What The Threat Of A Global Food Crisis Means For World Markets
Aug. 18, 2012
The global food crisis of 2007-2008 is threatening to repeat in the coming months, as the worst drought in 50 years devastates the US corn crop, with 51% of the crop rated “Poor/very poor” by the US Department of Agriculture. This crop is said to be on a par with that of 1988 crop, the worst in the past thirty years. Note that the US is the top producer and exporter of corn. Our account for nearly half of the world’s corn and also a third of the world’s soybeans, the harvest for which will be the lowest in five years. The director-general of the UN’s Food and Agriculture Organization, José Graziano da Silva, characterizes the present global food situation as “precarious,” as do experts we have contacted.
The food crisis in 2008 led to riots in some 30, mainly very poor, countries and immeasurable hardships in many more. Following that crisis, governments vowed to act to improve global food security, including at a G8 Summit in Italy in 2009. The followup is reported to have been a mixture of some gains and some disappointments. Among the gains are the provision of improved strains of some crops and increased agricultural aid. There have been disappointments in the areas of humanitarian food aid and a failure to agree on binding agreements to regulate food export bans. The 2008 crisis was made more severe by export restrictions by some important agricultural producers, including Russia and the Ukraine.