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Issues:
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NTS VIEWPOINT
US drought another wake-up call for global resolve on food price stability
The US is currently experiencing its worst drought in half a century. The resulting crop destruction has raised fears of yet another rise in global food prices, what would be the third in five years. This raises larger questions of how to tackle rising instances of food supply shocks. It also underlines the clear need for food price stability to be moved up the global food-security agenda.
The current drought in the US has devastated 88 per cent of maize (corn) crops and a high percentage of soybean crops. Domestic prices of maize and soybeans are already rising. Given that the US is the world’s largest maize exporter and a leading soybean exporter, and considering the significant use of maize and soybeans in animal feed, wider effects on global food prices could likely be seen. In particular, the price of beef, pork, egg and dairy products could rise significantly. Wheat prices are also likely to increase given their correlation with maize price movements.
The greatest price impact will likely be on the burgeoning middle class in industrialising countries, who are consuming meat and dairy products more regularly as incomes grow. In China, for instance, much of its imported soybean goes towards feed for its pork industry, which accounts for 50 per cent of the world’s pork production and caters to the increasing numbers in the country now able to afford to eat more meat.
The world’s poor and hungry are not likely to experience direct impacts from the US crop losses. In regions where maize is a staple food for the poor, consumers generally eat a different type of maize than what is grown in the US, or they eat maize sourced locally, meaning that they are shielded from scarcity in the international market.
Of concern, though, for the food security of the world’s poor and hungry is the possibility that the drought could trigger price spikes across a range of staple foods. For instance, the price of rice on the international market may rise if food importers address potential grain shortfalls by buying into Southeast Asia’s plentiful rice supplies (though, within Southeast Asia itself, government regulation of domestic prices would likely mitigate any impacts for the region’s rice consumers).
A new wave of record food prices would not bode well for building trust in the international market. Recent spikes have triggered shifts towards self-sufficiency in domestic production in some countries, and this may intensify after the US drought. Self-sufficiency is not a sustainable food security solution for states, as it is inefficient both economically and in resource utilisation, and may actually increase vulnerability to international markets in cases of unanticipated shortfalls in domestic production.
Price spikes could also lead to panic trading, and this could elevate price movements from challenge to crisis, as was seen during the rice price crisis in 2007–2008, which was initially triggered by a shortfall in wheat production in India. The need to take action to better stabilise international food markets, particularly during times of scarcity (actual or perceived), has never been more evident.
Contributed by Sally Trethewie.
Additional Info:
- Baragona, Steve, ‘US drought could trigger higher food prices’, Voice of America, 9 July 2012.
- Mohindru, Sameer, ‘Focus: Asian food bill to soar as US drought takes its toll on production’, The Wall Street Journal, 20 July 2012.
- Brown, Lester R., ‘The world is closer to a food crisis than most people realise’, Guardian, 24 July 2012.
- Mutikani, Lucia, ‘Analysis: Drought to cause food price spike but not inflation’, Reuters, 24 July 2012.
- Lowrey, Annie and Ron Nixon, ‘Severe drought seen as driving cost of food up’, The New York Times, 25 July 2012.
- Carlson, Benjamin, ‘US agricultural exports become costly amid drought’, Salon, 26 July 2012.
- Winn, Patrick, ‘Southeast Asia: Food crisis feed’, Alaska Dispatch, 26 July 2012.
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CLIMATE CHANGE, ENVIRONMENTAL SECURITY AND NATURAL DISASTERS
News & Commentaries
- Goering, Laurie, ‘As climate aid sags, vulnerable nations foot the bill’, AlertNet, 20 June 2012.
- Morgan, Jennifer, ‘Rio+20 in the rear view: A missed opportunity for climate change action’, WRI Insights, 29 June 2012.
- ‘ASEAN-EU exchange knowledge in disaster response, management’, Philippine Information Agency, 9 July 2012.
- Fogarty, David and Clare Baldwin, ‘Insight – Flood risk rampant across Asia’s factory zones’, Reuters, 22 July 2012.
- ‘UNISDR and China launch new urban resilience award’, Press release, UN International Strategy for Disaster Reduction (UNISDR), 26 July 2012.
- Thiaw, Ibrahim and Richard Munang, ‘Rio+20 recognizes value of biodiversity and ecosystems: Implications for global, regional and national policy’, Sustainable Development Policy & Practice, 27 July 2012.
- ‘Scores killed in North Korea floods’, Al Jazeera, 29 July 2012.
Selected Publications
This monograph gives insight into the debate on the consequences of migration as a result of climate change in the Southeast Asian context, with attention given to existing knowledge on the demographics of migration, the choices made relating to mobility, and the human insecurities that result from climate change in general, and from climate change-induced migration in particular.
This article presents an overview of the impact of environmental change on the rivers of Southern Asia as well as on the existing river water sharing arrangements in the region. It argues that the future of these agreements could be imperilled by environmental change, particularly with the climate shifts being amplified by China’s river water management policies.
