Futurists have been predicting for some years that global warming and competition for resources pose real problems in terms of political stability, even security. A tsunami of economic migrants leaving failed states is a possibility. What has been the most successful 50 years of alleviating poverty in human history is threatened. What's happening?
Since March last year, wheat prices have gone up 130 per cent, soya beans 87 per cent, and global food reserves are at their lowest levels ever. Some 100 million people in the poorest countries have been pushed further into poverty.
Governments are responding in different ways. Some are banning food exports, introducing clumsy, inefficient subsidies, rationing and imprisoning hoarders. Riots are erupting from Egypt and Ethiopia to Indonesia and the Philippines.
Food inflation is not just a terrible threat to the poor, but to families everywhere. China and India, where stunning growth and exports held down inflation worldwide, are now pushing up food and energy prices everywhere as their own people become stronger consumers. Energy prices feed directly into food prices because of fertiliser and distribution costs.
The rush to biofuels is also having a cruel impact on agriculture; subsidies and high oil prices are encouraging production away from basic foods. Rich countries are subsidising biofuel production, raising prices. Filling a Range Rover with subsidised ethanol takes as much 'grain' as would feed an African family for a year. The United Nations, International Monetary Fund, World Bank, World Trade Organisation and senior finance ministers pledged recently to provide US$500 million in urgent food aid by May 1, such is the crisis.
But how can you encourage poor countries to grow food when subsidies from rich countries mean that similar products appear in local markets, sometimes at a third of local prices? The medium- and long-term solution is the Doha Development Trade round, which is now at a critical stage. Unless the players at the WTO can get closer in the next few weeks, there will be no deal this year. Politics in the US and elsewhere make it difficult to believe a deal could be done next year.
