Is a food crisis looming? by Julian Cribb*
Australian graingrowers are currently enjoying premium wheat prices in a world market characterised by uprecedented low grain stocks. Analysts are debating whether we are heading into a supply and demand 'grain crisis'. While there is still much uncertainty on this score, it is clear that the volatile times ahead offer enormous challenges and opportunities to Australian growers and to grains research.
Australian research and farming methods already contribute innovations towards world food security. In a wide-ranging report, Julian Cribb* looks at some of the international resource issues underlying world food supplies and where Australia fits into the picture.
Market Signals, p 10, looks at current trends for the Australian grain market and our Guest Spot columnist, p14, provides a different perspective on the world cereal trade and addresses some 'myths'.
"Picture the annual world cereal grain harvest as a highway of grain circling the earth at the equator. This imaginary highway would he some 17 metres wide and 2.5 metres deep and a little over 50.000 kilometres long. To provide enough grain to feed the world's growing population, this highway of grain must he entirely reproduced and then increased in length about 1,000 kilometres each year." — Wheat breeder and Nobel laureate. Dr Norman Borlaug
This month the world has just 30 days supply of grain in store — the lowest in history. That is one-quarter the level of stocks two years ago, and less than half the level which prompted warnings of a global food crisis in the mid- 1960s and led to the Green Revolution.
In half the countries of the developing world, food production per head is falling. Eight hundred million people go hungry, 26 million refugees are on the march across international borders and, in the time you take to read this article, 300 children will die.
On a broader scale, the first tremors of world food insecurity are only just starting to be felt.
Why the shortfall?
The reasons for the shortfall are complex. Short-term factors such as poor harvests in major producing regions, the setting-aside of arable land in the United States and Europe and the sell-off of grain reserves in the United States are contributing to the current situation. Given average seasons, strong price signals will probably reverse these factors over the next three years, as farmers worldwide respond by sowing larger acreages.
But there is a deeper, structural problem underlay the crisis. This is the world's inability to sustain food output in densely-populated regions, the widespread degradation of soil and water, the loss of prime farmland and irrigation water to cities, cuts to agricultural research, the inexorable growth in population, and the rise in consumer demand.
Dr Borlaug's image of the world grain highway takes account of the need to feed 100 million more human beings every year, eight billion by 2020. But it does not factor in the impact of urban growth and rising incomes, which enable people to move from grain and vegetables to fish, poultry and red meat — and the multiplying pressures this adds to farming and natural systems.
For the first time, human demand is coming into collision with the capacity of the earth's natural resources to provide for it sustainably.
Worldwatch Institute president Lester Brown gives this example: if every Chinese consumer can afford one extra bottle of beer a year, it will require a million tonnes more barley to make it.
Chinese grain production, says Brown, has fallen behind population growth for the last 12 years despite rising incomes.
If these trends persist, China will need to import more than 350 million tonnes more grain a year, he predicts, nearly double the current world trade.
However, other analysts predict less demand aided by additional grain exports from current net importers such as the former Soviet Union. Undisputed is the fact that the world grain trade will remain volatile for the foreseeable future and pressure on natural resources will increase.
The cost in resources
Most countries are already experiencing hidden costs in soil and water degradation. At present it is estimated that between a fifth and a quarter of the world's arable, grazing and forest lands — a total of two billion hectares — are seriously degraded. In poorer countries, the inability of lowland
farmers to grow enough food drives them into the hills, felling forests and setting in motion a tragic chain-reaction of erosion, acidification and ruin that, eventually, destroys even marine fisheries and coral reefs.
Food resources from the sea are under acute threat. Fish make up one-fifth of the world's animal protein supply, yet global fisheries are in a state of crisis with production falling each year since 1989 despite increasing fishing effort. In Pakistan and India, salinity and erosion threaten huge tracts of irrigation croplands in the Indus valley, and disputes over scarce water are both fierce and frequent. Similar quarrels occur on other continents as human demand for water outstrips population growth two-to-one.
Indeed, water shortages are viewed by the International Food Policy Research Institute (IFPRI) as one of the most likely causes of war in the coming century — along with spreading poverty, malnutrition and disease.
"Renewable resource scarcities of the next 50 years will emerge with a speed, complexity and magnitude unprecedented in history," warns Canadian Professor Tad Homer-Dixon. The environment, writes US journalist Robert Kaplan, is "the national security issue of the early 21 st century".
What it means for graingrowers
Such dire resource problems may seem remote from the Australian wheatbelt, but in reality they will be directly felt as extreme volatility in grain prices, rising costs, and market insecurity. If nations resort to subsidies, farm incomes will again be driven down.
But on the positive side, developing countries may import at least 200 million tonnes more grain by 2020.
Australia is well placed to take the lead in tackling global food insecurity and poverty, according to Melbourne University Emeritus Professor Derek Tribe.
As pioneers of Landcare and sustainable farming systems for dryland areas such as TOPCROP™ and Right Rotations grower groups, Australia's farmers and scientists are already devising solutions to agricultural problems faced around the world. They are developing new low-input cropping systems that yield more and take less toll of soil, water or biodiversity.
Agriculture, says IFPRI's Per Pinstrup-Andersen, is the foundation of economic development and reduction of poverty. That in turn lowers population growth, generates political stability, better government, growth in secondary industries, a rising middle class (and greater demand for Australian commodities).
The answer to a world food crisis is not to grow all the world's food in America, Europe and Australia and try to sell it to people who are too poor to pay for it — but rather to use agricultural know-how to lift these poor societies out of poverty and the risk of conflict and into prosperity.
That way the world's food can ultimately be grown in regions where production is sustainable, and sold to others who are in a position to afford it.
The challenge for Australian farmers and governments today, and tomorrow, is to continue the drive to become leaders in averting a world food crisis, and the global conflict arising from it, by continuing to invest in agricultural development at home and overseas.
* Julian Cribb was formerly the science and technology writer for The Australian and a former national rural newspaper editor.