A report released by the World Bank in late August showed that global food prices rose by 10% in July. The price hike has been largely due to the massive heatwaves and droughts that have swept across the United States and eastern Europe over the past few months, causing havoc for farmers, destroying crops across the continents.
The Food Price Watch report is released by the World Bank each month and tracks global food prices for several staple items. The July report found that maize and wheat prices rose 25% and soybeans by 17%. Only rice saw a drop in prices, by 4%.
The price increases have been felt hardest by those in the Third World. For example, maize prices increased by 113% in July in some markets in Mozambique. In South Sudan, sorghum prices rose by 220%, while they rose by 180% in Sudan.
Australia has in no way been immune to the drought shock. In August Australia’s biggest bread maker Goodman Fielder said that bread prices were set to rise over the coming months. The price increases are due to the collapse in the corn harvests in the US. These harvests are forecast to drop by 100 million tonnes this year, in turn pushing wheat prices in Australia from $214 a tonne to $310 a tonne.
The shock in grain was also predicted to have an impact in chicken prices, with chicken feed accounting for about 65-70% of the cost of producing a chicken. In July, some retailers predicted prices were set to double almost immediately because of the drought.
This is not the first time extreme weather have been directly linked with food price hikes in Australia. For example, during the 2002-03 drought, food prices rose by 4.4%, nearly twice the rise of 2.7% in the consumer price index. Over 2005-07, drought prices rose by 12%, again double the CPI increase of 6%. The Queensland floods of 2010-2011 saw significant increases in food prices, although these increases were temporary.
These price increases are now seen by scientists as a direct result not only of global warming, but also in increasing climate variability, which is causing more droughts, floods and extreme weather events.
The World Watch Institute, a global sustainability research institute, blames increased prices directly on the climate variability that comes with climate change. As it states:
“Climate change has been attributed to greater inconsistencies in agricultural conditions, ranging from more-erratic flood and drought cycles to longer growing seasons in typically colder climates. While the increase in Earth’s temperature is making some places wetter, it is also drying out already arid farming regions close to the equator.”
New research coming from NASA scientist James Hansen earlier this year said that we can comfortably predict that not only are these sorts of events more likely to occur, but that we can also link current extreme weather events such as the US drought with climate change, meaning we can directly link climate change to significant increases in food prices. Even if the July price increases are temporary, with increasing climate variability, we should be prepared for increased prices and more shocks.
It doesn’t help that large proportions of several food staple crops are sucked up to feed the insatiable maw of the ethenol market.
Comes down to what’s better, trying to combat climate change using ethenol based fuels, or watching families in the third world starve.
Food prices also soaring due to massive greed in the handful of corporate giants who control the world’s grain trade and the bankers who manipulate international trade with their billions of free US Fed dollars. And a big thanks to the Howard government for selling off the AWB so that these multinationals could control our grain exports too.
These psychopaths see food shortages as an ideal way to increase profits, caring little for the millions who starve as a direct consequence of their greed. My prediction is that this is going to end badly.
And what are our governments doing to fight reduce carbon emissions? Federally relying on the purchase of overseas credits to reduce net emissions and in Victoria the Baillieu govt has given every nimby the power of veto for new windfarms within 2km of their home thereby strangling wind power (no restriction for coal) and has reduced the solar feed in credit to 30% of the per kwh retail price of electricity, thereby killing solar.
And still we have no national, no regional food security strategies….
The grain futures market has been creating wild price fluctuations for years. It’s called speculation! All the coffee drinkers will recall the crazy coffee prices a couple of years ago – the reasons given were varied including crop failures – but there was actually plenty of coffee. Then the ‘coffee speculators’ moved to something else and the prices stabilized. By the way, the producers didn’t share in the spike in coffee prices…….
And then how about the tons of fruit that were ploughed in or left unpicked this year in Australia because the price was too low to justify the cost of harvesting……..
Then there’s the insane US legislation to force the use of bio-fuel…..
Then we have the grain business to feed cattle………
Then we have the tons of fish that are pulped into fertilizer…
And of course the insane waste in the first world countries…..
The list goes on …………….
Hope someone has the answer!