Foolishness over Our Food Supply

The results show that the dominant causes of food price increases are investor speculation and ethanol conversion.


There’s an appeal for CARE’s 2011 World Hunger Campaign going on – tax-deductible at least in the US. And I find it absurd.

Not that they are making the appeal, but that they HAVE to. How is it that there is a food crisis?

Part of it is elucidated in a study by the New England Complex Systems Institute entitled The Food Crises: A quantitative model of food prices including speculators and ethanol conversion [PDF].

From the abstract:
Recent increases in basic food prices are severely impacting vulnerable populations worldwide. Proposed causes such as shortages of grain due to adverse weather, increasing meat consumption in China and India, conversion of corn to ethanol in the US, and investor speculation on commodity markets lead to widely differing implications for policy. A lack of clarity about which factors are responsible reinforces policy inaction. Here, for the first time, we construct a dynamic model that quantitatively agrees with food prices. The results show that the dominant causes of price increases are investor speculation and ethanol conversion. Models that just treat supply and demand are not consistent with the actual price dynamics. The two sharp peaks in 2007/2008 and 2010/2011 are specifically due to investor speculation, while an underlying upward trend is due to increasing demand from ethanol conversion.

In other words, greed, and insanity.

Read also The State of Food Insecurity in the World 2010: Addressing Food Insecurity in Protracted Crises [PDF] from the United Nations Food and Agriculture Organization: “FAO estimates that a total of 925 million people are undernourished in 2010 compared with 1.023 billion in 2009. Most of the decrease was in Asia, with 80 million fewer hungry, but progress was also made in sub-Saharan Africa, where 12 million fewer people are going hungry. However, the number of hungry people is higher in 2010 than before the food and economic crises of 2008–09.”

There are also, increasingly, water shortages. Frankly, those TV ads such as One Million New American Jobs: The Benefits of Increased Access to Domestic Oil & Gas, touting the Canadian tar sands oil that would have been too dirty for the US government to buy, under legislation signed by George W. Bush, make me even more nervous. Allegedly cheaper oil, but at what cost to the water supply?

As Blog Action notes:
“Food is something that we all share in common but is distinct to each of our cultures. The way we produce, distribute and consume food is crucial to our shared future, and the unhealthy imbalance of food scarcity in developing world and food over-abundance in the developed world is unsustainable for us all.”

Take the quiz.

Social media & sharing icons powered by UltimatelySocial