The world food crisis cropped up suddenly but is likely to persist for several years until farmers ramp up production to satisfy burgeoning demand, the executive director of the World Food Program said yesterday.
“I expect three or four years of humanitarian challenge,” especially because the world’s consumers are now competing with the biofuels industry for scarce crops, Josette Sheeran told the Peterson Institute for International Economics, noting that world consumption of food has been outpacing production for three years and has drained stores of grain to 30-year lows.
“I’m concerned about the fusing of food and fuel markets. Crops are being used as industrial outputs throughout the world” and are pitting moneyed energy interests against the poorest and neediest consumers, she told the nonpartisan think tank in Washington. “Energy bidders can outbid food buyers and, in a year of tight supplies, that’s having a bigger impact than it would ordinarily.”
Bad weather continues to exacerbate the problem, the most recent example being the cyclone that hit Burma in its rice-producing region and a poor year for crops in North Korea, developments that made both countries more vulnerable than ever to food shortages and hunger, she said.
The hoarding of rice and other crops, along with export restrictions in more than 40 major producers from Asia to Latin America, is worsening the problem, she said. Some of the World Food Program’s shipments of food to the needy have been impounded because of the export restrictions, and its contracts to purchase rice have been broken because Asian buyers have offered better prices, she said.
“This global rash of beggar-thy-neighbor policies will not provide a solution,” Ms. Sheeran said, calling on countries like Japan — with 1.5 million tons of rice in storage that often goes to waste — to open up to the rest of the world. “Will the countries with bounty share their food?”
The United Nations food program has identified another $430 million in new food needs on top of the $775 million it announced last month and the $3.1 billion it regularly doles out each year, she said, noting that escalating prices are forcing the agency to constantly reassess the situation.
Ms. Sheeran said the interplay of food and fuel prices has become so important that she starts each day by scanning the news to see what the price of oil is, and then looking at the prices for major food commodities such as corn, wheat and rice, which are rising in tandem with oil.
Premium crude closed at a record $121.84 a barrel in New York trading yesterday. Ms. Sheeran said the high price of oil and gas has prompted farmers in Africa to cut back on food production because they cannot afford the cost of nitrogen fertilizer, which is made from natural gas.
With food prices so high, “the natural reaction of farmers is to plant more. That is happening in developed countries, but the opposite is happening in the developing world” because of high fuel costs, she said.
Farmers in Kenya’s fertile Rift Valley are planting only one-third as much as they did last year because they cannot afford the skyrocketing cost of fertilizer, she said.
To resolve the crisis, “we need to get production up,” she said, suggesting that one of her greatest wishes would be for U.S. farmers to each devote 1 acre of idle cropland to alleviating the world food crisis. The 2.8 percent increase in global production this year projected by the U.N. Food and Agricultural Organization might not suffice.
“What is new is where will that food go — to consumers or energy production,” Ms. Sheeran said. “The linking of the markets puts a question in my mind whether it will relieve the situation.”
While the current food shortage is the worst in a generation and has raised Malthusian fears about the world running out of food and energy resources, Ms. Sheeran said she believes the crunch can be resolved over the long run by reviving agricultural production in Africa.
Many African farmers have been pushed out of the food market by a deluge of cheap food imports from Europe and the Americas. Many farmers moved to urban areas to try to eke out an existence at other jobs, and are now among the hungry because they cannot afford the rising cost of imported foods.
“I think the world can produce enough food. In many places in Africa, yields are one-tenth of what they could be,” Ms. Sheeran said. “Maybe the time has come for the African farmer.”
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