Protests raise fears of food crisis

from CNN

Food prices are soaring sending political shockwaves around the world but the reasons behind the looming crisis are numerous and complicated.

For the last 30 years the price of basic foodstuffs has remained relatively constant. For most of that period wheat, corn and soya actually fell in real terms.

Now, that period could be coming to an end, and the finger of blame is being pointed at a number of sources, including increased demand from growing populations and the transfer of land use from food to biofuel production.

Poor weather in some countries is piling on the pressure.

Desertification is accelerating in China and sub-Saharan Africa, while more frequent flooding and changing patterns of rainfall are already beginning to have a significant impact on agricultural production.

Climate change is also responsible for the increased demand from developed nations for biofuels.

In the U.S., ethanol production is on course to account for about 30 percent of the national corn crop by 2010, dramatically curtailing the amount of land available for food crops and pushing up the price of corn flour on international commodity markets.

Starting April 15 in the UK, at least two and a half percent of all transport fuels sold in the country must come from renewable sources.

Clare Oxborrow, of Friends of the Earth, said: "It's unacceptable for developing countries to be growing fuel for us to be using in the West instead of growing food to feed their people."

The International Monetary Fund is also extremely concerned about the prioritization of biofuels. It is "unacceptable for the export of agro-fuels to pose a threat to the supply situation of the very people already living in poverty" said Development Minister Heidemarie Wieczorek-Zeul.

But Brazilian President Luiz Inacio Lula da Silva said in April ethanol production "can be the hope for a development model for many countries, particularly in Africa, Latin America and Asia."

The European Union, which is pushing for higher renewable fuel targets, says biofuel quotas can be met domestically rather than importing from developing countries.

Many countries are subsidizing the price of food, and the World Bank has called for targeted subsidies to help the poor.

The U.N.'s World Food Programme needs an extra $500 million to make up the gap in emergency food aid, according to the World Bank.

In the longer term, international aid agencies have called for more money to support food production in developing countries.

Agencies like Oxfam also want protection for small farmers in developing countries and for agricultural marketing boards fighting demands from rich countries for fully open markets.

Riots from Indonesia to Haiti have caused political instability while rising prices for food staples have seen protests in Mexico, Egypt and the Philippines.

In less than a year, the price of wheat has doubled; corn, maize and soya are all well above average 1990s prices and rice is at a 10-year high.

The rising wheat price means the cost of a loaf of bread has more than doubled in places where the poor spend as much as 75 percent of their income on food.

In Yemen, some food prices have nearly doubled in the past four months sparking demonstrations and riots in which at least a dozen people were killed.

China, India, Egypt and Vietnam, four traditional rice exporting countries, have either imposed minimum export prices, export taxes or export quotas and bans. Such moves are expected to reduce rice exports from those countries.