather in Rome Tuesday for a UN food crisis conference. What does history teach about how to handle such shortages?
By Mark Rice-Oxley | Correspondent of The Christian Science Monitorfrom the June 2, 2008 edition
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Reporter Mark Rice-Oxley outlines several steps to help deal with the causes underlying global food shortages.
 Insecurity drives farm purchases abroad - 12/22/08 |
| Briefing: Lessons from past food crises - 06/03/08 |
| Ortega leads anti-U.S. critique at Latin American food summit - 05/09/08 |
| In Japan, mounting anger over bread-and-butter issues - 05/08/08 |
| Food riots, anti-U.S. protests erupt in Somalia - 05/07/08 |
| Roots of Asia's rice crisis - 04/22/08 |
A burgeoning population. Soaring energy costs. Rising demand for meat. A catastrophic harvest. A sudden run on the grain market – and an 80 percent surge in food prices in three years.
A brief run-down of the current world food crisis? Yes, but it also applies to the early 1970s – the last time the collective cupboard was bare. Despite similarities, today's food price shock also has some striking features which sets it apart from past crises.
As world leaders gather in Rome Tuesday for a three-day United Nations conference on what steps to take to address the international food crisis, they might study what lessons can be learned from the recent pages of history.
How unusual is this food crisis?
The current situation is hardly unprecedented. The 1972 alarm, triggered by a hungry Soviet Union seeking to compensate for failed grain harvests, had brutal knock-on effects in East Africa and the Asian subcontinent. Farm prices didn't start falling until 1975, once Washington and Moscow reached an agreement on grain trade. The deal sought to regulate Soviet grain purchases and calm markets by removing any sudden spikes in demand that would drain stockpiles. The episode left a clear lesson: transparency and regular trading between big market players can prevent price spikes.
Prior to 1972, anyone who has read John Steinbeck's early works will know about the privations of the 1930s. This was the most lasting food shock of the past century. It started during the Great Depression and was extended by World War II, as trading between nations broke down.
But Prof. Tim Lang, a prominent British food industry expert, says it was this shock that produced the modern agronomic era, where science took aim at boosting farm productivity.
Food prices also spiked in the late 1980s, and again in the mid 1990s after a drought crimped US grain supplies. On both occasions, markets settled down as farmers responded by planting more crops.
How does this crisis compare?
It's similar – and yet different. The World Food Program highlights four principal drivers. Two are familiar: the rise in oil prices which affect the entire value chain of food production, and weather-related events (bad harvests, particularly in Australia). Two are new: the diversion of crops for use in biofuels, and the rising prosperity of the world's two most populous nations, China and India.
"We have probably close to 4 billion people wanting to move up the food chain, consuming more meat, milk, and maize – and that takes a lot of grain," says Lester Brown, who heads the Earth Policy Institute in Washington. Data from the Australian Central Bank finds that the Chinese ate 20 kilograms (44 pounds) of meat per capita in 1985. Today, it's 54 kilograms (119 pounds) of meat per year (see chart).
"We have also seen an enormous growth in the last couple years in the use of grain to produce ethanol fuel in the US," Mr. Brown adds. The annual growth in world grain consumption, he says, has shot up from around 20 million tons a year from 1990-2005 to more than 40 million tons in the past two years. He blames much of the rise on a diversion of corn to ethanol distilleries.
"Biofuel demand is the largest source of new demand in decades and a strong factor underpinning the upward shift in agricultural commodity prices," said a report by the UN's Food and Agriculture Organization (FAO) this past week.
But US Agriculture Secretary Edward Schafer told reporters Thursday that biofuel production has only pushed up global food prices by 2 or 3 percent. He added that biofuels had cut consumption of oil by a million barrels a day.
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