ADI 08 Food Prices toolkit Spring

Food Prices Toolkit – Spring 3
Food Prices Toolkit – Spring 3 .............................................................................................................................1 ** Uniqueness and Links **..................................................................................................................................5 Food prices High....................................................................................................................................................6 Food Prices High....................................................................................................................................................7 Food Prices Low.....................................................................................................................................................8 Food Prices Low.....................................................................................................................................................9 Food prices DA link ............................................................................................................................................10 AT – Food Prices – Alt cause land shortages.....................................................................................................11 Alt Cause – Bad Weather....................................................................................................................................12 Alt Cause – Infrastructure deficiency................................................................................................................13 AT – Food Prices – Human Ingenuity Solves....................................................................................................14 AT – Food Prices – Alt Cause population..........................................................................................................15 AT – Food prices – Alt Cause Generic...............................................................................................................16 AT – Food Prices – Alt Cause generic................................................................................................................16 AT – Food Price – Oil Alt cause..........................................................................................................................18 AT – Food Price – Oil Alt cause..........................................................................................................................19 **Commodities**.................................................................................................................................................20 Sugar DA - Ethanol..............................................................................................................................................21 Sugar DA - Ethanol..............................................................................................................................................22 Sugar Ethanol DA link Extension.......................................................................................................................23 Brazil Econ Strong now.......................................................................................................................................24 Corn Prices low now............................................................................................................................................25 Corn Prices low now............................................................................................................................................26 corn prices low now.............................................................................................................................................27 Corn Price link ....................................................................................................................................................28 AT: IOWA LOSS..................................................................................................................................................29 Corn Prices high ..................................................................................................................................................30 Wheat Price DA Impact - Pakistan....................................................................................................................31 Wheat prices high now........................................................................................................................................32 Wheat price low....................................................................................................................................................33 High Wheat  instability ..................................................................................................................................34

ADI 08 Food Prices toolkit Spring

High Wheat  Famine........................................................................................................................................35 High Wheat kills economy...................................................................................................................................36 Wheat shortage temporary.................................................................................................................................37 Rice Prices low now.............................................................................................................................................38 Rice Price low now...............................................................................................................................................39 Rice Price low now...............................................................................................................................................40 Rice Price DA.......................................................................................................................................................41 Rice Price DA.......................................................................................................................................................42 Rice Subsidies key to Price..................................................................................................................................43 Rice Subsidies key to Price..................................................................................................................................44 High Prices hurt Rice Producers........................................................................................................................45 Rice key to Cali Economy....................................................................................................................................46 Fish Price DA........................................................................................................................................................47 Cotton Price DA Link..........................................................................................................................................48 Plan Increases cotton prices................................................................................................................................49 Cotton Price low now...........................................................................................................................................50 Cotton Prices high now........................................................................................................................................51 Cotton Price High now........................................................................................................................................52 **Generic Food Price Impacts**........................................................................................................................52 Famine...................................................................................................................................................................54 Famine...................................................................................................................................................................55 Famine...................................................................................................................................................................56 Famine...................................................................................................................................................................57 Famine – Deontology...........................................................................................................................................58 Famine –Deontology ...........................................................................................................................................59 Famine - Deontology............................................................................................................................................60 Africa War............................................................................................................................................................61 Africa War............................................................................................................................................................62 Resource Wars......................................................................................................................................................63 Resource Wars......................................................................................................................................................64 Resource Wars......................................................................................................................................................65 Failed States..........................................................................................................................................................66 Food Riots.............................................................................................................................................................67

ADI 08 Food Prices toolkit Spring

Food Riots.............................................................................................................................................................68 Economy Impact..................................................................................................................................................69 Pakistan ................................................................................................................................................................70 India Impact Module...........................................................................................................................................71 Haiti.......................................................................................................................................................................72 Egypt.....................................................................................................................................................................73 China Module.......................................................................................................................................................74 China.....................................................................................................................................................................75 China key to food security ..................................................................................................................................76 Poverty..................................................................................................................................................................77 HIV/AIDS ............................................................................................................................................................78 HIV/AIDS.............................................................................................................................................................79 HIV/AIDs..............................................................................................................................................................80 Biodiversity ..........................................................................................................................................................81 Genocide................................................................................................................................................................82 Genocide ...............................................................................................................................................................83 Food Security - Generic.......................................................................................................................................84 Food Insecurity: War...........................................................................................................................................85 Food Insecurity: War...........................................................................................................................................86 Food Insecurity: Biodiversity Impact................................................................................................................87 Food Security: Terrorism Impact.......................................................................................................................88 Food Insecurity: Genocide Impact.....................................................................................................................89 **High Prices Good**.........................................................................................................................................90 High Food Prices Solve Poverty..........................................................................................................................91 High Food Prices Solve Poverty..........................................................................................................................92 High Food Prices Good  African Food security............................................................................................93 High Food Prices Good  African food security.............................................................................................94 High Food Prices Good  increase farm econ.................................................................................................95 High Prices Good – Brazil...................................................................................................................................96 **Other **............................................................................................................................................................97 HUNGER INEVITABLE....................................................................................................................................98 AT Food Prices DA..............................................................................................................................................99

ADI 08 Food Prices toolkit Spring

AT Food Price DA..............................................................................................................................................100 WAR TURNS CASE..........................................................................................................................................101


ADI 08 Food Prices toolkit Spring

** Uniqueness and Links **


ADI 08 Food Prices toolkit Spring

Food prices High
Food prices to remain 35 percent higher than the past decade.
The Daily Green 6/6- (Annie Bell Muzaurieta, 6-6-08, ”The Future of Food Prices Crop Output Threatened by Wet Weather in Midwest, Dry Weather in Australia,” The Daily Green,
Meanwhile, dry weather in western Australia is wreaking havoc with that area's grain crops. Total grain output may be between 10 million metric tons and 12 million tons this harvest, less than initial government estimates, after a dry May. This news comes after the UN's Food and Agriculture

Organization (FAO) and the Organization for Economic Co-operation and Development (OECD) suggested that in the next 10 years food prices will remain well above the levels of the last decade, according to All Africa. The various factors contributing to the rise in food prices include high oil prices, changing diets, urbanization, economic growth and expanding populations, but also the growth in demand for biofuels. According to the report, the FAO and OECD said that world ethanol production has tripled between 2000 and 2007 and is expected to double again in the next decade. Climate change, low stock levels and speculation could also add to price volatility. An excerpt of FAO's Food Outlook report indicated: "Prices in real terms are projected to be 10 percent to 35 percent higher than in the past decade. Even a bumper harvest expected this year will do little to ease the plight of the world's poor."

Food prices are expected to continue to escalate
Columbia Missourian 08-(Laura Chapius, January 9, 2008 , “Food prices expected to rise,” Columbia Missourian,
COLUMBIA — Consumers all over the world can expect to pay more for food in coming years. The Economic Research Service of the U.S. Department of Agriculture expects prices to rise another 4 percent this year. If the projected increase for 2008 proves true, consumers will see the highest increase in food prices since 1990. With commodity prices hitting record levels and energy costs increasing, retailers must make up for the difference in the form of higher food costs. MU Agricultural Economics professor Joe Parcell credits several factors for the rise in food prices: exports, feed use, biofuels. Parcell blames the weak dollar and exports that are driven by a strong global economy. “The weak dollar is causing $4 a bushel of corn to look as cheap, for foreign buyers, as $2.50 a bushel of corn from a few years ago,” he said. “I don’t think anyone could have guessed that exports would be so strong.” The U.S. Bureau of Labor Statistics expects the

food cost increase to rise nearly 50 percent more than the overall rate of inflation based on the consumer price index.
The index measures the average change in prices paid by urban consumers for a market basket of goods and services, according to the U.S. Bureau of Labor Web site. It may not reflect every consumer’s experience because not everyone spends money the same way.

Food Prices will continue to rise- multiple reasons.
Bezold, Fidler, and Olson 08- (Clement Bezold, Devin Fidler, and Robert Olson, June 2008, “Food 2028: Key Forecasts,” Institute for Alternative Futures, Food prices will increase sharply over the next two decades. This will be driven by increased costs of farming inputs, transportation, and energy generally; challenges from climate change; and land, soil and fishery conditions. Meat prices will see particularly significant increases. A broad set of trends are acting to raise food prices, and each of these trends has a great deal of momentum. Major initiatives to address the challenges these trends pose can alleviate price pressures, but cannot take hold fast enough to prevent significant price increases in the years ahead. Key trends include: • Increasing
demand from rising affluence and changing diets in developing nations • Rapidly rising oil/energy prices •Climate instability • Water scarcity • Conversion of cropland to nonfarm uses • Competition of biofuel crops with food crops • Cutbacks in food exports • Decline and collapse of fisheries


ADI 08 Food Prices toolkit Spring

Food Prices High
Overall crop and livestock prices have increased 16% this year, according to a recent USDA report. Grain is up 42%, Corn is up 69%, and soybeans have doubled in price. Domestic biofuels are a main cause. Associated Press Financial Wire, “Food prices rise 16 percent during 2008” July 31, 2008, Lexis
Rising costs for fuel, feed and fertilizer propelled grain prices to all-time highs in June, raising the overall price of crops and livestock by 16 percent this year compared to last year. Corn and soybeans hit record prices. Wheat slipped from historic highs in March but is still up steeply from last year, according to a U.S. Department of Agriculture report released Thursday. Grain prices gained 42 percent for the year overall. Prices for farm products rose 1.9 percent in June alone,
according to the report. Grain staples including wheat and soybeans rose 1.6 percent during June. The price of livestock rose less than 1 percent. The annual report measures the price that farmers receive for their goods, not the ultimate price that consumers pay for food. Crops and livestock costs amount to a fraction of the final cost of food, after transportation, packaging and marketing costs are also factored in. While soaring grain prices mean big profits for farmers and agribusiness firms like Archer Daniels Midland Co. and ConAgra Food Inc., the trend is hurting meat companies Like Tyson Foods Inc. Meat prices haven't nearly kept pace with the cost of grain, which is the biggest input cost for meat processors. The USDA report shows corn and soybean prices climbing rapidly since 2007. The cost for cattle and hogs has largely stagnated. Even though corn farmers seem able to pass on the higher cost of their fertilizers and fuel, meat companies haven't been able to do the same, said USDA statistician Daryl Brinkman. "Demand for (meat) is not quite there. And there is plenty of supply to meet that demand, so that is keeping those prices pretty steady," Brinkman said. Corn and soybean

farmers, on the other hand, are seeing more demand than ever for their crops. While exports are increasing, so is domestic use of the crops for biofuels such as ethanol and biodiesel. Corn sold for an average of $5.61 a bushel in June, up 69 percent from $3.32 in 2007. Soybeans sold for $14.20 a bushel, nearly double last year's figure of $7.56. Corn went for just $2.14 a bushel in 2006 and soybeans sold for $5.61.


ADI 08 Food Prices toolkit Spring

Food Prices Low
Food Prices expected to drop in the near future.
Polish News Bulletin 6-12(June 12, 2008, “Food Prices to Fall in Coming Months,” Polish News Bulletin, lexis) According to a monthly report by the Institute of Agriculture Economics and Food Management (IERiGZ), food prices should start falling in the coming months, and the July-August decrease may be greater than last year, even though drought has brought harvest forecasts down. In mid-year the price of meat (especially pork) may grow at a faster pace, due to the seasonal supply decrease. The authors of the report cite the Central Statistical Office (GUS) and the National Bank of Poland (NBP)'s May results on consumer confidence to state that consumption growth may slow down. The institute expects that the demand for food will fall in the coming months on account of the growing general costs of living. Although in April food price growth rate exceeded the general inflation rate due to the seasonal fruit and vegetable price rises. However, owing to promising harvests, food is not seen as an inflation-causing factor this year.

Food Prices will drop with good crop production conditions.
Trostle 08(Ronald Trostle, May 2008, “Global Agricultural Supply and Demand: Factors Contributing to the Recent Increase in Food Commodity Prices,” USDA.)
With such low world stocks of food commodities, food prices are vulnerable to a production shortfall in one or more major production areas. If a significant shortfall occurs this year due to weather or disease, food prices might continue to rise sharply from the current high level. Although trade fl ows can mitigate some of these effects, new or existing trade restrictions or barriers can exacerbate price impacts. However, if good crop production conditions exist

in the Northern Hemisphere during the next 6 months, food commodity prices could retreat signifi cantly from their current highs.

Food prices are low in real terms Banse, Nowicki, van Meijl, LEI Agricultural Economics Research Institute, Senior Researcher, Head of division Agricultural Policy at LEI, 5/08, p. (Martin, Peter, and Hans, “Why are current world food prices so high?”, LEI)
World agricultural prices are very volatile which is due to traditional characteristics of agricultural markets such as inelastic (short run) supply and demand curves (see, Meijl et al. 2003).1 The volatility is also high because the world market is a relatively small residual market in a world distorted by agricultural policies.2 The combination of high technological change and inelastic demand cause real world prices to decline in the long run (trend). The prices, however, of many (major) agricultural commodities have risen quickly over recent years (see Figure 1). Recent increase in agricultural prices are strong, but even with the

increase that we have observed in the last three years, real agricultural prices are still low compared to the peaks in prices of the mid970s. Local prices are linked with these world prices. The transmission effect depends on the transparency of markets, market power and accessibility. Figure
2 depicts the price index for food commodities along with an index for the average of all commodities and an index for crude oil. Although the food commodity index has risen more than 60 percent in the last 2 years, the index for all commodities has also risen 60 percent and the index for crude oil has risen even more (see, also Trostle 2008)1. Since 1999 food commodity prices have risen 98 percent (as of March 2008); the index for all commodities has risen 286 percent; and the index for crude oil has risen 547 percent. In this perspective, the recent rise in food commodity prices is moderate. Figure 3 shows that spot prices in early 2008 for soybean and wheat are declining again while the spot prices for rice and crude oil continue to rise. The prices of wheat and soybeans declined by almost 30% and almost 20%, respectively, since their peak at the end of February this year. However, although real food prices are not extremely high in a historical perspective and other commodities have risen more, an increase in the price of food – a basic necessity – causes hardships for many lower income consumers around the world. This makes food9price inflation socially and politically sensitive. This is why much of the world’s attention is now focused on the increase in food prices more than on the more rapid increase in prices of other commodities, (see, Trostle 2008, p. 4).


ADI 08 Food Prices toolkit Spring

Food Prices Low
Food prices will decline Halliday, Staff Reporter, 5/29/08, p. (Jess, “Food prices will fall but remain above average, OECD/FAO”,
The outlook says that the increase in prices since 2005/6 is partly the result of adverse weather conditions in major grain producing regions, with spill over effects on crops and livestock. "In the context of low global stocks, these developments alone would have triggered strong price reactions." However such causes of

food price inflation are not new and they are not permanent; they have happened in the past, and prices have come down once the situation returns to normality and supply response. Despite conceding that weather conditions and agricultural product supply may become more variable with climate change, the outlook authors say they see no reason to believe that resolution seen in the past will not recur in the next few years.


ADI 08 Food Prices toolkit Spring

Food prices DA link
Lifting subsidies massively risks raising food prices and creating more food insecurity. Masami Kojima of the Oil, Gas, and Mining Policy Division, World Bank; Donald Mitchell of the Development Prospects Group, Development Economics, World Bank; and William A. Ward 2007, Professor and Director, Center for International Trade,
Clemson University. 2007 Energy Sector Management Assistance Program Considering Trade Policies for Liquid Biofuels The poor can be adversely affected by agricultural trade liberalization because prices of most agricultural commodities are likely to increase. As mentioned earlier in the chapter, liberalization of trade in sugar is expected to increase world sugar prices by as much as 40 percent. Those countries that are already integrated into international markets and possess good infrastructure are likely to benefit, but rising agricultural commodity prices could have a negative effect on food security in developing countries that are net food importers.4 Prices are expected to rise more steeply for the food products that developing countries import than for the commodities they export. The leastdeveloped countries, very few of whom export temperate-zone or competing products on which there are currently high tariffs, would generally be worse off (FAO 2003). In all cases, there are intra-country variations in addition to differences across countries. Net buyers of food, including farmworkers, will be adversely affected by rising food prices; the negative effects are not confined to urban areas only.

Subsidies keep food prices low. Conde Nast Portfolio May 14th 2008
The truth is that the U.S. and European subsidies that cause the Post, the NYT, the World Bank and many NGOs to get apoplectic have the effect of lowering world food prices. That means that fewer people go hungry than would be the case without these subsidies. This isn't rocket science, it's almost definitional. The U.S. and European effectively pay their farmers to keep farming, thereby producing more food than otherwise would be produced. This may have negative consequences for farmers elsewhere in the world, but it does mean that supply is greater and prices are lower than they would be in the absence of the subsidies.

SUBSIDIES LOWER CROP PRICES REIDL 07 (June 20, 2007, “How Farm Subsidies Harm Taxpayers, Consumers, and Farmers, Too,” Brian M. Riedl, Heritage Foundation)
This year's expiration of federal agriculture policies gives Congress an important opportunity to take a fresh look at the $25 billion spent annually on farm subsidies. Current farm policies are so poorly designed that they actually worsen the conditions they claim to solve. For example: * Farm subsidies are intended to alleviate farmer poverty, but the majority of subsidies go to commercial farms with average

incomes of $200,000 and net worths of nearly $2 million. * Farm subsidies are intended to raise farmer incomes by remedying low crop prices. Instead, they promote overproduction and therefore lower prices further. * Farm subsidies are intended
to help struggling family farmers. Instead, they harm them by excluding them from most subsidies, financing the consolidation of family farms, and raising land values to levels that prevent young people from entering farming. * Farm subsidies are intended to be consumer-friendly and taxpayer-

friendly. Instead, they cost Americans billions each year in higher taxes and higher food costs.


ADI 08 Food Prices toolkit Spring

AT – Food Prices – Alt cause land shortages
It is impossible to avoid competition for land with food and other agriculture. Doornbosch and Steenblik September 2007. Paris. Round Table on Sustainable Development. Gneral Secretariat. These estimates should be viewed with caution. As the FAO (2000) warns, the models used to calculate land availability tend to over-estimate the amount of land that could be used for agriculture and underestimate the area of land that is already in use (by 10-20%). Moreover, in practice it is often extremely difficult to make land that is technically available for agriculture actually available in practice. Other competing demands will exist that put constraints on future changes in land use. Increasing demand for natural fibres and other materials, for foods grown less intensively or using organic production methods, for conservation of ecosystems and biodiversity, and for carbon sequestration, can all be expected to reduce the land available at a given rental cost. In short, competition for arable land among food, fibre, biomaterials and energy production cannot be avoided. Although in theory there is enough land to feed everyone, land use constraints make it almost impossible, thus causing an unavoidable food-versus fuel debate. Doornbosch and Steenblik September 2007. Paris. Round Table on Sustainable Development. General Secretariat.
Global production of biofuels amounted to 0.8 EJ in 2005, or roughly 1% of total road transport fuel consumption. Technically, up to 20 EJ from conventional ethanol and biodiesel, or 11% of total demand for liquid fuels in the transport sector, has been judged possible by 2050.1 An expansion on this scale could not be achieved, however, without significant impacts on the wider global economy. In theory there might be enough land available around the globe to feed an everincreasing world population and produce sufficient biomass feedstock simultaneously, but it is more likely that land-use constraints will limit the amount of new land that can be brought into production leading to a “food-versus-fuel” debate.
Moreover, land use will be driven by the net private benefit owners can derive from their land. Any diversion of land from food or feed production to production of energy biomass will influence food prices from the start, as both compete for the same inputs. The effects on farm commodity prices can already be seen today. The rapid growth of the biofuels industry is likely to keep these prices high and rising throughout at least the next decade (OECD/FAO, 2007).


ADI 08 Food Prices toolkit Spring

Alt Cause – Bad Weather
Alt causality- bad weather
McClure and Paulson, Staff Reporters 5/28/08, p. (Robert, Tom, “Get used to high food costs, water shortages”, Seattle Pi)
Shocked by rising food prices? Get used to it -- and be ready for water shortages, too, says a sweeping new scientific report rounding up likely effects of climate change on the United States' land, water and farms over the next half-century. Some effects already can be felt, says the report released Tuesday, which synthesizes results of more than 1,000 individual studies. And it's not just humans' food that's at risk, said witnesses at a congressional field hearing in Seattle on Tuesday. An intense and sudden acidification of the Pacific resulting from climate change presages a possible breakdown in the marine food web, experts said at the hearing, headed by Sen. Maria Cantwell, D-Wash. "This is not a problem of tomorrow but a problem for today," said Rep. Jay Inslee, D-Wash., noting that nearly 10 percent of protein in the human diet is from the oceans. "It just scares the heck out of me." The U.S. Department of Agriculture report cataloged effects thought by scientists to be likely over the next 25 to 50 years on agriculture, land and water. Even if greenhouse gas production stopped now, climate change already has been set in motion, said the review by 38 scientists, mostly from the federal government and universities. The panel included some of the nation's leading climate researchers. "We have already observed the consequences," said David Schimel of the National Ecological Observatory Network, one of three lead authors. "We have a very clearly observed trend toward earlier snowmelt and more winter rain, both of which greatly complicate water management." Other early effects, the report said, include the country growing warmer and wetter over the past century. While the South and East are receiving more rain and snow, the West and Southwest -- with the greatest water shortages -- are getting less. More and hotter heat waves are occurring. Because of climate disruption of agriculture, consumers can count on higher food prices, researchers said in a news conference. An example of the kind of crop disruption to expect: This spring's unusually wet weather in Eastern Washington discouraged bees from flying. That led to fewer cherry trees being fertilized through pollination. Result: A smaller cherry harvest -- and higher prices. Although not all the effects of climate change will be bad, many seeming pluses actually aren't, the research team said. For example, more carbon dioxide makes plants grow faster. But, "as they grow quicker, they are generally going to be smaller plants," said Jerry Hatfield, of the Agriculture Department's Agricultural Research Service. Other results of the study include: Whereas warmer winter temperatures will spare some livestock from freezing to death, that is likely to be more than offset by deaths in heat waves. Increased fires and infestations of insects no longer killed off by cold winters could change the face of Western forests. The West's system of capturing runoff from snowmelt is likely to be thrown out of whack by increased winter rains and higher spring temperatures melting snow faster. Grain crops may benefit from warmer temperatures, growing more quickly -- but could be endangered by more heat waves or other climate disruptions. Horticultural crops such as tomatoes, onions and fruit are more likely to be affected than grains.


ADI 08 Food Prices toolkit Spring

Alt Cause – Infrastructure deficiency
Infrastructure issues prevent food acquisition- outweighs prices
Fernquest, BA and MSc Applied Economics, 5/8/08, p. (Jon, “Achieving World Security” The World Bank)
In the mid-1970s, as rapidly increasing

prices caused a global food crisis, food security emerged as a concept. Attention focused first on food availability but then quickly moved to food access and food use, and, most recently, to the human right to adequate food. The International
Covenant on Economic, Social, and Cultural Rights, ratified by 153 states, obligates these states to progressively realise the right to food. The commonly accepted definition of food security is when all people, at all times, have physical, social, and economic access to sufficient, safe, and nutritious food to meet their dietary needs and food preferences for an active and healthy life. For most of the world's malnourished people, the lack of access to food is a greater problem than food availability. The chronically food insecure never have enough to eat. The seasonally food insecure fall below adequate consumption levels in the lean season. And the transitory food insecure fall below the food consumption threshold as a result of an economic or natural shock such as a drought, sometimes with long-lasting consequences. Investments in agriculture are important to increase food security. The channels are complex and multiple. Rising

productivity increases rural incomes and lowers food prices, making food more accessible to the poor. Other investments - such as improved irrigation and drought-tolerant crops - reduce price and income variability by mitigating the impact of a drought. Productivity gains are key to food security in countries with a foreign exchange shortage or limited infrastructure to import food.
The same applies to households with poor access to food markets. Nutritionally improved crops give access to better diets, in particular through biofortification that improves crop nutrient content. The contributions that agriculture makes to food security need to be complemented by medium-term programmes to raise incomes of the poor, as well as insurance and safety nets, including food aid, to protect the chronic and transitory poor.


ADI 08 Food Prices toolkit Spring

AT – Food Prices – Human Ingenuity Solves
Human ingenuity solves- people adjust behaviors to scarcity
Cowen, professor of economics at George Mason University, 7/10/08 p. (Tyler, “Higher food prices won't always hurt”, American Public Media)
We all know that food prices are rising fast. As a result, people are cutting back on their food expenditures. They're buying fewer luxuries and eating at home more often. That's the shorter run trend. But here's what's less commonly understood: In the longer run, organic food, luxury foods and fancy restaurants will

do just fine. The economic logic is this: If all food becomes more expensive, what originally looked expensive suddenly appears cheap in relative terms. Consider a simple example: If food costs nothing to transport, say cheap milk would be $2 and organic milk would be $4. The organic milk costs
twice as much. Now add on a $2 transport cost to each item. The price comparison is then $6 to $4. The organic milk seems only a little more expensive. If you are going to buy milk in any case, you might even switch to the organic product. Of course at first, people are horrified by the higher prices. They cut back on food costs across the board, as we've been seeing. We're also in the middle of a recession and that won't last forever. Over time, people will get used to the general idea that food costs so much. They'll start to think about spending more for the organic milk because, in relative terms, it doesn't seem so outrageously high. Wealthier families in particular will turn away from Safeway and look toward Whole Foods. Economists refer to this result as the "Alchian and Allen theorem," named after its two founders Armen Alchian and William Allen, both formerly economists at UCLA. There's a lot of evidence that the theorem describes actual consumer behavior; it also explains why people tend to spend more when they are on vacation -- because it is not worth flying across the country to eat at McDonald's. So if food costs stay high, for a lot of people the future will be fresh pasta, caviar and organic tomatoes, not

plain oatmeal and a can of beans.


ADI 08 Food Prices toolkit Spring

AT – Food Prices – Alt Cause population
Alt cause- population growth causes starvation
Sachs, director of the Earth Institute at Columbia University, 5/18/08 p. (Jeffrey, “Surging Food Prices Mean Global Instability”, The Scientific American) Several factors are at play in the skyrocketing prices, reflecting both rising global demand and falling supplies of food grains. World incomes have been rising at around 5 percent annually in recent years, and 4 percent in per capita terms, leading to an increased global demand for food and for meat as a share of the diet. China’s economic growth, of course, has been double the world’s average. The rising demand for meat exacerbates the pressures on grain and oil-seed prices since several kilograms of animal feed are required to produce each kilogram of meat. Feed
grains have risen from around 30 percent of total global grain production to around 40 percent today. Land that would otherwise be planted to the main grains is shifting to soya bean and other oil seeds used for animal feed. It is forecast, for example, that U.S. farmers will cut maize plantings by 8 million acres, while raising soya-bean production by about the same amount. The grain supply side has also been disrupted by climate shocks, such as Australia’s massive droughts.


ADI 08 Food Prices toolkit Spring

AT – Food prices – Alt Cause Generic
EXPERTS AGREE THAT ETHANOL SUBSIDIES DON’T AFFECT FOOD PRICES MUCH KHOSLA 08 (Vinod Khosla, an Indian-American venture capitalist. He is an influential personality in Silicon Valley. He was one of the co-founders of Sun Microsystems and became a general partner of the venture capital firm Kleiner, Perkins, Caufield & Byers in 1986. “Khosla Speaks,” Forbes, May 21, 2008) While corn prices certainly have some impact on biofuels, their impact is constantly overstated by sources like the WSJ. In fact, they would do well to see what the U.S. Department of Agriculture has actually said on the subject. Yesterday, USDA Chief Economist Joe Glauber noted: "On the international level, the President's Council of Economic Advisors estimates that only 3% of the more than 40% increase we have seen in world food prices this year is due to the increased demand on corn for ethanol." As the USDA noted previously: "Given that foods using corn as an ingredient make up less than a third of retail food spending, overall retail food prices would rise less than one percentage point per year above the normal rate of food price inflation when corn prices increase by 50%." ETHANOL PRODUCTION IS ONLY A PROXIMATE CAUSE OF FOOD PRICES
HOLT-GIMENEZ AND PEABODY 08 (“From Food Rebellions to Food Sovereignty: Urgent call to fix a broken food system” Posted May 16th, 2008, Eric Holt-Giménez and Loren Peabody, Executive Director, Food First/Institute for Food and Development Policy)

The immediate reasons for food price inflation include; droughts in major wheat-producing countries in 2005-06, low grain reserves (we have less than 54 days worth, globally); high oil prices; a doubling of per-capita meat consumption in some developing countries, and the diversion of 5% of the world’s cereals to agrofuels. Though an increase in agricultural growth is projected for 2008, most experts agree food prices will continue to rise. Drought, meat diets, low reserves, and agrofuels are only the proximate causes of food price inflation. These factors do not explain why—in an increasingly productive and affluent global food system—next year up to one billion people will likely go hungry. To solve the problem of hunger, we need to address the root cause of the food crisis: the corporate monopolization of the world’s food systems. There are many reasons for high food prices, not just corn based ethanol
Farm Press, July 30, 2008 (“There's more to high food costs than corn prices,” Farm Press, d/l: For one, there are many, many factors contributing to high food prices that are not correlated with high commodity prices. There are high fuel costs required to transport commodities from the field to end users and high energy costs for processing commodities into food, etc. And who do you think has to pay actor Sam Elliot to say, “Beef, it’s what’s for dinner.” That’s right, it’s the consumer. Secondly, while high commodity prices do have some impact on higher food prices, it’s not such a clear cause

AT – Food Prices – Alt Cause generic
Food Prices rise as a direct result of recent weather conditions and high oil prices – ethanol production is only a secondary cause of rising food prices.

MSNBC 10-2-2007

ADI 08 Food Prices toolkit


Increased production of corn-based ethanol has raised U.S. food prices this year but not nearly as much as high oil prices and weather problems, the head of the Agriculture Department said Tuesday. Acting USDA Secretary Chuck Conner said ethanol "clearly had some impact" on food price inflation, but the fuel is getting too much of the blame "for what's happening in grocery store aisles." Heightened ethanol production is a cornerstone of President George W. Bush's energy policy and farmers increased the amount of corn they
planted to feed the fuel frenzy. But more ethanol also helped drive up the prices of livestock feed and other corn-dependent food products. Food prices have increased about 2.7 percent in each of the last three years. But a jump of between 3.5 percent and 4.5 percent is expected this year before retreating a bit to between 3 percent and 4 percent in 2008, Conner said at a conference hosted by the Renewable Fuels Association, which represents the U.S. ethanol industry. Global weather

conditions, including droughts in Australia, as well as rising demand in China and elsewhere drove up wheat prices. And the recent record highs for retail oil prices also add to inflation by increasing the costs of everything from packaging to transportation, Conner said.
He did not specify how much each factor contributed to rising U.S. food prices.

