[AODA members] Rising grain prices - Q&A with Peter Timmel

[Stacia Nordin, RD]

Thanks for sharing this Erika - I've pasted the file link you shared 
with us below for quicker access. I appreciate Peter Timmel's input on 
this, but there is one piece he misses - the need to reduce the amount 
of grain we as humans consume on our plates. There are 5-6 other food 
groups (depending on how your country organizes its food groups) that 
need to be boosted in our food production systems and diets:
* Fruits
* Legumes (beans and peas)
* Nuts (trees and ground nuts)
* Vegetables
* Root Starches (potatoe / yam type things)
* Fats and oilseeds (avocado, coconut, sesame and the like)

I think our fore-parents made an error when they chose grains as their 
focus in their agricultural systems 10,000 years ago - a better choice 
would have been to mimic natural mixed system of foods that balance the 
food energy across more food groups. It is not too late to change this 
'grain habit' into a 'diversity habit'. The benefits are many:
* These food stuffs are packed with micronutrients not found in grain 
sources, while still giving us energy sources for carbohydrates, fats 
and proteins;
* Several of the foods grow in marginal areas, are perennial (grow for 
many years), and are perfectly suited to the areas they naturally grow;
* The foods are beautiful and can be added to parks, city centres, 
flower beds and other interesting places to improve the way we use the 
earth;
* There are stories and history that go along with the species - 
re-connecting us to our cultures;
* Diversity adds excitement and interest to our lives :)

We have found immense pleasure in reviving the knowledge and use of East 
African species of plants, animals and insects in our Malawian yard. Our 
yard / garden / mini-farm is highly productive, healthy and requires no 
external purchases of chemicals to treat it (unlike mono-crop systems 
that require high inputs of fuel and chemical treatments - which end up 
running like a hospital / emergency room / war centre instead of a 
healthy food production site!).

The solutions lie in each one of us to think and live more sustainably 
in harmony with the way the natural environment was created / evolved. 
The natural environment has a lot to teach us about every aspect of life 
if we are willing to learn.

-- 
Stacia Nordin, RD
Registered Dietitian
Advisor to Malawi Ministry of Education, School Health and Nutrition
 * AODA President, www.EatrightOverseas.org
 * ADA HEN DPG International Food committee, www.HENDPG.org
 * Permaculture Network co-Editor
 * Nutrition Society Malawi Treasurer

Kristof, Stacia & Khalidwe
Crossroads PDN x-124, LL, Malawi

Malawi is +2 GMT (6-7 hours before USA EST)
+265 (0) 1-707-213 home
+265 (0) 9-333-073 cell stacia
+265 (0) 9-926-153 cell kristof
+265 (0) 8-132-710 cell khali / home

www.NeverEndingFood.org



Erika Garrity Pied wrote:
> FYI. An interesting Q&A from the Center for Global Development (CGD) 
> website with Peter Timmel, leading expert on agriculture and 
> development who is advising Indonesia on its response to the grain 
> crisis. He gives his opinion on the 4 major driving forces behind the 
> grain price rise and warns that if currently high global prices are 
> passed along to poor people in Asia, 10 million people or more could 
> die prematurely. See the link below.
> http://www.cgdev.org/content/general/detail/15820
Asian Rice Crisis Puts 10 Million or More at Risk: Q&A with Peter Timmer
Peter Timmer

04/21/2008

Soaring global food prices have led to a precarious situation in Asia, 
where government efforts to restrict rice exports are exacerbating 
shortages. CGD non-resident fellow Peter Timmer, a leading expert on 
agriculture and development who is advising Indonesia on its response to 
the crisis, warns in a Q&A that if currently high global prices are 
passed along to poor people in Asia, 10 million people or more could die 
prematurely.

Q: In the past famines have been about local or regional shortages. 
Experts have told us that the problem is not a global lack of food per 
se but rather problems in distribution. Is this still true?

A: It's not as true today as it was a decade or two ago because of the 
changing composition (and location) of increases in demand for food. 
There is still plenty of food for everyone, but only if everyone eats a 
grain and legume-based diet. If the diet includes large (and increasing) 
amounts of animal protein (not to mention bio-fuels for our SUVs), food 
demand is running ahead of global production. We have been drawing down 
grain stocks for the past seven years, and that is not sustainable.

See Also: Trade Policy for a New Deal on Hunger by Nancy Birdsall and 
Arvind SubramanianQ: In your opinion, what's driving this crisis?

A: It's important to start with the basic balance between food demand 
and food supply. Although the Green Revolution has run out of steam, and 
the rapid increases in food supply seen in the 1970s and 1980s are no 
longer in prospect, we have still seen respectable increases in food 
supply over the past decade--significantly larger than population 
growth. So the problem must largely lie on the demand side.

Four basic drivers seem to be stimulating rapid growth in demand for 
food commodities: (1) rising living standards in China, India, and other 
rapidly growing developing countries, which lead to increased demand for 
livestock products and the feedstuffs to produce them; (2) stimulus from 
mandates for corn-based ethanol in the United States and the ripple 
effects beyond the corn economy; (3) the rapid depreciation of the U.S. 
dollar against the Euro and a number of other important currencies, 
which drives up the price of commodities priced in U.S. dollars; and (4) 
massive speculation from new financial players searching for better 
returns than in stocks or real estate, also stimulated by the declining 
dollar.

