Wednesday, December 19, 2007


World Food Supply Is Shrinking, U.N. Agency Warns

Published: December 18, 2007

ROME — In an “unforeseen and unprecedented” shift, the world food supply is dwindling rapidly and food prices are soaring to historic levels, the United Nations’ top food and agriculture official warned Monday.

The changes created “a very serious risk that fewer people will be able to get food,” particularly in the developing world, said Jacques Diouf, head of the United Nations Food and Agriculture Organization.

The agency’s food price index rose by more than 40 percent this year, compared with 9 percent the year before — a rate that was already unacceptable, Mr. Diouf said. New figures show that the total cost of food imported by the neediest countries rose 25 percent in the last year, to $107 million.

At the same time, reserves of cereals are severely depleted, the agency’s records show. World wheat stores declined 11 percent this year, to the lowest level since 1980. That corresponds with 12 weeks of the world’s total consumption, much less than the average of 18 weeks’ consumption, in storage during the 2000-2005 period.

There are only 8 weeks of corn left, down from 11 weeks in the same five-year period.

Prices of wheat and oilseeds are at record highs, Mr. Diouf said Monday. Wheat prices have risen by $130 a ton, or 52 percent, since a year ago. United States wheat futures broke $10 a bushel for the first time Monday, a psychological milestone.

Mr. Diouf said the crisis was a result of a confluence of recent supply and demand factors that, he said, were here to stay.

On the supply side, the early effects of global warming have decreased crop yields in some crucial places. So has a shift away from farming for human consumption to crops for biofuels and cattle feed. Demand for grain is increasing as the world’s population grows and more is diverted to feed cattle as the population of upwardly mobile meat-eaters grows.

“We’re concerned that we are facing the perfect storm for the world’s hungry,” said Josette Sheeran, executive director of the World Food Program, in a telephone interview. She said that her agency’s food procurement costs had gone up 50 percent in the last five years and that some poor people were being “priced out of the food market.”

To make matters worse, high oil prices have doubled shipping costs in the last year, putting stress on poor nations that need to import food and the humanitarian agencies that provide it.

Climate specialists say the poor’s vulnerability will only increase.

“If there’s a significant change in climate in one of our high production areas, if there is a disease that affects a major crop, we are in a very risky situation,” said S. Mark Howden of the Commonwealth Scientific and Industrial Research organization in Canberra, Australia. Already “unusual weather events,” linked to climate change — like drought, floods and storms — have decreased production in important exporting countries like Australia and Ukraine, Mr. Diouf said. In southern Australia, a significant reduction in rainfall in the last few years led some farmers to sell their land and move to Tasmania, where water is more reliable, said Mr. Howden, one of the authors of a recent series of papers on climate change and the world food supply, published in the proceedings of the National Academy of Sciences.

“In the U.S., Australia and Europe, there’s a very substantial capacity to adapt to the effects on food — with money, technology, research and development. In the developing world, there isn’t.”

Ms. Sheeran said that on a recent trip to Mali she was told that food stocks were at an all-time low. The World Food Program feeds millions of children in schools and people with H.I.V. and AIDS. Poor nutrition in these groups increases the risk of serious disease and death.

Mr. Diouf suggested that all countries and international agencies would have to “revisit” agricultural and aid policies they adopted “in a different economic environment.” For example, with food and oil prices approaching records, it may not make sense to send food aid to poorer countries, but instead to focus on helping farmers grow food locally.

The food organization plans to start a new initiative that will offer farmers in poor countries vouchers that can be redeemed for seeds and fertilizer and will try to help them adapt to climate change.

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