Rises in food prices caused by Weakening U.S. dollar and greater consumption, Ethanol production is a marginal culprit Tim Mitchell, March 8, 2008, CHAMPAIGN – Area agricultural leaders say that a weakening U.S. dollar and more mouths to feed around the world – not ethanol plants – are largely responsible for the increased prices consumers are paying for food products. "When you find yourself paying more money for a box of corn flakes at the grocery store, only a few pennies of that increase came from the price of corn," said former Illinois Farm Bureau President Ron Warfield of Gibson City


ADI 08 Food Prices toolkit Spring

AT – Food Price – Oil Alt cause
TENENBAUM 08 (David J. Tenenbaum is a Wisconsin-based magazine freelancer who penned four books in Arco’s Toolbox series for professional builders.ENVIRONMENTAL HEALTH PERSPECTIVES, “Food vs Fuel: Diversion of Crops Could Cause More Hunger,” Spheres of Influence, Volume 116, June 2008)

As petroleum fuels get more expensive, biofuels become more profitable; therefore, biofuel pro- ducers can afford to pay more for their feedstock. According to Brown, this new relation- ship puts hungry people in direct competi- tion with empty gas tanks. “Historically the food and energy economies have been largely separate, but now with the con- struction of so many fuel ethanol distil- leries, they are merging,” he says. “If the food value of grain is less than its fuel value, the market will move the grain into the energy economy. Thus, as the price of oil rises, the price of grain follows it upward.”
Now that food crops can be converted into fuels, a new factor must be consid- ered—the link between the price of food and the price of petroleum.

RISING OIL PRICES INCREASE PRICES OF ALL AGRICULTURAL PRODUCTS TESLIK 08 (Lee Hudson Teslik, Assistant Editor of at the Council on Foreign Relations,[1] and was formerly a
professional speechwriter. Teslik's writings have been published by the Council on Foreign Relations, Newsweek, TIME Europe, Slate, the Washington Post, and the New York Times.[2] He has written speeches for international political figures and corporate executives. Teslik graduated from Harvard University, where he wrote for the Harvard Lampoon and was a fellow at Harvard Magazine,[3] the alumni magazine., June 30, 2008, “Food Prices,” Council on Foreign Relations)

Rising energy prices have direct causal implications for the food market. Fuel is used in several aspects of the agricultural production process, including fertilization, processing, and transportation. The percentage of total agricultural input expenditures directed toward energy costs has risen significantly in recent years. A briefing from the U.S. Department of Agriculture notes that the U.S. agricultural industry’s total expenditures on fuel and oil are forecast to rise 12.6 percent in 2008, following a rise of 11.5 percent in 2007. These costs are typically passed along to customers and are reflected in global spot prices (i.e. the current price a commodity trades for at market). The input costs of electricity have also risen, furthering the burden. Though it isn’t itself an energy product, fertilizer is an energy-intensive expense, particularly when substantial transport costs are borne by local farmers—so that expense, too, is reflected in the final price of foodstuffs. (Beyond direct causation, energy prices are also correlated to food prices, in the sense that many of the same factors pushing up energy prices—population trends, for instance, or market speculation—also affect food prices.)


ADI 08 Food Prices toolkit Spring

AT – Food Price – Oil Alt cause
The key culprit for food price fluctuation is oil prices and currency rates – not Biofuels
Maureen Groppe, 7/24/2008 Gannett News Service
WASHINGTON — A diverse and complex set of factors — including biofuels production, high oil prices, a weak dollar and food consumption rates — are behind the sharply rising cost of food, according to an analysis by Purdue University agricultural economists released Wednesday. The economists predict food prices will remain high as long as oil prices are also high and the dollar is weak. "Lower oil and a strong dollar would bring pressure on commodity prices to fall," said economist Wally Tyner, the report's lead author. He also said the full impact of higher corn and soybean prices haven't shown up in grocery prices yet. The cost of food has increased 7.5% since last year, according to the most recent government figures available. The U.S. Department of Agriculture says the highest anticipated increases this year are in eggs, dairy and poultry. The government's explanations for the increases are similar to those identified by Purdue researchers: stronger global demand, increased exports caused by both the stronger demand and weaker dollar, weather-related production problems and the increased use of corn and other food commodities for bioenergy. The Purdue researchers said the factors are too interrelated to be able to say how much of the price increase is caused by each factor. But they did breakdown the impact on corn, which has tripled in price since 2004. The analysts estimated that about $1 of the $4 increase in a bushel of corn is due to the U.S. subsidies of the ethanol industry. The rest was caused by the increasing price of oil. "There's a link today between crude oil and corn that never existed in the past," Tyner said, calling that a "revolution" in global agriculture. "Even if all the subsidies go away tomorrow, corn prices will still be high unless we choose to ban the use of corn for ethanol," Tyner said. The biggest pull comes from increased demand for biofuels as gasoline becomes more expensive. That increases the demand for corn, as well as for petroleum-based items including fertilizer and diesel that are used to grow commodities. And because oil and agricultural commodities are priced in dollars, the declining value of the dollar has made them cheaper for other nations, increasing the demand. "The link between the U.S. dollar exchange rate and commodity prices is stronger and

more important than many other studies imply," said Purdue economist Phil Abbott. "Whatever impacts the dollar will influence food prices."

The rise in Oil prices is the direct cause of the current rise in food prices.
Charles W. Corey, 27 June 2008, Staff Writer,
Washington -- World prices for oil and food commodities are closely linked, and six key factors are creating a “perfect storm” of conditions that are boosting prices worldwide, a group of U.S. Department of Agriculture (USDA) economists said June 23. Members of the group who spoke to, include Michael J. Dwyer, director and chief economist for the Foreign Agricultural Service; Daniel B. Whitley, deputy director of that office; and Hui Jiang, a USDA agricultural economist. Normally, Dwyer said, the international system is dynamic enough to handle one or two

simultaneous shocks, but the number of factors in play today “pretty much overwhelms the system’s ability to deal with it, and prices are spiking sharply higher.” He and his colleagues outlined six factors. First, higher energy prices have led to higher input costs for pesticides, fertilizers and herbicides (many of which are petroleum-based), higher processing costs and higher costs for transportation -- which directly affects the cost of food being shipped overseas. “Right now, to ship a ton of corn out of New Orleans to
Asia [costs] about $130,” a dramatic increase from not long ago. “When farmers have to pay more for their fertilizers and other inputs,” Dwyer said, “it means these higher food prices are not all pure profit to a producer because their costs are up as well.” Dwyer said it is incorrect to single out the current

U.S. biofuels policy, which promotes the conversion of some corn into biofuels, for driving up prices. “A lot of the world press is covering this issue right now, and it is probably the number one issue in the newspapers around the world. Unfortunately, a lot of the newspapers have unfairly scapegoated the U.S biofuels policy as the driver behind why corn prices and commodity prices in general have spiked sharply higher in the last 18 months.


ADI 08 Food Prices toolkit Spring



ADI 08 Food Prices toolkit Spring

Sugar DA - Ethanol
Uniqueness and Link - Removing sugar subsidies raise feedstock prices for sugar hurting sugar ethanol production. Masami Kojima and Todd Johnson October 2005 Energy Sector Management Assistance Programme (ESMAP) Potential for
Biofuels for Transport in Developing Countries Liberalization of agricultural trade and removal of domestic subsidies and protection, especially in industrial countries, would induce significant price increases for many agricultural commodities. Among currently used feedstocks for biofuel manufacture are sugarcane, maize, and soybeans. The world sugar market is one of the most distorted. Complete trade liberalization, which would dramatically reduce the production of sugar in a number of countries, is forecast to raise the world price of sugar by about 30–40 percent according to most estimates. This in turn would raise the cost of ethanol production until supply expansion responds to the much higher world sugar price. The impact on the price
of maize would be smaller, and that on soybeans very small.

Sugar ethanol is key to Brazil’s economy. August 7 2007
Meet sugar cane ethanol, a product fueling economic growth in Brazil, a nation that between its oil reserves and the burgeoning ethanol industry has attained energy self-sufficiency. Brazil has spent billions of dollars over decades of research to develop the technology to mass produce ethanol from the millions of cane acres that spread along the South American landscape.

Brazil key to Latin American growth.
Hakim 99- (Peter Hakim, president of the Inter-American Dialogue, Winter 1999/2k, “Foreign Policy, Is Latin America Doomed to Failure,” Academic Search Premier) Brazil, which accounts for nearly one third of Latin America's population and economic activity, will heavily influence the region's overall economic performance in the coming years. It is the wild card. True, Brazil's growth throughout the 1990s has been sluggish and will average less than 2.5 percent a year for the decade. Nevertheless, the country succeeded far beyond anyone's expectations in squeezing inflation out of its economy and quickly recuperating from its recent currency crisis. At this point, there is no telling whether Brazil's economy will
turn up or down. The country's fortunes hinge on the political skills and luck of President Fernando Cardoso and his advisers, who need to manage an unruly congress and fickle public opinion to keep reform efforts on track. Brazilian politics--fragmented, weakly institutionalized, and driven by local and regional interests--are a feeble underpinning for a modern economy and society. Yet few Latin American countries can boast richer political debate on key national issues, a more free and vigorous press, or a stronger trade union movement.


ADI 08 Food Prices toolkit Spring

Sugar DA - Ethanol
Downturn kills to the US economy.
Saavedra 03- (Boris Saavedra, professor, Center for Hemispheric Defense Studies , National Defense University, April 2003. NDU Working Paper, Confronting Terrorism in Latin America,” The United States shares with its Latin American neighbors an increasingly and vitally important financial, commercial, and security partnership. Any kind of political-economic-social-security deterioration in the region will profoundly affect the health of the U.S. economy—and the concomitant power to act in the global security arena.


ADI 08 Food Prices toolkit Spring

Sugar Ethanol DA link Extension
Sugar subsidies depress world prices by 40%, liberalization would kill sugar ethanol industries. Masami Kojima of the Oil, Gas, and Mining Policy Division, World Bank; Donald Mitchell of the Development Prospects Group, Development Economics, World Bank; and William A. Ward 2007, Professor and Director, Center for International Trade,
Clemson University. 2007 Energy Sector Management Assistance Program Considering Trade Policies for Liquid Biofuels In countries where government provides support to agriculture, biofuel feedstocks are usually beneficiaries of the subsidies. Among major biofuel producers, maize and soybeans in the United States and sugar beets and rapeseed oil in the European Union are large recipients of government aid. The global sugar market is among the most distorted, with high protection and price supports to EU, U.S., and Japanese producers. These policies have been estimated to depress world sugar prices by up to 40 percent from the levels that would have prevailed under a free market (Mitchell 2004). Trade liberalization would increase world prices for sugar more than those for all the biofuel feedstocks currently being used commercially, which would have an adverse impact on ethanol economics.


ADI 08 Food Prices toolkit Spring

Brazil Econ Strong now
Despite failure at Doha, Brazil’s economy is strong now.
Carlos Macias August 1, 2008 . “Dealing without Doha.” . Council of the Americas.
For Brazil, the talks’ collapse brings mixed results and expectations for its future. In a Q&A, Global Insight's Jan Randolph counts Brazil as one of the biggest losers in Doha's failure. On the other hand, Now recognized as a world player, Brazil is experiencing its strongest

economic performance in three decades and has thus far remained fairly insulated from the U.S. credit crisis. The New York Times profiles Brazil’s recent financial and social growth and highlights its successful development recipe of respect for open markets combined with targeted social programs.


ADI 08 Food Prices toolkit Spring

Corn Prices low now

CORN PRICES ARE THE LOWEST IN MONTHS AND WILL STAY LOW FOR THE REST OF THE YEAR ZHOU 08 (“Corn's recent slump may create buying opportunity,” Moming Zhou, MarketWatch reporter, based in San Francisco, MarketWatch, July 31, 2008)
"The current correction in corn is nearing one of the best buying opportunities in a very long time," said Shawn Hackett, president of financial information provider Hackett Financial Advisors. "The next few weeks should be a very fertile time to solidify one's commitment [to corn] and set the stage for well above average returns." Corn futures for December delivery soared 26% in June to as high as $7.96 a bushel after the Midwest flooding inundated some crop fields in the Corn Belt. But futures in July erased all the June gains and dived to $5.63 a bushel on July 23, the lowest since March 23. Recent favorable weather has helped corn's pollination this month and has put downward pressure on prices. Trading in the past few sessions, however, has seen signs of rebound in corn prices. On Wednesday, the benchmark contract rose for a fifth day to end at $6.21 a bushel on the Chicago Board of Trade. Still, it's about 20% lower than its all-time high. Some analysts cautioned that corn could stay lower for the rest of the year. See Food Futures. "We have obviously seen some recovery in corn prices" as some investors decided "that the market was oversold," said Elaine Kub, a grain analyst at commodities information provider DTN. "But I expect prices to stay near their low until we find something really bullish."

FUND LIQUIDATION IS DRIVING CORN PRICES LOWER DAVIS 08 (Ryan Davis, Dow Jones Newswires, 8/1/2008, “CBOT Corn Review: Drops Sharply On Weather, Liquidation”)
CHICAGO (Dow Jones)--Chicago Board of Trade corn futures settled sharply lower on continuing fund liquidation and a "non-threatening" weather outlook, traders

September corn closed down 22 1/2 cents to $5.65 per bushel, December corn closed down 22 1/2 cents to $5.85, and March corn closed down 22 1/2 cents to $6.05. Fund liquidation, which drove prices substantially lower in late trading Thursday, continued to pressure prices for the duration of Friday's session. There continues to be "a lot of speculators getting out of the market," said Sid Love, analyst with Kropf and Love consulting. The market also continues to look beyond the above-average temperatures expected throughout the U.S. corn belt this weekend to an expected mid-week cooldown starting around Tuesday. "After a couple of days we're going to turn this (heat) around and see another frontal
and analysts said. system come, provide some moisture, and cool things off again," said Dale Durchholz, analyst for AgriViser. "And then, overall, you're sitting here looking to August going 'there is no weather problem.'" The prospect of plentiful rain next week across portions of the corn belt is further pressuring the market, traders and analysts said.

you've got this attitude that is pretty pervasive in the trade right now that we're going to have a reasonably good corn crop," said Durchholz. There are "a lot of people" now projecting average yields at 152 bushels per acre or higher, he said. The
"So, U.S. Department of Agriculture is currently predicting an average yield of 148.4 bushels per acre. New yield projections will be released in a USDA Aug. 12 crop production report. That report is seen as the first concrete indication of the effects of June flooding throughout the U.S. Midwest.

THE LATEST REPORT SHOW THAT CORN PRICES ARE DECREASING AP 08 (Aug 1, 2008, “Agriculture futures trade mostly lower on CBOT”) Agriculture futures mostly traded lower Friday on the Chicago Board of Trade. Wheat for September delivery rose 10.25 cents to $7.94 a bushel; December corn fell 22.5 cents to $5.85 a bushel; December oats dropped 9.5 cents to $3.875 a bushel;
November soybeans declined 39 cents to $13.65 a bushel. Beef futures traded higher and pork futures traded mixed on the Chicago Mercantile Exchange.


ADI 08 Food Prices toolkit Spring

Corn Prices low now

WEATHER FORECASTS CAUSED A SHARP DECREASE IN CORN PRICES JACOBS 08 (“Corn, soybeans decline on Midwest rain forecast,” STEVENSON JACOBS, August 1, 2008, Associated Press) Corn and soybean prices fell sharply Friday as forecasts for rainfall in the steamy Midwest boosted expectations of good crop development and lessened supply concerns. Other commodities traded mixed, with crude oil rebounding slightly and gold, silver and copper prices turning lower. Showers are expected in parts of the Midwest next week, offering relief to dry corn and soybean crops as farmers prepare for the important fall harvest. The crops have been recovering well after the worst flooding in 15 years ravaged the U.S. Corn Belt in June, raising hopes of a robust 2008 yield. "It will be difficult to rally prices in corn or beans as long as the weather remains bearish," Vic Lespinasse, of, said in a note. Corn futures for December delivery fell 22.5 cents, or 3.7 percent, to settle at $5.85 a bushel on the Chicago Board of Trade, after earlier falling to $5.82. Soybeans
for November delivery dropped 39 cents, or 2.78 percent, to settle at $13.65 a bushel on the CBOT. Meanwhile, September wheat futures ended higher, adding 10 cents

Corn and soybean prices soared to record levels after the June floods wiped out thousands of acres of Midwest farmland. Prices have eased in recent weeks as warm, dry conditions return to the region.
to $7.94 a bushel on the CBOT.

CORN PRICES HAVE BEEN STEADILY DECLINING, INCREASING INVESTMENTS MEANS CORN PRICES HAVE STABILIZED. ZHOU 08 (Moming Zhou, MarketWatch Staff writer, “Corn, soybeans rise as dollar edges lower” July 28, 2008, Corn remains nearly $2 lower than its record high hit last month. It fell nearly 6% last week and has slumped 20% this month. "We have obviously seen some recovery in corn prices" as some investors decided "that the market was oversold," said Elaine Kub, a grain analyst at commodities information provider DTN. "But I expect prices to stay near their low until we find something really bullish." Corn ended last week's trading at $5.97 a bushel, the lowest since April 1. "To say that we have seen some extreme selling behavior in commodities over the last several weeks is a gross understatement," said Shawn Hackett, president of Hackett Financial Advisors. Corn and a few other commodities "have been the poster
children for irrational selling extremes."


ADI 08 Food Prices toolkit Spring

CORN PRICES LOW NOW CORN PRICES CONTINUE TO DECLINE FROM THEIR JUNE HIGH; STABILIZATION IS EXPECTED. JUNE WAS AN EXTREME CIRCUMSTANCE, FARMS ARE BEGINNING TO RECOVER FROM THE JUNE NATURAL DISASTERS. ILLINOIS FARM BUREAU 08 (Illinois Farm Bureau, Prairie Farmer newsletter, Grain Prices Continue to Weaken; Still Not Stable, July 28, 2008, Corn and soybean prices continue to weaken, but could settle into a more "sideways" pattern as production prospects unfold, according to University of Illinois Marketing Specialist Darrel Good.
out just under $8. During the same period, November 2008 soybean futures rallied more than $3, topping out just under $16.37. "Still, large daily price movements can be expected," says Good. December 2008 corn futures increased about $2 per bushel during the month of June, topping

"Much of the June rally was related to weather conditions in the United States as excessive rainfall threatened acreage and yield in a wide area over the Midwest," he notes. "That weather pattern followed a generally wet, cool May that resulted in late planting and slow emergence in some areas." He adds that soybean prices were also supported by a
generally strong export pace. USDA export estimates indicate that soybean exports during June totaled about 57 million bushels, compared to about 45 million in June 2007.

Continued strong demand by China and interruptions in exports from Argentina contributed to the large June exports. "Prices of both crops turned lower in July," Good notes. "Corn prices have been pressured by a combination of larger-than-expected acreage estimates released by the USDA on June 30, improving crop conditions, and lower crude oil prices." As of July 13, the USDA estimated that 64% of the corn crop was in good or excellent condition, equal to the rating of a year ago. Lower crude oil prices have resulted in lower prices for ethanol. The average price of ethanol at Iowa plants declined from $2.82 per gallon on July 3 to $2.57 per gallon on July 18. At the close of overnight trade on July 21, December 2008 corn futures settled $1.74 below the contract high. Soybean prices have not
declined as sharply as corn prices. "While December 2008 futures are down by more than 20% from the contract high, November 2008 soybean futures at $14.40 are down 12% from the contract high," Good says. "Soybean prices have been a little more resilient because of the uncertainty about Argentine

For corn, the drop in ethanol prices over the past two weeks has been more than offset by the decline in corn prices, he notes
exports and because of more concern about U.S. crop conditions."

CORN PRICES CONTINUE TO DECLINE FROM THEIR $8 HIGHS, PROJECTED THUNDERSTORMS LEAVE ROOM FOR CONTINUED GROWTH. ZHOU 08 (Moming Zhou, MarketWatch Staff writer “Corn, soybeans fall on weather concerns; wheat up”, Aug. 1, 2008, enews) Corn futures for December delivery slumped 22.5 cents, or 3.7%, to end at $5.85 a bushel on the Chicago Board of Trade, and November soybeans lost 39 cents, or 2.8%, to $13.65 a bushel. Thunderstorms were forecast to move into the Midwest, according to, and bring with them rains that will give crop growth in the major corn-producing area a major boost. Both corn and soybeans are planted in spring and harvested in fall. "There is no shortage of speculative market bears, who continue to interpret the generally favorable weather as a sign that yields could still match trend-line projections," said Elaine Kub, a grain analyst at commodities research firm DTN. Corn prices are now 25% lower than their record high near $8 hit last month. Some analysts said that corn's recent fall has created buying opportunities for the commodity.


ADI 08 Food Prices toolkit Spring

Corn Price link
Subsidies keep corn prices low. Masami Kojima of the Oil, Gas, and Mining Policy Division, World Bank; Donald Mitchell of the Development Prospects Group, Development Economics, World Bank; and William A. Ward 2007, Professor and Director, Center for International Trade,
Clemson University. 2007 Energy Sector Management Assistance Program Considering Trade Policies for Liquid Biofuels
The United States has a variety of government policies that support domestic producers of maize and prevent world market price signals from being transmitted to farmers (OECD 2006a), even though the United States is among the lowest cost producers of maize net of subsidies. These policies

encourage maize farmers to produce even when world market prices are depressed and keep global maize stocks high and prices low. Removing all import tariffs and farm support programs would result in an estimated increase in average world maize prices of 5.7 percent and an increase in maize trade of 4.5 percent (Fabiosa and others 2003). This relatively small impact on
prices and trade is due to the fact that much of the land devoted to maize production would likely remain dedicated to maize even without government policies, thereby maintaining supply levels. The main impact would be a drop in farm land prices.

Rising corn prices rapidly increase food insecurity. Masami Kojima of the Oil, Gas, and Mining Policy Division, World Bank; Donald Mitchell of the Development Prospects Group, Development Economics, World Bank; and William A. Ward 2007, Professor and Director, Center for International Trade,
Clemson University. 2007 Energy Sector Management Assistance Program Considering Trade Policies for Liquid Biofuels Rising prices of maize—and potentially of cassava, which is also an ethanol feedstock— would be a concern for the world’s poor, most of whom are net food purchasers. Maize is the preferred staple food of more than 1.2 billion people in Latin America and Africa (Global Crop Diversity Trust 2006). Cassava provides one-third of the caloric needs in sub-Saharan Africa and is the primary staple for more than 200 million poor people. It is also a reserve when other crops fail. A study at the University of Minnesota estimated that, for every percentage increase in the real prices of staple foods, the number of foodinsecure people in the world would rise by more than 16 million (Runge and Senauer 2007).


ADI 08 Food Prices toolkit Spring

IOWA CROP LOSSES ARE FAR LESS THAN EXPECTED AND WON’T AFFECT PRICES MUCH CLAYWORTH 08 (“Expert: Iowa's crop loss less severe than assessed,” By JASON CLAYWORTH, July 31, 2008, Des Moines Register)
Iowa's crop losses from floods are far less than first estimated, and statewide a decent harvest is in the works, a grain expert told an agriculture task force Wednesday. The hits are still significant, but some of the hurt has been reduced by replanting, said Chad Hart, an economics professor at Iowa State University who works closely with ISU Extension. Depending on factors such as how early it frosts or if additional disasters take place, Iowa is in line to harvest about 93 percent of the corn planted and 95 percent of soybeans, Hart told the Rebuild Iowa Commission's Agriculture and Environment Task Force. On June 20, Iowa Secretary of Agriculture Bill Northey estimated that 20 percent of corn and 10 percent of soybeans had been destroyed due to flooding. Total loss then was estimated at 3.3 million acres and $3.3 billion. On Wednesday, Hart, using numbers from the National Agriculture Statistics Service, estimated that 560,000 acres of corn and more than 400,000 acres of soybeans were lost. In total, Iowa farmers planted 13.7 million acres of corn and 9.4 million acres of soybeans, he said. His numbers exclude fields that have been replanted, which probably explains the contrasts with earlier reports, Hart told task force members. "The point is, Iowa statewide could have a good crop," he said. Hart noted that yield estimates are not yet available. Some farmers may see diminished yields
largely because of late planting, he said. Northey said he believes Wednesday's estimates are accurate. He cautioned, however, that the overall picture should not overlook the situations of some farmers who lost all or substantial portions of their crops. Nonetheless, the outlook is much better than earlier in the year, and those expectations are the reasons corn prices have dropped by nearly $2 a bushel in recent weeks, Northey said Wednesday. Corn is now around $5.50 a bushel, while soybeans are around $14 a bushel, down from a high this year of around $16.50.


ADI 08 Food Prices toolkit Spring

Corn Prices high
CORN PRICES ARE DECREASING BUT WILL REMAIN HIGH BECAUSE OF ETHANOL DEMAND REUTERS 08 (“U.S. ethanol distillers profit for third week,” Aug 2, 2008, Average margins for making U.S. ethanol have been narrowly profitable for the third week running, but slipped slightly this week on stronger corn prices, analysts said. U.S. distillers were making about 15 cents per gallon this week for every gallon of ethanol, down about 10 cents from last week, analysts said. Most ethanol in the United States is made from corn. September corn futures CU8 on the Chicago Board of Trade closed at nearly $5.88 a bushel on Thursday, up nearly 15 cents from the previous week. Ethanol maker Aventine Renewable Energy Holdings Inc (AVR.N: Quote, Profile, Research) reported this week that its corn costs during the second quarter rose to $5.38 a bushel, compared with $3.99 a bushel last year. Aventine reported a net loss of $1.9 million on the quarter due to losses on investment securities. At least corn prices have fallen sharply since spiking above $7 per bushel during the worst floods in the Midwest in 15 years in June. But global grain demand has kept the corn price from falling too far, making it difficult for all but the most efficient distillers to profit this year.
NEW YORK, Aug 1 (Reuters) -

CORN PRICES WILL INCREASE NEXT YEAR BECAUSE OF FERTILIZER COST SHUMAKER 08 (“U.S. crop production costs to rise one-third in 2009,” Jul 28, 2008, Lisa Shumaker) U.S. farmers will have to spend roughly 30 percent more next spring to plant corn and soybeans due to soaring energy prices driving up the cost of fertilizer, according to a University of Illinois study. As a result, consumers will likely pay higher prices for everything from bread to milk to meat. The cost to plant corn next spring will be $529 per acre, up 36 percent from 2008 and up 85 percent from the five-year average $286 per acre, said Gary Schnitkey, an agricultural economist who conducts the annual survey of expenses excluding land costs. At $321 an acre, soybean
CHICAGO (Reuters) input costs are projected to rise by 34 percent from 2008 and more than 78 percent from the 2003-2007 average of $180 an acre. Assuming cash-rent fees of $200 an acre, the study projects a break-even price of $3.82 a bushel for corn in central Illinois, based on an average yield of 191 bushels an acre. Soybeans would break even at $9.65 a bushel, based on yields of 54 bushels per acre. Schnitkey predicts 2009 prices significantly above break-even prices.

Based on futures markets, corn should sell for about $6 a bushel next year, with soybeans in the $13 to $14 range, he said. Corn, soybean and wheat prices at the Chicago Board of Trade hit record highs this year amid increased global demand for food, rising oil prices and government mandates for biofuels.


ADI 08 Food Prices toolkit Spring

Wheat Price DA Impact - Pakistan
South Asia Investor Review 08. 2-26,
South Asia Investor Review is focused on reporting, analyzing and discussing the economy and the financial markets of countries in South Asia, including Pakistan, Bangladesh and Sri Lanka. Riaz Haq. “Another Wheat Crisis Looms for Pakistan.”

Triggered by wheat export curbs by Kazakhstan and the lowest world inventory in 26 years, wheat price hit a new record at $25 per bushel or about $900 per ton. This translates into Pakistan Rs. 55 per kilo for raw wheat in bulk excluding transportation, milling and bagging. It represents a 400% increase in less than a year. According to the U.S. Department of Agriculture's Foreign Agricultural Service, Kazakhstan
is the sixth-largest exporter of wheat, behind the U.S., Canada, Russia, Argentina and the European Union. Kazakhstan is in the belt of wheat production that stretches from Ukraine through southern Russia. It already has exported nearly seven million tons of grain, of the available 10 million tons from the 2007-08 crop, Agriculture Minister Akhmetzhan Esimov said. " Former Prime Minister Shaukat Aziz announced in Sept, 2007 that the Pakistani government would import one million tons of wheat, stating that this action was necessary to “maintain a reasonable buffer stock for the future.” The export price for Pakistani wheat during the April-May export window was approximately $225-232 per ton. For December 2007 delivery, Pakistan is now looking at an estimated import price of $380-400 per ton, exclusive of transportation." Well, here we are in February 2008 and the price of wheat has more than doubled yet again since Dec, 2007. In fact, the inflation of wheat prices now exceeds all other commodities including oil, gold, metals etc. Like most

developing nations, the average person in Pakistan has very low discretionary spending, with the bulk of his or her income spent on food, clothing and shelter. The dramatic increases in commodity prices, particularly food, is very troubling for the vast majority of populations living in the developing countries such as Pakistan, India, China and the African nations. The exceptions, of course, are the nations with their own significant production of food and fuel and other natural resources. The nations producing and exporting food, fuel, and metals actually benefit from this trend of higher commodity prices. The incoming government in Pakistan will face a very difficult challenge in containing tremendous inflationary pressures on basic commodities such as food and fuel. A failure in this effort can lead to significant instability and has the potential to threaten the future of democracy in Pakistan.


