Senegal’s Wade bets local rice can make the country self-sufficient by 2015

As more than 1,000 people marched in Dakar to protest high cost of living, Senegal’s President Abdoulaye Wade claims he has created a plan to make the country self-sufficient in rice by 2015.

He calls for a massive crop expansion and irrigation program that will increase rice production six-fold to 600,000 metric tons. The government estimates that 250,000 hectares of land are currently free in northern part of the country and the Casamance River valley. Irrigation shouldn’t be as difficult because rice is presently grown near the edge of the Senegal, Saloum and Casamance rivers, and irrigated from recessional flooding.

IRIN admitted that most agriculture experts they spoke to gave their tepid support for Wade’s targets, but nobody came out and guaranteed they would be met. One expert claimed the biggest problem will be increasing yields, but the Minister of Agriculture argued that Senegal’s rice yield of six metric tons per hectare is better than Thailand’s. (The United Nation Food and Agriculture Organization isn’t too certain about the government’s numbers.)

Then there’s the issue of money: One estimate calls for $335 million in funding is necessary for infrastructure costs and leveling the land. That amount presently equals the country’s entire agriculture budget.

Mark supplying credit for rice producers and processors as another issue. Like most West African farmers, Senegal’s rice producers buy supplies on credit and then payback the loans when they sell their crop. However, those with bad credit have been denied anymore loans, basically kicking them out of future rice production. One way to break the credit log jam would be for investors and donors to establish cooperative banks to work with farmers of all credit histories, says the Council on Non-Governmental Organizations and Development Support.

The biggest obstacle facing this project is that few Senegalese eat local rice. That's because local rice is hard to find in the country’s markets because it carries a bigger price tag than imported rice from Thailand and Vietnam, who together control 75 percent of Senegal’s market. As world rice prices have hit record highs, people must shell out more to continue eating the grain.

Rice dependency remains a problem throughout the continent, says the Alliance for a Green Revolution in Africa. A little more than half of the rice produced in Africa is consumed by local people, the group says. In many countries, rice imports have increased lockstep with rice demand. The group says it is working with farmers from different countries to create stress-tolerant rice seeds that are palatable to local tastes.

A place at the table: What value for fertilizer in Africa’s green revolution?

From the Guardian:

The underinvestment and neglect of African farming go back to colonial times, but became increasingly apparent as the western development agenda gathered force. In the 60s and 70s agriculture was squeezed to pay for industrial development. But with the arrival of structural adjustment packages - deregulation, trade liberalisation and sharp cuts in state expenditure - imposed by the west in the 80s, the damage began to bite. The Washington consensus ruled that, freed from state intervention, the market would stimulate African agriculture, explains Steve Wiggins, a research fellow at the Overseas Development Institute. State funding was stripped out of state agricultural extension services, research and development, and farmers' marketing and credit facilities - all elements critical to Asia's green revolution.

The effect was catastrophic. Without improved seeds and availability of credit for fertiliser, productivity limped along. At every turn, farmers were knocked back. Kevin Watkins, of Oxford University, points out that where they did manage to improve yields, they faced exorbitant costs for transporting goods to market because of inadequate rural roads. Often when they got to market, they found it flooded with imports dumped by the west.

Through the 90s, aid flows began to increase as anxiety grew about how African development had stagnated. But the orthodoxy that the state had a role only in health and education - not in fostering economic growth - persisted. Donors were hostile to investment in agriculture: between 1990-02 and 2000-02 aid was rising but the amount going into developing agriculture dropped by 43%. It currently amounts to only 4% of all development assistance to the continent. Malawi in 2006 was the case study that proved the orthodoxy wrong: to avert famine after a catastrophic harvest, the government subsidised seed and fertiliser. The results were a good harvest, thousands of lives saved, and continuing economic stability.

One of the untold stories about Malawi’s now infamous move to reintroduce fertilizer subsidies is the fact that small farmers were being slowly squeezed out because global fertilizer prices were slowly, but steadily increasing for most of the decade. By at least one account, in 2007 alone, prices skyrocketed 200 percent.

