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Wheat is harvested in Punjab, where water has become a top concern.

The photo above is from a slideshow here.

AN article in the New York Times Food Chain series on agriculture in India, the successes, the failures and the challenges. These are not just around farm productivity but regulation, investment in agriculture, water, supply chain and culture.

The article begins:-

India’s supply of arable land is second only to that of the United States, its economy is one of the fastest growing in the world, and its industrial innovation is legendary. But when it comes to agriculture, its output lags far behind potential. For some staples, India must turn to already stretched international markets, exacerbating a global food crisis.

In it's concluding paragraphs the paper notes:-

How to address these challenges is a matter of debate.

From one quarter comes pressure to introduce genetically modified crops with greater yields; from another come lawsuits to stop it. And from yet another come pleas to mount a greener Green Revolution.

Alexander Evans, author of a recent paper on food prices published by Chatham House, a British research institution, said: “This time around, it needs to be more efficient in its use of water, in its use of energy, in its use of fertilizer and land.”

Mr. Swaminathan wants to dedicate villages to sowing lentils and oilseeds, to meet demand. The World Bank, meanwhile, favors high-value crops, like Mr. Chawla’s baby corn, because they allow farmers to maximize their income from small holdings.

The market may yet help India. Mr. Chawla, for instance, has replaced baby corn with sunflowers, prompted by the high price of sunflower oil. For the same reason, he is also considering planting more wheat.

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An article from the New York Times on the work of Norman Uphoff of Cornell University on improving agricultural productivity in rice without GM.

This extract refers:-

Harvests typically double, he says, if farmers plant early, give seedlings more room to grow and stop flooding fields. That cuts water and seed costs while promoting root and leaf growth.

The method, called the System of Rice Intensification, or S.R.I., emphasizes the quality of individual plants over the quantity. It applies a less-is-more ethic to rice cultivation.

In a decade, it has gone from obscure theory to global trend — and encountered fierce resistance from established rice scientists. Yet a million rice farmers have adopted the system, Dr. Uphoff says. The rural army, he predicts, will swell to 10 million farmers in the next few years, increasing rice harvests, filling empty bellies and saving untold lives.

“The world has lots and lots of problems,” Dr. Uphoff said recently while talking of rice intensification and his 38 years at Cornell. “But if we can’t solve the problems of peoples’ food needs, we can’t do anything. This, at least, is within our reach.”

Uphoff's approach is not universally accepted and critics include the 'rice science establishment as discussed in the article.

Robert Chambers, a leading analyst on rural development, who works at the University of Sussex, England, called it a breakthrough.

“The extraordinary thing,” he said, “is that both farmers and scientists have missed this — farmers for thousands of years, and scientists until very recently and then some of them in a state of denial.”

The method, he added, “has a big contribution to make to world food supplies. Its time has come.”

The article concludes:-

In Laos, an agriculture official recently said S.R.I. had doubled the size of rice crops in three provinces and would spread to the whole country because it provided greater yields with fewer resources.

“Once we get over the mental barriers,” Dr. Uphoff said, “it can go very, very quickly because there’s nothing to buy.”

The opponents have agreed to conduct a global field trial that may end the dispute, he said. The participants include the rice institute, Cornell and Wageningen University, a Dutch institution with a stellar reputation in agriculture.

The field trials may start in 2009 and run through 2011, Dr. Uphoff said. “This should satisfy any scientific questions,” he added. “But my sense is that S.R.I. is moving so well and so fast that this will be irrelevant.”

Practically, he said, the method is destined to grow.

“It raises the productivity of land, labor, water and capital,” he said. “It’s like playing with a stacked deck. So I know we’re going to win.”

It will be interesting to keep an eye on this, as if the approach holds up, it would seem to offer considerable advantages. productivity is increased and resource use reduced. Surely a good thing all round?

Adam recommends this article.

He wonders if there are other crops where a similar approach might be tried.

The article points up also how new approaches not only have to struggle to find acceptance from farmers, but also from the agriculture establishment.

YIELD The rice growing method is used in places like Indonesia.

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The Wall Street Journal has this interesting article on changes in attitude towards farming in the developing world, especially by the World Bank and IMF, who are acknowledging past errors of judgement.

It discusses the change concerning whether farmers should grow for food or export.

The article is a useful one and comes at the issue in a manner somewhat different from that which one might expect from the Wall Street Journal.

PONT-SONDÉ, Haiti -- Leonid Eustache coaxes a small rice crop out of his tiny plot here, but he could use some help from his government. He can't afford fertilizer. His only tool is a hoe. And half of his crop rots because nearby drainage canals are filled with water hyacinth.

"The water stays, and it rots the roots of my plants," the 62-year-old farmer said on a recent day, standing barefoot in a pool of stagnant water. "They should do something about that."

For the first time in a long while, someone just might. Haiti is one of many developing nations where a global food crisis is causing both donors and recipients of anti-poverty aid to rethink doctrines about the role of agriculture -- and whether poor nations should grow their own food or rely on the world's trading system.

For decades, poor nations were discouraged from investing too much in agriculture, which was seen as a problem rather than a solution to fighting poverty. Many free-market economists came to believe that the reason billions of people are poor is because they are shackled to subsistence farming. The economists' solution: find something else for them in manufacturing, tourism or services so that they can make money to buy food instead of growing it.

Poor countries were discouraged from growing much of their own staples, such as rice and wheat, that are usually grown more cheaply in rich countries. Instead, they were told to focus on export crops that might fetch a higher price.

This link is to a related video on whether to drink water of use water for crops.

Later the article comments:-

A growing number of World Bank economists are now convinced most poor nations need a healthy farm sector as the basis of a robust economy. The manufacturing booms that swept Asia only happened after the region's farm sectors developed. And new research shows that investing in agriculture lifts more people out of poverty much faster than long thought. The 2007 study "Down to Earth" by World Bank economists Luc Christiaensen and Lionel Demery found economic growth of the agriculture sector is at least twice as effective at reducing poverty as any other sector.

later the article considers what the impact of past policies has been:

Since the early 1980s, the World Bank and IMF preached that higher yields from rich countries' farmers would keep food cheap, eliminating the need for poor countries to spend their meager dollars on boosting agricultural productivity. This held true for years. Most poor countries could usually import staples more cheaply than grow their own, and could focus resources elsewhere.

That advice failed to take into account the possibility that food grown by wealthy farmers might not stay cheap forever. Even though agricultural productivity is still climbing, rising demand for food in Asia, greater use of grains for cattle, and the diversion of crops for biofuels have all helped increase prices quickly.

Now that countries want to revive their agriculture sectors, it's not going to be easy, given the neglect of the past few decades.

Consider what has happened in Africa. In the 1980s, governments were prodded by the World Bank to get spending under control. Many set about whacking agriculture programs. Irrigation projects dried up. Schools that trained scientists and agronomists fell into disrepair. At an agriculture school in Mozambique, students who are supposed to study mechanized farming rely on broken-down tractors and combines that sit like museum pieces on the school's lawn. In Ghana, some agents for the government's agricultural extension service, who are supposed to spread the latest scientific advice to farmers, often must hitch rides or walk to make their rounds.

The situation in Haiti provides an illustration of what happened, according to the article:-

U.S. rice, which Haitians call "Miami" rice, slowly displaced local rice. In the Artibonite, large-scale farming was nearly wiped out by a combination of imports and a land reform. By 2003, the Artibonite was producing less than 80,000 metric tons of rice. Haiti is now the world's biggest per-capita importer of rice -- it imported about 400,000 metric tons last year -- and the number four market for U.S. rice growers, buying $112 million worth of rice last year, according to the USA Rice Federation.

"In the case of Haiti, the lowering of tariffs without support for farmers to transition into more-profitable crops was a negative blow to the agriculture sector," said Diego Arias, a rice specialist who worked in Haiti for the Inter-American Development Bank and is now with the World Bank.

Outside advisers, he says, often failed to see that, to a Haitian farmer, rice is preferred as a low-risk crop -- easy to store, and easy to eat in times of low prices. Tomatoes, which experts urged Haitians to cultivate, "could have offered a better return," Mr. Arias concedes. "But tomatoes also are more risky. In Haiti, they spoil on the way to market, the roads are so bad

This article is worth taking a look at, it provides a counter balance to some of the other material that is available.