It's very hard to attribute weights to each of these causes to the 
run-up in food prices. The weights vary by commodity and by what time 
period is being considered. For example, rice prices started to explode 
just two months ago, well over a year after wheat prices sky-rocketed 
and eight months after the sharp run-up in corn prices. Individual 
commodities still have their own dynamics. But clearly there are also 
fundamental underlying connections across all of these commodity 
markets, even in the relatively short run, and only financial market 
linkages can explain those connections.

Q: How serious is the problem? Is there more hunger globally today than 
there was a few weeks ago when this broke as a major news story?

A: This is the most serious problem facing the world food economy since 
1973-74, when a million people in Sri Lanka and Bangladesh alone died 
prematurely as a result of a rice crisis. World Bank president Zoellick 
suggested last week that high food prices risked pushing 100 million 
people back below the poverty line, wiping out seven years of progress. 
In my view, the situation is actually much worse than that. Unless some 
way can be found to stop the explosive rise in food prices generally, 
and rice prices in particular, we will see sharply higher mortality. 
Most of these deaths will be in Asia because of the huge numbers of 
poor, hungry people there who are dependent on rice for their daily 
subsistence.

This will not be mass starvation, with people dying in the streets, but 
it will be sharply higher infant and child mortality and weakened adults 
succumbing prematurely to infectious diseases. If current rice prices in 
world markets are actually transmitted into most Asian countries--and 
this is not yet a reality, but it becomes more likely every day the 
world price stays this high--then even conservative calculations suggest 
that upwards of 10 million people will die prematurely.

A month ago I thought we would be able to avoid this happening, but now 
the world price is so high, and countries are so spooked, that even the 
big countries might not be able to keep their domestic prices low enough 
for poor people to afford the food they need.

Q: Does domestic politics in Asia play into this?

A: Absolutely! The trigger for the explosion in rice prices was the 
decision of the Indian government to impose an export ban in November 
2007, taking the world's second largest exporter out of the market. That 
set off fears in the newly elected, populist government in Thailand that 
rice prices would get out of control there, so export controls were 
openly discussed-- Thailand is the world's largest rice exporter. 
Vietnam followed with export restrictions in January 2008.

On the import side, the Philippines has been throwing fuel on the fire 
by insisting on huge tenders for rice from a world market that cannot 
provide it, thus driving up the price in this thin market. Last 
Thursday, the Philippines tendered for 500,000 metric tons of rice and 
received offers for only 316,000 metric tons at an average price of 
$1170, a price 30 percent higher than a week before. They have insisted 
they will do this again on May 5.

Q: Is more food aid the answer?

A: I understand the appeal of cranking up the food aid allocations to 
help poor people in the short run, but this is no real answer. My own 
sense is that the most urgent intervention right now would be to get 
India, China, Vietnam, Thailand, Indonesia, and the Philippines into one 
room and get them all to agree to open their markets to rice imports and 
exports, at least for the next six months. Once some sensible 
equilibrium is reached--perhaps around $500 per ton, where everyone can 
come out a winner--there would be time to sit down and discuss a 
sensible longer-term arrangement for rice trade. Continuing the current 
“beggar my neighbor” policies will be a catastrophe in both the short 
run and the long run.

Obviously, after we get through the worst of the crisis, huge new 
investments are needed to raise agricultural productivity around the 
world. These investments were forthcoming after the world food crisis in 
1973-74, and they are needed this time as well. But they take a long 
time to produce results.

Q: You say that getting the major rice producers and consumers-- India, 
China, Vietnam, Thailand, Indonesia, and the Philippines--to agree to 
open their markets would relieve the price pressure. How do you see this 
happening?

A: There are already several initiatives to get the Asian rice consumers 
and producers to talk about a cooperative solution. One from the 
Philippines is lead by their foreign minister and seems to involve 
greater trade cooperation, but it is undermined by their own refusal to 
lift their own high import duties on foreign rice. A second initiative 
comes from the International Rice Research Institute (IRRI) and focuses 
on quick production responses and longer run research initiatives. There 
has been no visible movement on either proposal.

Q: What role do you see for the U.S., other rich countries, and the 
international institutions?

A: There are two obvious things the rich countries can do: first, boost 
supply by funding food aid channels, including the World Food Program 
and others, with cash and commodities. Rice is now quite scarce 
physically in a number of distressed countries--a reversal of situations 
caused mostly by local crop failures or disasters. Second, end bio-fuel 
subsidies and mandates immediately. There is substantial disagreement 
over the role corn-based ethanol (in the U.S.) and vegetable oil-based 
bio-diesel (in Europe and some parts of Asia) in the recent price 
spikes--the "respectable" range is from 10 to 60 percent. But there is 
no way the rich countries can play a leadership role in bringing this 
crisis under control as long as they insist there is plenty of food for 
people, livestock, AND automobiles. There just isn't--and we've known 
that from the start of the U.S. bio-fuels program.

Peter Timmer and other CGD experts on the global crisis are available 
for media interviews. Please contact Ben Edwards to set up an interview: 
(202) 416-0740; Bedwards at cgdev.org.