Monday 14 April 2008

Focus: Hunger. Strikes. Riots. The food crisis bites

Four key factors behind the spreading fear of starvation across the globe

Growing consumption

Six months ago Zhou Jian closed down his car parts business and launched himself as a pork butcher. Since then the 26-year-old businessman's Shanghai shop has been crowded out - despite a 58 per cent rise in the price of pork in the past year - and his income has trebled.As China's emerging middle classes become richer, their consumption of meat has increased by more than 150 per cent per head since 1980. In those days, meat was scarce, rationed at around 1kg per person per month and used sparingly in rice and noodle dishes, stir fried to preserve cooking oil. Today, the average Chinese consumer eats more than 50kg of meat a year. To feed the millions of pigs on its farms, China is now importing grain on a huge scale, pushing up its prices worldwide.

Palm oil crisis

The oil palm tree is the most highly efficient producer of vegetable oil, with one acre yielding as much oil as eight acres of soybeans. Unfortunately, it takes eight years to grow to maturity and demand has outstripped supply. Vegetable oils provide an important source of calories in the developing world, and their shortage has contributed to the food crisis. A drought in Indonesia and flooding in Malaysia has also hit the crop. While farmers and plantation companies hurriedly clear land to replant, it will take time before their efforts bear fruit. Palm oil prices jumped nearly 70 per cent last year, hitting the poorest families. When a store in Chongqing in China announced a cooking-oil promotion in November, a stampede left three dead and 31 injured.

Biofuel demand

The rising demand for ethanol, a biofuel that is mixed with petrol to bring down prices at the pump, has transformed the landscape of Iowa. Today this heartland of the Midwest is America's cornbelt, with the corn crop stretching as far as the eye can see. Iowa produces almost half of the entire output of ethanol in the US, with 21 ethanol-producing plants as farmers tear down fences, dig out old soya bean crops, buy up land and plant yet more corn. It has been likened to a new gold rush. But none of it is for food. And as the demand for ethanol increases, yet more farmers will pile in for the great scramble to plant corn - instead of grain. The effect will be to further worsen world grain shortages.

Global warming

The massive grain storage complex outside Tottenham, New South Wales, today lies virtually empty. Normally, it would be half-full. As the second largest exporter of grain after the US, Australia usually expects to harvest around 25 million tonnes a year. But, because of a five-year drought, thought to have been caused by climate change, it managed just 9.8 million tonnes in 2006.Farmers such as George Grieg, who has farmed here for 50 years, have rarely known it to be so bad. Many have not even recovered the cost of planting and caring for their crops, and are being forced into debt. With global wheat prices at an all-time high, all they can do is cling on in the hope of a bumper crop next time - if they are lucky.

Food in figures

93,000,000 Acres of corn planted by US farmers last year, up 19 per cent on 2006.

76% Amount of US corn used for animal feed.

8kg Amount of grain it takes to produce 1kg of beef.

20% Portion of US corn used to produce five billion gallons of ethanol in 2006-07.

50kg Quantity of meat consumed annually by the average Chinese person, up from 20kg in 1985.

10% Anticipated share of biofuels used for transport in the EU by 2020.

$500m The UN World Food Programme's shortfall this year, in attempting to feed 89 million needy people.

9.2bn The world's predicted population by 2050. It's 6.6bn now.

130% The rise in the cost of wheat in 12 months.

16 times The overall food consumption of the world's richest 20 per cent compared with that of the poorest 20 per cent.

58% Jump in the price of pork in China in the past year.

$900 The cost of one tonne of Thai premier rice, up 30 per cent in a month.

Focus: Hunger. Strikes. Riots. The food crisis bites | Environment | The Observer