This is a searchable database of the resources, publications, initiatives and organisations that seek to understand and address the links between deforestation, Reducing Emissions from Deforestation and Forest Degradation Plus (REDD+) and agriculture. The database includes a series of studies geared towards understanding the ways in which increasing demand for certain commodities can be met without causing further deforestation, and how REDD+ finance and policy frameworks can assist the agricultural sector to transition from business-as-usual approaches to more sustainable and resilient agricultural systems.
Events & Announcements
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ENERGY AND HUMAN SECURITY
News & Commentaries
- Fisher, Jonah, ‘Laos’ work on the Mekong river draws criticism’, BBC, 4 July 2012.
- McManus, Bryan, ‘Energy agency says oil prices may fall 7% in 2013’, Jakarta Globe, 12 July 2012.
- Tabuchi, Hiroko, ‘Tokyo rally is biggest yet to oppose nuclear plan’, The New York Times, 16 July 2012.
- ‘Energy security and cooperation in South China Sea’, OilVoice, 18 July 2012.
- Gronholt-Pedersen, Jacob, ‘Myanmar invites foreign energy firms to explore 23 offshore oil, gas blocks’, Dow Jones Newswires, 18 July 2012.
- Kunmakara, May, ‘Cambodia mulls over atomic energy power’, The Phnom Penh Post, 20 July 2012.
- Macalister, Terry and Fiona Harvey, ‘China in talks to build UK nuclear power plants’, Guardian, 20 July 2012.
- Nugroho, Hanan, ‘East Asia energy geography: Where does Indonesia stand?’, The Jakarta Post, 25 July 2012.
- ‘Power cut causes major disruption in northern India’, BBC, 30 July 2012.
Selected Publications
This paper reviews the historical pattern of China’s oil supply and consumption and examines the current status of oil in China’s energy security. Based on the analysis of past and present patterns, it predicts three future scenarios for China’s oil usage and concludes with some policy recommendations.
This report consists of sections that range from an overview of Asia’s energy prospects, to policy solutions for meeting the region’s soaring energy demands. It highlights the importance of innovation and efficiency for achieving energy security in the future.
Events & Announcements
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FOOD AND HEALTH SECURITY
News & Commentaries
- ‘Sri Lanka: Focus on food insecurity in Jaffna’, IRIN, 9 July 2012.
- ‘Sustainability of rice landscapes in South East Asia threatened’, ScienceDaily, 9 July 2012.
- ‘Bangladesh: Floods leave thousands food insecure’, IRIN, 11 July 2012.
- M. Sreelata and T.V. Padma, ‘Farmers’ income study stirs up GM cotton debate’, SciDev.Net, 11 July 2012.
- Hall, Ashley, ‘Plan looks to secure national food security’, ABC, 17 July 2012.
- Lasheen, Nehal, ‘FAO launches project to boost food security in Egypt’, SciDev.Net, 18 July 2012.
- Roopanarine, Les, ‘Why is Yemen’s food crisis off the world’s humanitarian radar?’, Guardian, 24 July 2012.
- Schnirring, Lisa, ‘Gene analysis connects Cambodian EV-71 to Asian outbreaks’, Center for Infectious Disease and Policy (CIDRAP) News, 27 July 2012.
Selected Publications
- Shapouri, Shahla, Birgit Meade, Stacey Rosen et al., 2012, ‘International food security assessment, 2012–2022’, ERS Report Summary, July, Washington, DC: Economic Research Service (ERS), US Department of Agriculture.
This assessment by the US Department of Agriculture seeks to determine the status of international food security in the next decade. The results are drawn from projections of two key determinants of food security, namely, the capacity of countries to import and the status of food production. Key findings include that the number of people overall who are food insecure will increase. However, the share of the population who are food insecure in each of the 76 countries analysed will drop and the distribution gap will remain constant.
This annual publication draws on the expertise of the OECD and FAO. This edition outlines major trends in the decade ahead in the markets for key agricultural products including grains, meat and fish. It contains a feature section which outlines the challenges of achieving agricultural productivity growth sustainably.
Events & Announcements
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INTERNAL AND CROSS-BORDER CONFLICT
News & Commentaries
- ‘Myanmar: Kachin refugees in China in need’, IRIN, 27 June 2012.
- Esplanada, Jerry E., ‘Philippine gov’t, Muslim rebels optimistic of peace pact this year’, Philippine Daily Inquirer, 1 July 2012.
- ‘Timor-Leste: Peacekeeping drawdown begins’, IRIN, 5 July 2012.
- ‘Rohingya issue raised at Asean meet’, The Daily Star, 15 July 2012.
- Mu, Sochua and Cecilia Wikstrom, ‘Land grabs in Cambodia’, The New York Times, 18 July 2012.
- ‘Muslims in Burma’s Rakhine state “abused” – Amnesty’, BBC, 20 July 2012.
- Baig, Khurram, ‘Conflict, security and development: The hidden costs of violent conflict’, The Express Tribune, 23 July 2012.
- ‘Burma’s Suu Kyi urges minority rights’, BBC, 25 July 2012.
- Hussain, Zarir, ‘Northeast India clashes kill 38, displace 170,000’, Jakarta Globe, 25 July 2012.