ADI 08 Food Prices toolkit Spring

Wheat prices high now
The high price of wheat is getting higher The New York Times 08’ In Price and Supply, Wheat Is the Unstable Staple By DAVID STREITFELD Published: February 13, 2008
( CHICAGO — For decades, wheat was a commodity no American needed to think much about, except the farmers who grew it. The grain was usually plentiful and prices were low. All of a sudden, those assumptions have been turned upside down. With demand soaring abroad and droughts crimping supply, the world’s wheat stockpiles have fallen to their lowest level in 30 years, and stocks in the United States have dropped to levels unseen since 1948. Prices have been gyrating in recent days as traders tried to figure out what to make of the situation. On Tuesday, prices for a sought-after variety, spring wheat, jumped to $16.73 a bushel on the Minneapolis Grain Exchange, the latest of several records. Prices for common wheat are up nearly 50 percent since August, and they are up even more for the most sought-after varieties, leaving buyers, growers and longtime commodity traders shaking their heads. “Anyone who tells you they’ve seen something like this is a liar,” said Vince Boddicker of the Farmers Trading Company in Mitchell, S.D. Though this week’s prices were nominal records, the inflation-adjusted record for wheat was set in the mid-1970s, when it exceeded $20 a bushel in today’s dollars after huge sales to the Soviet Union. Foreign buying is driving this market, too, but these buyers include South Korea, Taiwan, Mexico, Nigeria and Venezuela. Economic growth abroad has given people the means to improve their diets, and they are developing a taste for products made from wheat. “We haven’t hit a price that has slowed the international interest,” said Joe Victor of the commodity research firm Allendale. “That is something that definitely has the market excited.” Among the consequences are stretched wallets at home and abroad as food processors pass along higher costs.


ADI 08 Food Prices toolkit Spring

Wheat price low
Wheat prices lowering now.
American Fuels 08’ What has happened to the price of wheat? May 14, 2008

Quietly, with little or no fanfare, over the last two months the price of wheat has gone down. So quiet in fact that I doubt anyone has noticed. I know I hadn't until I saw this small quote in a recent article . Over the winter, wheat prices soared to nearly $13 a bushel, but lately they have dropped below $8. With soybeans still high, that could be another factor pushing some farmers away from planting corn, Mr. Reed said. As soon as I saw it I went over to the Chicago Board of Trade and started looking for numbers. And as this chart of wheat futures shows wheat topped $13 per bushel in the middle of March and is now trading at less than $8 per bushel. So the big question is, have the retail prices for things made from wheat, such as bread gone down any? Well, according to the Department of Labor, it hasn't. The average price for a pound of white bread in March was $1.350 and for April it was $1.373. So the months of being told that ethanol production was leading to higher wheat costs as farmers switched from growing wheat to growing corn for ethanol (which didn't happen see here) has lead to bakers being able to keep bread prices high even though wheat prices have fallen without anyone questioning it.


ADI 08 Food Prices toolkit Spring

High Wheat  instability
WHEAT PRICES ARE DESTABILIZING GOVERNMENTS AND IGNITING STREET RIOTS. THE DISTURBED SUPPLY AND DEMAND IS SNOWBALLING INTO CIVIL TURMOIL IN 14 COUNTRIES. THE WHEAT CRISIS AFFECTS ECONOMIC GROWTH, SOCIAL PROGRESS, AND POLITICAL SECURITY AROUND THE WORLD. Washington Post. 2008, April 27. “The New Economics of Hunger: a brutal convergence of events has hit an unprepared global market, and grain prices are sky high. The world’s poor suffer most.” Anthony Faiola.
The food price shock now roiling world markets is destabilizing governments, igniting street riots and threatening to send a
new wave of hunger rippling through the world's poorest nations. It is outpacing even the Soviet grain emergency of 1972-75, when world food prices rose 78 percent. By comparison, from the beginning of 2005 to early 2008, prices leapt 80 percent, according to the United Nations' Food and Agriculture Organization. Much of the increase is being absorbed by middle men -- distributors, processors, even governments -- but consumers worldwide are still feeling the pinch. The convergence of events has thrown world food supply and demand out of whack and snowballed into

civil turmoil. After hungry mobs and violent riots beset Port-au-Prince, Haitian Prime Minister Jacques-Édouard Alexis was forced to step down this month. At least 14 countries have been racked by food-related violence. In Malaysia, Prime Minister Abdullah Ahmad Badawi is struggling for political survival after a March rebuke from voters furious over food prices. In Bangladesh, more than 20,000 factory workers protesting food prices rampaged through the streets two weeks ago, injuring at least 50 people. To quell unrest, countries including Indonesia are digging deep to boost food subsidies. The U.N.
World Food Program has warned of an alarming surge in hunger in areas as far-flung as North Korea and West Africa. The crisis, it fears, will plunge more
than 100 million of the world's poorest people deeper into poverty, forced to spend more and more of their income on skyrocketing food bills. "This

crisis could result in a cascade of others . . . and become a multidimensional problem affecting economic growth, social progress and even political security around the world," U.N. Secretary General Ban Ki-moon said. Prices for some crops -such as wheat -- have already begun to descend off their highs. As farmers rush to plant more wheat now that profit prospects have climbed, analysts predict that prices may come down as much as 30 percent in the coming months. But that would still leave a year-over-year price hike of 45 percent. Few believe prices will go back to where they were in early 2006, suggesting that the world must cope with a new reality of more expensive food.


ADI 08 Food Prices toolkit Spring

High Wheat  Famine
HIGH WHEAT PRICES THREATEN THE SURVIVAL OF 1 BILLION OF THE WORLD’S POOREST PEOPLE. Washington Post. 2008, April 27. “The New Economics of Hunger: a brutal convergence of events has hit an unprepared global market, and grain prices are sky high. The world’s poor suffer most.” Anthony Faiola.
People worldwide are coping in different ways. For the 1 billion living on less than a dollar a day, it is a matter of survival. In a mud hut on the Sahara's edge, Manthita Sou, a 43-year-old widow in the Mauritanian desert village of Maghleg, is confronting wheat prices that are up 67 percent on local markets in the past year. Her solution: stop eating bread. Instead, she has downgraded to cheaper foods, such as sorghum, a dark grain widely consumed by the world's poorest people. But sorghum has jumped 20 percent in the past 12 months. Living on the 50 cents a day she earns weaving textiles to support a family of three, her answer has been to cut out breakfast, drink tea for lunch and ration a small serving of soupy sorghum meal for family dinners. "I don't know how long we can survive like this," she said.


ADI 08 Food Prices toolkit Spring

High Wheat kills economy
Rising wheat prices hurt the economy Steffy 08’ Houston Chronicle (
Wheat is acting like the new oil. On Wednesday, contracts for May delivery reached a record of $13.50 on the Chicago Board of Trade. Though prices retreated at week's end, the world's pre-eminent grain rose more than 25 percent last month, the biggest such increase since 1973, according to Bloomberg News. Like oil, wheat prices are being driven by global demand, a shortage of supply and a weak dollar. Call it flaxen gold. Also like oil, higher prices for wheat and other edible commodities can rattle our already shaky economy.


ADI 08 Food Prices toolkit Spring

Wheat shortage temporary
Wheat shortages are temporary and have no long term impact
The New York Times 08’ In Price and Supply, Wheat Is the Unstable Staple By DAVID STREITFELD Published: February 13, 2008 ( Few farmers have enough wheat on hand to take advantage of the recent increases, the trader said. Most sold last fall for prices that seemed good at the time. The United States Department of Agriculture’s 10-year forecast, released Tuesday, sees the wheat shortage as temporary. Stockpiles were predicted to fall this year to 312 million bushels, from 456 million bushels, before rebounding to about 700 million bushels by the end of the decade. Higher prices “will encourage additional acreage and production,” the report said. Wheat plantings will rise to 65 million acres in the 2008-9 season, from 60.4 million this year, the Agriculture Department said, though it predicted the number would then fall because of competition from other crops.


ADI 08 Food Prices toolkit Spring

Rice Prices low now
Rice prices are controlled by dollar prices due to a speculator hedging strategy The Associated Press, June 12, 2008,
NEW YORK (AP) - Rice

futures fell Thursday as a stronger dollar encouraged selling from investors who bought commodities as a hedge against inflation. The dollar ticked higher against the 15-nation euro Thursday after the Commerce Department reported a jump in retail sales, boosted by tax rebate checks. The euro fell to $1.5452, down from $1.5571 in New York late Wednesday. A stronger dollar typically leads investors to sell commodities, which are viewed as hedges against inflation. A rising greenback aslso makes dollar-denominated commodities more expensive for overseas buyers. Rough rice futures for
September delivery fell 6.5 cents to $18.69 per 100 pounds on the Chicago Board of Trade, after earlier falling as low as $18.55.

Rice futures are Stable With a mixed ending for the month of July Commodity Online, 2008-07-10,
NEW YORK: Chicago Board of Trade wheat futures sagged on expectations for a bearish increase in US carryout and production, with the markets keeping an eye on weak corn futures. However, Rice futures ended mixed on the CBOT, with July higher but all other contracts lower on speculative selling. CBOT September wheat shed 10.75c to $8.2575 per bushel. Kansas City Board of Trade September wheat dropped 8.75c to $8.5250, and Minneapolis Grain Exchange September wheat slipped 2c to $8.83. July rice, which is trading without limits because it is in delivery,

was up 62c at $20.31 per hundredweight. September rice was down 16c to $17.91, and November rice was down 18c to $18.19.

Regardless of speculation, Rice prices will fall due to a good harvest
Dhaka July 22, 2008 The New Nation : Bangladeshs Independent News Source

Rice price in the international market is bound to fall in the wake of a good harvest, said economist and BRAC Executive Director Dr Mahabub Hossain. He told BSS that as only seven per cent of the total global output goes into the international market the high prices caused by speculation by one or two countries should be difficult to sustain particularly in the wake of a good harvest in the last season.


ADI 08 Food Prices toolkit Spring

Rice Price low now
Rice prices poised to fall more due to an increase of Vietnamese rice on the world market

Rice prices are expected to fall next month as the second June-July crops from Thailand and Vietnam are har_dhvested and brought to market, warn traders. Baht weakness could also add pressure to prices, said Chookiat Ophaswongse, president of the Rice Exporters Association. The Thai government is predicting a harvest of 7.6 million tonnes of paddy rice from the June-July crop this year, compared with only four million tonnes last year. Vietnam is also looking at
higher-than-expected output this year, allowing it to export as much as 4.5 million tonnes, in line with its shipments in 2007. With such a large flood of rice expected next month and demand drying up, traders expect prices of the staple could fall to $700 a tonne in Thailand, the level at which the government has pledged to step in and buy from farmers. Rather than sell at a loss, Thai exporters or the government are likely to build up massive stockpiles of milled rice, which can last in silos for up to five years, experts say. Malaysia bought 200,000 tonnes of Thai rice in May, but its Agriculture Minister said on Monday talks to buy another 300,000 tonnes had been put on hold since Kuala Lumpur's stocks had doubled to 180,000 tonnes. Last week, the Philippines, the world's biggest buyer,

''Foreign market activities are now a bit quiet. Buyers are holding their orders back as they expect prices to fall further next month due to increasing supply,'' said Mr Chookiat. He forecast that rice prices should fall further after Vietnam cut its minimum price for shipments by 2.5% to $780
also signalled it had completed its purchases for the year with a deal for 600,000 tonnes struck with Vietnam. per tonne from last week's $800 due to slowing export demand. The cut came shortly after Hanoi lifted an export ban on rice this month.

Rice Wholesale Prices are Down, which will lower rice retail prices Malaysian national news agency (Bernama), August 01, 2008, The price of several grades of imported rice has gone down between nine and 25 percent from Friday. Padi Beras Nasional Berhad (Bernas) managing director Bakry Hamzah in a statement today, said the wholesale price of Thai white rice with 5 percent broken grains and Vietnamese rice (5 percent) was now fixed at RM2,400 per tonne compared to RM3,200 previously. He said the price of Thai glutinous rice (10 percent) was now at RM2,600 per
tonne from RM3,000 previously, and Thai Hom Mali white rice AAA grade at RM3,550 per tonne from RM4,000. Thai Hom Mali grade A rice is now selling at

According to Bakry, the wholesale prices of the various grades of rice were reduced following the fall by 25 percent in the world market price of white rice. Recently, Bernas announced the reduction in the price of fragrant white rice and glutinous rice by 15 percent and 12 percent respectively, besides the price of other grades of rice following changes in the world market price. Bakry said the reduced wholesale prices of rice were expected to also bring down the retail prices. "The price stability will also encourage local rice millers to
RM3,450 per tonne compared to RM3,900 before, and Pakistan basmathi PK-385 and D98 at RM5,000 per tonne from RM5,500 previously. produce Super Special grade local rice (5 percent) and help ensure sufficient supply of this grade of rice in the market," he added in the statement.


ADI 08 Food Prices toolkit Spring

Rice Price low now

Rice prices are controlled by Dollar exchange rates NOT Speculators, a strengthening dollar will lead to a drop in rice prices. Steve H. Hanke, June 2008, Globe Asia, .Steve H. Hanke is a Professor of Applied Economics at The Johns Hopkins University in Baltimore and a Senior Fellow at the Cato Institute. From the Middle Ages onwards, the fear of deficient harvests in England and France immediately produced pamphlets attacking hoarders and speculators for driving up prices. ….. With rice prices soaring, the public's ire about speculators has risen – just as it did in the days of old. No current-day politicians have matched Vladimir Ilyich Lenin, who told the Petrograd Soviet that "until we apply terror to speculators – shooting on the spot – we won't get anywhere." That said, India's government has taken to shuttering commodity futures exchanges to protect the public from the sky-high prices caused by speculators. Interestingly, many commodities whose prices have surged such as tungsten and cobalt are closely held and don't trade on futures exchanges. Never mind. As Condorcet, Turgot and Smith might have said, what nonsense. If it's not the speculators, then what is causing rice prices to surge? The rice price problem (and that of other commodities) is largely a dollar problem. The fall in the dollar relative to gold has forced a massive increase in the world price of rice and other commodities. David Ranson and I have constructed the accompanying chart that illustrates the way that the price of rice responds to changes in the price of gold. The monthly history of the gold price for the past six decades is divided into three categories, according to the degree of the gold price change in the initial month. The evolution of the price of rice over the following year is then plotted. It's clear that changes in the dollar's price have accounted for the lion's share of the changes in rice prices historically. Today is no different. It's time to stop blaming the speculators and start pointing a finger at the weak dollar Speculators have no effect on the Rice Market, Rice price surges are controlled only by Government actions STEVE H. HANKE and DAVID RANSON, June 10, 2008, WALL STREET JOURNAL ASIA, Steve H. Hanke is a Professor of Applied Economics at The Johns Hopkins University in Baltimore and a Senior Fellow at the Cato Institute., Politicians have been quick to blame private speculators and hoarders for sky-high rice prices but, as usual, the wrong culprits have been fingered. The most recent rice-price spike resulted from government actions. A host of countries – including China, India, Egypt and Vietnam – imposed restrictions and bans on exports. These restrictions promised to further dry up what was already an anemic international trade in rice. Add to this the desire of other governments – including Malaysia and the Philippines, the world's largest rice importer – to bulk up their stockpiles in the face of food security concerns and you have a deadly one-two punch: restricted supply and burgeoning demand. It's no surprise rice prices surged.


ADI 08 Food Prices toolkit Spring

Rice Price DA
Rice prices are currently stable, even though they’re holding at dangerously high levels. Press Information Bureau 08 ( July 30th, “Wheat and Sugar Prices Generally Stable Last Week OTHER FOOD
13:13 IST Retail

prices of farm commodities monitored by the Department of Consumer Affairs at different locations have generally remained steady or shown mixed trend over the week ending July 25, 2008. Prices of wheat
remained steady at all reporting centers except an increase at Lucknow. Prices of sugar remained steady at all the reporting centers except for an increase at Delhi and Mumbai and decrease at Bhubaneshwar and Bangalore. Prices of gram dal remained steady at all the reporting centers except for an increase at Delhi, Bhubaneshwar, Guwahati and Chennai and decrease at Mumbai and Thiruvanthapuram. Prices of tur dal remained steady at all reporting centers except for an increase at Lucknow, Bhubaneshwar, Bangalore, Chennai and Thiruvananthapuram and decreased at Delhi and Mumbai. In Delhi, prices

of rice,

sugar, and groundnut oil held steady for one week. Price of vanaspati held steady for one month. Prices of wheat, atta, milk and salt
held steady during the last six months. Prices of gram dal, tur dal, tea, potato and onion increased while the price of mustard oil decreased. PSUs have contracted to import about 1.4 million tonnes of pulses of which about 1.22 million tonnes has arrived and 1.10 million tonnes has been disposed till date. The pulses being imported include urad, moong, tur and yellow peas. MP: CP: prices (30.7.2008)

U.S. Rice subsidies not only provide rice farmers in the U.S. with 75% of their annual income but actually keep the currently astronomically high price down. Ending rice subsidies would actually push global prices even higher. Griswold 06 (Daniel, “Grain Drain: The Hidden Cost of U.S. Rice Subsidies”, Nov. 16th. Daniel Griswold is the director of the
Cato Institute’s Center for Trade Policy Studies.)

Rice is the world’s most important food commodity and also the most protected and subsidized. Tariffs, tariffrate quotas, escalating barriers to processed rice, production and export subsidies, and state monopoly trading enterprises are common. Worldwide, tariffs on rice imports average 43 percent, and border protection and production subsidies

account for three-quarters of income for rice farmers in wealthier countries. The U.S. rice program is no exception. The U.S. government supports domestic rice production through tariffs on
imported rice and direct taxpayer subsidies based on production, prices, and historical acreage. Those programs make rice one of the most heavily supported commodities in the United States, with ramifications for U.S. taxpayers and consumers and rice producers abroad. Americans

pay for the rice

program three times over—as taxpayers, as consumers, and as workers. Direct taxpayer subsidies to the rice sector have
averaged $1 billion a year since 1998 and are projected to average $700 million a year through 2015. Tariffs on imported rice drive up prices for consumers, and the rice program imposes a drag on the U.S. economy generally through a misallocation of resources. Rice payments tend to be concentrated among a small number of large producers. Globally, U.S. policy drives down prices for rice by 4 to 6 percent. Those lower prices, in turn, perpetuate poverty and hardship for millions of rice farmers in developing countries, undermining our broader interests and our standing in the world. The U.S. program also leaves the United States vulnerable to challenges in the World Trade Organization. For our own national interest, the U.S. Congress and the president should work together to adopt a more marketoriented rice program in the upcoming 2007 farm bill, including repeal of tariffs and a rapid phaseout of subsidies.


ADI 08 Food Prices toolkit Spring

Rice Price DA
Higher rice prices would cause government collapse, resource wars, the starvation of millions and the imminent slaughter of entire populations through forced starvation. Axis Of Logic 08 (4/15, Bill Van Auken, “Amid mounting food crisis, governments fear revolution of the hungry” Bill Van Auken (born 1950) is a politician and activist for the Socialist Equality Party and was a presidential candidate in the U.S. election of 2004)
Last week’s meetings in Washington of the International Monetary Fund, the World Bank and the Group of Seven were convened in the shadow of the worst financial crisis since the Great Depression of the 1930s. While Wall Street’s turmoil and the deepening credit crunch dominated discussions, leaders of the global financial institutions were forced to take note of the growing global food emergency, warning of the threat of widespread hunger and already emerging political instability. The seven major capitalist powers in the G-7 (the US, Japan, Germany, Britain, France, Italy and Canada) made virtually no mention of the global food crisis, referring in only one brief reference to the risk of “high oil and commodity prices.” Instead, they focused on the stability of the financial markets, promising measures to shore up investor confidence. The IMF and World Bank, however, felt compelled to acknowledge the emerging worldwide catastrophe, in part because while these agencies are instruments of the main imperialist powers, they must posture as responsive to the needs of all countries. It would be too revealing for them to focus exclusively on the fate of major finance houses, while ignoring the fact that hundreds of millions


the planet are being threatened with starvation.

More decisive, however, is the realization that this crisis confronting the most impoverished countries and poorest sections of the world’s population is threatening to unleash a revolution of the hungry that could topple governments across large parts of the world. Even as the IMF and World Bank were meeting, the government of Haiti was forced out in a no-confidence vote passed in response to several days of demonstrations and protests against rising food prices and hunger that swept all the country’s major cities. Clashes between protesters and United Nations occupation troops left at least five people dead and scores wounded and saw crowds attempt to storm the presidential palace. Food prices in Haiti had risen on average by 40 percent in less than a year, with the cost of staples such as rice doubling. The same essential story has been repeated in country after country, from Africa to the Middle East, south Asia and Latin America. * In

Bangladesh, on Saturday, some 20,000 textile workers took to the streets to denounce soaring food prices and demand higher wages. The price of rice in the country has doubled over the past year, threatening the workers, who earn a monthly salary of just $25, with hunger. Scores were injured in clashes with police, who used
gunfire in an attempt to disperse the crowds. * In Egypt, protests by workers over food prices rocked the textile center of Mahalla al-Kobra, north of Cairo, for two days last week, with two people shot dead by security forces. Hundreds were arrested, and the government sent plainclothes police into the factories to force workers to work. Food prices in Egypt have risen by 40 percent in the past year. * Unions and shopkeepers staged a two-day general strike in the West African nation of Burkina Faso last week to protest high prices. The strikers demanded a “significant and effective” cut in the price of rice and other stables. * Several hundred demonstrators marched on parliament in Phnom Penh, Cambodia April 6 to protest food price hikes. The cost of a kilogram of rice has risen to $1 in a country where the average income is barely 50 cents a day. Police armed with cattle prods broke up the protest. * Earlier this month, in the Ivory Coast, thousands marched on the home of President Laurent Gbagbo, chanting “we are hungry” and “life is too expensive, you are going to kill us.” The country has seen food prices soar by between 30 percent and 60 percent from one week to the next. Police broke up the protest with tear gas and batons, injuring over a dozen people. Similar demonstrations, strikes and clashes have taken place in Bolivia, Peru, Mexico, Indonesia, the Philippines, Pakistan, Uzbekistan, Thailand, Yemen, Ethiopia, and throughout

The global market is dictating intolerable conditions for masses of people on every continent, provoking a worldwide eruption of class struggle. It is the concern that this struggle will spin out of control that found expression in the statements of concern issued by the IMF and World Bank leaders together with finance ministers and central bank chiefs gathered in Washington. “If food prices go on as they are today, then the consequences on the population in a large set of countries, including Africa, but not only Africa, will be terrible. Hundreds of thousands of people will be starving. Children will suffer from malnutrition, with consequences all of their lives,” Dominique Strauss-Kahn, the International Monetary Fund managing director, told an April 12 press conference in Washington. He warned that governments “will see what they have done totally destroyed and their legitimacy facing the population destroyed also.” Strauss-Kahn added: “So it’s not only a humanitarian question. It is not only an economic question. It is also a democratic question. Those kind of questions sometimes end into war.” “In just two months,” World Bank President Robert Zoellick said in an opening speech to the meeting of
most of sub-Saharan Africa. With terrifying rapidity, hundreds of millions of people all over the planet have been confronted with the inability to obtain the basic necessities of life.


finance ministers, “rice prices have skyrocketed to near historical levels, rising by around 75 percent globally and more in some markets, with more likely to come.” “In Bangladesh, a 2-kilogram bag of rice,” he said, holding up such a bag, “now consumes about half of the daily income of a poor family.” He added that wheat prices had increased by 120 percent, more than doubling the cost of a loaf of bread. “If food prices go on as they are today, then the consequences on the population in a large set of countries ... will be terrible,” said Zoellick. The “international community will also need to take urgent and concerted action in order to avoid the larger political and security implications of this growing crisis,” United Nations Secretary-General Ban Ki-moon told international finance and trade officials at a UN meeting following the weekend talks in Washington. The United Nations Special Rapporteur on the Right to Food Jean Ziegler offered among the bleakest prognoses for the continuing crisis. “We

are heading for a very long period of rioting, conflicts (and) waves of uncontrollable regional instability marked by the despair of the most vulnerable populations,” he told the French daily Liberation Monday. He pointed out that, even before the present crisis, hunger claimed the life of a child under the age of 10 every 5 seconds, and 854 million people in the world were seriously undernourished. What was now posed, Ziegler warned, is “an imminent massacre.”


ADI 08 Food Prices toolkit Spring

Rice Subsidies key to Price
Lowering Rice subsides will force farmers to switch to profitable Medicinal crops, leading to a collapse of the United States rice industry, having a ripple effect throughout the entire agricultural community Evelyn Iritani, December 04 2005, Los Angeles Times,
Chip Struckmeyer’s rice farm is a model of 21st-century efficiency. With the help of his son and a manager, he farms 485 acres of sticky clay soil, hiring planes to fly in seed at planting time and using high-tech laser equipment to level his fields. Last year, thanks to favorable weather, Struckmeyer and other California rice growers produced a record crop of high-quality short- and medium-grain rice, much of which went to Japan. But those ample supplies, plus competition from Asian suppliers, kept rice prices 30% below those of the previous year, while the cost of fuel and fertilizer soared. Even with tens of thousands

of dollars in aid from the government, the Colusa farmer figures he lost at least $100 an acre. Rice prices have risen this year, but he still doesn’t think he’ll make up last year’s losses. “Even if right now we could sell 1 million more sacks of rice, what’s the benefit if the price is below the cost of production?” asked the 57-year-old Struckmeyer, who is cutting back his rice acreage and shifting to high-value medicinal plants and herbs such as lavender, basil and rose geranium. Here in the rich Sacramento
Valley, the nation’s second-largest rice-producing region, free trade is losing its luster. Though U.S. farm exports are rising, imports are growing even faster, putting the U.S. on track to register its first trade deficit in agriculture in nearly five decades. Fifteen years ago, the U.S. had a 20% share of the global rice market. Today that has dropped to 12%. As the nation’s leading exporter of farm goods, California has a huge stake in the effort underway in the 148-member World Trade Organization to get the world’s richest countries to give up billions of dollars in farm supports in exchange for increased access to other markets. If successful, the Doha trade round could dramatically reshape global agriculture trade. Heavily protected producers in rich and poor countries would be undercut as more-efficient farmers emerge in countries such as Brazil, Argentina and parts of Southeast Asia. High-cost producers would be forced to move out of lower-paying commodity crops and into niche markets. The double-edged sword of trade liberalization can be seen in California. California farmers received $5.3 billion in subsidies from 1995 to 2004. But more than 90% of the state’s farmers grow crops such as oranges and nuts that receive almost no government aid and would benefit from market-opening measures. California citrus producers, for example, face tariffs as high as 50% in China and compete against European farmers, who receive large tax rebates and other government subsidies. “We are significantly disadvantaged at this point,” said Mike Wooten, vice president of corporate relations for Sunkist Growers Inc., a grower-owned marketing cooperative. Rice farmers aren’t happy about being

labeled big-time recipients of corporate welfare, but they don’t apologize for taking the government’s money. They say it is the only way they can survive when they face such high trade barriers in other countries and high production costs. Rice, which requires large amounts of water, fertilizer and land, costs four times as much to produce as corn or soybeans. Last year California rice farmers received $140 million in subsidies, an average of $37,089 per recipient, according to the Environmental Working Group, an
organization based in Washington that has been a chief critic of farm subsidies.


ADI 08 Food Prices toolkit Spring

Rice Subsidies key to Price
The Rice industry is dependent on federal government subsidies for its very existence – cutting subsidies to the rice industry would have a ripple effect throughout the agricultural community. Paul Schnitt Sep. 25, 2001, The Sacramento Bee (Sacramento, California) For more than 50 years, the Spanglers have farmed rice in Sutter County, brothers working side by side, growing old and yielding to sons. But there has never been a time when their silent partners have been so vital: the taxpayers. In the five years since Congress vowed to wean farmers from government subsidies, the Spanglers and their colleagues in the California rice industry have become so dependent on federal aid that they rely on taxpayer dollars for half their income. During 1999 and 2000, California farmers who produce the nation's second largest rice crop -- covering 500,000 acres in the Sacramento Valley -- harvested $480 million in federal subsidies. Much of the money went to large family farming operations that took advantage of rules designed to maximize government payments. In many rural Northern California counties, the government cash allows farmers to sustain their way of life, and be profitable, rather than sell their land to developers. Yet the subsidies, documented in records obtained by The Bee under the Freedom of Information Act, come with a price. Not only does the money make farmers dependent on government funding, it undercuts the classic notion of the independent family farmer as the mainstay of the rice economy. "Farmers like to think they are independent. Not really," said Arnold Hoffart, who, along with brothers Neil and Mark, grows rice on 1,600 acres near Yuba City. The Hoffarts, operating as Triple H
Ranches, received $1,250,124.64 in government subsidies over the last two years. They were among 19 Sacramento Valley rice farming operations -- mainly extended family partnerships -- that received more than $1 million in taxpayer assistance in that two-year period. An additional 93 received subsidies between $500,000 and $1 million. Dan Spangler acknowledges that the portion of his income from the government is probably the highest in history, as Congress approved multibillion- dollar bailouts the past four years for several farm commodities. The government subsidies of $480 million to the state's rice farmers nearly matched the $485 million market

"It's a bittersweet situation," Spangler said. "Try growing rice without being in the (federal) program." Gary Spangler, a partner and cousin, has a blunt response. "The reality is, we need that government payment,"
value of the crop for 1999 and 2000.