Adam is of the view that there is no simplistic answer, nor will one solution fit all circumstances. For example Haiti has been ravaged by war for much of the period as well, further the article suggests that land reform and a reduction in large scale farming was a significant contributor to the problem.

Interestingly, the article would tend to support the view that subsidies to rich world farmers to produce staple crops such as rice are not in the long run helpful. Further, higher value crops might have benefited Haiti, but lack of infrastructure mitigated against that. Thus another key factor identified elsewhere is apparent here - farmers cannot move up the value train without investment in infrastructure and support in initial capitalisation.

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Wanted: a rapid transformation of one of the most complex problems in the world’s poorest continent, to take place in the middle of a food crisis.

Thirty years after the first “green revolution” transformed agriculture in Asia and Latin America, as new seed varieties and copious fertiliser enabled farmers to break out of the subsistence trap, Africa is trying to follow suit.

Throughout the 1980s and 1990s, productivity in African farming failed to keep pace with population growth. Any increases reflected bringing more land under cultivation rather than lifting yield.

It would appear from the article that short term benefits will flow from improving markets and exploiting existing best practice and technologies.

But there is disagreement over whether Africa should seek an agribusiness model based on big commercial farms or concentrate on improving the lot of its millions of smallholders. Moreover, the difficulties in transforming African agriculture are manifold. Some are topological: the continent contains huge varieties of soil and climate, ranging from a Mediterranean climate in the Maghreb to tropical environments to temperate latitudes in South Africa. Crops grown and techniques used in one part often cannot be transferred to others.

It is probable that a hybrid solution may evolve. Improving the lot of smallholders will increase the ability of people and nations to feed themselves. It may not allow some nations to take advantage of climate and geography to exploit their agriculture as a means of export earnings.

NZ with a successful co-operative farming history may well be able to assist here, as may other nations with similar expertise. Agri-business does not have to mean faceless corporates nor foreign control, nor state ownership either.

So what are the prospects for improvements that will help feed a population approaching 1bn? The cause was given a boost when the Alliance for a Green Revolution in Africa, an association of farmers, agricultural businesses, scientists and research institutions, was founded in 2006 with $150m (£76m, €97m) from the Rocke­feller Foundation – which also played a central role in funding the first green revolution – and the Gates Foundation.

let us note here that Rockefeller and Gates are not directing what should happen, but are providing seed money to enable countries and people to feed themselves. They are not the Great Satans of food as Sue Kedgley would have us believe.

In fact Adam increasingly thinks that in many cases a lot of the NGOs, which are essentially in many cases single issue political lobby groups do more harm than good.

Mpoko Bokanga, executive director of the African Agricultural Technology Foundation (AATF), a public-private research partnership based in Nairobi, points to big contrasts even within the same country. “In western Kenya in the northern Rift valley there are very fertile areas with high productivity farms whose commercial potential has been well developed,” he says. “Then 50km away will be forgotten districts whose farms have a third or a quarter of their yield.”

While there are some big river systems, and some areas receive a lot of precipitation, most farming relies on unreliable rainfall: less than 5 per cent of cultivated land is irrigated in Africa, compared with 40 per cent in South Asia.

Again as Adam has frequently noted in earlier posts we see the common factors of under investment in research by governments, dissipation of Green Revolution benefits, though these were always much less in Africa and pre-eminently the issues of appalling governance, conflict and corruption.

One of the AATF’s projects, for example, is to develop a “water-efficient maize” that will tolerate longer periods of drought, a trait that will become increasingly important if, as appears to be the case, climate change is making rains more variable. The foundation will take basic research donated by Monsanto, the US-based agribusiness group. The International Maize and Wheat Improvement Centre in Mexico, a non-profit research institute that played a big role in the first green revolution, will then transplant it into high-yielding maize varieties that will thrive in tropical environments. The varieties will then be distributed to African seed companies without royalties. But Mr Bokanga says that it will be five or six years before strains are available that can be tested in the field.

It is important to note that Monsanto, a private company donated the research and that the seeds developed will be royalty free. This would not happen if private business did not exist. It is not all rape and pillage. Greens please note

Further down the road, the green revolution will have to confront one of the most controversial issues in world farming: genetically modified crops. African countries have been slow to adopt GM. South Africa is the only one that has approved a GM variety, though Burkina Faso may be on the point of approving a cotton strain, following its widespread use in India, and Egypt is looking at GM maize.

Prior to resolving that issue, the article notes

In the meantime, a lot can be done to extend the use of existing technology. In many African countries, particularly the poorer ones, it is not that fertiliser, or better hybrid seeds, do not exist. It is that a combination of poverty, a stunted private sector and weak marketing services prevents them getting to farmers.

The article points out that:-

Much of the agricultural support apparatus that African governments used back in the 1970s – state marketing boards to which farmers sold their produce, across-the-board fertiliser and seed subsidies, strategic reserves of grain in case of food crisis, target prices maintained by official intervention – were dismantled, often at the urging of the World Bank and other aid donors, which regarded them as wasteful, prone to corruption or positively damaging. (Similar institutions persist in European and American farming, however.) But the vacuum left by the wholesale withdrawal of the state was often not filled by private businesses, leaving farmers disconnected from domestic and international markets.

Yet we should not presume that that lends the concept validity, given that the EU and the USA are bywords for political pork, protectionism and waste, for example primarily due to the CAP the EU is unable to secure a clean audit report on it's expenditures. Further in a number of the nations concerned the economic and political climate was far from conducive to investment and development.

Agra, for example, is spending $40.5m establishing a network of 10,000 dealers to sell fertiliser and other inputs in rural areas. Some countries, such as the southern African nation of Malawi, are experimenting with “market-smart” subsidies designed to complement and stimulate rather than to replace the private sector.

There is, though, more to the impact of a green revolution on poverty and the availability of food than lifting output. The form growth takes, and the best way to spread its benefits, are matters of some debate.

Jon Maguire, a British investment fund manager, started an “Africa Invest” fund after visiting Malawi and finding villagers unable to generate a harvest through lack of rain, even though they lived on the shores of Lake Malawi. “I asked them why they didn’t invest in irrigation and they told me that money had not been circulating in the villages for three years,” he says. With no knowledge of agriculture himself, he raised $16m in funding, hired local farm managers and bought $3.5m worth of sprinklers and other irrigation systems.

His operation now runs 2,500 acres of farms, with another 9,000 “outgrower” families contracted to supply it. They sell paprika peppers and birdseye chillies to the world market, including Spain. “The Spanish were amazed at the quality of the paprika,” he says. Next year, his operation intends to buy what he says is Malawi’s first ever combine harvester.

Mr Maguire’s solution is large, export-oriented farms with heavy investment in irrigation.

It has to be said though, that many others disagree. “

Smallholders have proved they can compete if they get the right inputs,” he says. “That is what happened in the Asian green revolution.” Surpluses will build up and farmers can then move into cash-crop farming. Higher smallholder output of basic grains will also benefit the landless and the urban poor, by increasing supply and moderating food prices.

Adam is of the belief that there is room for both, especially if the concept of co-operatives is further explored.

He is concerned that many of those who disagree are simply re-acting with knee jerk reflexes to the past and not realising that the 21 st century is time for a different approach. It cannot be any longer State Good, Private Bad - surely people realise that, in Africa, the State has often merely been a means to transfer aid from the donor to the government to the pockets of whoever is currently in power.

Though as one might expect and no doubt music to the ears of the Greens:-

Leftwing critics of the idea of a green revolution do not doubt that Africa can increase productivity with new seeds and inputs, but say the benefits will go to large corporations and rich farmers. Raj Patel, a fellow at the left-leaning Institute for Food and Development Policy in the US, recently told a congressional committee that projects such as Agra, “while perhaps well intentioned, are models of unaccountable and unsustainable technological investment”. He called instead for “programmes that further the adoption and research into locally appropriate and democratically controlled agro-ecological methods”.

Now what the hell is he talking about. Sounds to Adam he is calling for collective farms and para statals. Were these not along with state subsidy and boards the same nostrums that contributed to several African countries becoming importers of food rather than exporters.