Fertilizer, our friend
African farmers use much lower levels of chemical fertilizers than farmers elsewhere, even though the continent’s fertilizer use has doubled since 1970. According to a study by Oumou Camara and Ed Heinemann, up through the mid-1980s, national governments delivered fertilizer inputs, often as loans, which farmers repaid at harvest time. To increase farm productivity, governments also began subsidizing these crop inputs. As pointed out above, when structural adjustment policies went into effect across sub-Saharan Africa, governments were forced out of the fertilizer business – subsidy programs were thrown aside as well as state-run distribution systems. However, the private sector could only pick up fertilizer input distribution chains in a number of states, resulting in the overall decline of the crop manures.

Today, the situation is different. Each country more or less has its own sector that purchases and distributes products depending on weather conditions, credit availability, etc. In some more urban countries, farmers can strike deals directly with producers and sellers. However, small farmers in remote areas remain under served by the free market system.

With population density increasing and many of Africa's farmers continuing to farm single cash crops, much of Africa’s soils today lack the nutrients they once had, degrading farmland and further depleting agriculture production – all in the face of increasing population.

What keeps prices high? Up to 90 percent of potash and nitrogen fertilizer sprayed on African crops is imported; although six African countries produce phosphate fertilizers. We can blame high transport costs and increased production costs, which have lead to African farmers running deficits to pay for fertilizers while crop yields have stagnated.

Another problem, until recently, was falling world food prices. When prices do increase, fertilizer use rises, creating demand and further augmenting costs. The problem remains that many countries have a limited number of suppliers, which keeps supply low and prices high, especially when factoring in transportation costs farmers must pay to go and find the products.

Talking points on environment, food prices, natural agriculture and trade

GM Foods: From Simon Jenkins in the Guardian:

It is clear that modification, which is as old as botany, has side-effects. But increased food productivity is so patently a good thing that to ban GM from European imports, and thus from Africa, is beyond perverse. Increased Indian and Chinese consumption is sucking the world dry of grain at just the time when the GM ban is denying the developing world the swiftest path to higher productivity - and at a time when supply is curbed by biofuel substitution.

These various green policies have established a lethal pincer movement on world food production. As the Oxford economist Paul Collier points out in his book The Bottom Billion, Africa has been subjected by European governments to one form of "befuddled romanticism" after another, from campaigns against GM foods and low-wage produce to "save the peasant" farm reform. Africa, says Collier, has less commercial agriculture than it did at the end of the age of empire, half a century ago.

While antagonism to science merely impedes progress, antagonism to economics is regressive. American subsidies to ethanol fuel are not just causing "tortilla riots" but costing American taxpayers a staggering $5.5bn a year. Biofuel tankers are circling the globe, burning gasoline and chasing subsidies. They have joined carbon emissions certificates among the world's greatest trading scams.

Link between biofuels and higher food prices, from the World Bank:

Increased bio-fuel production has contributed to the rise in food prices. Concerns over oil prices, energy security and climate change have prompted governments to take a more proactive stance towards encouraging production and use of bio-fuels. This has led to increased demand for bio-fuel raw materials, such as wheat, soy, maize and palm oil, and increased competition for cropland. Almost all of the increase in global maize production from 2004 to 2007 (the period when grain prices rose sharply) went for bio-fuels production in the U.S., while existing stocks were depleted by an increase in global consumption for other uses. Other developments, such as droughts in Australia and poor crops in the E.U. and Ukraine in 2006 and 2007, were largely offset by good crops and increased exports in other countries and would not, on their own, have had a significant impact on prices. Only a relatively small share of the increase in food production prices (around 15%) is due directly to higher energy and fertilizer costs.

More on biofuels and food prices, via Center for Global Development:

The evidence is increasingly compelling that the current generation of biofuels is contributing to global hunger and worsening, not helping to address, climate change. They are also only economical as long as oil prices stay high. Investing in research and development of a new generation of biofuels that could be grown on marginal lands not useful for food or forests is a worthwhile endeavor. But in the midst of the current crisis, and given the new evidence on the perverse effects on the environment, continuing to subsidize and promote the use of food crops for fuel is simply unconscionable.