ADI 08 Food Prices toolkit Spring

High Prices hurt Rice Producers
Even as international rice producers should be rejoicing over high prices, they’re suffering under high production prices and are unable to produce enough to provide stability to the rice market. International Herald Tribune 08 (April 7, Thomas Fuller, “High rice prices no windfall for many Asian farmers”

should be happy times in the radiant green rice paddies that Pomchan Luanguanna has spent more than price of his crop is soaring faster and higher than anyone can remember, and local newspapers are comparing rice, once a relatively inexpensive and neglected commodity, to gold sprouting from the black soil. But Pomchan, like many small farmers across Asia, [are] not rejoicing. His extended family eats more or less all the
three decades tilling: The rice he harvests from his small plot. His neighbors are worse off: They put down their tools when the prices of gasoline, fertilizer and pesticides soared. "Their fields are empty," Pomchan said. In the sprawling, high-tech farms of the United States, the oil fields of Saudi Arabia and the coal mines of Australia, farmers, drillers and miners are rubbing their hands in anticipation of a continued windfall from the boom in commodity prices. But for many rice farmers in Asia, the commodity they produce ends up as food in their stomachs, not cash in their bank accounts. Multimedia Graphic » View Related Articles Rich nations seek action on rising food prices World food prices soar as Asia consumes more Today in Business with Reuters U.S. jobless rate hits 4-year high GM posts $15.5

"The assumption is that all farmers are better off when prices go up," said Robert Zeigler, director general of the International Rice Research Institute in the Philippines. "The problem is that a large proportion of rice producers in the world are actually net rice buyers - they produce less than their actual needs." Rice prices have been creeping upward since the beginning of this decade, but it was not until February that they spiked sharply. The price of Thai B grade rice, a widely traded variety, reached $795 per ton last week, an increase of 147 percent from a year earlier. "Nobody has ever seen such a jump in the price of rice," said Kwanchai Gomez, the executive director of the
billion second-quarter loss Police report says Société Générale was unaware of rogue trades Thai Rice Foundation, a research center. "Certainly not in my lifetime, and that's a long time." She is 68 years old. The price of rice, always politically sensitive in Asia, has spread anxiety among consumers who are emptying shelves of the least expensive varieties. In the Philippines, the world's largest rice importer, the government warned that anyone hoarding rice could be charged with economic sabotage, which carries a life sentence. Armed soldiers supervised the distribution of subsidized rice last week. Experts say rice prices are rising because of a mix of irrational panic, weather problems - typhoons in the Philippines, a cyclone in Bangladesh, flooding in Indonesia and Vietnam - and an overall reduction in the amount of land dedicated to rice farming. There are also strong suspicions of hoarding, something that the Thai commerce minister recently encouraged before reversing himself. Thailand, which is by far the world's largest rice exporter, has become a focal point of the global rice market as other traditional exporting countries like Vietnam and India have halted or put restrictions on their exports in recent weeks to ensure sufficient domestic supplies. But it is a measure of the relatively weak position of rice farmers that even in Thailand most farmers have not yet benefited from the increase in prices. Their farms are generally bigger and more modern than those in Laos and other remote parts of Asia, but their productivity is low. Perhaps most important, they have no way of storing their own rice. Most of them sell their crops immediately after the main harvest in November, when supply is ample and prices are usually lowest. The price of Thai white rice is 122 percent higher now than it was in November. "Are most of the farmers benefiting from this?" said Kwanchai of the Thai Rice Foundation. "I would say no." "This price rise is a problem for everyone because no one was prepared," she said. But there are winners in the rice business, and there are likely to be more if the high prices hold or rise. Commercial farmers who have access to irrigation, which in Thailand be 25 percent of the total number, can harvest as often as four times a year and thus will reap a windfall in May when their next crop is due. The biggest winners are the millers and packers, because they are able to hold onto their rice and sell at higher prices. Yet it is striking how

many people in the rice business in Thailand are complaining as the price of

rice soars.

Korbsook Iamsuri, the head of Kamolkij, a rice exporting company that controls about 5 percent of the Thai export market, said the suddenness of the upswing had caused some exporters to lose tens of thousands of dollars.


ADI 08 Food Prices toolkit Spring

Rice key to Cali Economy
California’s economy relies on the Rice industry for export and tax revenue as well as employment - a decline in rice revenue would Devestate Californias economy Daniel A. Sumner and Henrich Brunke, September 2003, Total revenue of the California rice industry was almost $500 million per year in both 2001 and 2002 (see table 1). Total
revenue was thus somewhat less than $10 per hundredweight. This is the income that supported the production costs, infrastructure and rice land prices in industry. This is also the revenue that forms the basis for the industry's contributions to the rural economies of Northern California. The cost side of the net revenue equation indicates how total industry revenue was distributed. According to the cost of production data compiled by University of California Cooperative Extension the typical cultural costs for rice, including field preparation, seeding, fertilizing, irrigation and pest control are about $380 per acre. Harvest, drying, storage, post harvest costs and interest, including straw management add another $219 per acre. Costs associated with owned or rented crop land add $225 per acre. The UC estimated the typical full costs are $944 per acre. Land was the largest single cost item and indicates the capitalized value of net future returns that growers anticipate from producing rice. Hired and family farm labor is another major cost item. Rice is particularly important in six counties of the Sacramento Valley. The top six rice-producing counties are Colusa, Butte, Sutter, Glenn, Yuba and Yolo. Together these six counties produce about 94 percent of the California total. Rice is the number one agricultural commodity measured by market value of production in Butte, Colusa, Glenn, Sutter, and Yuba counties. It is also an important crop in Yolo County and is the number 2 slightly behind processing tomatoes in total revenue, including

Rice production does not simply add rice revenue to the economy. That revenue is multiplied as the economic activity of rice growers and others spreads through the local, state and national economies (see the Measure of California Agriculture, University of California Agricultural Issues Center). Additional revenue for other businesses and additional employment in rural communities follows from economic activity initiated in the rice industry. In addition, this economic activity and the added land values contribute to tax revenue that is used for rural schooling and other local
government payments. and state services. The local "multiplier" impacts indicate that about $1.60 dollars are added in county economic activity for each dollar of rice revenue in the counties of the Sacramento Valley. The impacts are larger than 1.6 in Butte, Sutter and Yolo counties where there is more non-farm business that relies on rice. The effect is largest, approaching 2.0 in Sacramento County. Employment multipliers show that each million dollars of rice revenue generates approximately 10 jobs in the local county. The largest impact is in Butte County with about 13 jobs per million dollars of rice total revenue. Overall

we can associate about 5,000 rural community jobs in the Sacramento Valley with the California rice industry. This employment is crucial in these communities, which have a relatively small economic base and higher than average unemployment rates. …. California rice also plays a major role in the national and global rice economy. California is the number-two rice state in the United States and the sole producer of high quality medium grain japonica rice favored by many consumers. Rice is a major export commodity for California and California is a major rice exporter. Buyers in Northeast Asia and the Mediterranean region rely on California rice and these markets are growing with more open trade rules. Cali key to US Economy Matthew Benjamin 10/12/03, US News
Everybody is interested in California, billionaire financier Warren Buffett said in August when asked why he agreed to advise then gubernatorial hopeful Arnold Schwarzenegger. But Buffett meant more than a morbid fascination with car chases and Hollywood glitterati. "You can't have trouble out there without it affecting the rest of the country." As usual, the Oracle of Omaha was dead on. California's economy accounts for an eighth of the U.S.

economy and is larger than the economies of all but four nations, ranking between Britain and France. Its technology, agriculture, and entertainment industries lead the nation. So when the Golden State sneezes, the national economy can easily catch a cold.


ADI 08 Food Prices toolkit Spring

Fish Price DA
The only thing keeping Fishermen from going under are subsides granted by the government, removing them would be devastating
Steven Rosenberg, March 16, 2008 ([Rosenberg is a staff member of the Boston Globe], “Senators Criticize Fishing oversight,” Boston Globe, d/l: LexisNexis)
At issue is a Feb. 8 letter written by John Oliver, acting assistant administrator for fisheries for the National Oceanic and Atmospheric Administration, the organization that oversees fishing regulations. In his letter to Paul Diodati, director of the Massachusetts Division of Marine Fisheries, Oliver recommended that just half of the $13.4 million go toward fishermen's subsidies. Oliver also recommended that 40 to 60 percent of the funds be used to buy back some of the 700 federal groundfish permits held by Massachusetts fishermen. "Capacity reduction, such as buyouts, is at the core of transitioning to a more stable fishing environment," Oliver wrote. In e-mails to the Globe, Kerry and Kennedy reiterated that the funds should go to help the ailing fishermen. "These funds should be distributed based on the needs of our fishermen, not on the dictates of NOAA bureaucrats," Kerry said. "Our fishing families are hurting, and the last thing they need is a bureaucratic mess of federal dictates and interagency squabbles. The fishermen of Massachusetts need help and they need it now." Added Kennedy, "There's no question

that our fishing industry needs immediate relief, and this federal funding is intended to do just that. I look forward to working with the fishing industry and our state officials to ensure that the funds are used to help those who were hurt by Framework 42." Framework 42 is the latest in a series of federal government regulations designed to build up depleted fishing stocks. The regulation, which took effect in November 2006, cut days at sea for Massachusetts fishermen who catch haddock, flounder, and other groundfish. A decade ago, fishermen could fish almost 100 days out of the year, but under Framework 42, they're down to 24 days a year at sea.

Good subsidies also help to maintain a healthy environment, removing them would damage the ecsystem
International collective in support of fishworks in 2005 Clearly, therefore, the overcapacity and overfishing in the fisheries of several developing countries cannot be attributed to subsidies; these occur despite lower subsidies.Rather, they are mainly related to open-access regimes and an indiscriminate response to market signals. Some people argue that there are no ’good’ subsidies. We disagree. There are ’good’subsidies and ’bad’ subsidies. Good subsidies are those that can bring about better control over the input of fishing effort and the output of fish; encourage participatory management regimes; introduce equitable property rights (which sufficiently recognize the characteristics of artisanal, small-scale fisheries); lead to effective monitoring, control and surveillance systems; relocate fishers from overcrowded inshore waters to labour-scarce fisheries or nonfishing activities; contribute to protecting fish habitats; and help build up an information base.Subsidies, needless to add, are one among
several means to an end, not an end initself. If equity and sustainability could become the ’public objective’.


ADI 08 Food Prices toolkit Spring

Cotton Price DA Link
Domestic subsidies lower the worldwide price of cotton by raising the supply. Helling, Madeline, Beaulier, Hall. High cotton: Why the USA should not Provide subsidies to cotton farmers. Economic viewpoints. 2008.
Local revenues that could be generated by the domestic cotton industry within African states, such as Burkina Faso, could contribute to their economic development. However, America’s subsidised products undermine the economies of these countries by lowering the worldwide price. American subsidies stimulate US production of cotton, therefore increasing world supply and depressing prices. As a result, cotton farmers in developing nations find it difficult to sell their cotton for a profit.


ADI 08 Food Prices toolkit Spring

Plan Increases cotton prices
Eliminating subsidies raises cotton prices by as much as fifteen percent. Economist’s View. 2006. Cotton subsidies.
Take away subsidies and cotton prices will rise, perhaps as much as 15%. “There’s real money here for the individual African,” says Daniel Sumner, an economist and cotton expert at the University of California. ... Africans are trying to make the best out of a bad situation. In some parts of Africa, cotton growers are expanding production... In Uganda, where civil wars in the 1970’s and 1980’s devastated farming, cotton growers are making a major comeback. In Zambia, cotton output is soaring. In both countries, foreign investors are opening gins and assisting growers.

Plan causes for domestic cotton prices to skyrocket because subsidies allow farmers to receive artificially low prices. Helling, Madeline, Beaulier, Hall. High cotton: Why the USA should not Provide subsidies to cotton farmers. Economic viewpoints. 2008.
Subsidies to American cotton farmers are interfering with normal market processes; American farmers are receiving artificially high prices for their cotton, due to government subsidies, and are flooding the international market with their cotton as a result. This glut has driven the price of cotton down and has thus had a detrimental impact on countries such as Benin, Burkina Faso, Chad and Mali, whose economies rely heavily on cotton production. For example, in Burkina Faso, 85% of the population farms cotton. The cost of cotton production in Burkina Faso is onethird the cost of production in the USA, but local farmers cannot compete with the American cotton in the marketplace (Olvera and Magill, 2007). Small farmers in Burkina Faso complain that ‘they must compete against highlymechanized, well-subsidized US rivals’ and argue that ‘American subsidies serve to depress prices on world markets’ (BBC News, 2007). To get some perspective on the effect of US cotton subsidies on Burkina Faso’s economy, consider the following from the presidents of Mali and Burkina Faso:


ADI 08 Food Prices toolkit Spring

Cotton Price low now
Cotton prices continuing to decline even though production is falling. Emerging Textiles July 2008. Cotton Prices Again Down Amid Rising Pessimism. Emerging Textiles Trade Information.
Cotton prices continued last week declining amid new signs of falling global production and consumption in the next season. A rebound in other commodity markets was ignored on the U.S. cotton market while such a weakness did not trigger a recovery in physical demand, however. Indian domestic prices started declining after New Delhi eliminated tariffs and taxes on cotton imports.

Cotton prices decreasing in 2008 Don Shurley, July 2008 Cotton Marketing News, Volume 6, Number 29 On April 1, cotton was 81 cents/lb (Dec08 futures), soybeans were $11.47/bu (Nov08 futures), and corn was $5.98/bu (Sep08 futures). On May 1, cotton was 77 ½ cents, soybeans $11.93, and corn $6.27. Today, closing futures prices were roughly— cotton 73 cents, soybeans $14.50, and corn $6.00. Since April 1 and May 1, corn and soybean prices have held up with soybeans increasing. Cotton has trended downward and lost ground relative to other crops. Today’s price at 73 cents translates into 70 cents or less cash price for most producers. So, if prices remain at this level into harvest and considering the sharp increase in production costs this year, profit margins will be “thin” to say the least. I’m sure this is not exactly
what the producer had in mind back in March, April, and May when the decision was made to plant the crop.


ADI 08 Food Prices toolkit Spring

Cotton Prices high now
World Cotton Price is Projected Higher in 2008/09 Secretariat, INTERNATIONAL COTTON ADVISORY COMMITTEE, April 08
World cotton area is projected to remain relatively stable in 2008/09 at 33.8 million hectares. However, cotton

harvested area in the USA is projected to decline by a further 15% in 2008/09 as a result of surging prices for soybeans, corn, wheat and other oilseeds. Reduced cotton plantings in the USA could be offset by increases in China (Mainland), India, the African Franc Zone, Australia and Brazil, while stable area is projected for Pakistan, Turkey and
Uzbekistan. World cotton production in 2008/09 is projected at 26.9 million tons (+3%), while cotton mill use is projected to grow at a lower rate of +1% compared with 2% in 2007/08 and 7% in 2006/07, due to slower world economic growth and an increase in cotton prices relative to polyester. As a result of the gap between world production and consumption, world cotton ending stocks are projected to decline for the second season during 2008/09 to 11 million tons (-5% from 2007/08, and -13% from 2006/07). The fundamentals of cotton supply and use alone would suggest a season-average Cotlook A Index of less than 70 cents per pound in 2007/08. However, based

on trends in prices during the first eight months of 2007/08, it is obvious that prices will be higher. Increases in prices of competing crops, the increasing role of speculative activity and commodity investment funds may be affecting cotton prices in ways that are not reflected in fundamental measures of cotton supply and use. Cotton prices rising higher and higher. YNFX (/Yarns and Fibers Exchange) Cotton Price News. 31. July 2008.
Brisk trading continued in cotton market as over 5,000 lint bales were traded at higher prices on Wednesday. The KCA sources said that there had been brisk trading on Friday trading period. The prices were showing upward trend from the last few days. The price committee fully deliberated the price issue and later decided to reduce the prices by Rs 25 per maund, therefore, the prices fixed at Rs 3,900 per maund, while the official spot rates were at Rs 4,180 per 40 kg The supply of fresh phutti was slow which affected the deals. Spinners and millers were looking to grab all the unsold stock. While ginners and growers were concerned about the prices and said that they should get adequate compensation for it. They were happy after the increase in prices. On Friday, over-8000 lint bales changed hands. About 1,100 bales were from Sindh, exchanged at the rate of Rs 4,010 to 4150 per maund. While the remaining were from Punjab and changed hands in the price-range of Rs 4,150 to 4,250 per maund. Floor brokers said that the trading improved after the fears of short crop. The sources said that the trading may pick-up further as the demand had been rising while the fears about short crop have accelerated the process of procurement.

World cotton production is expected to decline due to competition from other crops. Global Industry News 2008. ICAC sees cotton prices rising in 2008/2009. Yarns and Fibers Exchange.
The International Cotton Advisory Committee (ICAC) forecasts a season-average Cotlook A Index of 79 cents per pound in 2008/09, 6 cents higher than the expected 2007/08 average. This projected price increase is due mainly to an expected decline in the stocks-to-mill use ratio in the World-less-China (Mainland), says the group. "World cotton production is projected to decline slightly in 2008/09 to 26.0 million tons. Declines in production are forecast in the United States, Brazil, and Turkey due to competition from grains and soybeans. These reductions could offset increases projected in Asia, West Africa and Australia," says ICAC.


ADI 08 Food Prices toolkit Spring

Cotton Price High now
Cotton prices rising significantly. PRlog press. 2008. Cotton prices hikes substantially, Cotlook A index rising by five cents. Free Press Release Distribution.
Acrylic staple fiber, 1.5D/38mm in China inched up by a cent to US$2.53 a kg while in Taiwan was at US$2.25 a kg. In India, the spec fell by a cent to US$2.77 a kg. 3D Mitsubishi Rayon contract price was unchanged at US$2.4 kg. Acrylonitrile prices North China inched up further by US$5 a ton to US$2,070 a ton while else where it remained constant. VFY prices in China inched up to a couple of cents for respective specs. 75D bright and dull in China local market was at US$7.45 a kg In India, prices declined by a cent across specs. 10D bright in India got quoted at US$5.93 a kg. VSF price in India declined by a cent in the week 1.2D dull was at US$3.05 while 1.5D-2.0D dull was US$2.95 a kg. 1.5D/38 mm in China was at US$3.01 whereas 1.5D in Pakistan was at US$3.05 a kg. Cotton fiber prices increased substantially across markets. Cotlook A index increased 5 cents in the week,

whereas Nymex cotton futures jumped 11 cents. China cotton index inched up by a cent. Indian cotton prices were also bullish, and standard Shankar 6 prices increased 4 cents to US$1.51 a kg.

Cotton prices at record high. The Nation Daily Newspaper. June 24, 2008. Cotton price surges to record high.
The price of high quality cotton has climbed by Rs100 to a record level of Rs4200 per maund across the country.Senior cotton trader Nasim Usman told newsmen on Tuesday the deal of 200 bales of cotton from Pak Pattan's fresh crop was finalized at Rs4200 per maund. Their delivery will be made on July 1, 2008.Increased price of 'phutti' as well as demand of cotton by textile mills had led to the rise in cotton price.

**Generic Food Price Impacts**


ADI 08 Food Prices toolkit Spring


ADI 08 Food Prices toolkit Spring

High Food prices have lead to world-wide shortages and hunger
NY Times, May 11, 2008 (“Change We Can Stomach,” New York Times, d/l: LexisNexis) COOKING, like farming, for all its down-home community spirit, is essentially a solitary craft. But lately it's feeling more like a lonely burden. Finding guilt-free food for our menus -- food that's clean, green and humane -- is about as easy as securing a housing loan. And we're suddenly paying more -- 75 percent more in the last six years -- to stock our pantries. Around the world, from Cairo to Port-au-Prince, increases in food prices have governments facing riots born of shortages and hunger. It's enough to make you want to toss in the toque.

Escalating Food Prices threaten millionswith hunger
NY Times, May 11, 2008 (“Change We Can Stomach,” New York Times, d/l: LexisNexis) Similar networks could also operate in the countries that are now experiencing food shortages. For years, the United States has flooded the world with food exports, displacing small farmers and disrupting domestic markets. As escalating food prices threaten an additional 100 million people with hunger, a new concept of humanitarian aid is required. Local farming efforts focused on conserving natural resources and biodiversity are essential to improving food security in developing countries, as a report just published by the International Assessment of Agriculture Science and Technology for Development has concluded. We must build on these tenets, providing financial and technical assistance to small farmers across the world. But regional systems will work only if there is enough small-scale farming going on to make them viable. With a less energy-intensive food system in place, we will need more muscle power devoted to food production, and more people on the farm. (The need is especially urgent when you consider that the average age of today's American farmer is over 55.) In order to move gracefully into a post-industrial agriculture economy, we also need to rethink how we educate the people who will grow our food. Land-grant universities and agricultural schools, dependent on financing from agribusiness, focus on maximum extraction from the land -- take more, sell more, waste more.

High Food Prices and resistance from the US Farm lobby are driving millions to suffer from hunger globally
NY Times, May 6, 2008 (“Food Emergency,” New York Times, d/l: LexisNexis) As soaring food prices threaten to unleash widespread hunger across Africa and other poor countries, President Bush is right to press Congress for more food assistance. He is also right to insist that some of that aid be given in cash to purchase food from local farmers. Unfortunately, the American farm lobby, which supports food aid as long as it gets the profit, is fighting any change to the system. The situation has become increasingly desperate as rising energy prices, growing world demand and government-subsidized ethanol production -- in the United States and Europe -- have driven corn prices up by 25 percent over the last year. The prices of wheat and soybeans have doubled. There have already been food riots in several countries, including Haiti, Egypt and Somalia, with fears of more to come. Beyond the emergency aid, wealthy donors also need to do a lot more to help Africa and other developing countries increase food production. That will require assistance to develop agricultural markets and aid and credit for new technologies and seeds to boost yields. Providing cash to buy food locally would help stimulate farming in the countries that need it most.


ADI 08 Food Prices toolkit Spring

Rising Food prices are hurting the world’s children, who are suffering from malnutrition
NY Times, April 14, 2008 (“To prevent malnutrition For Children’s Sake,” New York Times, d/l: LexisNexis) What should also be highlighted is the devastating effect that rising world food prices will have on the most vulnerable infants and young children. Beyond the age of exclusive breast-feeding, the quality of the food children receive is as important as the quantity. To maintain health and growth, children between 6 and 24 months old need energy furnished by grains and fats, as well as specific essential nutrients included in animal-source proteins like milk. In ''malnutrition hot spots'' like the Sahel, East Africa and South Asia, where most of the world's five million malnutrition-related deaths occur each year, poor families already struggle, and often fail, to provide their children with such varied diets. As you point out, it is critical to strengthen the World Food Program's ability to carry out general food distributions and other interventions as the global food crisis spreads. But increasing the quantity of food aid is not enough. Stemming and reversing the high rate of malnutrition-related deaths in the young should be a top priority. ''Ready to use'' nutrient-rich and dense foods and other nutritional supplements geared to the specific needs of young children can have a significant effect. Enhancing existing food aid with these supplements may increase the global cost of food aid, but if the world truly seeks to contain this growing crisis, this cannot be seen as a luxury.


ADI 08 Food Prices toolkit Spring

Famine threatens to kill millions in Africa in the next year alone. Hunger and malnutrition rates are increasing causing a public health emergency. Current Health 2006 Running on empty: the global fight against hunger is as fierce as ever; YOUR WORLD, a Weekly Reader
publication October 1, 2006
Worldwide, people of every age struggle to fill their most basic needs every day. The

United Nations notes that in recent years, world hunger rates have risen. (Hunger in this context means long-term lackof food.) After the number of hungry people fell from 959 million in1970 to 791
million in 1997, it quickly rose again. During the late 1990s, hunger rose at a rate of almost 4 million people per year. By 2002, the number had reached 852 million.

According to the United Nations, hunger levels are increasing because nations aren't investing enough in farming; much land is unsuitable for agriculture; and in many areas, the human population is growing. Wars and other conflicts can also make growing or getting food difficult, resulting in food insecurity uncertain access to safe and adequate food. Going without food is dangerous. Severe hunger and malnutrition (lack of adequate nutrients) can result in permanent brain damage, learning disabilities, and stunted growth. Without enough calories, proteins, vitamins, and minerals, the body is unable to fight illnesses such as malaria, measles, and diarrhea. The Hunger Project, an organization that works to end world hunger, estimates that 24,000 people diefrom hunger-related causes every day. "There is actually a food crisis that is looming" in developing countries, says Debbie Diederich, director of youth marketing for the relief group World Vision International. Even though enough food exists to feed the world's population, many families go without food because it's too costly. Many others just can't get to the food. "Hunger exists not because there's a lack of food or a lack of resources. Hunger exists because of the distribution of that food," says Jennifer Hecker,
organizing director of the National Student Campaign Against Hunger and Homelessness. War and conflict can displace people to remote areas with little water and land that is unsuitable for farming. Some advocates believe that governments around the globe don't spend enough on feeding the hungry or farming. Conflict and economic problems were the main causesof more than 35 percent of food emergencies between 1992 and 2003, according to the U.N. Food and

Agriculture Organization. Here are just some of the current hunger situations in Africa alone. * In Malawi, where flooding has wiped out local crops and caused afood crisis, every schoolchild eats a bowl of porridge each day at school. The prospect of food
attracts the children to school; the porridge gives them the energy they need to learn. But for many of those students, that is the only food they eat each day. * Zimbabwe has a shortage of 1.2 million tons of grain. Because people's household stocks have run low, the demand for grain on the market has

* The worst drought in a decade is hitting Kenya hard. The resulting famine has been declared a national disaster. In regions such as Mandera, the ground is covered with the
risen, and costs have sky-rocketed. Fuel and transportation problems also make the distribution of available gram more difficult. rotting bodies of animals thathave died from lack of food and water. One in three children has been declared malnourished. But experts say the drought is not the main cause of the food crisis. Because of government instability, money isn't being spent on developing land for farming. For example, in the city of Nairobi, the government has been accused of spending millions of dollars on luxury vehicles. Meanwhile, the country is appealing todonors for $225 million to help an estimated 3.5 million people in need of immediate aid. One New Zealand food manufacturer is reported to have offered canned dog food for the people. The Kenyan government turned down the donation. * In Sudan, government conflict with rebels has uprooted whole communities. At press time, about 500,000 people lived in refugee camps in the region of West Darfur. Ongoing violence there has made it difficult for relief organizations to provide food for the people. * Land mines in Angola keep farmers from returning to their land for harvesting. * In Burkina Faso, 20 percent of families have had to abandon farming because of deaths from AIDS, according to the BBC.

The impact on children is particularly harsh. The United Nations notes that if hunger statistics remain constant, more than 5 million children worldwide will die each year from complications of starvation.

Complacency in the face of famine is murder, there is more than enough food to feed every hungry person. Africa News, June 30 2007 “Africa: Food for 12 billion. So why did 854 million go without?” accessed July 2, 2007 SS

you are suffering from over-consumption, I am suffering from under-consumption. We need to strike a balance," said Mary Wahu Kaara from the Kenya Debt Relief Network with reference to the North and the South. Her words were echoed by Hilkka Pietila, honorary president of the World Federation of United Nations Associations: "We are wasting food in the North. We are eating too much, burning grain as fuel, and growing grain to feed pigs to slaughter for ham." Their contributions were part of a heated debate
over the past two days about the eradication of hunger, this at the Civil Society Development Forum. The three-day meeting is being hosted by the Conference of Non-governmental Organisations in Consultative Relationship with the United Nations (CONGO) and the United Nations Millennium Campaign. It ends Saturday. Jean Ziegler, U.N. special rapporteur on the right to food, alerted the more than 500 delegates that while 854 million people went without food

in the world last year, enough food was produced to feed 12 billion people. "This is why a child that dies from famine is murder," Ziegler said.

ADI 08 Food Prices toolkit Spring

Millions are dying right now due to hunger.

What if your child were starving? One

[James, World Food Program, 2007, Millions still starve in a world of plenty, Ottawa Citizen]

child dies every five seconds of hunger and related diseases. You have no doubt run across these sad statistics before, perhaps in a television appeal or a news article. Frankly, they are hard to get your mind around and,
worse yet, a bit paralysing. It's difficult to imagine all that loss of innocent life, and who would want to? But if you had the opportunity, as I have, to see some of these young children, to hold them in your arms and look into the eyes of their pleading mothers, the statistics become far too real. And they haunt you. They have troubled me now for the five years I have spent as head of the World Food Program. WFP delivers food aid to poor families that saves millions of children's lives -- and the lives of those left hungry by war in Darfur, AIDS in southern Africa, and natural disasters such as the Indian Ocean tsunami. On

average WFP feeds more than 90 million malnourished people, but it is not yet enough to have a real impact on the cold statistics of child mortality. I recall all too vividly the first time I held a dying child in Africa. First, there was an incredible sorrow, and then quickly
after, a deep shame. How could we -- how could I -- let this happen? The child's face was blank, but somehow I still saw a plea in it. I certainly saw a plea in the face of his mother, who I know thought that somehow I could miraculously help. I couldn't. It was already too late, and the local doctor from Medecins sans Frontieres said the child had at best a few weeks to live. How is this still happening in 2007? We are so rich in the United States, Canada, Europe and Japan that we watch sports and soap operas on expensive little cellphones and the value of the food we throw away far exceeds what it would cost to feed all the world's orphans and refugees. Do I sound like I am pushing some global welfare scheme? I am not. I am a proud Republican, an ardent capitalist and probably a touch more traditional than most. And because I am all those things, I am really puzzled, frustrated and ashamed that we tolerate hunger and malnutrition on the scale it still exists today. We so clearly have the capacity to end it. We North Americans worry sometimes obsessively

about the health impact of eating too much, but according to the World Health Organization, hunger and malnutrition are still the biggest threat to health worldwide and they claim more lives than AIDS, malaria and tuberculosis combined. It is pretty amazing that with all our technology, the world's biggest killer remains what it was when we slept in caves. So why aren't we getting the traction we need to do something about it? In part, I suspect that on some level many people in the West do not really
believe hunger is as lethal as we know it is. Yes, hunger exists in North America, too, but it is a different hunger and largely the product of local failures in quite well-funded social welfare systems. While there are 852 million people who are chronically hungry worldwide, global food

aid -- from all donors -- is barely one-10th of the size of domestic nutrition efforts in the U.S. And most global aid is concentrated on emergencies such as Afghanistan and Darfur, not on the low-grade hunger that is ruining the lives of 400 million children. So not only are we not doing enough, we are concentrating our resources predominantly on emergencies that make the evening
news. I have often thought a hungry child in the middle of a war or a huge natural disaster was somehow better off than one living in a developing country at peace and quietly struggling to better itself. Sadly, all of us seem to pay far more attention to the former than the latter. The issue is not so much a lack of generosity by donors as perhaps mistaken priorities. Official Development Assistance has broken through to an all-time high of more than $100 billion and globally poverty dropped by an extraordinary 20 per cent in the 1990s, largely due to economic growth in China, India and other parts of Asia. The AIDS pandemic and the Indian Ocean tsunami elicited an unprecedented outpouring of private aid and foundations such as Gates, Ford and Lilly are having a greater impact than ever before. But despite all this we are seeing the creation of a permanent underclass of extremely poor people

who are severely malnourished, and the numbers of starving are growing. It is not clear to me that the donor or academic communities have fully grasped the incredible impact of good nutrition in global development.


