An executive of the South African corporation, Sasol, has stated in a TV interview that his company can set up facilities to convert coal to liquid fuel by the Fischer-Tropisch process for any state or region in the USA that has coal deposits that they would like to exploit. Governor Brian Schweitzer, did you hear that?
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In China and India, two fast-growing giants that have become grain hogs in recent years, policymakers have themselves to blame for declining yield growth. While Vietnam has become a major rice exporter by giving farmers claim to their land—and a motive to get the most out of every paddy in the long term—China's peasants live in fear of local cadres with the power to snatch their fields for pet development projects. That's a big reason "most farmers in China have gone a whole generation without making major improvements to their land," says Roy Prosterman, chairman emeritus at the Rural Development Institute in Seattle. In India, the poorest 18 million families—more than 100 million people—face a similar plight because they are landless. They work mainly in the fields, earning meager wages for seasonal work, and when food prices skyrocket their real wages plummet. It's a recipe for famine.
Policymakers in both countries are addressing these land issues. Beijing has issued new directives to bolster farmers' tenure rights, and India plans to give its poorest 18 million households tennis-court-size garden plots to buffer them from spiking grain prices.
It's not only subsidized food that feeds the hunger crisis. The average incomes in poor agricultural regions are undercut by America's cotton subsidies, by Europe's phony opening of its sugar market (only to cheap unrefined sugar) and by the U.S. and European practice of "tariff escalation" on coffee. The latter raises tariffs depending on how fully coffee growing nations process their beans. "The more value they add by grinding, packaging it, branding it and doing everything else they teach in business school, the higher the tariff," says Moore. Now these policies are raising the vulnerability of nations like Colombia and Egypt to famine.
So is the boom in biofuels. Western farm lobbyists have embraced corn ethanol (and other biofuels such as rape-seed biodiesel) as a new way to gobble up excess production and justify lavish farm subsidies. The result has been a vast shift of land into energy crops (15 percent of arable land in Germany and France, and some 20 percent of America's corn production). Prosterman warns that "we need to close the subsidy spigot, otherwise we won't be feeding 15 to 20 percent of our corn to cars, but two or three times that amount. I shudder to think what that would do to food availability worldwide."
Agronomists argue that the planet is not even close to being tapped out on spare food growing capacity to nourish an expanding population. And economists say higher prices could be the wake-up call that compels politicians to create the right incentives for farmers to meet that potential. They need to cut the red tape, knock down the trade barriers and create conditions in which investments in agriculture flow to the areas that need it most. In one promising development, the food-price crisis has led African and other poor countries to all but drop import tariffs among themselves, which should boost production. And in recent years the EU has begun slashing its highly destructive export subsidies from a high of €15 billion in the 1990s to less than €3 billion last year (though they still refuse to abolish many of their highest tariffs). To solve the food crisis, a much more profound attitude shift will be needed. As hundreds of thousands of tons of warehouse rice sit in bins in Japan, it's a change that can't come too soon.
With Rod Nordland in Rome, Akiko Kashiwagi in Tokyo and Chris Yabes in Negros
© 2008
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