Decreasing poverty in rural areas, from the International Assessment of Agriculture Knowledge, Science and Technology for Development, a 1500-page report claiming that agriculture progress has been highly uneven and stressed the importance of "natural" agriculture programs like crop rotation and local fertilizers.

Important options for enhancing rural livelihoods include increasing access by small-scale farmers to land and economic resources and to remunerative local urban and export markets; and increasing local value added and value captured by small-scale farmers and rural laborers. A powerful tool for meeting development and sustainability goals resides in empowering farmers to innovatively manage soils, water, biological resources, pests, disease vectors, genetic diversity, and conserve natural resources in a culturally appropriate manner. Combining farmers’ and
external knowledge would require new partnerships among farmers, scientists and other stakeholders.

Repsonses to the report, via Guardian:

Responding to the report, a group of eight international environment and consumer groups, including Third World Network, Practical Action, Greenpeace and Friends of the Earth, said in a statement: "This is a sobering account of the failure of industrial farming. Small-scale farmers and ecological methods provide the way forward to avert the current food crisis and meet the needs of communities."

Lim Li Chung, of Third World Network in Malaysia, said: "It clearly shows that small-scale farmers and the environment lose under trade liberalisation. Developing countries must exercise their right to stop the flood of cheap subsidised products from the north."

Guilhem Calvo, an adviser with the ecological and earth sciences division of Unesco, one of the report's sponsors, said at a news conference in Paris: "We must develop agriculture that is less dependent on fossil fuels, favours the use of locally available resources and explores the use of natural processes such as crop rotation and use of organic fertilisers."

As the Doha Trade Round remains blocked and food prices have skyrocketed around the world, countries should try to work out bilateral trade deals, says former World Trade Organization head Supachai Panitchpakdi told the Wall Street Journal.

"You see governments going country to country negotiating” trade deals involving key commodies like rice, wheat and milk, said Mr. Supachai, who is now secretary general for the U.N. Conference on Trade and Development. “That is something that is necessary.”

Will GM foods keep a hungry continent better fed?

Image: FreeDigitalPhotos.net

World Agriculture output rose 25 percent between 1972 and 1982. But in Africa, it declined some 14 percent. Since then, the continent has been running to keep up with the rest of the world in terms of agriculture production. Its population keeps growing, putting strain on the environment. This is underlined by the fact that 16 of the 18 most undernourished countries hail from Africa. The major question we must ask: In these times of rising food prices, how will Africa provide affordable, healthy food for its people?

This story begins with a current event: Benin has decided to renew for five years its moratorium on marketing, import and use of genetically modified foods, Africquenligne reported.

The short article goes to state that Benin, like many other African countries, lacks the scientific skills and equipment to properly detect, monitor and control GMOs once they find their way into the country.

It has been said that on the whole Africans are very skeptical regarding genetically modified crops of any sort. Africans claim that GM products will harm the continent’s bounty of biodiversity. Governments also understand that a majority of the continent lives in rural areas and relies on the environment for their livelihoods, which most often involves growing crops on the small scale.

If I had to put my finger on it, I'd say the major complaints against GM foods is they have not been thoroughly tested – worries abound that Africa will become a testing ground – which will put the continent’s poorest at severe economic risk if these crops fail; (or, if they work too well, increasing yields will drive food prices down. African farmers only have to look at the U.S. and Europe to see cheap food and disenfranchised farmers.); also, GM seeds provides an upper hand to large international agri-conglomerates who will be able to profit from the work of African farmers. Finally, people could be put at risk for potential health risks from eating GM foods.

Here is a 2007 status report on GMO crops in Africa from the African Centre for Biosafety, from South Africa that I think provides a good window into the various debates regarding GMO.

The GM push in Africa has recorded several significant setbacks and failures, with Florence Wambugu’s GM sweet potato in Kenya and the Gates Foundation’s GM sorghum in South Africa being the most prominent. The rejection by South Africa’s GMO regulatory authority of the GM sorghum project is extremely significant, as this sets the boundaries that even pro-GM South Africa cannot cross: namely, that genetic engineering of a crop where Africa is the centre of origin will not be tolerated. Importantly, this rejection represents a huge set back for crucial components of the ‘New Green Revolution in Africa’ push, which is heavily funded by the Gates Foundation.