ADI 08 Food Prices toolkit Spring

Famine – Deontology
There is no moral difference between allowing a child to starve and killing that child. A vote negative is a death knell for millions

SINGER 1972 [Peter, Ira W. DeCamp Professor of Bioethics at Princeton University, and laureate professor at the Centre for
Applied Philosophy and Public Ethics, University of Melbourne. Famine, Affluence, and Morality, Philosophy and Public Affairs, vol. 1, no. 1 (Spring 1972), pp. 229-243 [revised edition]] These are the essential facts about the present situation in Bengal. So far as it concerns us here, there is nothing unique about this situation except its magnitude. The Bengal emergency is just the latest and most acute of a series of major emergencies in various parts of the world, arising both from natural and from manmade causes. There are also many parts of the world in which people die from malnutrition and lack of food independent of any special emergency. I take Bengal as my example only because it is the present concern, and
because the size of the problem has ensured that it has been given adequate publicity. Neither individuals nor governments can claim to be unaware of what is happening there. What are the moral implications of a situation like this? In what follows, I shall argue that the way people in relatively affluent countries react to a situation like that in Bengal cannot be justified; indeed, the whole way we look at moral issues - our moral conceptual scheme - needs to be altered, and with it, the way of life that has come to be taken for granted in our society. In arguing for this conclusion I will not, of course, claim to be morally neutral. I shall, however, try to argue for the moral position that I take, so that anyone who accepts certain assumptions, to be made explicit, will, I hope, accept my conclusion. I begin with the assumption that suffering and death from lack of food, shelter, and medical care are bad. I think most people will agree about this, although one may reach the same view by different routes. I shall not argue for this view. People can hold all sorts of eccentric positions, and perhaps from some of them it would not follow that death by starvation is in itself bad. It is difficult, perhaps impossible, to refute such positions, and so for brevity I will henceforth take this assumption as accepted. Those who disagree need read no further. My next point is this: if it is in our power to prevent something

bad from happening, without thereby sacrificing anything of comparable moral importance, we ought, morally, to do it. By "without sacrificing anything of comparable moral importance" I mean without causing anything else comparably bad to happen, or doing something that is wrong in itself, or failing to promote some moral good, comparable in significance to the bad thing that we can
prevent. This principle seems almost as uncontroversial as the last one. It requires us only to prevent what is bad, and to promote what is good, and it requires this of us only when we can do it without sacrificing anything that is, from the moral point of view, comparably important. I could even, as far as the application of my argument to the Bengal emergency is concerned, qualify the point so as to make it: if it is in our power to prevent something very bad from happening, without thereby sacrificing anything morally significant, we ought, morally, to do it. An application of this principle would be as follows: if I am walking past a shallow pond and see a child drowning in it, I ought to wade in and pull the child out. This will mean getting my clothes muddy, but this is insignificant, while the death of the child would presumably be a very bad thing. The uncontroversial appearance of the principle just stated is deceptive. If it were acted upon, even in its

qualified form, our lives, our society, and our world would be fundamentally changed. For the principle takes, firstly, no account of proximity or distance. It makes no moral difference whether the person I can help is a neighbor's child ten yards from me or a Bengali whose name I shall never know, ten thousand miles away. Secondly, the principle makes no distinction between
cases in which I am the only person who could possibly do anything and cases in which I am just one among millions in the same position.

The principle of intervening actions enhances our argument, we are not responsible for the trivial probabilistic effects of their disads. Our actions to stave off famine should be evaluated for their inherent moral value.
Alan Gewirth, philosophy professor, Chicago, ABSOLUTISM AND ITS CONSEQUENTIALIST CRITICS, 1994, p. 38. An example of this principle may help to show its connection with the absolutist thesis. Martin Luther King, Jr. was repeatedly told that because he led demonstrations in support of civil rights, he was morally responsible for the disorders, riots, and deaths that ensued and that were shaking the American Republic to its foundations. By the principle of the intervening action, however, it was King’s opponents who were responsible because their intervention operated as the sufficient conditions of the riots and injuries. King might also have replied that the Republic would not be worth saving if the price that had to be paid was the violation of the civil rights of black
Americans. As for the rights of other Americans to peace and order, the reply would be that these rights cannot justifiably be secured at the price of the rights of blacks. It follows from the principle of the intervening action that it is not the son but rather the terrorists who are morally as well as causally responsible for the many deaths that do or may ensue on his refusal to torture his mother to death. The important point is not that he lets these persons die rather than kills them, or that he does not harm them but only fails to help them, or that he intends their deaths obliquely but not directly. The point is rather that it is only through the intervening lethal actions of the terrorists that his refusal

eventuates in many deaths. Since the moral responsibility is not the son’s, it does not affect his moral duty not to torture his mother to death, so that her correlative right remains absolute.


ADI 08 Food Prices toolkit Spring

Famine –Deontology
We must help when we can to prevent famine, it is out responsibility to do it

SINGER 1972 [Peter, Ira W. DeCamp Professor of Bioethics at Princeton University, and laureate professor at the Centre for
Applied Philosophy and Public Ethics, University of Melbourne. Famine, Affluence, and Morality, Philosophy and Public Affairs, vol. 1, no. 1 (Spring 1972), pp. 229-243 [revised edition]] It has been argued by some writers, among them Sidgwick and Urmson, that we need to have a basic moral code which is not too far beyond the capacities of the ordinary man, for otherwise there will be a general breakdown of compliance with the moral code. Crudely stated, this argument suggests that if we tell people that they ought to refrain from murder and give everything they do not really need
to famine relief, they will do neither, whereas if we tell them that they ought to refrain from murder and that it is good to give to famine relief but not wrong not to do so, they will at least refrain from murder. The issue here is: Where should we draw the line between conduct that is required and conduct that is good although not required, so as to get the best possible result? This would seem to be an empirical question, although a very difficult one. One objection to the Sidgwick-Urmson line of argument is that it takes insufficient account of the effect that moral standards can have on the decisions we make. Given a

society in which a wealthy man who gives 5 percent of his income to famine relief is regarded as most generous, it is not surprising that a proposal that we all ought to give away half our incomes will be thought to be absurdly unrealistic. In a
society which held that no man should have more than enough while others have less than they need, such a proposal might seem narrow-minded. What it is possible for a man to do and what he is likely to do are both, I think, very greatly influenced by what people around him are doing and expecting him to do. In any case, the possibility that by spreading the idea that we ought to be doing very much more than we are to relieve famine we shall bring about a general breakdown of moral behavior seems remote. If the stakes are an end to widespread starvation, it is worth the risk. Finally, it should be emphasized that these considerations are relevant only to the issue of what we should require from others, and not to what we ourselves ought to do. The second objection to

my attack on the present distinction between duty and charity is one which has from time to time been made against utilitarianism. It follows from some forms of utilitarian theory that we all ought, morally, to be working full time to increase the balance of happiness over
misery. The position I have taken here would not lead to this conclusion in all circumstances, for if there were no bad occurrences that we could prevent without sacrificing something of comparable moral importance, my argument would have no application. Given the present conditions in many

parts of the world, however, it does follow from my argument that we ought, morally, to be working full time to relieve great suffering of the sort that occurs as a result of famine or other disasters. Of course, mitigating circumstances can be adduced - for instance, that if we wear ourselves out through overwork, we shall be less effective than we would otherwise have been. Nevertheless, when all considerations of this sort have been taken into account, the conclusion remains: we ought to be preventing
as much suffering as we can without sacrificing something else of comparable moral importance. This conclusion is one which we may be reluctant to face. I cannot see, though, why it should be regarded as a criticism of the position for which I have argued, rather than a criticism of our ordinary standards of behavior. Since most people are self-interested to some degree, very few of us are likely to do everything that we ought to do. It would, however, hardly be honest to take this as evidence that it is not the case that we ought to do it. It may still be thought that my conclusions are so wildly out of

line with what everyone else thinks and has always thought that there must be something wrong with the argument somewhere. In order to show that my conclusions, while certainly contrary to contemporary Western moral standards, would not have seemed so
extraordinary at other times and in other places, I would like to quote a passage from a writer not normally thought of as a way-out radical, Thomas Aquinas. Now, according to the natural order instituted by divine providence, material goods are provided for the satisfaction of human needs. Therefore the

division and appropriation of property, which proceeds from human law, must not hinder the satisfaction of man's necessity from such goods. Equally, whatever a man has in superabundance is owed, of natural right, to the poor for their sustenance. So Ambrosius says, and it is also to be found in the Decretum Gratiani: "The bread which you withhold belongs
to the hungry; the clothing you shut away, to the naked; and the money you bury in the earth is the redemption and freedom of the penniless." [4] I now want to consider a number of points, more practical than philosophical, which are relevant to the application of the moral conclusion we have reached. These points challenge not the idea that we ought to be doing all we can to prevent starvation, but the idea that giving away a great deal of money is the best means to this end.


ADI 08 Food Prices toolkit Spring

Famine - Deontology
We have a moral obligation to stop hunger wherever it is needed. MORRIS, Executive Director of the World Food Programme, June 30th 2005 (James T, Statement to the Executive Director of the Security Council)
The United Nations has a Special Rapporteur on the Right to Food, Jean Ziegler. In some ways, he and I could not be more different in our political and economic outlooks -- he is a leading Swiss socialist and I am a confirmed American capitalist. We do not see the world through the same lens, but on one

point we could not agree more: vulnerable, hungry people -- especially women and children -- have a right to food. And we agree that food should never be a weapon in war, or an instrument of diplomatic coercion. The most eloquent affirmation of this principle came from President Ronald Reagan when he approved US aid to Ethiopia in 1985 during the great famine there, despite his strong antipathy toward the Mengistu Communist regime. He put it quite simply: "A hungry child knows no politics." Whatever a government's perceived sins or the level of popular indignation, we cannot withhold aid as a political tactic in an emergency.

Food is a basic human right that we have the resources to uphold. BARRET, Professor of Applied Economics at Cornell, AND MAXWELL, Deputy regional director for CASE International, 2005 [Christopher, Co-Director of the African Food Security and Natural Resources Management program at Cornell and editor of
the American Journal of Agricultural Economics. Food Aid After Fifty Years: Recasting its Role, Routledge, pg. 112]

Numerous authors note that the interest in human rights – and particularly the right to food – increasingly dominates humanitarian and development debates. Never has there been a time when the capacity to end global hunger has been greater, yet significant gaps remain between rights and reality. While the global community is adequately providing access to food for 1.5 billion more people than it was able to feed twenty years ago, and as obesity problems associated with excess food consumption become widespread health concerns not only in the high-income countries but in middle- and lower-income countries as well, more than 800 million people remain chronically undernourished and hungry. This undernutrition problem is overwhelmingly concentrated in South Asia and Sub-Saharan Africa, though pockets of hunger and malnutrition remain in all countries, western industrialized societies as well.13 In 1999, the United Nations Committee on Economic, Social and Cultural Rights clarified the right to food when it attached a "general comment" on this right to the ICESCR. General Comment No. 12 defines this right as "having physical and economic access to food of adequate quality and quantity, and having the means to obtain it, including access to food via means of production or Procurement." Access should be sustainable and protect human dignity. The right to food is generally understood to constitute a claim of the individual vis-a-vis the state in which s/he resides, and generates individual entitlements and related obligations potentially enforceable in courts of law. This underlines the difference between needs and rights – rights imply an obligation on behalf of other parties that needs do not.


ADI 08 Food Prices toolkit Spring

Africa War
Food insecurity causes conflict and civil wars in Africa.
Ellen Messer Fellow at the Woodrow Wilson International Center for Scholars and a visiting associate professor at the School of Nutrition Science and Policy, Tufts University. She was previously director of the World Hunger Program at Brown University. Marc J. Cohen, a political scientist, is Special Assistant to the Director General at the International Food Policy Research Institute in Washington, DC. And Thomas Marchione, 2003 an anthropologist, is Nutrition Advisor at the Bureau for Humanitarian Response, U.S. Agency for International Development. CONFLICT: A CAUSE AND EFFECT OF HUNGER Earthscape.
In sum, conflict

has an enormous impact on human (food, economic, health, environmental, personal, community, and political) security (UNDP, 1994)—an impact well beyond the immediate conflicts and combatants. Food insecurity can also contribute to the outbreak of conflict. In the Horn of Africa in the 1970s, 1980s, and 1990s, droughts devastated already food-insecure, politically-oppressed populations, triggering chronic famines and civil wars. Ethiopia is a case in point: in the 1970s the failure of Emperor Haile Selaissie's government to respond to food shortages touched off his overthrow. Famines in the Sahelian nations of Upper Volta and Niger in the 1970s also triggered coups when governments proved unwilling or incapable of responding to these conditions or made only selective responses.
The international community responded to these calamitous conditions through the UN system by strengthening the FAO's Global Information and Early Warning System on Food and Agriculture (GIEWS). It also strengthened alternatives to GIEWS— such as the U.S. Famine Early Warning System (FEWS)—by establishing grain reserves and minimal food-aid obligations for donor nations. The capacities of the World Food Programme and bilateral agencies' capacities to deliver food and development assistance were also expanded. Improved early warning and response (with more technically-advanced use of geographic information systems and satellites plus onthe- ground informants) became part of a deliberate international political strategy to prevent food insecurity and prevent famine or civil disruption. And this strategy was largely successful in preventing drought-induced famines in the 1980s and 1990s. But the famine experience of Ethiopia in the 1980s demonstrated that improvements in famine early warning are not sufficient to ensure the successful prevention or

mitigation of both famines and the possibility that denial of access to food will ignite conflict.

These conflicts cause global war. Jeffrey Deutsch, 11/18/2002 Founder, Rabid Tiger Project, RABID TIGER NEWSLETTER, Vol. 2, No. 7, p.
The Rabid Tiger Project believes that a nuclear war is most likely to start in Africa. Civil wars in the Congo (the country formerly known as Zaire), Rwanda, Somalia and Sierra Leone, and domestic instability in Zimbabwe, Sudan and other countries, as well as occasional brushfire and other wars (thanks in part to "national" borders that cut across tribal ones) turn into a really nasty stew. We've got all too many rabid tigers and potential rabid tigers, who are willing to push the button rather than risk being seen as wishy-washy in the face of a mortal threat and overthrown. Geopolitically speaking, Africa is open

range. Very few countries in Africa are beholden to any particular power. South Africa is a major exception in this respect - not to mention in that she also probably already has the Bomb. Thus, outside powers can more easily find client states there than, say, in Europe where the political lines have long since been drawn, or Asia where many of the countries (China, India, Japan) are powers unto themselves and don't need any "help," thank you. Thus, an African war can attract outside involvement very quickly. Of course, a proxy war alone may not induce the Great Powers to fight each other. But an African nuclear strike can ignite a much broader conflagration, if the other powers are interested in a fight. Certainly, such a strike would in the first place have been facilitated by outside help - financial, scientific, engineering, etc. Africa is an ocean of troubled
waters, and some people love to go fishing.


ADI 08 Food Prices toolkit Spring

Africa War
Lack of food causes African instability – it forces people to cram into cities, increasing crime and governmental capabilities MORRIS, Executive Director of the World Food Programme, June 30th 2005 (James T, Statement to the Executive Director of the
Security Council)

Chronic hunger in the African countryside is a destabilizing influence that undermines political stability and security. It spurs the continuing migration of rural people into cities, where the existence of at least some basic social services -including subsidized or free food -- acts as a lure. There is a chance that as ARVs become more widely available -- undoubtedly first in urban areas -- they too will act as a magnet in rural-urban migration. Waves of AIDS orphans are fleeing the countryside and arrive in cities without any

means of economic support, often contributing to social disintegration and crime. Hungry children are far more easily recruited as child soldiers in places like northern Uganda. We need a dedicated effort through school feeding and other activities to keep these
children in rural areas and in school. Projections for urban population growth in sub-Saharan Africa are among the highest in the world with cities like Nairobi, Lagos and Lusaka experiencing growth rates of over 6 percent per annum. The impact of rural urban migration on employment in Africa has been precisely the opposite of Western Europe and the United States -- it has led to higher rather than lower rates of unemployment and social instability. At a certain point

the capacities of municipal governments are stretched to the limit and social demands are not met, aggravating internal political and social tensions, especially among competing ethnic groups perhaps not accustomed to sharing the same political space. There is little concerted investment to encourage Africans to remain in the countryside. African Governments and
international donors have neglected investment in agriculture which aggravates the problem of poverty. In countries like Uganda and Kenya, for example, over 80 percent of the poorest people are rural. Yet if you look at ODA statistics, the percentage of funding devoted to agriculture has dropped from 12 percent in the early 1980s to a mere 4 percent today. The current terms of trade for the continent's agricultural products are also poor, further undermining rural economies. This, by the way, makes progress in the Doha Round on dismantling subsidies and other trade distorting practices critical for rural Africans. Competition for limited food resources can ignite violence and instability. The fact that African agriculture is still so dependent on rainfall and there

are comparatively large pastoral populations contributes to population movements that can also incite conflict. The violence in Darfur, for example, has reduced the movements of nomads and led to overgrazing in areas with insufficient water, and the result has been drought-like conditions. We have seen this problem for decades not just in Sudan, but in Mauritania, Senegal and other countries as well. When families can neither plant nor market livestock products, they begin to move. The economy in North Darfur is now in shambles. Most markets are closed, fighting has reduced cultivation, and cereal prices have skyrocketed.

Lack of food in Africa exacerbates refugee crises. Morris, Executive Director of the World Food Programme, June 30th 2005 (James T, Statement to the Executive Director of the
Security Council)
The continuing presence of large numbers of IDPs and refugees is inherently a threat to both political and economic stability and the

threat of hunger presents significant complications in resettling them. It is difficult to persuade a family in Angola, for example, to return to their home village if they do not have sufficient food tide them over to the next harvest. WFP invests
heavily -- when we get the funding -- in repatriation packages that allow ex-combatants to feed themselves and their families while they get re-established at home.

Food aid has been a critical component in disarmament, demobilization and reintegration efforts in Africa. In the last five years alone, we have targeted 800,000 combatants in Liberia, Burundi, Somalia, DR Congo, Sierra Leone, Rwanda and Angola. Just this past
week we approved a new demobilization aid package for 150,000 former army and militia combatants in the DR Congo where pressure to demobilize and disarm has grown in recent months. In the West Africa, where thousands are still displaced by over a decade of war, food aid is used to help restore social and economic sectors. As one WFP report noted, “today’s stability is fragile, and progress is impossible if people lack basics like food,

shelter, and the means to keep their families healthy.” WFP food aid is now a tool to support education, help rebuild communities and give
people the means to safeguard their own welfare.


ADI 08 Food Prices toolkit Spring

Resource Wars
Food prices kept at current levels for the long-term lead to massive resource wars. D-Day 08 (April 9, 2008 Wednesday 3:40 PM EST “World Food Crisis Update”, Lexisnexis accessed 7/29/08)
Apr. 9, 2008 (D-Day delivered by Newstex) -- Last week I tried to call some attention to the looming world food crisis that is resulting from soaring prices on staples like rice and wheat. This week we've seen a continuation of that alarm as the crisis

has spread. Rice climbed to a record for a fourth day as the Philippines, the biggest importer, announced plans to buy 1 million tons and some of the world's largest exporters cut sales to ensure they can feed their own people. Rice, the staple food for half the world, rose as much as
2.9 percent to $21.60 per 100 pounds in Chicago, before paring gains. The price has doubled in the past year. Philippine President Gloria Arroyo announced two rice tenders today and pledged to crack down on hoarding. Anyone found guilty of "stealing rice from the people'' will be jailed, she said. "We're in for a tough time,'' Roland Jansen, chief executive officer of Pfaffikon, Switzerland-based Mother Earth Investments AG, said in an interview with Bloomberg Television from Zurich today. Unless

prices decline, "you will have huge problems of daily nutrition for half the planet.'' Mother Earth holds about 4 percent of its $100 million funds in the grain. This is basically a preview of the resource wars that will result if we continue to ignore the disastrous effects of climate change. Wealthy or resource-rich nations will simply pull their goods from the world market and retrench to benefit their own citizens, and as a result resource-poor nations will have little recourse. When you see wheat harvests becoming a more prized commodity than heroin harvests in Afghanistan, you know that there's a major problem out there. The impact on global security is great, as nations without access to adequate food supplies will create civil unrest and perhaps even the toppling of many regimes. And it should be of particular concern where in the world these sparks of violence and rioting would occur. Already we're seeing incidents in places like Egypt, Haiti, Ivory Coast, Cameroon (40 died in riots in February), Uzbekistan, Yemen and Indonesia. But consider that nearly half of the 160 million in Pakistan are "food insecure" and risk malnutrition and starvation from rising prices. We've seen that grinding poverty can be a magnet for extremism and fundamentalism. This is a national security crisis as well as a moral one. Another example of geopolitical concerns of world hunger is in Zimbabwe, a country with 10,000% inflation and almost totally
reliant on world food aid. In the midst of a political crisis where longtime dictator Robert Mugabe has apparently lost national elections but won't give up his position, violence has spread, in particular with respect to seizing farms. Militant ruling party supporters invaded white-owned farms Monday, a day after President Robert Mugabe urged Zimbabweans to defend seized land, fanning fears he would stage a violent crackdown to retain power [...] Invasions that began Sunday worsened with intruders entering at least 23 farms in southern Masvingo province and northern Centenary, said Trevor Gifford, president of the Commercial Farmers Union. In Masvingo where the police have been very cooperative, every time they remove invaders, within five, six hours theyre reinvading, he told The Associated Press.

Dean, 1995 (Jonathon, advisor on International Security Issues for the Union of Concerned Scientists, Bulletin of the Atomic Scientists, No. 2, Vol. 51, p. 45, March, lexis) Experts throughout the world expect growing population pressures and increasing environmental stress to develop over the coming decades into intense, far-reaching social unrest and regional conflict. Economic development is the solution, however slow and uncertain it may be in coming. But the world also needs effective regional conflict-prevention procedures. Left on its own, regional violence can lead to confrontation and even war between the great powers, including the United States, as might occur, for example, in the event of conflict between Ukraine and Russia or between China and its neighbors. In the final analysis, unchecked regional violence and the fear of further violence will lead more states to develop nuclear weapons. In past decades, this process occurred in Israel, South Africa, India, Pakistan, Iraq, and presumably, in North Korea. A world with 20 or 30 nuclear weapon states would not only make a more effective global security system impossible, it would lead the present nuclear weapon states to modernize and increase their weapons - and it would markedly increase the vulnerability of the United States to direct attack.


ADI 08 Food Prices toolkit Spring

Resource Wars
Food prices could trigger war in the world’s poorest regions and increase the severity of current conflicts Agence France Press Apr 12, 2008 WASHINGTON (AFP)
Rising food prices could have terrible consequences for the world, including the risk of war, the IMF has said, calling for action to keep inflation in check."Food prices, if they go on like they are doing today ... the consequences will be terrible," International Monetary Fund managing director Dominque Strauss-Kahn said."Hundreds of thousands of people will be starving ... (leading) to disruption of the economic environment," Strauss-Kahn told a news conference at the close of the
IMF spring meeting here.Development gains made in the past five or 10 years could be "totally destroyed," he said, warning that social unrest could even lead to war."As we know, learning from the past, those kind of questions sometimes end in war," he said. If the world wanted to avoid "these terrible consequences," then rising prices had to be tackled.Skyrocketing prices on rice, wheat, corn and other staple foods like milk particularly hurt developing nations, where the bulk of income is spent on the bare necessities for survival.Higher energy prices, too, are driving up the cost of food, as well as stoking broader inflation.In recent months, rising food costs have lead to social unrest in several countries such as Haiti and Egypt. Thirty-seven countries currently face food crises, according to the Food and Agriculture Organization.

High food prices cause massive resource wars. CBS News April 18, 2008
The head of the International Monetary Fund warned Friday that soaring world food prices can have dire consequences, such as toppling governments and even triggering wars. Dominique Strauss-Kahn told France's Europe-1 radio that the price rises that set off rioting in Haiti, Egypt and elsewhere were an "extremely serious" problem. "The planet must tackle it," he said. The IMF chief said the problem could also threaten democracies, even in countries where governments have done all they could to help the local population. Asked whether the crisis could lead to wars, Strauss-Kahn responded that it was possible. "When the tension goes above and beyond putting democracy into question, there are risks of war," he said. "History is full of wars that started because of this kind of problem." Strauss-Kahn was appointed last year to head the IMF.
He was a finance minister in the late 1990s in France. Also on Friday, French President Nicolas Sarkozy suggested a global partnership among financial institutions, governments and the private sector to tackle the reasons for rising food prices. He also said France is doubling its food aid budget this year to about $95 million because 37 countries are experiencing "serious food crises." Globally, food prices have risen 40 percent since mid-2007. The increases hit poor people hardest, as food represents as much as 60-80 percent of consumer spending in developing nations, compared to about 10-20 percent in industrialized countries, the U.N.'s Food and Agriculture Organization has said. The World Food Program blames soaring food prices on a convergence of rising energy costs, natural disasters linked to climate change, and competition for grain used to make bio-fuels like ethanol. Program spokesperson Benita Luescher told CBS News correspondent Michelle Miller, "What we're seeing is a perfect storm." Meanwhile, officials said Thursday that United Nations programs will distribute 8,000 tons of food and other help for Haitians in coming days as part of efforts to confront unrest over rising prices that set off recent rioting. U.N. spokeswoman Michele Montas said food provided by the World Food Program will focus on children, pregnant women and nursing mothers in the north, west and central regions of Haiti, the poorest nation in the Western Hemisphere. Anger over surging food prices has threatened

stability Haiti, which has long been haunted by chronic hunger. Haitian lawmakers fired Prime Minister Jacques Edouard Alexis over the rioting. Mamadou Bah, spokesman for the U.N. country team in Haiti, said the 8,000 tons are available
stock and will be distributed over the next two months starting Thursday. The U.N. Children's Fund will double its child feeding program to combat malnutrition and spend some $1.6 million on water and sanitation projects in the northwest and Artibonite regions, Montas said. Globally, food prices have risen 40 percent since mid-2007. Haiti is particularly affected because it imports nearly all of its food, including more than 80 percent of its rice. Once productive farmland has been abandoned as farmers struggle to grow crops in soil devastated by erosion, deforestation, flooding and tropical storms.

Protests and looting in Port-au-Prince left at least seven dead last week, including a Nigerian officer in the 9,000-member U.N. peacekeeping force who was pulled from a car and killed Saturday. Three Sri Lankan peacekeepers were injured by gunfire early last week. Brazilian members of the U.N. peacekeeping force distributed 14 tons of rice,
beans, sugar and cooking oil to 1,500 families in the capital's sprawling Cite Soleil slum Tuesday. The World Food Program and the U.N. mission in Haiti continue to support various projects aimed at creating jobs, Montas said. Some 2,500 Haitians are already employed by these projects which have a combined budget of $2.3 million, she said.


ADI 08 Food Prices toolkit Spring

Resource Wars
High food Prices Result in Regional Instability
Times 08’ [,8599,1717572,00.html] Add this to the list of items that could seriously threaten world peace: food. Rocketing food prices — some of which have more than doubled in two years — have sparked riots in numerous countries recently. Millions are reeling from sticker shock and governments are scrambling to staunch a fast-moving crisis before it spins out of control. From Mexico to Pakistan, protests have turned violent. Rioters tore through three cities in the West African nation of Burkina Faso last month, burning government buildings and looting stores.
Days later in Cameroon, a taxi drivers' strike over fuel prices mutated into a massive protest about food prices, leaving around 20 people dead. Similar protests exploded in Senegal and Mauritania late last year. And Indian protesters burned hundreds of food-ration stores in West Bengal last

October, accusing the owners of selling government-subsidized food on the lucrative black market. "This is a serious security issue," says Joachim von Braun, director-general of the International Food Policy Research Institute (IFPRI), in Washington. In recent weeks, he
notes, he has been bombarded by calls from officials around the world, all asking one question: How long will the crisis last?


ADI 08 Food Prices toolkit Spring

Failed States
Higher Food Prices Lead to an Increase in Failing States
Brown 07’ [Lester R. Brown 10-05-07 Earth Policy Institute MASSIVE DIVERSION OF U.S. GRAIN TO FUEL CARS IS RAISING WORLD FOOD PRICES]

The number of hungry people in the world has been declining for several decades, but in the late 1990s the trend reversed and the number began to rise. The United Nations currently lists 34 countries as needing emergency food assistance. Many of these are considered failed and failing states, including Chad, Iraq, Liberia, Haiti, and Zimbabwe. Since food aid programs typically have fixed budgets, if the price of grain doubles, food aid will be reduced by half. Urban food protests in response to rising food prices in low and middle income countries, such as Mexico, could lead to political instability that would add to the growing list of failed and failing states.

Unless food prices decline, we will see serious malnutrition in over half the world’s population, which will spark numerous conflicts and riots. Sim and Rossingh 08 (Glenys and Danielle, April 8th, “Rice Jumps to Record on Philippine Imports, Curbs on Exports”
April 8 (Bloomberg) -- Rice climbed to a record for a fourth day as the Philippines, the biggest importer, announced plans to buy 1 million tons and some of the world's largest exporters cut sales to ensure they can feed their own people. Rice, the staple food for half the world, rose as much as 2.9 percent to $21.60 per 100 pounds in Chicago, before paring gains. The price has doubled in the past year. Philippine President Gloria Arroyo announced two rice tenders today

``We're in for a tough time,'' Roland Jansen, chief executive officer of Pfaffikon, Switzerland-based Mother Earth Investments AG, said in an interview with Bloomberg Television from Zurich today. Unless prices decline, ``you will have huge problems of daily nutrition for half the planet.'' Mother Earth holds about 4 percent of its $100 million funds in the grain. China, Egypt, Vietnam and India, accounting for more than a third of global rice exports, curbed sales this year to protect domestic stockpiles. The World Bank in Washington says 33 nations from Mexico to Yemen may face ``social unrest'' after food and energy costs increased for six consecutive years. The Philippines, which imports about 15 percent of its rice, is tightening controls over domestic sales and buying more overseas.
and pledged to crack down on hoarding. Anyone found guilty of ``stealing rice from the people'' will be jailed, she said. The government's rice tenders are in April and May. ``I am leading the charge'' against any officials and businessmen who divert supplies or distort the price of the staple food, Arroyo said in a televised speech today. ``The need to avert social tensions from high food prices'' has made ``food sufficiency even more urgent,'' Abah Ofon, a soft-commodities analyst with Standard Chartered Plc, said in a report yesterday. Food importers may not be able to meet their needs because of the export limits, Dubai-based Ofon said. Philippines Imports The Philippines may raise imports of milled rice by as much as 42 percent to 2.7 million tons this year from 1.9 million tons in 2007 to discourage speculation by local traders, Agriculture Secretary Arthur Yap said March 26.