The article concludes:-

Ask five different people in the green revolution debate and you get seven different answers. Africa needs private agricultural suppliers. Africa needs water. Africa needs roads. Africa needs GM crops. Africa needs big farms. Africa needs small farms. The reality seems to be that in such a diverse continent, Africa is likely to need all of them – and more.

This where, as he has commented a number of times before Adam sees a major opportunity for NZ farming to build on it's expertise and sell services, livestock and skills to Africa. Not only can we do good, we can make money doing so and at the same time assist in transforming the NZ economy into much more of a skills based one.

The key thing to realise in all this is that Africa is a vast continent with many countries, societies, cultures and environments. Consequently, there will be scope for a wide variety of economic models to be tried, improved and adapted to the local conditions. More than one is likely to prove successful at varying times.

The Financial times is running a series titled the Need to Feed. the first article commences:-

The world stood on the brink of starvation and, warned doomsday forecasts in the 1960s, the battle to feed all of humanity was already lost. Famine was common in some of the most populated countries. Predictions of Malthusian catastrophe made the bestseller lists, with Paul R. Ehrlich writing in The Population Bomb that by the 1970s and 1980s the victims would number in the hundreds of millions.

But human ingenuity saved the day. A massive programme of investment in agricultural research and infrastructure – avidly supported by the US out of a cold-war-fuelled fear that hungry countries could fall into the arms of the Soviet Union – led to an explosion in farm productivity. Nations that never dreamt of being able to feed themselves were transformed into net exporters of food.

So through investment in research the world moved into a position of food abundance. The Green Revolution enabled nations unable to feed themselves to feed themselves.

Those efforts, led by Norman Borlaug, an American agronomist who was later awarded the Nobel peace prize, resulted in the development of higher-yielding seeds and an exceptional expansion in the use of irrigation, fertilisers and pesticides in developing countries.

The green revolution was in many respects a victim of its own success. The increase in food production from the early 1960s was so great that it not only staved off global hunger but also opened the way to almost 40 years of cheap and abundant food supplies. Wheat yields per hectare, for example, jumped from less than 500kg to nearly 3,000kg today. Indeed, for most of the 1990s the problem was too much food, with much talk in Europe of grain “mountains” and “lakes” of milk and wine.

The concluding paragraphs are below. but the entire article is worth reading, Adam intends to look for some further commentary on the summit:-

Some argue that a second green revolution will be harder to achieve than the first, because genetically modified organisms provide the only hope for new seed, and Europeans are dead against them; because there is not enough water to permit a big expansion of irrigation in, say, Africa; and because oil at $125 a barrel makes fertilisers too expensive. That seems unduly pessimistic. As Mr Bage points out, the only thing known for sure is that there has been an enormous fall in agricultural investment over 30 years. It seems a bit early to rule out in advance the possible benefits of reversing that decline.

But saying smallholder agriculture needs investment, and actually providing it, are different matters. Over the past three months, pledges of money have surged and two institutions—the World Bank and IFAD, a UN agency—have emerged as the main prospective lenders.

Unfortunately, says Simon Maxwell of Britain's Overseas Development Institute, much of the “new” $1.2 billion promised by the World Bank, and the $500m from the Asian and Latin American Development Banks, is not really additional. It is diverted from other programmes, and this raises worries about robbing Peter to pay Paul. Moreover, even the so-called new funding doesn't amount to very much: tens of millions of dollars, which may be enough for some new seeds but is a far cry from the $15 billion-20 billion a year Mr Ban wants for a green revolution. Mr Ban's efforts to improve farming are laudable and ambitious. So were Mr Annan's efforts to boost peacekeeping.

Or in the Economists case, the Doha Dilemma. This post refers to an article in the print edition of the Economist for 29 May 2008.

THE global food crisis has shone a harsh spotlight on the consequences of government meddling in agriculture. Poor people go hungry, in part, because Americans pay their farmers to divert crops from food to fuel. But in at least two areas, the crisis has emboldened those who are sceptical of free markets in food.

The first is “food security”. Politicians in rich and poor countries have seized on recent price spikes as proof that free farm trade is a risky business and self-sufficiency a worthy goal. The second area concerns the poor. For years reformers have advocated freer trade on the grounds that market distortions, particularly the rich world's subsidies, depress prices and hurt rural areas in poor countries, where three-quarters of the world's indigent live. The Doha round of trade talks is dubbed the “development round” in large part because of its focus on farms. But now high food prices are being blamed for hurting the poor (the topic of a big United Nations summit in Rome starting on June 3rd).

The argument for self-sufficiency is easiest to counter. Anyone who believes autarky is the route to food security should look at starving North Korea. In world markets trade barriers, not the lack of them, have exacerbated the mess. The commodities that have seen the biggest price spikes are those which tend to be traded least. Only 6% of global rice production, for instance, flows across borders.

Thus:-

The notion that free trade precludes food security is plainly wrong-headed.

Adam's emphasis. Thus Jim Anderton is to be commended in his comments about the proposals by the Greens.

Further, all the political parties need to take the time and effort to understand what is going on in this area, rather than propose politically attractive populist solution in a kneejerk re-action to consumer concerns.

The second question is the more difficult, and the article spends considerable effort on discussing the inter-meshing of trade, food prices and poverty reduction. The article is worth reading in full.

It highlights some interesting effects of different types of reform. Research from the World Bank is cited on what might happen if trade was truly free. in part is would appear that some negative impact may result from the lavish nature of existing subsidies. The suggestion is that reducing tariffs is beneficial to consumers, whilst subsidy reduction may cause prices to rise.

Again this would tend to suggest that the Kedgley Question is the wrong question. It is not trade that is the problem, but the fact that globally in rich and poor countries a system of subsidies has arisen in addition to tariff barriers.

But as always things are not simple, the research quoted tends to indicate:-

that high food prices, on average, transfer income from richer to poorer households. And prices are not the only route through which poverty is affected. Higher farm income boosts demand for rural labour, increasing wages for landless peasants and others who buy rather than grow their food. Several studies show this income effect can outweigh the initial price effect. Finally, the farm sector itself can grow. Decades of underinvestment in agriculture have left many poor countries reliant on imports: over time that can change.

This moves us towards considering the need for significant improvements in governance, research and development and in order to feed the growing world population re-consideration of attitudes towards GM crops.

It should be obvious in addition that a reliance on organic foods is not going to provide the answer nor will plots for each family when we are talking over the next few decades of some 3 billion extra mouths to feed; plus the depletion of many fossil aquifers through inappropriate depletion.

The Economist article records that World Bank research suggests, of the countries covered by the study, that:-

Fully free trade in farm goods would reduce poverty in 13 countries while raising it in two.

Yet recently the World Bank has according to the article been taking what appears to be a somewhat contradictory track, based on another study. On analysis this may not be the case as apparently the countries considered were not the same in both sets of studies.

even if higher prices for staples exacerbate poverty in some countries, at least in the short term, the effect may be outweighed by increased demand for other farm exports, such as processed goods, as rich countries cut tariffs.

The article concludes:-

These subtleties suggest two conclusions. First, the bank, and others, should beware sweeping generalisations about the impact of food prices on the poor. Second, the nature of trade reform matters.

Removing rich-country subsidies on staple goods, the focus of much debate in the Doha round, may be less useful in the fight against poverty than cutting tariffs would be.

The food-price crisis has not hurt the case for freer farm trade. But it has shown how important it is to get it right.

Indeed - so it would be much better to examine the issue by regard to the factors affecting different countries and to understand the impact change is likely to have.

Interestingly, tariff reduction appears more likely to help the poor.

This conclusion might conceivably enable a new avenue of approach to be taken on agriculture with regard to the conclusion of the Doha Round? This is conjecture on Adam's part and he would be interested to know how that stacks up from an economic standpoint.

It does appear though that the answer to the Kedgley Question is that free trade, appropriately structured is likely to be beneficial to the poor in respect of food security. Thus undermining the position taken by the NZ Greens amongst others.

