Global food prices have returned to the spotlight in recent weeks, owing to the devastating drought in the United States that has caused crop prices to climb. The global food price index produced by the UN Food and Agriculture Organization (FAO) rose by 6 percent to 213 points in July, causing concern that we could be heading towards another crisis similar to that of 2007/8 that pushed 44 million people into poverty.
But what can be done to prevent this from happening? An immediate reaction from producer countries may well be to impose export bans, to protect food availability in their own countries. Director-General of the International Food Policy Research Institute, Shengenn Fan, warns against this. In a recent statement he said:
Countries must stay away from imposing export restrictions when food prices increase because they lead to tighter market conditions and panic purchases by food-importing countries, thereby exacerbating food price hikes.
The production of biofuels has also fallen under scrutiny, with FAO Director-General Jose Graziano Da Silva speaking out in the Financial Times last week. Currently, about 40 percent of total maize production in the United States is used to produce ethanol. The US Department of Agriculture’s forecast for maize production is at its lowest level since 2006/07, sparking debate as to whether the mandates in the US and EU should be relaxed in times of food shortage. Da Silva commented:
While the current situation is precarious and could deteriorate further if unfavourable weather conditions persist, it is not a crisis yet. Countries and the UN are better equipped than in 2007-08 to face high food prices, with the introduction of its Agricultural Market Information System, which promotes co-ordination of policy responses. Risks are high and the wrong responses to the current situation could create it. It is vitally important that any unilateral policy reactions from countries, whether importers or exporters, do not further destabilise the situation.
When food prices rise sharply, it is those in the developing world, who spend a large percentage of their income on food that suffer most. The following infographic, produced by the World Food Programme demonstrates varying income expenditure on food, and what happens when the poor are forced to spend more on food: they are left with barely any income for health, education and shelter.
It is therefore critical we avert another food crisis, and research shows we have it within our power to do this. Vulnerable families in the developing world need not rely on industrial powerhouses such as the United States for their crops, they could be self-reliant, and produce enough food not only to feed themselves, but their continent. As Marianne Bänziger, Deputy Director-General at the International Maize and Wheat Improvement Center (CIMMYT) recently commented:
There are many developing countries where productivity could be increased to reduce overreliance on imports and benefit rural poor and development in those countries at large. The potential for improvement is enormous. Providing farmers with knowhow and improved agronomy, seed, and storage methods can produce dramatic effects both for individual families, entire countries, and the globe as a whole.
To enable smallholder farmers to rise to this challenge, it is imperative that we invest in the infrastructure necessary in rural areas, and improve access to stress-tolerant seeds and fertilizer. Weather-based index crop insurance mechanisms that protect farmers from adverse climatic events, and extension services that train farmers in agroforestry, crop diversity and smart irrigation, can all play critically important roles in creating a resilient new crop of farmers that will stave off hunger for future generations.