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In fear of living in the scarcity - the food shortage will reach a critical phase in Asia and Africa

First things first, food security for Africa and Asia is still an urgent global challenge, and as per the Food and Agriculture Organization of the United Nations (FAO), even in 2012, food insecurity is still a major global concern as 1 billion people are suffering from starvation, under-, and malnutrition, and we are still far from reaching millennium development goal (MDG) number 1: to halve extreme poverty and hunger by 2015. The cost of food has risen worldwide since June 2011 and is today at an all-time high. This problem is much greater than the levels of the last great food crisis (2007-08). The result is that many more people in their millions are being dragged below the poverty line and several developing nations are facing the risk of a massive food shortage. Natural resources have always been threatened with extinction and this remains a scenario that is unlikely to change over time. Take the 2007-08 food shortage scenario. Whether it was then or now, the factors remain the same: export controls, bio-fuel production, high oil prices and poor harvests. Up until 1800, all was fine with the demand and supply chain as the global population was hovering around 800 million. But now that the worlds population is closing in on 8 billion, it has become a doomsday scenario of sorts. This, coupled with a ten-fold increase in the wealth of developed nations, has compounded the problem. Not to mention, the phenomenal growth in developing nations like Africa and Asia, that has led to the shortage of hydrocarbons, metals, fertilisers, land and water. Finite resources will lead to higher price points and these will become the order of the day. The result is palpable: slow growth rate of both the developed and developing nations and a severe food crunch in poor countries. Take the rising demand for finite resources in developing countries like China and India. No wonder, the demand-supply gap is widening and so is inflation. Though the number of malnourished people is coming down, the absolute number has increased during the current food crisis to around 963 million. Studies point out that by 2050, there will be 3 billion more people to feed. And that will severely cripple the food supply chain. Better fertilisers and increased usage of water has enhanced the yield by over 70%. But when it comes to cereals, the production has neither gone up nor come down. This is because the investment in agriculture is decreasing. According to UNs Food and Agriculture Organization (FAO), the annual growth rate in the production of aggregate grains and oilseeds is slowing down. Between 1970 and 1990, production went up by 2.2 percent every year. Since 1990, it has come down to 1.3 percent. Further attesting to this fact is the USDA. According to its 10-year agricultural projections for U.S. and world agriculture, the rate will come down to 1.2 percent every year between 2009 and 2017. However, the demand during this period was at two percent every year. And this is largely due to the continuously increasing population,

rising incomes and changing diets. And this is particularly true in emerging economies like China and India. Blame this on the largely inept agricultural research and development by both the government and international institutions. Part of the reason for their complacency is because the food prices have remained stable in the last two decades. With water becoming a scarce commodity, agriculture is no longer a viable option; thereby the land is being converted for non-agricultural purposes. Another reason is the rising fuel costs that make agriculture, a costlier enterprise. This is because fuel escalates the cost of processing and transportation of food products. To add to this, the landings for conducting fishing have come down in the last decade. And this is primarily because of too much fishing or unsustainable fishing mechanisms. Take nutrient depletion. According to UNEP, nearly 33% of the potentially arable land area of the world is not fit for agriculture because of its salinity. Around the world, about 20% of irrigated land (thats 4.5 lakh square kilometres) is affected by salt. And this results in about 2,500 to 5,000 square kilometers of agricultural output lost due to salinity. In South Asia alone, the yearly loss is pegged at US$1,500 million, according to UNEP report of 1994. The biggest eyesore is that only about 43% of the cereals produced are available for human consumption. This is because the rest is depleted due to a bad harvest and poor distribution infrastructure. Not to mention, cereals being consumed by animals, too. With no new land feasible for agriculture, and people gravitating towards grain-intensive meat, as they get richer, the situation is only getting more complicated. On top of that, the population continues to grow at over 1%, adding to the problems of compounding growth, which is not a sustainable option. In the developing nations, people are shifting from a grain-rich diet (rice, wheat, corn, etc.) to a protein-rich diet (livestock like chicken, pork and beef), further fuelling the demand for grains. After all, it takes 2-3 kilo of grains to produce 1 kg of chicken, 4 kilo of grains to produce 1 kg of pork and 7-8 kilo of grains to produce 1 kg of beef. This trend towards meat consumption means, the livestock also needs grains to feed itself. The growth of the grain-based bio-fuel industry (particularly in the US and Brazil) has further put pressure on grain production. Take China. Between 1994 and 2009, it doubled its per capita annual meat consumption to 70kg. Ofcourse, its much lower than the US, New Zealand and Australia (which average 100kg) and Europe (80kg). But this increasing meat consumption has strained its grain production because 70% of Chinas corn produce and 14% of its wheat are being used to feed its livestock industry. By 2015, studies estimate that China will have more middle class families than the US. These 120 million households will further drive the demand for automobiles, energy, steel, cement, copper and agriculture. However, there isnt much productive new land available for