The price

of rice from Thailand, the world's biggest supplier, may climb another 25 percent this year, said exports including Vichai Sriprasert,
former president of the Thai Rice Exporters' Association. Rice seeding in the U.S. is behind last year's pace because of flooding in growing regions, the Department of Agriculture said yesterday. Farmers in six states have planted 11 percent of their crop versus 21 percent a year earlier. In Arkansas, the biggest rice-producing state, about 2 percent of the crop was seeded, compared with 21 percent. Commodity prices are posting their seventh year of gains. The UBS Bloomberg Constant Maturity Commodity Index of 26 raw materials more than tripled in the past six years as global demand led by China outpaced supplies of metals and crops. Global Inflation Rising food prices are fueling global inflation. Wholesale costs in India rose 7 percent in the week ended March 22, the fastest pace in more than three years. Soaring prices could lead to increased unrest, such as in Haiti recently, the United Nations said in a report yesterday. Four people died in two days of rioting last week over food prices in Haiti, the western hemisphere's poorest country, the organization said on its Web site. ``What we see in Haiti is what we're seeing in many of our operations around the world -- rising

prices that mean less food for

the hungry,'' the report said, citing the United Nations World Food Program's executive director Josette Sheeran.

Burkina Faso, Cameroon, Egypt, Indonesia, Ivory Coast, Mauritania, Mozambique and Senegal have also experienced unrest in the last several weeks related to food and fuel prices, according to the report. Half Portions ``We are starting to see conflict and civil unrest,'' Francisco Blanch, who heads global commodities research in London at Merrill Lynch & Co., said in an interview on Bloomberg Television today. ``Central banks will have to start taking measures to slow the inflation pain down.'' The Philippine government had asked fast-food chains and restaurants to serve half portions of rice to cut waste, farm secretary Yap said on March 19. Wheat traded in Chicago has more than tripled in three years, also threatening social stability. As many as seven people died from exhaustion or in fights while waiting in bread lines in Egypt, according to police reports. Pakistan sent troops to guard flour mills in January. Standard Chartered yesterday increased its 2008 rice forecast by 12 percent to $18.50 per 100 pounds. Rice futures for May delivery ended the day lower, dropping 52 cents, or 2.5 percent, to $20.48 per 100 pounds on the Chicago Board of Trade. The price has jumped 48 percent this year. Stockpiles are at their lowest since the 1980s and demand for the grain has gained 40 percent in two decades, Ofon said.


ADI 08 Food Prices toolkit Spring

Food Riots
HIGH FOOD PRICES ARE ALREADY CONTRIBUTING TO FOOD RIOTS, WHICH WILL INCREASE WITHOUT REFORM HOLT-GIMENEZ AND PEABODY 08 (“From Food Rebellions to Food Sovereignty: Urgent call to fix a broken food system” Posted May 16th, 2008, Eric Holt-Giménez and Loren Peabody, Executive Director, Food First/Institute for Food and Development Policy) The skyrocketing cost of food has resurrected the specter of the "food riot." The World Bank reports that global food prices rose 83% over the last three years and the FAO cites a 45% increase in their world food price index during just the past nine months. The Economist’s comparable index stands at its highest point since it was originally formulated in 1845. As of March 2008, average world wheat prices were 130% above their level a year earlier, soy prices were 87% higher, rice had climbed 74%, and maize was up 31%. Not surprisingly, people have taken to the streets in Mexico, Italy, Morocco, Mauritania, Senegal, Indonesia, Burkina Faso, Cameroon, Yemen, Egypt, and Haiti. Over 100 people have been killed and many more injured. In Haiti, the poorest country in the western hemisphere, with food prices increases of 50-100%, driving the poor to eat biscuits made of mud and vegetable oil angry protestors forced the Prime Minister out of office. The food crisis will get worse before it gets better. Without massive, immediate injections of food aid, 100 million people in the Global South will join the swelling ranks of the word’s hungry. But the protests are not simply crazed “riots” by hungry masses. Rather they are angry demonstrations against high food prices in countries that formerly had food surpluses, and where government and industry are unresponsive. They
reflect demands for food sovereignty: people’s political and economic right to determine the course of their own food systems.


ADI 08 Food Prices toolkit Spring

Food Riots
FOOD PRICES THREATEN WORLD SECURITY AND CAUSE MASSIVE HUNGER WARD 08 (The Toronto Star, April 20, 2008, “A vicious circle of misery; As the price of basic staples soars and global aid reaches the breaking point, chronic hunger will become the norm,” Olivia Ward, Toronto Star SECTION: NEWS; Pg. A09) Salvadoran President Elias Antonio Saca declares it a "perfect storm" that "might become a hurricane that could upset not only our economies but the stability of our countries." His words reflect frustration over the complex causes of the price spikes, from historic lows in food stocks aggravated by global warming to higher consumption of meat and dairy products in emerging economies, to escalating energy costs, profiteering and increased production of biofuels that feed vehicles rather than people. With food riots spreading from Haiti to Egypt, Yemen, Cameroon, Thailand, the Philippines, Uzbekistan and beyond, the link between food security and world security has never been stronger. The "six degrees of separation" between rich and poor countries are rapidly shrinking. Increasingly, the responsibility for warding off the starvation that could trigger massive global unrest falls on the shoulders of aid providers and their donors. For countries like El Salvador, where money buys 50 per cent less food than it did last year - and before the price spike, many were already spending more than half their incomes on food - aid is especially urgent. Agencies are only beginning to lengthen the list of
destitute people who are dependent on their help. "In Salvador the poor used to survive on rice, and beans, and perhaps a tortilla," says Rowe. "They would add the occasional piece of meat or chicken." Now, he says, "it's coming down to rice." And less of it. Once the fallback food of the poorest, rice is becoming unaffordable in quantities that sustain life for the most destitute. Since last January its price has leapt by 80 per cent on world markets. The humble foodstuff almost seems targeted by a malevolent agri-god. In Australia, drought has almost halted the largest rice mill in the southern hemisphere. In North Korea, a third of the crop was decimated by floods. In the Philippines, higher fuel and fertilizer costs have escalated prices so much the government staged a dramatic crackdown on rice theft. The upward surge in price may not last, experts say, but there's little chance of a return to the days of cheap and available rice supplies. "We will hit a peak, and it will drop pretty quickly, but not anywhere near $300 a tonne," Robert Zeigler, head of the Philippines-based International Rice Research Institute, told Reuters. The current price is about $1,300

As a result, donor countries and aid agencies are wrestling with some of the toughest policy decisions in recent memory. "There are short- and long-term things we can do to help," says Katarina Wahlberg,
a tonne. social and economic policy co-ordinator for New York-based Global Policy Forum. In the short term, she says, wealthy donor countries have to increase their contributions to WFP and other aid agencies. In 2007, Canada donated about $161 million of the agency's $2.9 billion budget. And, Wahlberg adds,

donors should begin to curtail domestic subsidies for producing biofuel, which dampen incentive for growing food crops. In the long term, they must take a hard look at the side effects of globalization that make the poorest countries dependent on imported food, she says.
"Small-scale farmers should be producing for local markets." The UN will focus on rising food prices when its agencies meet in Switzerland on April 28. That's three

adults should have about 2,000 calories a day to survive healthily," says Mia Vukojevic, Oxfam Canada's humanitarian co-ordinator. "If you cut back to 1,000 they will get sick. Children are especially vulnerable to malnutrition. Hunger means more illness, more medical care, more time to recover, more deaths. It's a vicious circle of misery."
days away from the WFP's deadline for launching cutbacks if its plea for support isn't heeded. "We know that


ADI 08 Food Prices toolkit Spring

Economy Impact
HIGH WORLD FOOD PRICES ENSURE A GLOBAL ECONOMIC MELTDOWN Elliot, 2008 (Larry, Journalist, “Soft Landings and Hard Realities: The IMF Thinks We Can Ride Out This Crisis, But There Could
Be Far Worse News To Come”, Guardian Weekly, April 18, Lexis)
The first is that it is far too early to say that the worst is over. Henry Paulson, who does Summers's old job at the US treasury, said he expected to see some impact from lower interest rates and tax cuts by the third quarter of this year. But that depends on the US housing market stabilising, because until it does there is a real risk of a vicious circle of foreclosures, collapsing consumer confidence, rising unemployment, bigger losses for US banks, tighter credit conditions and a falling stock market. The IMF says that risks are still heavily weighted to the downside. It produced an alternative scenario in which there would be a further tightening of credit conditions, a far bigger drop in equity and property prices than it currently expects, a gloomier assessment of the prospects for long-term productivity growth in the US, and an unwillingness on the part of foreign investors to continue buying US assets. It already believes there is a 25% risk of a global recession; under this alternative scenario it says there would be a deeper and longer period of falling growth in the US, accompanied by an extended period of weakness in the eurozone and spillover effects on the rest of the global economy through weaker trade flows and tougher credit conditions. This scenario looks just as realistic as the fund's baseline soft-landing forecast. For one thing, there is a clear disjunction between the idea that this is the biggest financial shock since the Depression and the idea that there will be only a short-lived and relatively mild impact on growth. In addition, the soft-landing thesis conveniently ignores the other headwinds facing the global economy. These include rocketing commodity prices that are contributing to a sharp rise in imported inflation, severe downward pressure on the dollar that threatens to become a disorderly plunge, the still-sizeable global imbalances that have resulted in massive trade surpluses in Asia, and massive trade deficits in the US, which have been only slightly reduced by a cheaper greenback and weaker growth. That list was supplemented last week by global hunger caused by rising

food prices. The world has suddenly woken up to what should have been blindingly obvious: trying to solve the problem of climate change by using crops for biofuel was a short-term fix with potentially lethal result. If you encourage farmers to use land that would have produced food for fuel, the price of food will go up. Gordon Brown considers this to be a serious crisis and is right to call for a global response. Yet apart from the humanitarian need to help those going hungry, rising food prices make it harder to avoid recession in the West, since they stifle consumer confidence and make policy-makers warier about cutting interest rates.

High food prices kill the global economy MARTIN FACKLER, June 15, 2008, New York Times“Surging Oil and Food Prices Threaten the World Economy, Finance
Ministers Warn “
OSAKA, Japan — The

finance ministers from the world’s richest nations warned Saturday, though they stopped short of offering concrete solutions. Finance ministers from the Group

global economy faces a one-two punch from slowing growth and soaring fuel and food prices, of

8 industrialized nations wrapped up a two-day meeting in Japan that was dominated by talk of rising petroleum prices, which have set off street protests across the world. In a statement, the ministers said higher prices of oil and other commodities threatened the world economy at a time when it was still reeling from the collapse of the housing market in the United States. The ministers urged oilrich nations to increase production to help reverse a trend that has pushed up oil prices to nearly $140 a barrel, a record. The ministers also warned that the rising cost of oil and other commodities could spur broader increases of prices and wages. The specter of fighting inflation as the ministers try to revive their flagging economies would “make our policy choices more complicated,” the statement said. The combination of inflation and low growth, known as stagflation, is difficult to escape

“For a long time, the world economy enjoyed a combination of robust growth and low inflation, but it now faces headwinds,” the statement said. “Elevated commodity prices, especially of oil and food, pose a serious challenge to stable growth worldwide.”
because steps to spur economic activity, like lowering interest rates, can also lead to price increases.


ADI 08 Food Prices toolkit Spring

Continued high food prices push Pakistan’s economy and government over the edge, especially now that Musharraf has lost power. Pakistan Newswire 08 (3/28, “World Bank says Pakistan must take immediate action to prevent its economy from collapse”,
l/n accessed 7/29)

Pakistan must take immediate action to prevent its economy from collapse, the World Bank has warned. It said painful
adjustments would be needed to prevent a crisis sparked by high oil and food prices. Under President Pervez Musharraf, the countrys economy flourished. United Nations predicts 2008 growth at 6.5 despite its political troubles. But there are fears that growth, which has been led by consumer spending, could be hit

This is not yet a crisis, but the economic picture for Pakistan is not good, said World Bank vice president Praful Patel. World Bank warned that the rising budget deficit, higher inflation, a growing current account deficit and sinking foreign exchange reserves could all threaten Pakistans economy unless the new government took urgent action. Growth can only continue if Pakistan adjusts to new global reality, which includes high prices for oil, commodities and foodstuffs such as wheat, Patel said. The
by imported inflation. comments came after Bank officials met with representatives of new Prime Minister Yusuf Gilani. Bank noted there were some positive areas in economy, as foreign investment remained strong and stock market had posted gains. World Bank said its team discussed changes in oil imports, taxation and prioritising government spending in order to lower budget deficit while protecting the poor. Subsidy programmes could include cash transfers, which were given to families affected by devastating October 2005 earthquake, to offer an appropriate safety net for poor.

South Asian conflict ensures nuclear winter
Ghulam Nabi FAI,


July 8, 2001, The Washington Times, “The most dangerous place,” p. B4 The most dangerous place on the planet is Kashmir, a disputed territory convulsed and illegally occupied for more than 53 years and sandwiched between nuclear-capable India and Pakistan. It has ignited two wars between the estranged South Asian rivals in 1948 and 1965, and a third could trigger nuclear volleys and a nuclear winter threatening the entire globe. The United States would enjoy no sanctuary. This apocalyptic vision is no idiosyncratic view. The director of central intelligence, the Defense Department, and world experts generally place Kashmir at the peak of their nuclear worries. Both India and Pakistan are racing like thoroughbreds to bolster their nuclear arsenals and advanced delivery vehicles. Their defense budgets are climbing despite widespread misery amongst their populations. Neither country has initialed the Nuclear Non-Proliferation Treaty, the Comprehensive Test Ban Treaty, or indicated an inclination to ratify an impending Fissile Material/Cut-off Convention.


ADI 08 Food Prices toolkit Spring

India Impact Module
Rising food prices is inviting an ecological catastrophe in India. Business Line 08 (May 7, OPINION GLOBAL WARMING MAY AGGRAVATE INDIA'S WHEAT WORRIES, l/n accessed
Processors and consumers are scurrying to cover their requirements and save themselves from further price increases. Relief from agricultural commodity inflation (called 'agflation') is unlikely anytime soon. Governments have recognised the threat from high food prices and have begun to take precipitate action to contain the damage. China, for instance, banned the use of grains for bio-fuels in June 2007. Russia imposed an export tax on wheat. India too has taken a series of steps to shut out exports and augment imports. As a fallout of food inflation, the

'food versus fuel' debate is becoming shriller. Should traditional foods be diverted for burning as fuel? How ethical is it to burn food when millions across the world are hungry and cannot afford high-priced food? This debate is likely to continue for a while until the market
returns to more sensible levels. Climate change and global warming have added a new dimension to the already unnerving market uncertainty. There is heightened awareness about the pernicious effects of rising average temperatures. Global warming, admittedly a slow phenomenon, can devastate agriculture. Tropical countries are at greater risk of being affected by climate change. Adaptation and mitigation strategies need to be put in place to fight global warming.

India's concerns relating to grains, in general, and wheat, in particular, are becoming more serious as time goes by. While demand continues to expand rapidly - driven by income growth, demographic pressure and changing food preferences - output has turned unsteady in the last 6- 7 years. Weather has turned suspect and water stress is becoming endemic. In frontline States such as Punjab and Haryana grain mono-cropping has resulted in deterioration of soil health. The water table has declined to alarmingly low levels. An ecological disaster is waiting to happen. The demand-supply mismatch follows rising demand
India's status unmatched by production. This has an effect on market prices. There is now creeping dependence on wheat imports to augment domestic availability and rein in prices. India may not exactly be food insecure today; but the widening supply gap does raise concerns over food security in the coming years. The per capita availability of foodgrains today is less than it was 15 years ago. Grains are becoming inaccessible and unaffordable for the poor. So, the future looks uncertain and somewhat scary. Rising

energy prices too contribute to food inflation globally as the cost of food production

rises. Synthetic fertilisers, use of energy for mechanised farming and transportation costs rise with higher energy costs. So, high energy prices lift grain
prices worldwide; and India cannot remain insulated. Wheat could be one of the crops most seriously affected by global warming. Under Indian growing conditions, wheat is at the limit of heat tolerance. Any further rise in average temperatures during the growing season December-March can potentially affect yields. Indian maize, in addition to wheat, is another important grain that is susceptible to global warming. We need to take cognisance of this looming threat, in addition to several others that already exist. The research priorities are clear. We need heat-tolerant varieties that consume water efficiently. Farm scientists have their task cut out.


ADI 08 Food Prices toolkit Spring

High food prices are forcing 2/3 of the population of Haiti to do the unthinkable; eating mud in an attempt to relieve their starvation. UPI 08 (July 29th, “Haitians, short of cash, eat mud” accessed via l/n) People in Haiti have become so desperate for food that many are eating mud, U.N. officials said. U.N. officials say that food is available in the impoverished Caribbean nation, The Guardian reported. But prices are rising so fast that the Food and Agriculture Organization predicts that food will cost 80 percent more at the end of the year than it did in January. The high prices come in a country
where much of the population is already living on the edge. The United Nations says that two-thirds of Haitians live on less than $1 a day. In normal times, pregnant women use mud cakes as a source of calcium. Now, they cakes. "You

are famine food. "It stops the hunger," said Marie-Carmelle Baptiste, who makes mud eat them when you have to." The cakes' raw material comes from a clay deposit outside Port-au-Prince. Baptiste said they have become more expensive to make, but she does not want to raise her prices until she has to because she knows that, for her customers, the cakes are the last resort.


ADI 08 Food Prices toolkit Spring

Unless food price relief is given Egyptian civil unrest will continue to spark demonstrations and food riots. McDonough 08 (Challiss, Mar 24th, “Egyptian Bread Crisis Stirs Anger”, VOA News: In Egypt, a shortage of subsidized bread has resulted in long lines and occasional clashes in which several people have been killed. The president has ordered the army to use its bakeries to try to end the bread crisis, but the roots of the problem are more than just simple supply and demand. Rising food prices and poverty have combined with corruption to create a bread problem that will not be easily solved. VOA
Correspondent Challiss McDonough has more from Cairo. An Egyptian woman carries a tray of bread at a public oven in Giza, Egypt, 16 Mar 2008 An Egyptian woman carries a tray of bread at a public oven in Giza, Egypt, 16 Mar 2008 About 30 people are crowding around two small windows at a Cairo bakery, shouting at each other and jostling for the best place in line. The heat is blistering already, and women in the crowd shade themselves from the sun with plastic bags. A woman named Fatma says she waits here for two to three hours every day to buy bread for her family of five. Gesturing toward the chaos at the bakery window, she says, "What can I say? You can see this bread problem for yourself. The prices of everything have gotten so high." This bakery is selling round loaves of government-subsidized bread, known locally as "balady" or country bread. The price is fixed at five Egyptian piasters, or less than one U.S. cent a loaf. In recent months, rising food prices have fueled a shortage of this subsidized bread, leading to long lines and short tempers. Several people have been killed in fighting that has broken out in bread lines or clashes between customers and bakers. Last week, President Hosni Mubarak ordered the army to use its bakeries to make balady bread in an effort to stem the shortage. But it is not simply a matter of supply and demand; even the president acknowledged that part of the problem is corruption. Economist Hanaa Kheir el-Din is executive director of the Egyptian Center for Economic Studies. "All other food prices have risen. There are a lot of food prices which rose sizably - look at the oil price for instance, rice, sugar, everything is rising - but balady bread has been kept at five piasters a loaf, and the flour which goes into it is delivered at a much lower price while the baker can sell it on the black market at several times the price," said Kheir el-Din. The corruption is not limited to selling subsidized wheat flour on the black market. At the bakery, a heavy metal door swings open and then clangs shut quickly, and a man scurries away holding five round pieces of freshly baked bread. Another man who gives his name only as Samir waves his hand angrily toward the door. He says the bakery employees let some people inside to get bread quickly while he and the rest are waiting in line outside in the sun for hours. This is an emotional issue. Bread is such a vital staple food here that Egyptians use a different word for it than other Arabic-speakers do - they call it "aish," which literally means "life." Egypt's government has taken other measures to try to rein in rising food prices, including stopping the export of locally grown rice. And other governments in the region are facing similar troubles - over the past few months, food prices have sparked demonstrations and riots in countries such as Morocco, Yemen and even wealthy Saudi Arabia. In Egypt, the bread crisis is a symptom of a larger problem - one of stagnant wages that have failed to keep up with the cost of living. There is no shortage of bread for those willing and able to pay higher prices for it. Some people who buy the subsidized product resell it just down the street for twice the price. And unsubsidized bread is in plentiful supply at local markets, but that costs five times as much. Fatma says the unsubsidized bread is too expensive, and the loaves are smaller than the real balady ones. She says she simply cannot afford to feed her children that way. She says her family of five lives on a single pension of only 350 Egyptian pounds a month, or just over $60. That is similar to the wages earned by civil servants and factory workers, and even doctors in public hospitals. Fatma says each of her family members eats two pieces of bread a day. If she had to buy unsubsidized bread at five cents apiece, she would end up spending about one quarter of her monthly income on bread alone. The rising food prices have helped fuel protests and strikes by working professionals around the country. Economist Hanaa Kheir el-Din says the entire wage system needs to be overhauled, and the food subsidies cannot be removed until ordinary working Egyptians can earn a living wage. "You cannot pay a person 100 pounds a month as income and then let him buy whatever commodities are available in the market at market prices," said Kheir el-Din. "One has to revise the subsidy program along with revising the income policy, particularly wages in the government sector." The World Bank says Egypt's economy has been growing at a healthy rate of seven percent per year, but at the same time, poverty has been growing too. So Egypt's poor are not seeing the benefits

of the economic growth, and roughly 20 percent of the population is below the official poverty line, living on less than two dollars a day. The last time the Egyptian government tried to remove subsidies on bread, in 1977, riots broke out and more than 70 people were killed.

But food subsidies now take up a huge portion of Egypt's annual budget, one that is growing as global food prices rise. Kheir el-Din says the subsidies need to be targeted to the neediest people. "Balady bread in particular should not be made available to people who can afford better bread," he said. "This should be targeted to the people who cannot afford to buy a 25- or 40-piaster loaf. But everybody may get this subsidized bread, and this is where the subsidy program has to be revised." Back at the bakery, Fatma sighs as she stares at the raucous crowd pushing and shoving to get closer to the front. She shakes her head and moves into line, saying under her breath, "May God have mercy on the poor."


ADI 08 Food Prices toolkit Spring

China Module
Increased food prices are severely hurting China’s ability to combat domestic hunger and threaten the nation’s economic growth. Peter Harmsen, Staff Writer, Agence France Presse, May 12, 2008, “China warns about inflation with price rises at near 12-year
highs”, Lexis China's inflation rate rose to 8.5 percent in April, staying near 12-year highs, the government said Monday, warning tougher measures were needed to handle the nation's most intractable economic problem. The figure, released by the National
Bureau of Statistics, marked a reacceleration after the consumer price index weakened to 8.3 percent growth in March from 8.7 percent in February. "Growth in consumer prices remains high," the statistics bureau said in a press release. "At the moment, we must pay close attention to future price trends and prioritise the control of price increases and inflation even higher." China's recent bout of inflation has been triggered mainly by soaring food prices, and data from the statistics bureau data showed this remained the case last month. Overall food prices increased by 22.1 percent in April from a year earlier, while pork, the favourite meat for the vast majority of Chinese, became 68.3 percent more expensive over the same period. By contrast, non-food prices increased by a mere 1.8 percent in April from a year earlier, according to the statistics bureau. "It is linked to the fact that the international prices of primary products, and especially grain prices, continue to rise, impacting domestic food prices," the statistics bureau said. China's communist rulers have made the war on inflation one of their main economic priorities this year, fearing that rising prices could impact social stability as the costs of essentials rocket. Investment bank Goldman Sachs said the figures were higher than market expectations, suggesting that "it is still far too early to claim success in the battle against inflation." "As underlying inflationary pressures remain undiminished, it is vital for the government to keep its tightening policy stance to anchor inflationary expectations," Goldman Sachs said in a research note. Chinese Vice Premier Wang Qishan on Friday warned global inflation posed a threat to the country's speedy growth, saying high prices abroad constituted a major pressure for the economy. "Global inflation has intensified, creating major outside pressure for China," Wang said in a speech at a financial forum in Shanghai. The way China is now importing inflation reflects its ever-greater integration with the global economy, foreign economists said. "China's economy is quite well connected to the world economy," said Louis Kuijs, a senior economist with the World Bank's Beijing office. "That means many of the price

impacts that are being felt at the global level, in global markets for commodities and for food products, are being felt in China as well."

Despite avoiding the adverse effects of high food prices, China’s economy is poised to be severely hurt if high food prices continue. Steven Sitao Xu, Staff Writer, South China Morning Post, July 15, 2008, “Chinese economy is fit to weather stagflation” Lexis
The spectre of stagflation looms over much of the global economy. But what about mainland China? Its economy continues to speed ahead, but recently the central bank has been slamming on the brakes to curb inflation. And, as soaring oil and food prices in world markets show no sign of easing, some observers caution that the mainland economy could also fall victim to sustained high inflation and slower growth. Chinese economic policymakers are certainly worried about rising prices. True, its consumer price index fell from 8.5 per cent in April to 7.7 per cent in May, but that was largely due to the effect of measuring the year-on-year increases from the already-elevated levels of last year. What is more, in mid-June, the government was forced to raise the state-mandated prices of petrol and electricity. The move was long overdue. More importantly, Chinese policymakers' chief goal is to engineer a soft landing of the economy. In fact, the decision to raise energy prices underscores Beijing's commitment to move towards a more sustainable growth path by liberalising politically sensitive but economically inefficient state price controls. The mainland has a long way to go to normalise prices of fuel and other things. Thanks to its strong fiscal profile - the budget surplus is expected to be 0.5 per cent of gross domestic product this year, while the public debt-to-GDP ratio is only about 20 per cent - it can easily afford to maintain fuel subsidies via price controls. The costs of such subsidies are mainly borne by affected state-owned companies in the form of a profit squeeze, not necessarily by Beijing and the yuan in the form of loss of investors' confidence.


ADI 08 Food Prices toolkit Spring

The combination of high food and oil prices has been uniquely detrimental for emerging markets like China. Peter Apps, Special Correspondent for the Birmingham Post, “Record oil and food prices hurt markets in East the most;
EMERGING MARKETS” July 9, 2008, Birmingham Post, Lexis Most emerging economies beyond a handful of crude producers are suffering from record oil and food prices, with Asian markets in general and China's in particular likely to be notable losers. South Africa and Turkey also stand out as being vulnerable, while Russia and the Gulf States, which should be the main beneficiaries as crude prices soar, will still struggle with high inflation and the risk of economic overheating. Emerging markets have proved largely "decoupled" from the Western credit crunch but inflation is proving a global problem. Until late May emerging equities in particular had been doing relatively well, more or less recovering losses earlier in the year when worries over Western banks sparked global risk aversion. Some investors even moved into emerging markets, seeking diversification from a developed world downturn. "The credit crunch was very much a Western phenomenon," said Mark Hammond, investment director for fund manager Fidelity covering global, US and emerging markets. "Inflation is much more global." Hedge fund monitor EPFR says fund flows into emerging markets had been broadly positive this year but have now turned negative everywhere except the Middle East and Africa. Index provider Standard & Poor says that by its indices emerging equity markets lost 10.07 per cent in June, putting them down 12.5 per cent so far this year. Developed markets were also hit, but S&P says they lost slightly less, down 7.90 per cent in the year to date. Benchmark MSCI emerging equities are down almost 17 per cent so far this year, against 14 per cent for the equivalent global index. Emerging markets have in some ways been a victim of their own success. Their resilient and ever-growing demand for natural resources, particularly food and fuel in India and China, has prompting price rises that have in turn sparked inflation. Investment bank Morgan Stanley says Asia stands to lose out the most from oil's rise as the region, especially China, is more energy reliant than other emerging markets. Moreover, higher oil prices may also prompt Western buyers to seek suppliers closer to them due to higher delivery costs. "The monumental energy price increases will be a 'game change' for Asia," the bank said in a research note.


ADI 08 Food Prices toolkit Spring

China key to food security
China is critical to world food security, their impact is unrivaled Anthea Webb, Director of the World Food Program in China, China Daily, “WHY CHINA IS CRUCIAL TO WORLD FOOD SECURITY” May 15, 2008, Lexis
For us, it is very hard to predict now how bad the impact of the calamity will be and what kinds of impact it will have on China, especially at a time when the world is sliding into a food crisis. Whatever happened, China still played a very important role in the world's food security. Last week Premier Wen Jiabao said that "China is deeply concerned about food security", and announced that the government would give $2 million to the United Nations World Food Program (WFP) in response to the extraordinary difficulties it is facing as a result of rising food prices. This brings China's donation to WFP in 2008 to $4.5 million: the largest donation ever made by China to WFP for use in other developing countries. The premier also said that by ensuring China can provide sufficient food for its population of 1.3 billion

people, the country is making a major contribution to world food security. At a moment when world food security is facing unprecedented challenges from rising prices, China's role is fundamental. Over the past year the Food and Agriculture
Organization (FAO)'s food price index has risen by 57 percent. On the international market, the price of staple foods like wheat and rice has more than doubled. Shoppers from Beijing to Boston to Brussels have seen their grocery bill rise rapidly. For the wealthier consumers, who spend 10 to 20 percent of their income on food, that means cutting back on the number of times they eat at restaurants, or on desserts and other treats. But for people who were just able to make ends meet last year, the increases in prices of basic foods such as bread and rice are disastrous. The people who spend more than half of

their income putting food on the family table are now faced with the prospect of cutting back on more nutritious foods like meat and dairy. The very poorest - those who survive on 50 cents a day - have started to reduce the number of meager meals they eat each day. The WFP's executive director has called the effect a "silent tsunami". Like the tsunami that swept across the Indian Ocean in December 2004, this wave of high prices knows no borders. It is bringing a surge of suffering to poor people across the globe and its effects such as increased malnutrition and poverty will be felt for years to come. What has caused this dramatic change in food prices? Firstly,
demand for food has changed. Once upon a time, grains like wheat, corn and rice, were used mainly as food for people. Today, however, these simple foods are also used to produce feed for animals and ethanol for biofuels. Secondly, high crude oil prices have impacted the cost of producing food. Unfortunately, few farmers are reaping the benefit of high food prices since the cost of fertilizers, fuel for their machinery and transport to market have also risen, meaning their profit margins have decreased. Thirdly, the weather also plays a big part in agriculture and recent years have seen serious droughts in major grain-exporting nations such as Australia. Cyclone Nargis, which devastated much of the Irrawaddy Delta in Myanmar, is also likely to contribute to higher rice prices, since it has destroyed much of this year's crop. On top of the suffering currently facing the people affected directly by the Cyclone, the people of Sri Lanka and Bangladesh, who had planned to buy some of that rice, will find it even harder to meet their needs this year. This uncanny convergence of factors - new demands for grains, rising production costs and reduced supply because of bad weather - have created an economic "perfect storm". Where does China

fit into this picture? Already, by producing food for more than 20 percent of the world's population on less than 10 percent of its arable land, China is carrying a heavy burden for global food security. It is the world's largest producer of grain, and production has increased every year for the past four years, reaching 501.5 million tons last year. More than 95 percent of the grain it needs is grown in China. The State Grain Administration estimates its grain reserves hold between 150 and 200 million tons - enough to meet up to six months' consumption and well above the 18 percent of consumption recommended by FAO. But China is not immune to food price pressure. Food, which accounts for 30 percent of the basket of goods on which inflation is calculated, has been blamed for the high levels of inflation recorded in the past year. Those
increases have been attributed to rises in three main commodities: pork because a disease killed many of the herd last year; fruit and vegetables because the snow and ice storms in southern China in January and February destroyed many horticultural crops; and cooking oil because it relies heavily on soybean imports, the international price of which has grown steadily over recent years. The government has demonstrated its concern over the issue

of domestic food prices by introducing 10 measures to boost production and contain prices. These include incentives for farmers, restrictions on exports and limits on the use of food for biofuel production. Many commodity analysts - including the
World Food Program - are counting on those measures to be successful. Notwithstanding the impressive increases in grain production in China over the past 30 years, the country's farmers face a tough challenge to keep increasing the amount of grain they grow at the same pace as demand is rising. The amount of land and water available for agriculture is decreasing, so much will depend on them being able to get better yields. And the best incentive is for farming to be profitable. Personally, I am optimistic that China's farmers can rise to this challenge, with the right kind of support from the government. I have seen how hard-working farmers in rural Anhui province toil to grow wheat, rice, rapeseed and vegetables not just for their families but for other provinces too. I have also seen that many of them still rely on buffaloes to till their fields and on rainfall to water their crops. Better machinery and irrigation could help this productive province grow even more. China has already made so much progress, reducing the number of undernourished people by more than 150 million over the past 30 years. Then, one in three Chinese children was malnourished; today just 7 percent of children are too short for their age, a sign of poor nutrition. In fact, the average 6-year-old boy in China today is 6 kg heavier and 6 cm taller than he would have been 30 years ago. That's concrete evidence of better diets and health. China, perhaps better than any other developing country, has seen first hand how economic development depends on food security. It knows that growing economies need healthy, well-

nourished and well-educated workers. Now the world is counting on its farmers being able to continue increasing the amount of grain they can grow, to meet growing requirements at home and to stabilize prices. WFP is hoping that it can learn
from China's tremendous progress, and export some of the lessons - as well as financial and other support - to developing countries which are still struggling with poverty and hunger.