Amongst the key factors affecting supply and therefore prices have been the issues of :-

• protectionism - EU, US Farm Bill, tariffs
• poor land use - Japanese rice farmers
• inefficient farming practices - see IAASTD reports
• governance - EU CAP sending wrong signals, Zimbabwe exporter to importer, Burma major loss in production prior to Nargis, similar position in other countries
• impact of natural disasters - drought in Australia, cyclone Nargis,
• failure to invest in agriculture and agri-science, thus squandering the benefits of the Green Revolution
• impact of mis-information and politically inspired campaigns re GM and GE foods and seeds
• 'green ' pressures and fears of oil shortages, causing switch of food production to bio-fuels, often in a grossly inefficient manner, depleting food and water supply for little if any energy benefit

Next week there is a major conference on Food Issues in Rome being held under the auspices of the FAO.

One of the aims of the conference, according to the FAO:- "a historic chance to re-launch the fight against hunger and poverty and boost agricultural production in developing countries."

Per Scoop - copy of NZ Govt Press Release:-

New Zealand is to have an 11-member delegation at the summit meeting, led by Jim Anderton.

It includes Green MP Sue Kedgley, who is personally paying her own costs, and NIWA principal climate scientist Jim Salinger and Fisheries Ministry chief executive Wayne McNee.

Not exactly a high powered delegation given the importance of the topic and of agriculture to NZ.

This last week, immediately prior to the FAO conference, the OECD and the FAO issued their most recent survey of agriculture.

The FT has an article on that survey of agriculture here, the article concludes:-

Still, the margin for error is minuscule. In 2012-13 cereals production is expected to exceed consumption by just 0.3 per cent. That makes prices sensitive to any market distortions. The state promotion of biofuels is one such factor: since the end of 2004 about 60 per cent of higher grain production has been eaten up by biofuels use. The OECD assumes this ratio falls to 40 per cent, but the medium-term direction of governments’ policies remain unclear.

Meanwhile, emergency export bans and other impediments to free trade could easily prevent the extra forecast production from fulfilling demand. The OECD may be counselling calm, but given that empty stomachs are involved it is hard to relax.

Key to resolution of the crisis is to avoid adopting measures which will exacerbate the problem rather than assist in resolving it.

This one of the reasons Adam is so appalled at the failure to conclude the DOHA Round and the various protectionist statements made by the French and German Agriculture Ministers recently. Coupled with passage of the US farm Bill with sufficient margin to over -ride President Bush's veto.

The article referenced above may appear to conflict somewhat with a recent OECD/FAO forecast that food prices will stay high for 10 years, but in fact it does not, food prices will fall but not back to the once prevalent low levels:-

The price projections imply falls from the current records but suggest that food inflation will continue to be a long-term problem, particularly for poor countries.

“Without exception, average real prices are likely to remain above those observed during 1985-2007,” said the report summary. The OECD said the projections were preliminary numbers.

Alexander Müller, an assistant director-general at the FAO in Rome, said the world needed to get used to higher food prices. “In the near future, we will have to live with higher prices for agricultural commodities.”

The report referred to in the articles quoted above is the joint OECD - FAO Agricultural Survey which was presented in the last couple of days.

Interestingly, from an NZ viewpoint, the articles make no mention of dairy - although demand for dairy product is rising in a number of countries.

At the launch:-

OECD chief Angel Gurria - in a Reuters report, threw his weight behind genetically modified crops as an antidote to high food prices. Gurria, speaking after he and the head of the UN food agency presented a report forecasting high food prices over the next 10 years, was asked by Reuters when he left a news conference if he was calling outright for promotion of GM crops and a moratorium on government-supported promotion of biofuel. "I am saying genetically modified crops are part of the solution," Gurria told Reuters.

The food price report by OECD and UN Food and Agriculture Organisation (FAO), published before the world food summit in Rome next week, suggested GM crops could help boost output to feed more people and livestock.

A video of the press conference may be found here. The report:-

also questioned the merits of government-sponsored plans to promote the grain-guzzling production of ethanol fuels as an alternative transport fuel, but without calling outright for a repeal of big ethanol targets, such as exist in the United States and the European Union. "I'm saying it's time for a serious review," he said when asked by Reuters to elaborate on the report. "We'll see then what action should be taken."

It is to be hoped that the FAO meeting sees serious and rational discussion on the issue of bio-fuels and on GM crops. Adam is of the opinion that for political protectionist reasons, and to protect some powerful lobbies, some countries are hell bent on maintaining artificial barriers against efficiently produced bio-fuels for example based on sugar cane and on GM crops for different reasons. They are aided and abetted in this by some NGOs who seem to have little if any regard for the truly poor and starving and who cloak themselves in moral self rectitude of a sickly green hue.

FAO head Jacques Diouf, in Paris for the presentation of the report, declined to be drawn when asked if he too was demanding a freeze of government-aided, biofuel-promotion projects, but he said he feared further distortions were afoot. "We mustn't repeat the same farm policy errors of the past, for which developing countries have paid dearly," he told the news conference, where he said the FAO-hosted food summit would draw 40 leaders and 1,500 envoys from 150 countries. He said he hoped the summit would come up with both urgent answers to the rising hunger risk -- a matter of humanitarian aid primarily -- and ideas on long-term food security.

Adam hopes that amongst other matters the FAO will focus on the factors he outlined at the start of this post.

In another article on World Bank actions,FT World Bank :-

The World Bank on Thursday unveiled a $1.2bn fast-track funding facility to help combat the impact of rising food prices on the poor.

The facility includes a $200m trust fund which will pay for grants targeted at the world’s poorest countries.

and:-

“The World Bank has shown impressive leadership on the food crisis in the last few weeks. We need to see similar political momentum and serious response from next week’s meeting in Rome,” Elizabeth Stuart, senior policy advisor at Oxfam, said.

The World Bank’s plan comes as the Organisation for Economic Co-operation and Development and the UN Food and Agriculture Organisation confirmed an earlier report by the Financial Times that food prices would remain high for the next 10 years, although they would fall from current near-record levels.

The organisations said in their Agricultural Outlook that the world needed to reconsider the use of geneticically-modified organisms to boost agricultural production, as well as embark on a “serious review” of biofuel policies.

This news is extremely heartening, it is to be hoped that the politicians and officials meeting in Rome achieve something concrete and not just a series of resolutions to meet and discuss the matter further.

Unfortunately Adam fears the worst when he reads comments attributed to Sue Kedgley of the Greens and a member of the NZ delegation.

Ccomments from Ms Kedgley, via Scoop copy of Greens press release,:-

"I expect there will be intense debate between the free trade marketeers and those who believe the free trade agenda is one of the causes of the present crises," Ms Kedgley says. "As a long time food campaigner I am looking forward to hearing the perspectives of people deeply affected by the world food crisis."

Ms Kedgley says she will bring a different perspective from the standard 'free trade at all costs' policies of many developed countries. "The conference will seek solutions to the global food crisis and rising food prices which are causing growing anger around the world, as people find themselves unable to afford food to eat. Some are warning that rising food prices pose more of a threat to political and social stability than the current crisis in global markets.

Well Adam agrees that food is a major geopolitical issue which along with water constitutes the emerging conflict flashpoint.

Where Adam takes strong exception to Ms Kedgley is in her remarks concerning free trade at any cost.

In the area of food many developed countries are rampantly protectionist, often to the point of absurdity, eg the EU, Japan and USA for example, but they are not the only ones. Other countries must of necessity embrace free trade in food because they do not have the land or other physical resources to feed their populations, or because through governmental incompetence they cannot.

As noted above the rush to develop bio-fuels has been a major cause of rises in grain prices, in rice a failure to build on the Green Revolution plus government incompetence has added materially to the problems - in addition rising oil costs have been a factor.

So Adam considers Ms Kedgley's remarks to be ill judged though no doubt music to the ears of European protectionists who will use this as a means to try and further restrict NZ food trade to Europe. Which of course will not worry Ms Kedgley, because after all, despite trade being an essential to the NZ economy the Greens are against it, or if not against it would like to reduce it and thus reduce us to penury by hobbling it.

Ms Kedgley goes on:-

"We need to challenge the doctrine of free trade and accept that people's right to food, to be free from hunger, must have priority over an ideological fixation on allowing market forces to prevail at all costs."