Selected Publications
This paper focuses on the development missions undertaken by the armed forces of the Philippines and Thailand. It argues that the military’s significant role in political succession and the increasing salience of concepts that connect security with development lie behind the re-emergence of military engagement in development activities. Security sector reform and civilian oversight are needed to ensure the effectiveness of development projects with military involvement.
This yearbook presents military-related data for 2011 – such as military expenditure, international arms transfers, nuclear forces and armed conflicts – for countries across the world. It identifies the progress in and challenges for international peace.
Events & Announcements
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TRANSNATIONAL CRIME
News & Commentaries
- Eban, Katherine, ‘The truth about the Fast and Furious scandal’, Fortune, 27 June 2012.
- Tu, Thanh Ha, ‘From Hong Kong to Canada: Inside a human smuggling plot’, The Globe and Mail, 9 July 2012.
- Castle, Stephen and Doreen Carvajal, ‘Europe’s downturn creates unlikely smugglers’, The New York Times, 11 July 2012.
- Colombage, Dinouk, ‘Human smuggling on the rise in 2012’, The Sunday Leader, 15 July 2012.
- ‘New UNODC campaign highlights transnational organized crime as a US$870 billion a year business’, UN Office on Drugs and Crime (UNODC), 16 July 2012.
- Grillo, Ioan, ‘Saint, knights and crystal meth; Mexico’s bizarre cartel’, Reuters, 18 July 2012.
- Garland, Ian, ‘Pressed for cash: Rise of counterfeit money in Peru as police seize $2m in fake U.S. currency and 1.5 million euros’, Daily Mail, 19 July 2012.
- ‘Bank secrecy masks a world of crime and destruction’, Observer, 22 July 2012.
- Neo, Chai Chin, ‘Wildlife trafficking “at all-time high”’, Today, 30 July 2012.
Selected Publications
The study traces the evolution of illicit financial flows from Mexico from 1970 to 2010. Utilising economic models, the analysis demonstrates that illicit outflows over the period was USD872 billion. Across the first decade of this century, the outflows averaged almost USD50 billion a year. This analysis is however conservative and, due to the lack of data, does not include drug smuggling, human trafficking and some forms of trade mispricing. Were reasonable estimates of illicit capital generated by these activities to be incorporated into the analysis, the figures would be substantially higher.
According to this report by a wildlife trade monitoring network, Lao PDR is playing a more prominent role in the international ivory trade than was previously thought. The report points to the significantly higher volume of ivory items openly on sale in Lao PDR and the seizures of African ivory en route to the country as indicators of its growing involvement in the illegal trade. The report recommends the confiscation of all ivory on sale in Lao PDR, better monitoring of markets, and greater enforcement and prosecution of offenders. It also urges international cooperation to sever the illicit Africa-to-Asia ivory trade chain.
Events & Announcements
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WATER SECURITY
News & Commentaries
- Evans, Alexandra E.V., Munir A. Hanjra, Yunlu Jiang et al., ‘Water pollution in Asia: The urgent need for prevention and monitoring’, Global Water Forum, 9 June 2012.
- Binstock, Jenny, ‘Government scraps four proposed dams on the Teesta River in India’, International Rivers, 3 July 2012.
- Su, Liu, ‘Asia’s world city urgently needs a water strategy’, CleanBiz Asia, 5 July 2012.
- Binstock, Jenny, ‘Examining environmental flows critical for river ecosystems in India’, International Rivers, 25 July 2012.
- Herbertson, Kirk, ‘How the next 12 months of Xayaburi dam construction will affect the Mekong River’, International Rivers, 26 July 2012.
- ‘Chronic 2000–04 drought, worst in 800 years, may be the “new normal”’, ScienceDaily, 29 July 2012.
- ‘Researchers analyze melting glaciers and water resources in Central Asia’, ScienceDaily, 29 July 2012.
- Sithraputhran, Siva, ‘Malaysia water “crisis” signals fierce fight for richest state’, Reuters, 29 July 2012.
- ‘Singapore to meet water target before deadline’, Today, 30 July 2012.
Selected Publications
Pumping of groundwater for irrigation is, it is suggested, a significant source of greenhouse gas (GHG) emissions in China. However, this source of GHGs has been relatively neglected and is largely unregulated. Using survey data from 11 provinces in China, this study estimates GHG emissions from that source. The result is then upscaled to the national level using government statistics for the remaining 20 provinces.
In Africa, groundwater is the major source of drinking water and its use for irrigation is forecast to increase substantially to combat growing food insecurity. This article presents the first quantitative continent-wide maps of aquifer storage and potential borehole yields in Africa based on an extensive review of available maps, publications and data. The maps are intended to lead to more realistic assessments of water security and water stress, and to promote a more quantitative approach to the mapping of groundwater resources at national and regional level.
The combination of satellite remote sensing technology and greater computing power has provided land and water management scientists and practitioners with enhanced possibilities for data acquisition and processing. This issue of Water Figures looks at how scientists at the IWMI and its partner organisations are using the new resources to benefit sustainable agricultural development.
Events & Announcements
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