ADI 08 Food Prices toolkit Spring

Rising food prices are forcing 2 and a half million people into poverty with each slight increase in the Philippines alone. Dumlao 08 (Doris, The Philippine Inquirer, “ADB: High food prices affect poor most, cause more poverty” May 8, reposted at
MANILA, Philippines -- For

every 10 percent increase in food prices, about 2.3 million more Filipinos fall into poverty, a new study by an Asian Development Bank economist suggests. The conclusion of a new research paper -- “Has Inflation Hurt the Poor?
Regional Analysis in the Philippines” authored by ADB economist Hyun Son -- was that inflation was hitting poor Filipino consumers harder than the more affluent ones. "Specifically,

the poor are highly sensitive to the price changes in food, particularly staple food

items such as rice,” the study said.

"In addition, concerns over rising food prices are surmounting because such increase can undermine the gains from poverty reduction and human development that developing countries have experienced for the last decade or so,” it added. Estimates on the price elasticity of poverty by commodity in the Philippines suggested that a

10 percent increase in non-food prices -- such as fuel and utilities -- would drive an additional 1.7 million people into poverty. Separating the impact of specific commodity increases,
the study said a 10 percent increase in the price of rice would force an additional 660,000 Filipinos into poverty. An increase in fuel prices of 10 percent was also seen driving more people into poverty, but with a smaller headcount of 160,000. The study showed that since 2003, the price increases in the Philippines have led to greater sufferings for the poorest segment of the population. The effects of rising food prices were observed to be different across households. "Rising

food prices may lead to income gains for net producers. However, many urban and rural poor who are food consumers and not necessarily producers suffer the most from rising food prices,” the study said. “Thus,
with increasing food prices, some will gain and some will lose,” it said. Using household surveys and detailed price data, the study analyzed the impacts of higher food prices on the average standard of living and on poverty for the Philippines. The

study showed the dominating effect of rising food prices on poverty over the period of 2003-06. “In particular, the severity of poverty rose by 16.8 percent while the standard of living declined by about 1 percent over the period,” the study said. The study also suggested that the decline in the standard of living due to food price increases was particularly greater for the poorest of the poor. “At worse, these households struggling to meet the minimum standards of living might have no choice but
to cut down their expenditures on health and children's education,” the study said. “Hence, safety measures will be required particularly for the poorest of the poor to be able to cushion the negative impact of higher food prices on their spending,” it said. The study thus proposed an alternative price index for the poor

Finally, the study found that the increase in food prices has been the major factor causing high inflation in the Philippines in recent periods. The non-food items of consumption have played a relatively minor role. “It is wiser thus to direct government policies towards stabilizing food prices,” the study said. “Given these
that takes into account the consumption patterns of the poor. current trends moreover, monetary policy may not be an effective tool to combat rising inflation. Such policies may push the economy into recession, which will hurt the poor even more.” The surge in the country's inflation rate to a three-year high of 8.3 percent in April has put the Bangko Sentral ng Pilipinas under more pressure to tighten monetary policy. During the BSP's latest quarterly inflation briefing Thursday, top BSP officials said there were indications that demand pressures, and not just supply shocks, were also contributing to the sharp increases in consumer prices and that the central bank would have a role to play in cooling inflation and managing people's expectations. BSP Deputy Governor Diwa Guinigundo said: “We're looking at two things. First, we're looking at the second-round effects. If there are wage adjustments and transport fare adjustments, even in terms of utilities charges, once you see an early sign of evidence of second round effects, I think monetary policy will have a good scope for addressing inflation.” The second trigger, Guinigundo said, was the role of the inflation expectations channel in managing actual inflation.


ADI 08 Food Prices toolkit Spring

Famine exacerbates and contributes to HIV/AIDs transmission, increasing risk factors such as migration and transactional sex. Wilson Center, 2006 Food Security and Its Impact on International Development and HIV Reduction, 10-16
Suneetha Kadiyala, a scientist at the International Food Policy Research Institute, argued that food food to lead fully productive lives—increases

insecurity—a situation in which people cannot get enough the risk of exposure to HIV/AIDS through factors such as increased migration and transactional sex. Conversely, she said, HIV/AIDS can exacerbate food and nutrition insecurity: HIV/AIDS-related illness and the diversion of resources to AIDS treatment result in labor and capital shortages that threaten food supply. Additionally, AIDS deaths degrade formal and informal rural organizations, leading to a loss of farming knowledge. In food-scarce areas, HIV-positive individuals are more susceptible to malnutrition, as HIV raises energy requirements by 10-30 percent in adults. Of the 25 countries with the highest prevalence of HIV/AIDS, 21 are receiving assistance from the WFP. Kadiyala noted that malnutrition is not only associated with a decrease in immune function, it also compromises effectiveness and increases toxicity of antiretrovirals. Due to the strong connections between the prevalence of the virus and malnutrition, Dey said that food security should be a priority for donor
organizations, specifically those with large AIDS funding arms. The 2007 budget for the President’s Emergency Plan for AIDS Relief (PEPFAR), for example, exceeds $4 billion, some of which Dey believes should be rerouted to improving nutrition: “There is a growing body of literature that

indicates nutritional support is a vital part of a comprehensive response to HIV/AIDS.”

AIDs is a unprecedent threat to all life on the planet. Mutuma Mathiu, AFRICA NEWS, July 15, 2000 Lexis
Every age has its killer. But Aids is without precedent. It is comparable only to the Black Death of the Middle Ages in the terror it evokes and the graves it fills. But unlike the plague, Aids does not come at a time of scientific innocence: It flies in the face of space exploration, the manipulation of genes and the mapping of the human genome. The Black Death - the plague, today easily cured by antibiotics and prevented by vaccines - killed a full 40 million Europeans, a quarter of the population of Europe, between 1347 and 1352. But it was a death that could be avoided by the simple expedient of changing addresses and whose vector could be seen and exterminated. With Aids, the vector is humanity itself, the nice person in the next seat in the bus. There is nowhere to run and nowhere to hide. Every human being who expresses the innate desire to preserve the human genetic pool through the natural mechanism of reproduction is potentially at risk. And whereas death by plague was a merciful five days of agony, HIV is not satisfied until years of stigma

and excruciating torture have been wrought on its victim. The plague toll of tens of millions in two decades was a veritable holocaust, but it will be nothing compared to the viral holocaust: So far, 18.8 million people are already dead; 43.3 million infected worldwide (24.5 million of them Africans) carry the seeds of their inevitable demise - unwilling participants in a March of the Damned. Last year alone, 2.8 million lives went down the drain, 85 per cent of
them African; as a matter of fact, 6,000 Africans will die today. The daily toll in Kenya is 500. There has never been fought a war on these shores that was so wanton in its thirst for human blood. During the First World War, more than a million lives were lost at the Battle of the Somme alone, setting a trend that was to become fairly common, in which generals would use soldiers as cannon fodder; the lives of 10 million young men were sacrificed for a cause that was judged to be more worthwhile than the dreams - even the mere living out of a lifetime - of a generation. But there was proffered an explanation: It was the honour of bathing a battlefield with young blood, patriotism or simply racial pride. Aids, on the other hand, is a holocaust without even

a lame or bigoted justification. It is simply a waste. It is death contracted not in the battlefield but in bedrooms and other venues of furtive intimacy. It is difficult to remember any time in history when the survival of the human race was so hopelessly in jeopardy.


ADI 08 Food Prices toolkit Spring

Elevated food prices leads to an inability to treat HIV/AIDS in Africa Mallard 08 (Cole, July 30th, reporting from Washington, D.C. for VOA News,

AIDS experts say treating HIV/AIDS effectively requires more than medications such as anti-retroviral drugs; it requires good nutrition, food security and sustainable livelihoods. This is one of the topics to be discussed at the 17th
International AIDS conference in Mexico City. Stephen Lewis, the former UN special envoy for HIV/AIDS in Africa, is now co-director of AIDS Free World, an international organization that promotes timely, effective global responses in the fight against HIV/AIDS. From Toronto, Canada, he told Voice of America reporter Cole Mallard that without

good nutrition it’s not possible for a person with HIV to handle the effects of antiretroviral drugs and enhance their performance. Alicia Keyes (l) and Stephen Lewis Stephen Lewis and singer Alicia Keys at Toronto
AIDS conference in 2006 He says food security is an issue because “Africa is desperately short of food, the world doesn’t have the food to deliver, and the ability to produce enough food is increasingly limited.” He adds that most Africans earn their living through agriculture, and if one’s income is threatened by sickness, drought or famine, “then you’re in terrible difficulty; you simply cannot survive.” But Lewis says agricultural productivity can be improved. “I think that Professor Jeffrey Sachs has shown that with his millennium villages, by bringing in better seeds and better fertilizer and some small irrigation; you get a tremendous increase in crop productivity when you do that.” He adds that international trade agreements can help increase Africa’s ability to sell its produce and revive the economy. He says focusing on the grass roots level would enhance food availability as well, “but it requires a coordinated approach which is not in place, and I think these things always come with time, but they come late, and in the process of coming late you lose tremendous numbers of lives. ”The former UN AIDS envoy says

the current rise in global food prices adds to the problem because countries that normally import food can’t afford it (he says that’s also true of oil prices) and agencies that deliver food to countries in crisis, like the World Food Program, are also compromised by constantly having to make additional appeals. All this, he says, comes down to the fact that “for a grandmother who’s buried her own adult children and is looking after four or five grandchildren, and the food prices at the local market are so high that she can’t afford to feed her kids on the weekend, and they only get one meal a day at school, it’s a real crisis for the family.” A lack of the nutrition gained from food makes the HIV/AIDS pandemic worse. North, editor of Red Cross Red Crescent, 2006 (Rosemarie North, International Federation editor of the Red Cross Red Crescent, Food Security-a paradigm shift, Google, June 29, 2007)
In homes where someone has HIV/AIDS, much of the household income will be spent on medicines or doctors. Often, someone will drop out of school or the workforce to care for an ill family member. There is a lethal nexus between food and HIV/AIDS. People living with HIV/AIDS need more calories and nutrients each day. In addition, malnutrition hastens the progress of HIV/ AIDS and opportunistic infections. Finally, without good nutrition, antiretroviral drugs are not as effective.


ADI 08 Food Prices toolkit Spring

Malnutrition exacerbates HIV/AIDS by making people more susceptible to the disease. As well, HIV/AIDS leads to malnutrition by causing diseases that take nutrients from the body. J van Liere, member of the Royal Tropical Institute, September 2002 (Marti J van Liere, member of the Royal Tropical Institute of the Netherlands, HIV/AIDS and Food Security in Sub-Saharan Africa, September 2002, pg. 3)
Both AIDS and malnutrition are important killers in sub-Saharan Africa. With 3 million AIDS deaths in 2001, we can calculate that 6 deaths per minute are due to HIV/AIDS. Most of those who die experience nutritional problems. The latest figures of the FAO estimate that there are still more than 800 million people affected by hunger. Altogether there are 12 deaths per minute associated with malnutrition. Both AIDS and malnutrition are driven by poverty, conflict, and inequality. There is strong evidence that they operate in tandem, both at the individual level and at the social level : Malnourished individuals are more susceptible to become HIV-infected and more susceptible to secondary infections HIV infection and the secondary infections lead to malnutrition (increased nutritional requirements, diarrhoea, anorexia) Exclusive breast feeding, considered one of the most cost-effective nutrition behaviours for adequate growth and nutritional status of the baby, is one of the modes of transmission of the virus from the mother to her baby Finally, the disease leads to losses in productivity, labour, income and will thus endanger the food security situation of the members of an AIDS affected household.


ADI 08 Food Prices toolkit Spring

Rising food prices will force arable land increases which will come at the cost of biodiversity Blas 08 (Javier, London Financial Times Asia Edition, Jan. 22nd, l/n accessed 8/1)
Scarcity of water and arable land means that the boom in food prices could last longer than most expect, a new study has warned. The report, published today by the UK-based consultants Bidwells Agribusiness, said the

boom - until now fuelled by rising demand from emerging countries and the biofuels industry - would be exacerbated by supply constraints. Richard Warburton, head of
Agribusiness at Bidwells, said it was impossible to know yet whether the agricultural market was facing a structural or a cyclical change. But he warned that even if it was cyclical, "we are up against a long cycle of rising prices". Wheat and soyabean prices have surged to records, corn prices hit a 12-year high this year and rice prices have doubled in the past year to levels not seen since the mid-1990s. Meat, poultry, eggs and dairy products prices have also increased sharply. Instead of focusing on the current factors behind rising food prices, such as growing populations, increasing income levels and new demand from the

It said water and land scarcity, together with slow improvement in agronomics, would be key factors shaping food production.
biofuels industry, the report for the first time examines the limitations faced by farm production in the medium term. "Sustainability will ultimately be defined by food production per area of land and quantity of water used, as these are the obviously limiting factors."

Arable land, in particular, could only be increased at the cost of "massive destruction of forest and habitats and extreme pressure on biodiversity and carbon sequestration capacity". "Balancing environmental sustainability against the needs of an ever larger and increasingly hungry population may well prove to be the biggest challenge of the 21st century," the report said. For the past half century, the world has been able to
increase output thanks to rising productivity boosted by genetic advances, such as cereal seeds resistant to drought, and better agronomics, such as the wider use of irrigation, fertilisers and pesticides. But Mr Warburton said that "yields gains have already plateaued" after more than doubling from 1.1 tonnes per hectare in 1950 to 2.7 tonnes per hectare in 2000. "It is unquestionable . . . that constraints on (farm) production are tightening," the report said. In addition to land scarcity, lack of water would hamper agriculture. China and India, the world's two most populated countries, would be forced to provide more water to their rapidly growing urban populations rather than to their farmers, which would cut agricultural output. Water was also an issue in highly productive areas such as California and southern Spain, the report said. Sugar price surge, Page 24 28E 40L 26U

Biodiversity loss ends in an absolute extinction. Takacs, 96 (David, teaches environmental humanities @ the Institute for Earth Systems Science and Policy @ Cal State, The Idea
of Biodiversity: Philosophies of Paradise, p 200-201)
So biodiversity keeps the world running. It has value and of itself, as well as for us. Raven, Erwin, and Wilson oblige us to think about the value of biodiversity for our own lives. The Ehrlichs’ rivet-popper trope makes this same point; by eliminating rivets, we play Russian roulette with global ecology and human futures: “It is likely that destruction of the rich complex of species in the Amazon basin could trigger rapid changes in global climate patterns. Agriculture

remains heavily dependent on stable climate, and human beings remain heavily dependent on food. By the end of the century the extinction of perhaps a million species in the Amazon basin could have entrained famines in which a billion human beings perished. And if our species is very unlucky, the famines could lead to a thermonuclear war, which could extinguish civilization.” 13 Elsewhere Ehrlich uses different
particulars with no less drama: What then will happen if the current decimation of organic diversity continues? Crop yields will be more difficult to maintain in the face of climatic change, soil erosion, loss of dependable water supplies, decline of pollinators, and ever more serious assaults by pests. Conversion of productive land to wasteland will accelerate; deserts will continue their seemingly inexorable expansion. Air pollution

will increase, and local

climates will become harsher. Humanity will have to forgo many of the direct economic benefits it might have withdrawn from Earth's wellstocked genetic library. It might, for example, miss out on a cure for cancer; but that will make little difference. As ecosystem services falter, mortality from respiratory and epidemic disease, natural disasters, and especially famine will lower life expectancies to the point where cancer (largely a disease of the elderly) will be unimportant. Humanity will bring upon itself consequences depressingly similar to those expected from a nuclear winter. Barring a nuclear conflict, it appears that civilization will disappear some time before the end of the next century – not with a bang but a whimper.14


ADI 08 Food Prices toolkit Spring

Those benefiting from high food prices are profiting from current and eventual genocide from mass starvation. Cook 08 (Richard, April 24, “Crisis in Food Prices Threatens Worldwide Starvation: Is it Genocide?”
Richard C. Cook is a former U.S. federal government analyst, whose career included service with the U.S. Civil Service Commission, the Food and Drug Administration, the Carter White House, NASA, and the U.S. Treasury Department.

First of all, let’s get rid of the idea that we are seeing “impersonal market forces” at work. “Supply and demand” is
not a “law”—it’s a policy. If a seller has an article in demand it’s a matter of choice whether he charges a premium when he offers it for sale. If he’s a decent, honest soul, maybe he won’t necessarily charge all the market will bear, particularly if the item is a necessity of life, such as food. Or maybe there will be a responsible public authority around that will prohibit price gouging or else subsidize the purchaser, as often happens in credit markets. Of course public spirited action like this is itself a declining commodity in a world afflicted with the kind of market fundamentalism and rampant privatization that has been the rage since the 1980s Reagan Revolution. Second, let’s ask the question which any competent investigator should pose when starting out on the trail of a possible crime: “Who benefits?” Indeed we may be speaking of a crime on the scale of genocide if the events in question are a) avoidable; in which case the crime is one of negligent homicide; or b) planned, where we obviously have a conspiracy among the contributing parties.

Those who benefit are obviously the ones who finance agricultural operations, those who are charging monopoly prices for the commodities in demand, the various middlemen who bring the products to market after they leave the farm, and the owners or mortgagees of the land, retail space, and other assets required to conduct the production/consumption cycle. In other words, it’s the financial elite of the world who have gained complete control of the most basic necessity of life. This includes not only the international financiers who
provide capitalization, including the leveraging of trading in commodity futures up to the 97 percent level, but even organized crime groups which the U.S.

And is all this part of a long-term strategy by international finance to starve much of the world’s population in order to seize their land, control their natural resources, and enslave the rest who fear a similar fate? Already millions of people are losing their homes to housing inflation and foreclosure. Is actual or threatened physical starvation the next part of the scenario? And where are the governmental authorities whose job it is to protect the public welfare both at the national and international levels? These authorities long ago allowed a situation to develop, including in developed nations like the U.S. , where people in localities no longer have the simple ability to feed themselves, even in emergencies. And not one of the candidates remaining in the U.S. presidential election—John McCain, Hillary Clinton, nor Barack Obama—has addressed the food pricing issue. Indeed,
Department of Justice says have penetrated world materials markets. all three are part of a government that has gone so far as to exclude much of the rising cost of food from measurements of inflation, an innovation that took place on Bill Clinton’s watch. It is now April. Already food has run out in some parts of the world. In a few months winter will come, at least in the Northern Hemisphere. What will happen then? Are you certain food will be on your table? And suppose you wanted to make a contribution to your own well-being and to that of your family and community by going into farming. In most parts of North America you can look around and see plenty of underutilized land. But could you do it? Could you buy or lease land and pay taxes on it after the galloping inflation of the real estate bubble? Could you get bank loans for equipment and operating expenses under today’s constrained credit conditions? Could

you afford fuel for your equipment when petroleum costs over $115 a barrel? Is water readily available from developed supplies and is electricity available at regulated prices? Could you purchase anything other than geneticallymodified seed? Would local supermarkets buy your produce when your prices are undercut by massive corporate distributorships importing food from abroad? Does the system even exist in your home town for marketing of local farm products? And does anyone in power even care? Well, whether they do or not, “We the People”
should care. One of the worst aspects of the consumer society is the separation between the individual and the products of the earth we utilize. We always assume that whatever we need will be there so long as we have money in our bank account or the ability to charge on a credit card and pay later. Such assumptions are losing their validity. Back in the 1960s people who were starting to understand these things began a modest “back to the land” movement. Today it is time to start one again. Except this time we need to do it right by demanding government policies that support it. This means low-cost credit, price supports, affordable utilities, favorable tax policies, and decisions by government and businesses to “buy local.” Food

production cannot safely be left in the hands of agribusiness and international finance capitalism any longer.


ADI 08 Food Prices toolkit Spring

Rising food prices nullify the fight against poverty and re-entrench an oligarchic principle of population correction through genocide. Aspects, 7-29-08 (
The simple fact is that the world is not “too full.” It might feel like it is, sometimes, as our basic economic infrastructure crumbles round our ears, and as

Today’s hikes in oil and food prices are not the result of population fuelled demand, unavailability, or as a lack of capability to produce. They are purely artificial, as the result of Policy. And what is that Policy? In a word: GENOCIDE. The population of this planet is staring a dark age in the face. Culturally, we are already there. But in terms of human suffering, the period we are entering now will put all historical genocides in the shade. The policy has been stated many times: reduce the population of the planet from its present levels. At April’s G7 meeting of finance ministers in Washington, the World Bank issued statements warning of the impoverishment of entire regions of the world as the result of the food crisis, a situation they believe will not change in the coming year. Robert Zoellick, President of the World Bank, issued a statement at the same meeting, stating that the rise in food prices would be likely to nullify the fight against poverty. As the saying goes, “no shit, Sherlock!” These
poverty forces the people of large parts of the planet into having large families. guys can make their statements with confidence, because they know of the activities of speculative kingpin, George Soros, and people like him. For those unaware, Soros was behind the near collapse of the British Pound in 1992. Georgie has moved on from currency speculation. That form of profiteering only caused economic hardship. Today, he is aiming fairly and squarely at human death. On the 18th June, Goergie told a Budapest newspaper: “Rather

than expecting energy prices to go down somehow, we should accept that it must go further up first, for us to be able to solve the [long-term] problem. Prices must go up first so as to encourage people to consume less.” So Georgie wants us to consume less, which might be fine for you or I, who probably don’t struggle too much for our three meals a day. What happens if you are one of the several billions who only eat once per day? Do they need encouragement to consume less? Georgie’s mechanism for pushing prices up is typified by his
recent aquisition of all the commodities trading and merchandising business of the giant multi-national ConAgra Foods. This aquisition was made by a private investment fund managed by Soros Fund Management LLC, acting as part of a consortium with New York hedge fund Ospraie Management and New York asset manager General Atlantic. The $2.8 billion deal is estimated as the largest acquisition ever by a hedge fund. The agreement includes 144 ConAgra facilities, located primarily in North America. Renamed Gavilon, the new company provides physical distribution and merchandising of grains, feed ingredients, fertilizer, and energy products; as well as agriculture, energy, and other commodity trading activities, and “risk management services” — i.e., commodity futures derivatives speculation. It doesn’t stop there. It goes without saying that Georgie is right in there pushing biofuels. Another

string to the bow, the biofuels insanity is a strategy that even the greenies don’t want. The ConAgra operations provide “procurement and marketing services” for ethanol and bio-diesel producers, supply chain infrastructure, as well as financial hedging. Georgie’s not alone of course. Politicians and scientists have all been pushing the insanity that biofuels are the answer to the non-existent Global Warming problem. And if
Biofoolery is not enough, GM is being pushed harder than ever. GM crops are designed to reduce diversity of plant species through cross-pollenation, and more importantly, guarantee control of the food supply chain. The decades long destruction globally of small farming, to be replaced with huge factory farms planting seeds only ever purchased from Monsanto adds to that effect. We even have these two insanities of GM and biofoolery getting it together, with scientists at Michigan State University messing with the genetic makeup of corn to develop a strain that can break down its own cellulose, thus making fermentation easier, and biofuel production more efficient. The problem for the corporations, at least in the short term, is that the risk of cross-pollenation makes GM unpopular. So until the use of GM is universally accpepted, they need to do something about that. Just another of the “conincidences” in the world, is Colony Collapse Syndrome. Bees, the little stinging insects that we depend upon to pollenate our food supply, are dying out in unprecedented numbers. Is it really a coincidence that this happens within a few years of the development of GM crops, or that certain GM crop manufacturers also happen to belong to a cartel of pharmasutical/chemical/insecticide manufacturers and have had their products banned because they are harmful to bees?


ADI 08 Food Prices toolkit Spring

Food Security - Generic
Foods security outweighs all other impacts – it makes every impact inevitable Trudell, J.D. Candidate 2006, 05 (Robert H., Fall, Food Security Emergencies And The Power Of Eminent
Domain: A Domestic Legal Tool To Treat A Global Problem, 33 Syracuse J. Int'l L. & Com. 277, Lexis)

Today, more than 842 million people - nearly three times the population of the United States - are chronically hungry. 43 "Chronic hunger is a profound, debilitating human experience that affects the ability of individuals to work productively, think clearly, and resist disease. It also has devastating consequences for society: it drains economies, destabilizes governments, and reaches across international boundaries." The enormous number of chronically

hungry people conjures up a critical question: how can we feed these people? While the rate of population growth has been leveling off in the developed, wealthy countries of the world, the populations of the poorest countries and regions of the world still grow at an alarming pace. 45 Population statisticians refer to this phenomenon as population momentum. 46 Of the seventeen countries whose

In sub-Saharan Africa, millions are undernourished and millions more live on a dollar a day, making it the most povertystricken region in the world today. [*285] Chronic hunger and poverty are the rock-and-a-hard-place in
women average six or more births in a lifetime, all but two are in Africa.
48 47

between which the people of sub-Saharan Africa find themselves today. One tragedy endlessly feeds upon and exacerbates the other because a person needs money to buy food, but she (or he) cannot earn money when she is chronically hungry.

The food

security issues of this region are a global concern. Silvio Berlusconi, Prime Minister of Italy, and Chairperson of the 2002 World Food Summit in Rome said, "Together with terrorism, hunger is one of the greatest problems the international community is facing." Human security is a value which can be broadly

defined as both the "freedom from fear" and the "freedom from want." 51 Until recently, security was largely a concern arising out of the conflict among states, i.e. state security, which can be summed up in the phrase "military preparedness." 52 Today, it is recognized that the achievement of freedom from want is as important a goal as the achievement of freedom from fear and countries must arm themselves against such fear by addressing food insecurity. 53 In an editorial in the Economist, Kofi Annan, Secretary General of the United Nations, wrote that today's threats to security - terrorism, food security and poverty - are all interrelated so that no one country can tackle them alone. 54 For example, keeping our food supply secure plays a direct role in achieving freedom from fear. The State Department has been studying the possibilities of food-borne bioterrorism, introducing the national security element to food security concerns. 55 Likewise, in December [*286] 2004, during his resignation announcement, Tommy Thompson, the former Secretary of the Health and Human Services Department, stated: "For the life of me, I cannot understand why the terrorists have not

Food security deserves its place in any long-term calculation regarding global security. Widespread chronic hunger causes widespread instability and debilitating poverty and decreases all of our safety, for example from the increased threat from global terrorism. Widespread instability is an unmistakable characteristic of life in sub-Saharan Africa. Food insecurity, therefore, causes global insecurity because widespread instability in places like sub-Saharan Africa threatens all of our safety. Food insecurity in the unstable regions of the world must be taken on now lest we find ourselves facing some far worse danger in the days to come.
attacked our food supply, because it is so easy to do."

Yet it is a mistake to think of global security only in military terms.