What rubbish she does speak. It is trade in food that has put food in the mouths of many, not protectionism. What parallel universe does she live in.

It is free trade in food that is the life blood of the NZ economy.

It is investment in agriculture and agri-science that has enabled growth in productivity, both in NZ and globally. It is the failure to build on past investment that has contributed to the current position.

Does she really think that farmers in poor countries do not want to make a living. Indeed, in developing countries as well as developed one, farming lobbies can be just as big a barrier and as tenacious in defending themselves to the detriment of the majority.

It is the long term manipulation of markets and tariffs by governments that causes much of the problem, not free trade.

What on earth is the NZ Government doing in allowing this Luddite to form part of our delegation?

Why is she paying her own way, does this mean she has negotiated an arrangement where she can speak against government positions?

After all as earlier FT article quoted by Adam in a post some 8 weeks ago pointed out:-

There is, no doubt, an element of speculative bubble in some of the big recent leaps in commodity prices but some of the underlying trends look more permanent. A combination of a larger and richer world population, the threats to agricultural production from climate change and rising subsidised demand for biofuel - the latter another example of producer interests capturing government policy - suggest the food crisis is more than a blip. Supply can expand in the medium term, by bringing new land into cultivation or improving farming techniques, but by how much remains unclear. In the meantime, the voices of the non-farming poor are becoming too strident to ignore.

It often takes a mounting sense of crisis to get politicians to focus on allowing markets to deliver cheaper food. The ancestor of modern cheap food policies, the repeal of the Corn Laws in Britain in 1846, was spurred by growing unrest within the swelling cities of an industrialising economy. In 1848 that unrest burst out into a series of revolutions across western Europe - though not in Britain.

Governments across the world need to plan to deliver cheap food - not to please truculent farmers - and to let free markets deliver it as far as is prudent. The world's poor need to be freed from the hunger that threatens once more to entrap them.

As that same article argued:-

The reality is that most of the real distributional conflicts over food take place within the same country between rural and urban dwellers (or, indeed, between cash-crop farmers and others within the countryside), not between rich nations and poor ones. Exhibit one is the cause célèbre of the rice farmers of Ghana, whose protective import tariffs have been cut, exposing them to international competition. The likes of Oxfam have for years led a succession of pliable celebrities and journalists by the nose round the markets of Accra and invited them to be outraged by the sacks of cheap, subsidised American rice stacked floor to the ceiling.

But if they look carefully, they will also see sacks of largely unsubsidised rice from Vietnam and Thailand, both of which provide the urban poor of Accra with cheaper staple food than can domestic producers. Tariff protection for Ghanaian rice is not global trade justice. It is a transfer from everyone else in Ghana, particularly city-dwellers trying to feed their families, to the rice-growers.

Let the FAO focus on removing all the barriers, internal and external. Let us seek to eliminate distortions and allow a free flow of food to where it is needed. It should be noted that market distortions tend to cause speculation and send false price signals not the other way around.

Further, as part of agreed actions from the Rome conference let there be an unequivocal message to the WTO and its membership that conclusion of the Doha Round is an essential element in resolving this crisis.

Let us hope also that no one takes any notice of Sue Kedgley and any others of her ilk.

Food prices have undergone a paradigm shift and will not drop back to pre-crisis levels for at least the next 10 years, putting long-term pressure on governments facing the food crisis, according to a forthcoming report.

The report, by the Organisation for Economic Co-operation and Development and the UN’s Food and Agriculture Organisation, will say food prices have moved to a “higher plateau” because of rising demand from the biofuels industry and developing countries such as China.

Note this reference to bio-fuels. Now it is unclear whether this report takes into account the impact on food supply of changes in the set aside regime in the EU which will potentially release 5 million hectares of land into production.

What is clear that policies adopted by the EU and the USA do not help.

The item comments further:-

“Without exception, average real prices are likely to remain above those observed during 1985-2007,” said the report summary. The OECD said the projections were preliminary numbers.

Alexander Müller, an assistant director-general at the FAO in Rome, said the world needed to get used to higher food prices. “In the near future, we will have to live with higher prices for agricultural commodities.”

The new estimates of elevated prices in the long term come as the cost of food shows the first tentative signs of stabilising after surging more than 50 per cent in the past 12 months. In April the FAO’s food index registered its first drop in 15 months and officials said prices appeared to be “reaching a peak”.

and concludes:-

The report will warn that with many agricultural commodity supplies continuing to be tight, low stock levels are not likely to be replenished quickly, so “the possibility of further sharp prices hikes . . . seems to be likely for the next few seasons”.

The OECD/FAO report is based on the assumption that conditions remain fav-ourable for further growth in biofuels production.

It remains to be seen what this will mean in economic terms for New Zealand's farming industry.

However, the efficiency of NZ farming is such that there may be at least 2 immediate benefits:-

• greater interest in FTAs from countries like Japan
• very considerable opportunities in the provision of advisory services to countries seeking to improve their agriculture

A more recent one is titled 'World Poor Pay Price as Crop Research is Cut', this article bears out the point made by Adam in other posts on the impact of reduced spend on agri-science rearch and development in recent years.

If you read the article read the charts also they help illustrate the issues.

The article begins:-

The brown plant hopper, an insect no bigger than a gnat, is multiplying by the billions and chewing through rice paddies in East Asia, threatening the diets of many poor people.

The damage to rice crops, occurring at a time of scarcity and high prices, could have been prevented. Researchers at the International Rice Research Institute here say that they know how to create rice varieties resistant to the insects but that budget cuts have prevented them from doing so.

This is a stark example of the many problems that are coming to light in the world’s agricultural system. Experts say that during the food surpluses of recent decades, governments and development agencies lost focus on the importance of helping poor countries improve their agriculture.

The budgets of institutions that delivered the world from famine in the 1970s, including the rice institute, have stagnated or fallen, even as the problems they were trying to solve became harder.

“People felt that the world food crisis was solved, that food security was no longer an issue, and it really fell off the agenda,” said Robert S. Zeigler, the director general of the rice institute.

Vital research programs have been slashed. At the rice institute, scientists have identified 14 genetic traits that could help rice plants survive the plant hopper, which sucks the juices out of young plants while infecting them with viruses. But the scientists have had no money to breed these traits into the world’s most widely used rice varieties.

The article examines the problems in funding facing the Rice Institute and similar ones elsewhere. The impact of reduced funding on staffing and programmes.

As the NYT notes:-

Similar troubles plague other centers in Asia, Africa and Latin America that work on crop productivity in poor countries. Agricultural experts have complained about the flagging efforts for years and warned of the risks.

“Nobody was listening,” said Thomas Lumpkin, director general of the International Maize and Wheat Improvement Center in Mexico.

Now, a reckoning is at hand. Growth of the global food supply has slowed even as the population has continued to increase, and as economic growth is giving millions of poor people the money to buy more food.

With demand beginning to outstrip supply, prices have soared, and food riots have erupted that have undermined the stability of foreign governments. World leaders are scrambling to respond. On May 1, President Bush asked Congress for an extra $770 million to pay for food aid and to help farmers improve their productivity.

Yet even whilst doing this, we see:-

cuts in agricultural research continue. The United States is in the midst of slashing, by as much as 75 percent, its $59.5 million annual support for a global research network that focuses on improving crops vital to agriculture in poor countries. That network includes the rice institute.

Robert Bertram, who oversees the funding for the United States Agency for International Development, said he was still trying to stop the cuts and argued that research to improve crop yields was “like putting money in the pockets of poor people, and I mean billions of poor people.”

Whilst this is happening the USA passes another farm bill providing billions in unnecessary subsidies to US agri-business and the EU maintains it's ruinously expensive Common Agriculture Policy and promotes grossly inefficient farming practices.

The NYT quotes these examples, which Adam finds truly horrifying:-

Crop by crop and country by country, agricultural research and development are lagging.

The center in Mexico has created drought-tolerant corn for Africa and higher-yielding, disease-resistant wheat for South Asia. But it does not have the money to get the varieties into the hands of poor farmers.

In Africa, where yields have remained stagnant since the 1960s, efforts to bolster them have been hampered by cuts not only in research but also in programs like fertilizer distribution.