agriculture. And then, theres the shortage of water. There is only 6% of fresh water left for China to feed its population (20% of the worlds population). According to a report by the Global Harvest Initiative, Africa will be affected the most, as it will only be able to cater to the food requirements of 13 percent of its population by 2050. East Asia is better off at 74 percent and so are North Africa and the Middle East (83 percent). The food shortage is even closer than we think. According to UN estimates, by 2030, the world will require 50 percent more food, 45 percent more energy and 30 percent more water. If we fail to fulfill this requirement, about 3 billion people will reel in poverty, according to the UN report. By 2050, food shortage will become severe in Africa and Asia. According to a recent report by Bloomberg, though the US produces twice as much food, the distribution is not up to mark. With the recent food inflation, social unrest is grabbing front-page news in several countries. And these include Malaysia (millers & bakers), Indonesia (markets selling soybeans and meats) and Pakistan (wheat marketers). Peruvian farmers protested recently against the rising price of fertilisers. South Africa is not far behind either where demonstrations were spurred by a rise in food and electricity prices. All of these were peaceful protests, but other poorer countries have had people resorting to violence. Some of those countries include Guinea, Mauritania, Morocco, Senegal, Cameroon, Mexico, Uzbekistan, Yemen, Niger, Egypt, Haiti, Ethiopia, Philippines, Thailand, Mozambique, Ivory Coast, Bangladesh and Indonesia. Indonesian food consumption patterns have changed since the late 1990s, with dairy and meat consumption growing and grain consumption falling on a per-person basis. Packaged and prepared food sales have grown strongly. Growth in household incomes and a sustained shift of population from rural to urban areas have contributed to these changes. Indonesias food consumption changes are consistent with evidence that global food consumption patterns have been moving toward more meats, dairy products, and sugar. As against that despite progress in agriculture and food production, the relative decline of agriculture compared to other sectors has been a central feature of Indonesian economic development over the past twenty-five years. While the GDP increased at an annual rate of 7% in real terms, agricultural output increased by only 4.3%. In the same period, the share of agriculture in the GDP fell from 56% to 20%. Indonesias agricultural imports grew quickly in 2007 to 2010, more than recovering from the setback they suffered in the Asian financial crisis of 1997-98 The FAO wants nations around the world to set sustainable development goals that would complement the eight Millennium Development Goals to 2015 and create a framework for action after 2015. The production of food should be ramped up by 70% in the next four decades. That means an investment of $83bn a year on agriculture in developing countries. The countries should work with international organisations such as the FAO to create an evergreen revolution, which would double productivity even while reducing resource usage and avoid

further biodiversity losses. If the water and marine ecosystems are managed well, affordable sustainable energy could be possible by 2030. To make the economy more robust, the pricing on carbon and natural resources should be set through taxation, regulation or emissions trading schemes by 2020. Not to mention, the phasing out of fossil fuel subsidies by 2030. Sustainability is the operative word here. And the UN report has asked nations to incentivise sustainable practices through wealth and public pension funds from development banks and export credit agencies. To aid their growth, the governments or stock market vigilantes should push for regulations that will encourage sustainable practices. The governments should work in tandem with scientists to monitor and revise the science behind environmental thresholds or tipping points. Furthermore, the FAO report has asked the United Nations to name a chief scientific adviser or board to advice governments engaged in such sustainable practices. There are certain challenges even if one were to implement all these measures. Besides the shortage of water, land and the right eco system, there is the climate change issue. This will affect agriculture because of extremes in weather conditions, be it temperature, rainfall, flooding or drought. Going by their foreign reserves, developed countries will insulate themselves by stocking up on food. But the poor countries will face the challenge of food shortage like never before. Will the world sit up and take notice? Its about time before its too late.

By Pankaj Kumar
The author is a business and economics writer.