ADI 08 Food Prices toolkit Spring

Food Insecurity: War
Food insecurity risks global wars
Messer Professor of Nutrition Science and Policy at Tufts University 01 (Ellen Messer, Marc J. Cohen, Special Assistant to the Director General at the International Food Policy Research Institute & Thomas Marchione, Nutrition Advisor at the Bureau for Humanitarian Response, U.S. Agency for International Development , “CONFLICT: A CAUSE AND EFFECT OF HUNGER,” ECSP REPORT · ISSUE 7)

Econometric studies provide additional empirical evidence of a link between food insecurity and violent conflict. These studies find a strong relationship between indicators of deprivation (such as low per capita income, economic stagnation and decline, high income inequality, and slow growth in food production per capita) and violent civil strife (Nafziger &
Auvinen, 1997; Collier & Hoeffler, 1998). Mathematical models developed for a U.S. government study identified high infant mortality —the variable that most efficiently reflects a country's overall quality of material life—as the single most efficient variable for explaining conflicts between 1955 and 1994. Along with trade openness and regime type, infant mortality was one of three variables best correlated with the historical cases studied. It often interacts with lack of trade openness and repressive regimes to trigger state

political and institutional factors in interaction with environmental factors (such as drought and deforestation) are key indicators of potential conflict in Africa: well-being is affected not just by natural disasters, but also by how effectively a regime responds to them.
failure (Esty et al., 1995; 1998). In sum,

Ineffective responses include inappropriate policies, such as those used by some Sahelian countries in the 1960s and 1970s: they both neglected agriculture and subjected it to disproportionate taxation relative to the allocation of public expenditure received. These policies greatly intensified the impact of the severe 1972-75 drought in the region (Christensen et al., 1981). Other ineffective responses include unwillingness to respond to disaster, as in Ethiopia in 1974 or Rwanda in 1993 (J. Clay et al., 1988; Uvin, 1996b), and deliberate use of food and hunger as weapons, as in the Horn of Africa in the 1980s and 1990s (Messer, Cohen, & D'Costa, 1998). These examples demonstrate that famine is a result of political choices as well as capabilities (Drèze & Sen, 1989). Ethnic and

There is a high correlation between a country's involvement in conflict and its classification by FAO as a “low-income food deficit” country. Such countries have high proportions of food-insecure households. And, as already noted, conflict is also
Political Rivalries, Hunger, and Conflict highly correlated with high rates of child mortality (see Figure 2), which is a common index for food insecurity. Nevertheless, a number of analysts have challenged the notion that food insecurity is a causal factor in conflict. Paarlberg, for instance, argues that environmental scarcities such as land shortage, land degradation, and rapid population growth—what he refers to as “eco-Malthusian emiseration”—are not generally a factor in African conflicts. Rather, Paarlberg notes, the level of conflict in Africa has been relatively stable since the end of the colonial era. In his view, “[a] far more convincing explanation for violent conflict in sub-Saharan Africa starts with the serious geographical mismatch, long noticed on the continent, between post-colonial national boundaries and ethnic boundaries.” (Paarlberg, 1999, page 1). More generally, Gleditsch (1998) has pointed out that most conflicts can be sufficiently explained as a result of political, economic, and cultural factors, without reference to environmental scarcities. In fact, neither viewpoint precludes a food-security connection. Even Homer-Dixon (1999), a leading figure in the environmental security field, concedes that environmental scarcity alone does not inevitably result in conflict. Instead, he stresses that

resource constraints can have a profound influence on the social factors that eventually lead to conflict—as when elites monopolize control over scarce resources (such as water, cropland, or forests) and non-elites perceive themselves as unfairly deprived. As an example of how this works in practice, Uvin (1996b) argues persuasively that environmental factors in general—and food insecurity in particular—critically contributed to triggering the 1994 genocide in Rwanda.
Per capita food production and availability had declined dramatically in Rwanda over the preceding decade. The collapse of the world price of coffee in 1985 greatly reduced local and national government revenues and sapped rural households' purchasing power, even as urban job opportunities grew scarce and food prices rose. Deteriorating living conditions made many Rwandans into a ready

audience for government appeals to ethnic hatred.


ADI 08 Food Prices toolkit Spring

Food Insecurity: War
Lack of food security causes social collapse within a country – this means your heg da is inevitable
Taylor and Cayford, 03 (Michael R, Jerry, American Patent Policy,
Biotechnology, and African Agriculture: The Case for Policy Change, RFF Report, November 2003, pg 7-8,

The countries of sub-Saharan Africa face daunting social, economic, and health challenges. Achieving basic food security is the
central one for many countries and individuals in that region. If basic nutritional needs are not being met, the consequences are seen, certainly, in individual suffering, but also in the failure of societies to thrive socially and economically. Food security, economic development, and

poverty reduction are thoroughly intertwined. So too are the interests of the United States and developing countries in Africa and elsewhere. In the post-September 11 environment, U.S. leaders increasingly recognize that the lack of food security outside the United States is related to our quest for physical security inside the United States.

Malnutrition causes considerably more deaths than war
Charles Ellwood, University of Missouri. “Sociology and Modern Social Problems” 2003… /chapter9.html 2003
As already implied, then, economic

depression exercises a very considerable influence upon death rate, particularly when economic depression causes very high prices for the necessities of life and even widespread scarcity of food. This cause produces far more deaths in modern nations than war. The doubling of the price of bread in any civilized country would be a far greater calamity than a great war. While modern civilized peoples fear famine but little, there are many classes in the great industrial nations that live upon such a narrow margin of existence that the slightest increase in the cost of the necessities of life means practically the same as a famine to these classes. Statistics, therefore, of all modern countries, and particularly of all great cities, show an enormous increase in sickness and death among the poorer classes in times of economic depression.


ADI 08 Food Prices toolkit Spring

Food Insecurity: Biodiversity Impact

Food insecurity results in the destruction on biodiversity Trudell, J.D. Candidate 2006, 05 (Robert H., Fall, Food Security Emergencies And The Power Of Eminent
Domain: A Domestic Legal Tool To Treat A Global Problem, 33 Syracuse J. Int'l L. & Com. 277, Lexis)
In 1994, the United Nations Development Program, an organization dedicated to sustainable development in the developing world, identified seven main categories of threats to human security: economic, health, environmental, personal, community, political, and food security.

food security is fundamental to each of the other listed threats because a population that cannot feed itself will not be able to thrive, will be increasingly unhealthy, and will destroy the environment of the land it depends upon in its desperate pursuit of food. [*288] The lack of food security in sub-Saharan Africa makes it one of the least stable regions of the world.

One cause of this instability can be seen in the connection of food insecurity with the degrading sub-Saharan environment. In the search for sustainable agriculture, the pressures of a growing population have resulted in a reduction of cropland. In Africa, forests are cut down to make grazing pastures, then grazing pastures erode away and become deserts or areas of land incapable of producing any sustainable harvest because the soil has no more nutrients. violent conflicts.
73 74 75

Such instability has a negative effect on global security, especially in the poorer countries of the world, which suffer from major


One commentator, writing about sub-Saharan Africa, noted: "the relationship that exists between human security and environmental

Many of the farmers in this region still use the "slash-and-burn" method of subsistence farming. The forests of sub-Saharan Africa are cut down for agriculture because, as will be further discussed below, the African soil quickly loses its ability to sustain plant life so more and more land is needed to grow the same amount of food.
degradation is best illustrated in the agricultural sector."
77 78 79


ADI 08 Food Prices toolkit Spring

Food Security: Terrorism Impact

Food insecurity in sub-Sahara increases the risks of terrorism Trudell, J.D. Candidate 2006, 05 (Robert H., Fall, Food Security Emergencies And The Power Of Eminent
Domain: A Domestic Legal Tool To Treat A Global Problem, 33 Syracuse J. Int'l L. & Com. 277, Lexis)
Human security is a value which can be broadly defined as both the "freedom from fear" and the "freedom from want." 51 Until recently, security was largely a concern arising out of the conflict among states, i.e. state security, which can be summed up in the phrase "military preparedness." 52 Today, it is recognized that the achievement of freedom from want is as important a goal as the achievement of freedom from fear and countries must arm themselves against such fear by addressing food insecurity. 53 In an editorial in the Economist, Kofi Annan, Secretary General of the United Nations, wrote that

today's threats to security terrorism, food security and poverty - are all interrelated so that no one country can tackle them alone. 54 For example, keeping our food supply secure plays a direct role in achieving freedom from fear. The State Department has been studying the possibilities of food-borne bioterrorism, introducing the national security element
to food security concerns. 55 Likewise, in December [*286] 2004, during his resignation announcement, Tommy Thompson, the former Secretary of the Health and Human Services Department, stated: "For the life of me, I cannot understand why the terrorists have not attacked our food supply, because it is so easy to do." 56 Yet it is a mistake to think of global security only in military terms. 57

Food security deserves its place in any long-term calculation regarding global security. Widespread chronic hunger causes widespread instability and debilitating poverty and decreases all of our safety, for example from the increased threat from global terrorism. 58 Widespread instability is an unmistakable characteristic of life in sub-Saharan Africa. 59 Food insecurity, therefore, causes global insecurity because widespread instability in places like sub-Saharan Africa threatens all of our safety. Food insecurity in the unstable regions of the world must
be taken on now lest we find ourselves facing some far worse danger in the days to come.


ADI 08 Food Prices toolkit Spring

Food Insecurity: Genocide Impact

Food insecurity drives genocides Trudell, J.D. Candidate 2006, 05 (Robert H., Fall, Food Security Emergencies And The Power Of Eminent
Domain: A Domestic Legal Tool To Treat A Global Problem, 33 Syracuse J. Int'l L. & Com. 277, Lexis)
Among other findings, Andre

and Platteau's study showed that between 1988 and 1993 there was widespread unequal land distribution in Rwanda leading to a steep rise in the numbers of people in the "vulnerable sections of the population," that is, those living in poverty. 95 These segments
of the population were too numerous to simply become invisible, homeless segments of Rwandan society. 96 The "vicious cycle of poverty" reached across generations where the landless were led to despair and destroyed the traditional system of marriages. 97 Rwandan courts and other methods of adjudicating land conflicts could not cope with the sheer numbers of disaffected people. The social system in Rwanda began to breakdown. 98 The Andre and Platteau study began in 1988, and even then, "due to extreme scarcity of land and to the harsh realities of struggle for bare survival, tensions had developed to such an extent that the social fabric was at risk of falling asunder." 99 With hindsight, we know this risk was realized, and nearly one million people were slaughtered, largely due to long-held ethnic animus, but certainly food insecurity played its deadly part in the tragedy.


ADI 08 Food Prices toolkit Spring

**High Prices Good**


ADI 08 Food Prices toolkit Spring

High Food Prices Solve Poverty
Higher food prices help to spur investment in better production practices. The World Bank estimates about poverty are wrong. There will be a massive reduction in the amount of poverty in a world with high food prices. Homi Kharas, Senior Fellow, Global Economy and Development, Wolfensohn Center for Development, July 29, 2008, “Rising
Food Prices – An Upside?”, The Brookings Institute, The good news is that higher food prices are exactly what is required to restore balance in the market. With rising demand and constrained supply the iron law of economics permits no other response. In a market economy, when demand exceeds supply, prices rise. Higher prices discourage consumption, but they also encourage more investment and enhance production.
Anyone who doubts the link between food prices and agricultural investment should take a close look at the stock price of the world’s largest producer of agricultural equipment, John Deere. While most US shares have taken a beating, John Deere’s share price has doubled and has

split two-for-one in the last two years. High food prices are encouraging farmers to invest heavily in new equipment. This pattern is being repeated across the world, with investments in equipment, storage and land improvements. More food is already being produced in response to higher prices: forecasts for cereals production in 2008 by the Food and Agriculture Organisation show a significant increase. This should come as no surprise. When prices fell steeply between 1997 and 2002,
cereal production declined. Now that prices have risen back to the levels of the mid-1990s, cereal production has resumed its upward trend. Productivity is on the rise. More profits for farmers does not mean a benefit to humanity. Some have argued that rising food prices hurt the

poorest of the poor. The World Bank suggested that today’s higher food prices could push 100m more people into poverty. Unfortunately, the World Bank’s flash estimate, which was based on an extrapolation from a nine-country study, has not stood up to scrutiny. The reality is that the impact of high food prices depends on each household’s income and consumption patterns.
Beyond this, the impact also depends on what happens to labour, land and credit markets. As a further complication, domestic agricultural prices in most countries do not mirror world prices but also reflect government tax and subsidy policies. All these factors have to be taken into account to understand the impact of high food prices on household welfare. The Asian Development Bank (ADB) has just completed a study including the three countries with the largest rural populations in the world: India, China and Indonesia. Consider India, which has a long history of subsidising agricultural

input and output prices. According to the ADB, this has led to a system which is “unproductive, financially unsustainable, and environmentally destructive; … (it) also accentuates inequality among rural Indian states.” Higher world food prices might be just the push needed by India, along with many other countries, to persuade it to reform its agricultural pricing system and provide new opportunities for its desperate farmers. The ADB report also analyses China in some detail. It concludes that rural households in China should enjoy a significant reduction in the incidence of poverty as a result of high food prices. Although some urban households will be made worse off, these are the same households which have seen steady growth in wages in
the last few years and have a middle-class living standard. In fact, a short while ago many analysts claimed that the greatest risk to China’s development was the growing gap between income levels in urban and rural areas. With today’s food prices, that problem has receded. The outcome in Indonesia appears to be more mixed. Urban low-income and landless labourers would become poorer, while small and medium farmers would be better off. Indonesia has large numbers in both these groups, so many people would be affected. On average, the ADB simulations suggest that there would be about the same number of winners and losers, so average national poverty would remain unchanged. It is surely true that high food prices will cause hardship to

many. The suffering of those in Cairo, Haiti and much of Africa is real. The spectre of hunger is ugly. That cannot be denied and should not be forgotten. Nor should we leap to the conclusion that food prices at today’s levels are here to stay. But for the majority of the world’s poor, to be found among the 1.7 billion rural residents of India, China and Indonesia, the dream of a “chicken in every pot” is becoming more attainable because world food supply is rising again. That is the upside for humanity from today’s high food prices.


ADI 08 Food Prices toolkit Spring

High Food Prices Solve Poverty

High Food and Fuel prices good – benefit people of poor, developing countries
Patrice Hill, June 2, 2008 ([Hill is a reporter for the Washington Times] “High Prices Not All Bad; Developing Nations Provide Materials,” Washington Times, d/l: The hardship of high food and fuel prices for the world's most impoverished people has garnered much attention, but economists say the commodities boom is probably helping more poor people than it hurts because developing countries are the primary source of raw materials. Most Middle Eastern nations as well as countries such as Brazil, Argentina, Chile, Venezuela, Botswana, Zambia and Congo are major beneficiaries of the sixfold increase in oil prices since 2002 as well as record high prices for corn, rice, wheat, soybeans, copper, gold, diamonds and other basic goods the world needs for sustenance and growth. While high costs are a burden on millions of people in the developing world - primarily the urban
poor not engaged in farming or mining - the world's richer countries are paying the biggest price because they are dependent on developing nations for the raw materials they need to fuel their economies. "High commodity prices are a problem for the industrial countries - almost all of which are commodity importers, but a boon to the emerging economies, many of which are net exporters of commodities," said David Wyss, chief economist at Standard & Poor's Corp. The hundreds of billions more dollars each year that consumers in the United States, Europe and Japan pay for

fuel and other raw materials amounts to a massive transfer of income to the developing world, where the money is fueling rapid growth, raising living standards and feeding the emergence of a middle class.


ADI 08 Food Prices toolkit Spring

High Food Prices Good  African Food security
Higher food prices encourage African governments to invest in agricultural production and leads to African economies’ lasting, “exciting growth,” lessening any destructive effects of subsidies.
The Star (South Africa) June 10, 2008. “High Food Prices Open Investment Windows.” Donwald Pressly, Cape Town. High food prices provided an enormous opportunity for African investment in agricultural production as the continent was resource rich compared with any other continent, Michael Spence, the World Bank chairman of the commission on growth, said yesterday. Spence, speaking at the annual bank conference on development economics, said high food prices, which were likely to moderate in the medium term as the supply side was encouraged, could translate into good news for the continent if governments "invested in productivity growth". While nobody liked high food prices - and they had a devastating effect on the poor, who spent 50 percent or more of their income on food and fuel costs - investment in technology to boost agricultural productivity created an enormous opportunity for Africa. At the opening session of the three-day conference, President Thabo Mbeki said Africa had undergone "exciting growth" recently. "For some, this may appear to be the result of the passing impact of a commodity price boom." Some might expect African economies to slow down and run into difficulties at the end of this boom, as many did after the boom of the 1960s and 1970s, including South Africa. "But I am certain that those of us who have looked more closely at the development of Africa would have seen that there is evidence that the current opportunity to benefit from a commodity boom will not be frittered away as it was before, at least not by all countries," Mbeki said. Meanwhile, Spence was asked what finance minister Trevor Manuel could have meant by his remark that a multilateral response should be employed by
developing countries to respond to the rising cost of fuel - a major driver of rocketing food costs. Spence said he agreed with Manuel's view that "we have to avoid Balkanising the energy markets", where countries tried to lock up the sources of supply or to impose controls on exports or prices. He said any attempts to control prices would create a disincentive to investors "to create new technology". Attempting to control prices, whether in food or fuel, was "the fastest way" to cut off investment. Spence, a 2001 Nobel Prize winner, was also doubtful that developing countries would win the battle against American and European agricultural subsidies. But high prices of agricultural products lessened the destructive effect of these subsidies as emerging markets became more competitive as the products achieved higher prices, said Spence.


ADI 08 Food Prices toolkit Spring

High Food Prices Good  African food security
High food prices offer Africa the opportunity for an “agricultural renaissance” that will enhance Africans’ livelihoods, nutrition, and long-term food security. Africa News May 30, 2008. “World Bank Urges Continent to Take Advantage of High Food Prices.” AllAfrica, Inc. The Nation.
The World Bank has asked developed nations to help African farmers take advantage of the high food prices through increased food production. The bank's president, Mr Robert Zoellick, said while development partners had pledged additional financial assistance, more needed to be done in agricultural research. Others are development and infrastructure, since Africa's economic gains were at risk from high food and energy prices. "This crisis provides the opportunity to build a coalition of responses across the African continent. "This offers a vehicle for an agricultural renaissance that raises small-scale farmers' income, enhances livelihoods, nutrition and ultimately, food security for Africa," Mr Zoellick said. He was speaking at joint press conference with Food and
Agriculture Organisation representative for Africa, Modibo Traoré. Others were International Fund for Agricultural Development president, Mr Lennart Bage; and the World Food Programme executive director, Ms Josette Sheeran. Mr Zoellick told journalists that although African governments had increased their investment in Agriculture, few had met the 2003 commitment to spend at least 10 per cent of their annual budgets on agriculture. The four organisations asked the international community to complement increased financial assistance with real breakthroughs in trade negotiations. This is to ensure that Africa's producers could gain access to lucrative markets. The agencies asked leaders in developed nations, international organisations and the private sector to join hands under the leadership of African and regional organisations, the AU and the New Partnership for African Development. This is to support immediate and long-term goals for growth in the continent's agriculture. They asked governments to make it easier to buy food meant for humanitarian assistance by removing export controls and taxes. "Africa's very impressive economic progress of the last eight years must not be derailed by high food prices. "Efforts to meet the hunger Millenium Development Goal can succeed if we seize the opportunity of high food prices in a continent with vast, untapped agricultural potential. "With good policies and sufficient assistance, Africa can more than meet this challenge," said Mr Bage.


ADI 08 Food Prices toolkit Spring

High Food Prices Good  increase farm econ.
High food prices buoyed the income of small cereal and dairy farmers elsewhere in the world, with an increase of 12% in incomes. The Irish Times July 1, 2008. “Farm incomes increase buoyed by high food prices.” Ronan McGreevy.
FARM INCOMES rose by 12 percent last year buoyed by high food prices and better export markets especially in Asia, according to the Department of Agriculture’s annual review. The global shortage in commodities, which has resulted in rising food prices, saw cereal farmers incomes increase by nearly 70 percent last year. However, the bad summer last year meant that farmers were not able to benefit as much as they could have done from escalating prices and volumes were down slightly on other years. The booming dairy sector also benefited hugely from rising food prices. Dairy farmers received 34 cent a litre for their milk last year, a rise of 29 percent on the previous year. However, the boom in farm incomes did not translate into substantially higher food prices which only rose by 2.8 per cent last year, below
inflation of 4.9 per cent. The biggest increases, though, were in common foodstuffs with beef increasing by 5 per cent, milk by 7.4 per cent and fresh vegetables by 7.4 per cent. The figures mean that food prices have escalated this year and now stand at 14 per cent above May 2007. Food prices in Ireland remain the second highest in the EU at 25 per cent more expensive than the European average. Escalating food prices globally this year have been partially blamed on demand in China and India especially for meat and dairy products. However, they have also led to a boom of Irish food exports to Asia which increased by a phenomenal 50 per cent last year, according to Department of Agriculture figures. Bord Bia has now achieved its strategy of doubling food exports to Asia to EUR 400 million two years ahead of schedule. The biggest beneficiary has been the dairy industry which now accounts for 70 per cent of the EUR 400 million worth of exports to Asia last year. IFA

president Pádraig Walshe welcomed the rise in farm incomes and said dairy farmers, in particular, were entitled to a boost in incomes after 10 years of losses in the sector. However, he also said that increases did not take into account that other sectors of the agriculture economy
were struggling. Income levels for pig farmers decreased by 9.7 per cent and beef farmers were squeezed by falling demand and South American imports with a decrease in income levels of 1.7 per cent. There was also a small decrease in the income of poultry suppliers. Mr Walshe said pig and poultry producers were squeezed between supermarkets and rising feed costs. The outlook, though, for beef farmers is much better this year with an estimated increase of 20 percent in cattle prices because of a shortage of beef in the EU and a dramatic fall off in imports from Brazil because of health and safety issues. In total agricultural exports rose by an estimated 5 per cent last year to EUR 8.6 billion accounting for 7 per cent of GDP, 8 per cent of employment and 10 per cent of exports. Minister for Agriculture Brendan Smith described the export performance as an excellent result. Significant progress has been achieved in the face of stiff trading competition, rising energy costs and the strengthening of the euro against the dollar and sterling.


ADI 08 Food Prices toolkit Spring

High Prices Good – Brazil
High commodity prices have greatly benefitted Brazil above all other countries, allowing it to escape debt and stagnation and become an economic force
Patrice Hill, June 2, 2008 ([Hill is a reporter for the Washington Times] “High Prices Not All Bad; Developing Nations Provide Materials,” Washington Times, d/l: Perhaps the most notable rising star among developing countries getting a lift from the commodities boom is Brazil, the Latin American giant whose exports of everything from beef to oranges have turned it into an economic force to contend with this decade. The surge in food prices after years of stagnation has been especially kind to Brazil, which at the turn of the decade was a debt-ridden ward of the International
Monetary Fund. Brazil's economy expanded by 5.4 percent in 2007 - the fastest rate in three years - and its exports have tripled since 2003 amid booming global demand for steel, iron-ore, soybeans, orange juice and sugar. With a recent major discovery of oil off the coast of Rio de Janiero, some analysts think Brazil may soon become a major exporter of oil as well. Brazil's record commodity exports have bolstered its revenues and reserves to the point that it shed its external debts and became a net creditor to the world in January, prompting Wall Street ratings agencies to raise the nation's credit rating above junk status - a fitting symbol for the country's meteoric rise. The growing incomes and rising opportunities for people in Brazil and other commodity-

rich countries have raised living standards and enabled consumers to purchase more from abroad, causing imports of all kinds to leap by 172 percent to $6 trillion in those nations between 2000 and 2007, said Joseph P. Quinlan, chief market strategist at Bank of America Corp. "The penchant to consume is gaining traction globally, most notably in developing nations," he said. "Going to the mall on Saturday afternoon is just
as popular in Bangkok and Sao Paulo as it is in Boston and San Antonio."


ADI 08 Food Prices toolkit Spring

**Other **


ADI 08 Food Prices toolkit Spring

BOTH LOW AND HIGH FOOD PRICES CONTRIBUTE TO FAMINE HOLT-GIMENEZ 08 (July 29, 2008, Eric Holt-Giménez, Executive Director, Food First/Institute for Food and Development Policy, “Pouring Fuel on the Food”)
It is a mistake to confuse the immediate possible causes of the world food crisis with the root causes. Though the agrofuels boom may have created the spark the ignited the food price inflation, the food crisis did not begin with recent food riots. Paradoxically, a thirty-year global trend in declining food prices still left 860 million of the world’s population hungry—largely because most of the world’s poor are small farmers who were plunged further into poverty by low prices for their crops.
The World Bank’s agrofuels alarm is well-placed, but not completely disinterested.


ADI 08 Food Prices toolkit Spring

AT Food Prices DA
The link between subsidies and low food prices is a myth Bruce A. Babcock Iowa Ag Review Spring 2006
U.S. farmers often justify farm program payments by linking the payments to the small share of U.S. disposable income that is spent on food. Those who make this linkage attribute high productivity and high production at the farm level to program payments. The availability of less-expensive raw ingredients then decreases production costs of food processors and manufacturers, leading to lower food prices. If this story is true, then a removal of farm program payments should lead to higher food prices. Logically, the largest increases should show up in food products in which currently subsidized raw ingredients (corn, wheat, or
soybeans) make up the largest share of total production costs.A reasonable formula for approximating how the price of a food item would change because of a change in the price of a raw ingredient is to multiply the percent change in the price of the raw ingredient by the share of the price of the food item that is represented by the cost of the raw ingredient. For example, corn represents perhaps 38 percent of the cost of producing a market-ready hog. The cost of a marketready hog represents 28 percent of the final retail price of pork. This means that corn represents approximately 10.64 percent of the retail price of pork.Suppose that the removal of farm programs caused the price of corn to increase by 5 percent. The price of pork would then increase by about 0.53 percent. That is, pork

chops that cost $3.00 per pound with farm subsidies would increase in price by less than two cents per pound. If corn prices were to rise by 10 percent with the removal of subsidies, then pork chops would cost only three cents per pound more than they currently do. Because corn represents a smaller share of the final value of beef and dairy products, retail prices for these products would go up by a smaller amount (in percentage terms) than the price of pork.It is difficult to come up with examples in which subsidized U.S. commodities have a greater than 10 percent share of final retail value. And at this maximum share, it would take a doubling of commodity prices to increase consumer prices by 10 percent. But no credible analyst has ever estimated that farm payments result in such a large supply expansion that their withdrawal would cause commodity prices to double. The idea that U.S. commodity policy is really a cheap food policy is a myth.


ADI 08 Food Prices toolkit Spring

AT Food Price DA
While direct payment subsidies lower food prices, other incentive structure mechanisms can act to keep prices artificially elevated Griswold, Slivinski, Preble February 2006
America's agricultural policies have remained fundamentally unchanged for nearly three-quarters of a century. The

U.S. government continues to subsidize the production of rice, milk, sugar, cotton, peanuts, tobacco, and other commodities, while restricting imports to maintain artificially high domestic prices. The competition and innovation that have changed the face of the planet have been
effectively locked out of America's farm economy by politicians who fear farm voters more than the dispersed consumers who subsidize them. The time is ripe for unilaterally removing those distorting trade policies. In 2006 Congress will begin to write a new farm bill to replace the protectionist and subsidy-laden 2002 legislation that is set to expire in 2007. Meanwhile, the Bush administration will be negotiating with 147 other members of the World Trade Organization to conclude the Doha Round before the president's trade promotion authority expires in mid-2007. Congress and the administration should seize the opportunity to do ourselves a big favor by eliminating farm subsidies and trade barriers, a change that would benefit all Americans in six important ways. 1. Lower Food Prices for American Families The foremost reason to curtail farm protectionism is to benefit American consumers. By shielding the domestic market from global competition,

government farm programs raise the cost of food and with it the overall cost of living. According to the Organization for Economic Co-operation and Development, the higher domestic food prices caused by U.S. farm programs transferred $16.2 billion from American consumers to domestic agricultural producers in 2004. That amounts to an annual "food tax" per household of $146. This consumer tax is paid over and above what we dole out to farmers through the federal budget.American consumers pay more than double the world price for sugar. The federal sugar program
guarantees domestic producers a take of 22.9 cents per pound for beet sugar and 18 cents for cane sugar, while the world spot price for raw cane sugar is currently about 10 cents per pound. A 2000 study by the General Accounting Office estimated that Americans paid an extra $1.9

billion a year for sugar due to import quotas alone.American families also pay more for their milk, butter, and cheese, thanks to federal dairy price supports and trade barriers. The federal government administers a byzantine system of domestic price supports, marketing orders, import controls, export subsidies, and domestic and international giveaway programs. According to the U.S. International Trade Commission, between 2000 and 2002 the average domestic price of nonfat dry milk was 23 percent higher than the world price, cheese 37 percent higher, and butter more than double. Trade policies also drive up prices for peanuts, cotton, beef, orange juice, canned tuna, and other products. These costs are compounded by
escalating tariffs based on the amount of processing embodied in a product. If the government allowed lower, market prices for commodity inputs, processed foods would be substantially cheaper. Lifting sugar protection, for example, would apply downward pressure on the prices we pay for candy, soft drinks, bakery goods, and other sugar-containing products. The burden of higher domestic food costs falls disproportionately on poor households. Farm protections act as a regressive tax, with higher prices at the grocery store negating some or all of the income support the government seeks to deliver via programs such as food stamps. If

American farm subsidies and trade barriers were significantly reduced, millions of American households would enjoy higher real incomes.

The number of variables that are taken into account when deciding how much acerage to plant make it impossible to say if government subsidies are affecting this decisions and, by extension, prices Bruce A. Babcock Iowa Ag Review Spring 2006
This discussion is not an attempt to minimize the impacts of U.S. farm subsidies on farmers' acreage decisions. Rather, it is meant to illustrate how complicated estimation of the impacts actually is. Farmers base their decisions about what and

how much to plant on numerous factors, including rotation considerations, production costs, expected market prices, availability of crop insurance, and expected benefits from farm programs. The complicated nature of these decisions makes it quite difficult to determine if U.S. farm programs for crops other than cotton are vulnerable to a WTO case against them on the basis of price suppression. The role that these programs play in farmers' planting decisions varies across crops, regions, and crop years. Simple "rules of thumb" that use total payment levels as a guide or the belief that the programs work as a cheap food policy are inadequate measures of the impacts of farm payments on U.S. supply and international commodity prices

ADI 08 Food Prices toolkit Spring

CONFLICT TURNS AGRICULTURE- MULTIPLE WARRANTS CHRISTOPLOS ET AL 04 (Ian Christoplos, Catherine Longley and Tom Slaymaker, “THE CHANGING ROLES OF AGRICULTURAL REHABILITATION: LINKING RELIEF, DEVELOPMENT AND SUPPORT TO RURAL LIVELIHOODS,” July 2004, Overseas Development Institute Humanitarian Policy Group) Agricultural production is inevitably affected by conflict, for example: • insecurity may prevent access to farms and markets for the timely implementation of key tasks; • expanding urban populations due to displacement may affect market demands and may lead to intensified peri-urban production that competes with rural producers; • changing household composition (due to death, abduction, displacement or migration) may reduce family labour; • the loss or depletion of financial assets may limit access to agricultural inputs; • displacement may force farmers to abandon their farms and/or production output altogether; • access to land, labour and other inputs may be limited in places of refuge; • agricultural outputs may be forcibly extorted by warlords or local militia; • formal input delivery systems may cease to function; • changes in the local economy (either related to conflict or relief food supply) may render staple food production unprofitable (though other crops may become very profitable); and • over-exploitation of land may have long-term negative consequences for the natural resource base.