Even in the United States, long a world leader in agricultural research, some money has been shifted away from crop-productivity work into issues like nutrition and food safety.

The biggest cutbacks have come in donations to agriculture in poor countries from the governments of wealthy countries and in loans from development institutions that the wealthy governments control, like the World Bank. Such projects include not only research on pests and crops but also programs to help farmers adopt improved methods in their fields.

But it was this next fact that really rocked him to his heels:-

Adjusting for inflation and exchange rates, the wealthy countries, as a group, cut such donations roughly in half from 1980 to 2006, to $2.8 billion a year from $6 billion. The United States cut its support for agriculture in poor countries to $624 million from $2.3 billion in that period.

That is astounding at a time of massive wealth expansion and rising living standards for so many, support to improve farming practice, crop development etc, was cut. Cut!

The article points out:-

In the 1960s, population growth was far outrunning food production, threatening famine in many poor countries. But then wealthier nations joined forces with the poor countries to improve crop yields. Countries like India and Pakistan embraced new plant varieties, irrigation projects and fertilizer programs in a vast effort that came to be known as the Green Revolution.

Yields soared, and by the 1980s, the threat of starvation had receded in most of the world. With Europe and the United States offering their farmers heavy subsidies that encouraged production, grain became abundant worldwide, and prices fell.

SO subsidies to farmers in wealthy countries directly impacted the efforts made in smaller countries to increase farming efficiency. SO the rich made the poor poorer.

The article discusses how agri-research was impacted:-

Advocates for agriculture fought a losing battle to stop the cutbacks — nowhere more than in the World Bank, the huge institution in Washington that makes low-interest loans to poor countries for development projects.

Adjusted for inflation, the World Bank cut its agricultural lending to $2 billion in 2004 from $7.7 billion in 1980.

The Green Revolution had led to creation of a global network of research centers focusing on agriculture and food production, with 14 institutes — including the International Rice Research Institute — scattered across Asia, Africa and Latin America, in addition to a research office in Washington. The centers, known collectively as the Consultative Group on International Agricultural Research, carry much of the burden of improving crop yields in developing countries.

As the world lost its focus on crops, the budgets of some of the centers were cut. At others, the budgets stayed level or even rose, but donors increasingly directed the money toward worthwhile but ancillary projects like environmental research. Spending fell on the laborious plant-breeding programs needed to improve crop productivity.

As these trends played out, the stage was being set for a food emergency.

From 1970 to 1990, the peak Green Revolution years, the food supply grew faster than the world population. But after 1990, food’s growth rate fell below population growth, according to a report by Ronald Trostle, a researcher at the Agriculture Department.

The article suggests that a focus by funders in some instances on environmental research rather than on food productivity has been somewhat less than helpful.

The NYT goes on:-

At the World Bank, agricultural financing has begun to recover. Under a new president, Robert B. Zoellick, the bank has decided to double its lending for such programs in Africa. After President Bush’s request to Congress, other wealthy countries are joining the United States in increasing their support.

But the case of the brown plant hopper shows there will be no quick fix for the years of neglect.

Around 2004, the world economy began growing more quickly, about 5 percent a year. So as the food supply was lagging, millions of people were gaining the money to improve their diets.

Yet because of past mistakes these vital research centres have been affected - to look at the Rice Institute again and the rise of the brown hopper, this pest was increasingly harmful, but in this period:-

the rice institute was being gutted.

Its money comes come from government donations, foundation grants and assistance from development institutions like the Asian Development Bank, an affiliate of the World Bank. After peaking in the early 1990s, the rice institute’s budget has been cut in half after adjusting for inflation, a reflection of the larger cutbacks in global agriculture.

Several dozen important varieties of rice have been lost from the institute’s gene bank through poor storage. Promising work on rice varieties that could withstand high temperatures and saltier water — ideal for coping with global warming and the higher sea levels that may follow — had to be abandoned.

A potential solution is at hand for the plant hopper problem. No fewer than 14 new types of genetic resistance have been discovered. But with the budget cuts, the institute has mounted no effort to breed these traits into widely used rice varieties.

Doing so now would take four to seven years, if money could be found. In the meantime, the hoppers have become a growing threat. China, the world’s biggest rice producer, announced on May 7 that it was struggling to control the rapid spread of the insects there. A plant hopper outbreak can destroy 20 percent of a harvest; China is trying to hold losses to 5 percent in affected fields.

“We must stay ahead of rapidly evolving pests — and increasingly, a changing climate — to assure global food security,” said Mr. Zeigler, the rice institute’s director. “Cutting back on agricultural research today is pure folly.”

So again we see some of the common factors that impact the issue of Food Security and Food Prices:-

• excessive and inefficient subsidies, especially in wealthy nations
• poor governance leading to lack of investment
• lack of focus on improved food productivity
• failure to invest in agri-research

Many of the disease and productivity issues could materially improve the ability of the world to feed itself and through improved productivity and new strains assist in mitigating some of the impacts of climate change.

Not to invest substantially in these areas strikes this commentator as folly.

Adam again reiterates his view that these issues offer a major opportunity to New Zealand agri-research bodies, which they should seek to grab with both hands, as the skills and expertise of NZ farmers should be highly markeatble at this time.

He laments however, what he sees as realtive under investment in research in New Zealand and thinks the government's Fast Forward fund is not the answer.

He suspects that the elimination of subsidy and protectionist tariffs would make available sufficient monies, probably more than sufficient monies to materially improve the situation, maybe even solve it and provide improved living standards for the poor and lower prices for those in more developed countries.

Overall Adam thinks it could be said that the world did not learn the real lesson of the Green Revolution, which he thinks might well be that the world can feed itself, if only it invests the skills, time and money to ensure that it does so in an efficient, practical and sustainable way - without the baggage of subsidy and protectionism which hampers us now.

See the Page listing all Adam's posts in this area.

These pictures are from the Philippines and assist in illustrating some of the challenges faced.

If it was not so sad, it would be laughable.

Unfortunately it is not only sad, but extremely worrying and does not give Adam much hope that Doha will be resolved nor the food issues that bedevil the world, with closed mind thinking such as this, coupled with arrogance in spades.

This article in the Financial Times refers, and it starts:-

Germany believes China, India and the US should be forced to adopt higher environmental and health standards if they want to export food products to the European Union, says Horst Seehofer, Germany’s farm minister.

His comments echo calls by Paris for new EU barriers to free trade in response to rising global demand for food. Michel Barnier, France’s farm minister, last month called for curbs on “free-market liberalism”, a view reflected by Mr Seehofer: “We need more market liberalisation, but under fair conditions.”

Fair of course does not mean fair, but the opposite. The Minister continued:-

“This does not mean more protectionism. We do not want to isolate the EU but to apply EU standards in other parts of the world,” he told the Financial Times, adding that new standards should be agreed among industrialised and emerging economies in the World Trade Organisation.

This is economic and cultural imperialism of breathtaking arrogance. If they were successful and policies such as the EU's were adopted globally we would be setting back the cause of development let alone free trade decades. It would be as if the Green Revolution had never happened and agricultural science might well be frozen in a time warp, especially given the EUs specious views on GE and GM for example.

The UK plans to attack the proposals (see later in this post)

These proposals are about exporting European approaches to poorer countries, they might have an initial shortlist of locations, but it will be extended.

The article continued:-

Mr Darling will urge fellow EU finance ministers to support the dismantling of the CAP, claiming it is costing consumers in Europe billions of pounds a year in higher food bills, while hurting farmers in the developing world.

Mr Seehofer dismissed such assertions as “complete rubbish”. Rather, political change and greater farming efficiency in the developing world were needed.

“The developing countries need to be able to produce more food [for themselves]. They also need political reforms, better education and less corruption. Steps are also needed against big landowners that think only of maximising profits and not feeding the local population,” he said

The CAP is a byword for waste, inefficiency, bureaucracy and corruption. Plus note the attack on property rights.

Adam agrees that improved governance is needed in many countries, including the EU in agriculture, plus many European farmers are not efficient. Indeed, the CAP props up many - see France.

