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WSWS : News & Analysis : World Economy

Global food prices rise and famine increases

By Barry Mason
29 March 2008

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The United Nations body World Food Programme (WFP) has warned that the rise in global food prices will reduce its ability to feed hungry and malnourished people.

Speaking last month in Rome, where the WFP is based, WFP Executive Director Josette Sheeran said, “Our ability to reach people is going down just as needs go up.... We are seeing a new face of hunger in which people are being priced out of the food market.... Situations that were previously not urgent—they are now.”

In a press release, the WFP gave a new estimate for the funds needed for its work this year at nearly US$3.5 billion, half a billion more than estimated last year. This money is for approved projects to feed 73 million people in 78 countries throughout the world. It notes that this money is for projected feeding schemes and does not include unforeseen emergencies that may arise.

It also notes that the poorest people on earth will have to spend an increasing portion of their meagre income on food. The WFP warns that these people will be forced to buy less food, or less nutritious food, or rely on outside help.

The countries that will be most affected include Zimbabwe, Eritrea, Djibouti, the Gambia, Togo, Chad, Cameroon, Niger and Senegal, all on the African continent. Also affected will be Haiti, Myanmar (Burma), Yemen and Cuba.

The WFP says amongst the factors pushing food increases are rising oil prices and the increase in demand for food, especially meat, in China and India. This increase in demand is a result of the rapid increase in economic power of these countries.

Weather events linked to climate change have also played a part in the rise in prices. The increasing use of crops for biofuels is another factor at work in the market.

Mark Thirlwell, writing in the Financial Times February 26, provided some data on the scale of the threat to food provision. He pointed out that world food prices have risen by 75 percent since the new millennium with a 20 percent increase last year alone. China’s consumption of meat and soybeans has gone up by 40 percent in the last decade as its economy started to soar.

He points out that whilst in the past, increases in food prices have been alleviated by subsequent increases in production, that may not apply this time.

He argues that the rise in oil prices and subsequent spurt in the production of biofuels will have a long-term impact on food supply. Increasingly, crops will be grown to meet the increased demand for biofuel rather than food.

The fact that food costs represent a bigger proportion of the income for the poor in the so-called undeveloped countries will exacerbate their plight. Thirlwell writes: “While the share of food in the consumption basket of a rich country such as the US is relatively low, at about 10 percent, it averages about 30 percent in China and more than 60 percent in sub-Saharan Africa. Those countries that are most vulnerable are the low-income net food importers. Higher food prices add more strain to import bills that have often already been stretched by higher energy prices. Several of the poorest economies fall into this category and are heavily dependent on food aid to meet their needs. But the worldwide volume of such aid has stagnated for the past two decades and, what is worse; the quantity of aid delivered tends to fall as prices rise, given that a large proportion comprises a fixed annual dollar amount.”

He points out that those most at risk will be the urban poor. Whilst in many sub-Saharan Africa countries, a large proportion of the population exist as subsistence farmers, the trend is for the poor to leave the land and head for the burgeoning urban centres.

The drive to switch to crop production for biofuels is having an impact in Africa. Ghana, Benin, Ethiopia, Uganda, Tanzania, Zambia and South Africa all have plans to produce crops for biofuel.

A report in the Independent, February 16, explained that a meeting of the African Biodiversity Network had met in South Africa to discuss biofuel production. The article quoted respected Nigerian environmentalist Nnimmo Bassey, who said: “Africa is a wide open continent and the energy industry wants to take advantage... This is a flashback to colonial plantations.”

The article continued; “From the savannahs of West Africa to the rainforests of Congo, the plains of Tanzania and the wilderness of Ethiopia, governments are handing over huge tracts of fertile land to private companies aiming to convert biomass grown on large plantations into liquid fuels for export markets. African leaders like Senegal Abdoulaye Wade are predicting a ‘green revolution’ and looking eagerly to lucrative exports.”

Climate change will also affect crop production in Africa. A recent report from Stanford University predicted a drop of nearly a third in the production of the food staple crop maize as a result of climate change over the next two decades.

A separate study carried out by the Centre for Environmental Economics and Policy in Africa (CEEPA), which is based in South Africa, states Africa will lose around 4 percent of its cropland over the next 30 years and will have lost around 18 percent by the end of the century.

The US Agency for International Development (USAID) has said it will cut the amount of food aid it provides. It blamed the recent sharp increase in commodity prices, which have left it with a US$120 million budget deficit.

Amy Barry, an Oxfam spokesperson on trade, quoted in the Observer on March 2, noted: “More and more people are going to be facing food shortages in the future.... Given what is happening due to rising food prices we need to think about the impact this will have on people [in the developing world] who are spending up to 80% of their incomes on food.”

The impact of the economic crisis of the capitalist system will have a devastating affect on the lives of some of the poorest people in the world.

See Also:
Workers protest rising prices in UAE, Egypt
[22 March 2008]
Food prices continue to rise worldwide
[25 February 2008]