Costs rise and World Food Program faces crisis

March 25, 2008

The LA Times runs a story by Tracy Wilkinson examining an impending shortage of global food aid likely to impact the world’s poor over the upcoming year. The UN’s World Food Program anticipates that, due to rising costs, it will lack sufficient funds to meet the needs of millions of people with unstable food supplies around the world. About half way in, the author makes the following direct statement in an attempt to explain the immediate sources of the crisis:

Food commodities are becoming more expensive because of rising demand in developing countries, natural disasters and climate change, and the shift of millions of tons of grains to the production of biofuels.

This is an admirably direct comment, however, she has left a few key factors out of the picture. The most important of them has to do with the structural relations of the global political economy:

Over the past thrity years or so, wealthy nation’s agro-subsidies coupled with the manipulation of commodity futures markets by corporate food producers have artificially depressed food commodity prices, thereby undermining productivity in poor countries. Now, at a time when commodity prices are rising, poor farmers and poor countries have been locked out of agricultural production by the subsidized (multinational) competition. As a result, they do not benefit from a business cycle, but instead face life-threatening shortages.

A stable global food supply will not come about through increased donations to the UN alone. It also requires a more fundamental transformation of the practices and rules of global trade.

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