Then the piece concludes:-

Mr Seehofer said the EU had very high standards on “the environment, on water, on health and social issues, that are also expensive for our farmers to implement. The EU should move step-by-step to ensure that third-world countries also have to meet these standards if they want to export to the EU.”

Make it so costly that they do not bother. This is the EU where some farmers make more money by preserving the landscape than farming. The latter sentence in the paragraph is also threatening to those farmers who have managed to create a market and living by supplying vegetables such as beans from Kenya to Europe.

He said this idea was broadly in line with France’s proposals on a “European preference” in farm products to reflect higher EU standards. Poorer developing countries would not be affected, but the US, China, India and Latin America would, he said.

So in one breath it does not affect poorer countries, but then immediately prior he spoke of 3rd world countries having to comply.

Note how he attacks USA, India and China as well as Latin America.

This is rampant protectionism, cloaked in a lot of tosh and piffle and faux concern for the poor.

Where is Peter Mandelson in all this? This statement seems against what he was saying the other day, when in another FT article he was quoted as saying:-

In an interview with the BBC’s Hardtalk programme to be broadcast on Thursday, Mr Mandelson said: “It is irresponsible to be pretending to people you can erect new protection, new tariff barriers around your economy in this 21st century global age and still succeed in sustaining peoples’ living standards and jobs. It is a mirage and they know it.

and later in the same article as saying:-

Mr Mandelson said that even the rhetoric of protectionism was damaging. “It is very irresponsible in my view to pretend to people that we can disengage from international trade, we can create barriers around our economy and then be surprised when people retaliate by doing the same,” he said. “It is going to lead us into a vicious spiral of beggar-thy-neighbour policies which will take us decades back in terms of trade growth.”

Now Mandelson was referring to the US Democratic Presidential hopefuls - Clinton and Obama. However, in this writer's view you cannot say this about them and not be held to a similar standard in your own bailiwick.

No doubt Mr Mandelson will have some suitable casuistic turn of phrase to seek to distinguish and defend the indefensible views of the French and the Germans, whilst castigating those nasty protectionist Democrats. Protectionist though they are.

The UK Chancellor, perhaps for domestic reasons, plans to take a strong stance in a meeting this week, here is an extract from an FT article on Alistair Darling's viewpoint:-

The future of the European farm budget, which still consumes more than a third of all EU spending, could become the most contentious issue facing the union in the next few years.

With Gordon Brown's government under fire at home, and with public anxiety about rising food prices growing, Mr Darling's decision to pick a fight with key European partners now may be influenced by domestic politics. Many of his prescriptions for the CAP are shared by the European Commission, which is phasing out the last export subsidies and which wants to shift more direct support for European farmers to rural development.

But Mr Darling wants to go much further, scrapping EU external tariffs, which inflate prices for commodities such as beef and dairy products, and ending all direct payments to farmers. "It is unacceptable that, at a time of significant food price inflation, the EU continues to apply very high import tariffs to many agricultural commodities," he writes.

The chancellor says "efficient international markets" - not protectionism - are the best way to maintain global and European food security, and that a successful conclusion of the Doha round of world trade talks is vital.

He also calls for action to raise "farmer knowledge" of mechanisms such as agricultural futures and options to manage risk, and for more investment at a European and national level into agricultural research.

It is perhaps unfortunate that Mr Darling perhaps lacks credibility given his recent performance in the field of economic management and his Prime Minister's low political status.

Again though we see the common factors emerging here when looking at a European dimension that we see elsewhere, the need for:

• better governance, for example massive reform of the CAP
• elimination of distorting subsidies
• more sustainable approach to biofuels
• better agricultural management and development
• improved farming practices
• free trade
• successful conclusion of the Doha Round
• greater investment in agricultural research
• more overall investment in developing

If this was done we might see improved food security and living standards for the poor, more sustainable farming practices and cheaper food in Europe.

Nah, Adam is being delusional - but one can hope.

WHEN Haiti’s prime minister resigned last month after a week of food riots, it seemed to confirm a warning that Bob Zoellick, the president of the World Bank, had given ten days before. He said 100m people were being pushed into hunger and malnutrition—and 30-odd countries faced social upheaval unless food policy improved and the rich world got its act together to help. A month on, policy has not improved, and the rich world’s response has mostly been muddled—yet surprisingly, poor countries have been able to contain the unrest, albeit at heavy cost.

Simon Maxwell, head of Britain’s Overseas Development Institute, a think-tank, says one problem is that donors need a single, simple guide on how and where to help, not a clamour of competing United Nations bureaucracies with different plans. There are moves in this direction. The first priority has been to finance the World Food Programme (WFP), the world’s largest distributor of food aid. The WFP asked for $750m this year and has so far got about two-thirds of that.

Then later:

Rich countries are already managing to be fairly incoherent without any UN infighting. The hope, at least among economists, was that higher prices would induce rich countries to cut state aid to farmers and—says Paul Collier, a development expert at Oxford University—“lead people to question their pleasant fantasies about GM [genetically-modified] food in Europe and biofuels in America.” So far, there are few signs of that.

The current American farm bill proposes only modest cuts in ethanol subsidies. The EU has not changed its biofuels target (10% of all fuel by 2020); it continues to bully developing countries not to plant GM crops and this week refused permission to grow varieties of GM maize and GM potatoes in Europe.

As usual the EU and the USA cannot avoid listening to special pleadings and mis-information. One wonders what the US re-action will be under a President Obama or President McCain.

The article points out the issues faced by poorer countries and how the actions taken are often of a beggar thy neighbour variety, or very short term in nature and economically not sustainable. In this regard attention is drawn to Adam's post of 8th May 2008 on the issues faced by oil rich states for example.

The article concludes with this:-

These policies are inflationary and expensive. Oil exporters, or countries like Egypt that benefit from big remittances from them may be able to afford them for a while. Others are not so lucky. In Indonesia, where half the population lives on less than $2 a day, inflation is 9% and food prices are soaring (the price of subsidised rice to the poor was jacked up 60% in April). The government is planning to fuel subsidies, which would make social protection and subsidised rice more affordable. The response: more protests

There is a need for the mass of competing interests to sort themselves out.

Rich countries must face up to their responsibilities and untangle the web of protectionism and subsidy which is a major factor in this problem.

To that end the Doha Round must be completed.

The issues of food supply must be addressed in conjunction with the issues of climate change.

An integrated strategy needs to be developed and actioned rapidly, not at the glacially slow pace we see now in the Doha Round, at a time when many developed countries are rapidly adopting Climate Change policies that may well cause more food price and security problems.

Clearly this is arrant nonsense.

Oh, for politicians who will lead rather than pander to special interests and sector pleadings.

Consequently, Adam has rather low expectations for the outcome, yet as he noted on 8th May, the political implications of not resolving the food and water issues may make Climate Change a secondary issue. In one sense it should be, for we cannot in all conscience adopt policies to mitigate climate change that in themselves massive harm to our fellow human beings.

Not only is this event devastating in personal terms for so many, it will have economic consequences regionally and possibly globally too. The failure of the despotic regime to invest in agriculture and in flood prevention has now truly caused a catastrophe.

Read the FT article it makes for dispiriting reading, especially when one realises what potential Burma has.

Yet again we see the same factors present:-

• corrupt governance
• under development
• inefficient farming practices
• once self sufficient regions becoming food importers

Below is an extract, but the whole article is worth reading. Adam enjoyed the reference to Hugo Chavez.

Cereal farmers are indeed doing well, but livestock farmers are not, and both share a problem common to farmers worldwide: farming needs fertiliser, and fertiliser needs energy, so farmers´ input costs have also risen.

Livestock farmers are caught both ways: dearer fuel and feed for their animals. Rising food prices are directly related to an oil price of $110 a barrel and the inflation in other energy costs, too.

High demand for energy partly explains those prices. But so, too, does the reluctance of oil-producing countries to expand their output to meet demand.

The Opec cartel, spurred on by Venezuela and Iran, does not want its windfall to end, and neither does Russia.

Thus Hugo Chávez, supposedly a "Bolivarian Socialist" helping the world´s poor, is contributing to a new bout of starvation. If we could get oil supply up and prices down, the food crisis would also fade.