Indeed, 2007, has not been a good year for GE in South Africa. The first ever GM cassava field trials also faced the thumbs down from the South African regulatory authorities; a major retailer in South Africa, concerned about the possibility of GM potatoes still in field trials in South Africa having entered the food chain, publicly announced their decision not to stock GM potatoes until its safety had been proven. The South African sugar industry also strongly indicated their extreme reluctance to throw their weight behind GM sugarcane. The South African regulatory authorities also rejected out of hand, Syngenta’s application for commodity import of its GM maize for ethanol on food safety grounds.

Some Background
In 2006, more than 40 African countries received some form of food aid, which equaled about 5 million tons. At least three-quarters of the world’s food aid originates in the United States, where certain GM products can mix freely with others; a lack of labeling system has allowed these products to enter other food systems. Complaints by Zambia and Sudan (among others) lead to some changes in international food aid. The European Union, which favors donating money for food over sending food itself, stipulated in 2003 that its funds could not purchase GM foods.

In West Africa, a broad-based coalition against GMOs has been formed. At least 40 African countries are parties to the international environmental agreement regulating moving GMOs across borders. However, few countries have functioning systems to regulate GMOs, although several have imposed heavy restrictions on them.

Today, nine countries report field trials in various GMOs: Burkina Faso; Egypt; Kenya; Morocco; Senegal; Tanzania; Zambia, and Zimbabwe. A somewhat larger list of countries have the capacity to undergo tests.

In West Africa, Burkina Faso and Nigeria are probably the most pro-GMO countries. Burkina Faso, Africa’s biggest cotton producer, has allowed testing of genetically modified strands of cotton.

I’ll call it what I like
A side issue – in this specific post, but an important theme nonetheless – is the idea of “biofuels,” which has been renamed by some NGOs as “agrofuels” which, they say, is a better term to express what is really happening: Agribusiness producing fuel from plants as another commodity in a wasteful, destructive and unjust global economy.”

Whatever it is called, a variety of African crops have been earmarked for this new fuel tests: maize, soybeans, groundnuts, cassava, sugarcane, pumpkin seeds, and Jatropha.

The South African government attempted to propose to replace 4.5 percent of liquid-road-transport fuels with agrofuels by blending ethanol and biodiesel with conventional petroleum. Civil society organizations heavily criticized the draft strategy, claiming it would provide a chance to introduce different varieties of GM maize and soybeans into the country, which they claim already has a lax regulation system. As the report pointed out above, South Africa’s regulators denied an application by the firm Syngenta to import its genetically modified maize to be converted solely into ethanol.

Will this revolution be skipped?
The first Green Revolution of the 1970s largely failed in Africa, says GlobalChange at the University of Michigan, because its climate does not tolerate the projects preference for crops of high yield, needing bountiful amounts of irrigation and fertilizers. Thus, the world’s higher crop yields between 1972 and 1982 were completely lost in Africa.

The second Green Revolution, brought to you by the Gates and Rockefeller Foundations, is currently taking place and will concentrate on Africa’s small farmers who often cultivate without any machinery, fertilizer and irrigation. These farmers often live far from food markets, making selling their surplus expensive and wasteful. The underlying problem, says the Rockefeller Foundation, is that African farmers don’t grow high-yield crops.

They’d like to correct that with the Alliance for a Green Revolution in Africa that will provide African farmers with better seed varieties, which will help grow larger harvests; better fertilizer use, including training in soil and water management techniques, and developing a better delivery system to get new fertilizers far from city centers; finally, creating better developed storage systems, transportation facilities and markets to sell the products. Finally, where possible, install better irrigation systems.

Here’s just a few harsh words GRAIN saves for this plan, which they claim is ill-suited for small scale farming.

Whether it is the new Green Revolution or the old, the first losers are farmers, especially small farmers. [Alliance for a Green Revolution in Africa] sets out to replace the seeds that African farmers have carefully developed for their farms and cultures, with varieties suited to industrial monocultures. Such seeds will pave the way for the industrialisation of African food crops, opening the door to large agribusiness to come in and dominate.