The misleading element of the explanation is the attribution of the boom in food prices to demand for meat in China and India. It is true that, as those countries become more affluent, they are eating more meat. But this is a gradual process.

The immediate issue is that both are suffering from faster inflation, caused by a credit boom. In China, in particular, that credit boom is a result of its efforts to keep its currency artificially cheap. If that policy were to change - as it must, eventually - with a crackdown on domestic inflation, that demand-growth for meat would fade.

In the longer term, it is the self-inflicted wounds that we should be addressing. The surge of subsidies for biofuels, which has persuaded many farmers to switch crops, may prove short-lived, but subsidy schemes tend to be difficult to kill off once in place.

The rational approach would be to abandon trade barriers against the cheaper and less-polluting sources of ethanol in Brazil and elsewhere. But rationality and farming policy rarely go together.

That point can be multiplied a thousand times when it comes to attitudes in Europe to food technology. Every boost in farm productivity has come thanks to technology - from better fertilisers and pesticides to the high-yield rice varieties of India´s "green revolution" in the 1960s.

Again, we see the impact of:-

Ukraine said it would allow exports of 1.2m tonnes in the next two months, up from a previous quota of just 200,000 tonnes.

Sorin Vaslobal, of Paris-based cereals broker Plantureux, said Kiev’s decision could trigger a domino effect. “We see Ukraine’s move as applying pressure on Russia to remove its 40 per cent export tax,” he said. Argentina and Kazakhstan have also restricted their wheat exports.

The International Monetary Fund and the World Bank have asked agriculture commodities exporters to scrap or at least ease their foreign sales restrictions.

The International Grains Council on Thursday said the global wheat crop will hit a record 645m tonnes this year, up from 603.5m tonnes in 2007, as weather improves and farmers sow more wheat at the expense of crops such as corn. Luke Chandler, a cereal analyst at Rabobank in Sydney, said: “Wheat prices are expected to ease in the second half of 2008 as a potential record-breaking world wheat crop looms.”

This is a good sign, but much remains to be done, especially in the areas of:-

• market access
• farming practice
• agriculture development
• governance
• aid

This superb editorial from the Financial Times is an excellent reminder of the problems faced and where much of the blame lies. Though not all the blame.

Adam has taken the step of reproducing the item in it's entirety, so that his readers can appreciate the complete item.

In the article he calls for:

We must not stand idly by. Unless we act now, the world faces a downward spiral of trade restrictions, higher prices for staples and starvation. The World Food Programme urgently needs additional funds and supporting its well-run programmes to feed the poor is a moral and economic imperative.

Although aid is the first step, we must be bolder in tackling the long-term challenges of food supply.

Then later he writes:-

We must not lose sight of longer-term solutions. This calls for a more global approach to policies. Agricultural policies must change. Higher food prices over the past few years in part reflect well-intentioned, yet misguided policies in advanced economies, which attempt to stimulate biofuels made from foodstuffs through subsidies and protectionist measures.

High food prices also reflect imprudent agricultural pricing policies in some developing countries, and these too need to be improved.

No one should forget that all countries rely on open trade to feed their populations. But we are already seeing actions at the national level, such as curbs on food exports, that have a damaging global impact. Completing the Doha round would play a critically helpful role in this regard, as it would reduce trade barriers and distortions and encourage agricultural trade.

A French politician calling for completion of Doha and a reduction in protectionist policies, though he seems to imply such protectionism in advanced economies is linked to biofuel issues.

He concludes with this statement:-

We have a moral responsibility to get food into the hands of poor people. The world can afford it and global co-operation can deliver the macro-economic framework and incentives needed to address the problem in a lasting manner.

It is to be hoped that this article and more importantly what the writer does behind the scenes has an effect.

Peter Mandelson, the EU Trade Commissioner has also commented on this recently, as this article from The Times makes clear.

Europe's trade chief gave warning of “a spiral of protectionism” in the grain trade as the price of rice soared to a new record and grain-producing countries stopped exports to prevent further outbreaks of food rioting.

Leading grain exporters in the developing world are shutting off supplies in an attempt to curb domestic food price inflation, but Peter Mandelson, the European Trade Commissioner, said that the export curbs were aggravating food shortages.

He said: “By chasing an illusion of food security these policies throttle domestic production, choke off supplies and risk leading to a spiral of protectionism and dwindling production.”

This is of course the same Peter Mandelson who on behalf of the EU has been a major impediment to achieving resolution of the Doha Round. Perhaps at last he may mean what he doth protest he does, and translate attractive spin into deeds of substance, but see my comment on the perfidious French later.

The same article noted this also:-

Hoarding is the main cause of the rice crisis, according to the International Rice Research Institute (IRRI). “It's an understandable reaction by governments but it is not necessary. Southeast Asia is entering a harvest period,” said an IRRI spokesman.

In the longer term the Manila institute sees severe problems with rice supply in Asia. “In the past three to four years, Asia is eating more rice than it produces. World stocks have come down substantially,” said IRRI. The main causes are shrinking cropland, dwindling water supplies, inadequate investment in agriculture and a shortage of labour, all consequences of Asia's rapid industrialisation.

New varieties of rice, hybrids and bio-engineered strains could improve output but funds for research and development have been cut.

Yet again the causes are identified as including factors Adam has noted in prior articles on this issue.

The problem will not be solved by everyone becoming vegetarians, or eating less meat as some who comment on blogs and write letters to newspapers seem to think. Nor will it be solved by people ceasing to reproduce as others seem to think.

The answer lies in amongst other factors:-

• investment in agriculture science
• Changing farming practices
• Both the above will assist yield improvement and combating disease and insect damage, plus in the longer term improving drought resistance
• Eliminating artificial barriers to trade
• Enabling farmers to obtain greater reward for their labour
• Improved governance
• Ceasing to grow crops inappropriate to a given geography
• Reconsidering the nature and composition of biofuels
• Reducing subsidies
• Seeking to increase the percentage of livestock fed on grass rather than grains
• Bringing presently unproductive, but suitable land into an appropriate and sustainable form of production

This will all be for nothing, however, if the kind of attitude foreshadowed in this article again from The Times is allowed to prevail:-

France has launched a political campaign to restore food protectionism at the heart of Europe’s agriculture policy as food riots erupt in poor countries and global leaders give warning of the dire consequences of soaring grain prices.

At a high-level EU agriculture meeting in Luxembourg, Michel Barnier, the French Agriculture Minister, called on Europe to establish a food security plan and to resist further cuts in Europe’s agriculture budget.

Mr Barnier said that the EU should not bow to pressure from the World Trade Organisation to reduce further its agricultural subsidies but instead should increase aid to farmers in developing countries.

The French initiative at the EU Agriculture and Fisheries Council follows a week in which food riots toppled the Government of Haiti and the President of the World Bank voiced concerns about the consequences of food price escalation.

It also coincides with Gordon Brown’s calling for concerted international action to tackle rising food prices, including a world trade deal that cuts subsidies to richer countries.

In a speech at Goldman Sachs in London today, the Prime Minister is to raise questions about the effect that the rapid move towards biofuels is having on food production and prices.

The Times article says later:-

With deft political timing, the French Agriculture Minister blamed economic liberalism and “too much trust in the free market” for the soaring cost of food.

He said: “We must not leave the vital issue of feeding people to the mercy of market laws and international speculation.”

The unwinding of the financial subsidies and quotas in the EU’s Common Agriculture Policy is vigorously opposed by France but supported by Britain and the Nordic countries. The French Government is expected to push forward its arguments in favour of greater food security when it assumes the EU presidency in July.

France has resisted calls for big cuts in the Common Agricultural Policy (CAP) budget demanded by emerging market countries and Mr Barnier’s intervention comes as global trade talks that would free up trade in agriculture reach a key juncture in Geneva.

The French push for greater support for European farmers is likely to be resisted by Mariann Fischer Boel, the EU Agriculture Commissioner who has argued for further CAP reforms.

Diplomatic sources in Brussels said that the Commission believed higher food prices would stimulate farming output.

“Our policy is to liberate production,” said one Commission source.

It is to be hoped that the French, arch protectionists do not get their way. This issue is far too important to allow their views to prevail.