West Africa, here we come
Continuing with the African Centre for Biosafety’s report, we can see the many international agencies attempting to persuade and enable West African governments to create more GMO-friendly legislation. The US Dept. of Agriculture currently trains scientists in biotechnology and a USAID program helps countries enhance bio policy and research. Another USAID-funded program provides support for expanding agriculture biotechnology, including genetic modification.

The report also has harsh words for the World Bank, which is attempting to get approval of a biosafety policy through the West African Economic and Monetary Union, WAEMU, although the proposal was only written in English, hardly any help for the French-speaking group. Some groups, such as GRAIN, have also claimed that the World Bank has attempted to undermine public debate on these programs.

ECOWAS, which is a grouping of all West African states, has also held meetings, sponsored by USAID, “in order to ease the way for GE industries in West Africa,” according to the report. Civil society groups across the region have stepped up pressure on ECOWAS to slow down the acceptance of GMO.

USAID’s Regional Biosafety Project, which counts Benin, Burkina Faso, Mali, Senegal and Togo as members – has been put in place to harmonize biosafety laws across the region. It also, the report asserts, acts as a method to establish Bt cotton into the region, one the few cash crops for these countries. The authors claim that Bt cotton in West Africa will distract attention from illegal U.S. cotton subsidies and provide a foot in the door for U.S. corporations into this lucrative commodity.

Countries
While Benin has extended its moratorium on GM foods, it continues to receive food aid from the United States, a probable source of GM foods.

• Burkina Faso is currently testing bio cotton, but there are no dates when it will (if ever) be released to consumers. Scientists are also currently researching various GM plants, including those with drought tolerance, insect and virus resistant cowpeas. Burkina also accepts U.S.-based food aid, including cornmeal, which has a high likelihood of being GM;
  
• Cote d’Ivoire does not currently have any trials on GM foods, but is of food aid. Same for Gambia and Guinea Bissau, Liberia, Mauritania, Sierra Leone and Togo;
• Ghana has a little GM testing going on today, but the clouds are gathering. The similar cowpea project as Burkina is going on in Ghana; cases have been made by Ghanaian scientists to test a tomato resistant to yellow leaf curl; also, proposals have been completed for eggplant, cabbage and cassava. The Statesman newspaper in Accra reported that international community began workshops and trainings to sensitize the population regarding genetically modified foods, code words for arm-twisting sessions;
  
• Guinea-Conakry has sent government agents to trainings regarding GMO foods. However, there is currently no R & D going on in the country. It is a recipient of food aid;
  
• Mali currently tests GM cotton, but the government halted plans to allow other tests. It is a recipient of food aid;
  
• Nigeria is currently focusing on research in palm oil and has announced plans to begin testing on maize, cassava and sweet potatoes. Universities have been testing cowpeas and cassava, which came under criticism by a consumer rights group. Also, tests have taken place in yam and banana;
  
• Niger is participating in the cowpeas tests and is a large beneficiary of food aid. Ditto for Senegal, which did test cotton, but scrapped it because the seeds failed.

Soaring prices bring out protesters across Burkina Faso; General strike urged

I heard an estimate that 20,000 marched peacefully Saturday in Ouagadougou. I still have not heard about other cities.

One observer pointed out that the difference between Saturday’s marches and the violent protests from a few weeks back that sacked four cities in Burkina Faso could easily be summed up simple fact of their make up: Saturday’s marches were organized by unions and attended by working people; the previous riots were carried out by those without work. Make that young people without work.

From Agence France Presse:

"We call on workers to strike for 48 hours, from Wednesday April 8 to midnight April 9 throughout the country," said Tole Sagnon, secretary general of the main union, the General Confederation of Labour in Burkina (CGT-B).

The declaration signed by the leaders of six unions and some 15 independent organisations was read by Sagnon following a peaceful demonstration in Ouagadougou over high prices, corruption and fraud in one of the world's poorest countries.

Similar marches, conducted with the permission of authorities, were held in some six cities around the nation drawing tens of thousands of people to the streets, local residents told AFP.

"I'm demonstrating because the cost of living is too high. We do not want to attack the government... but everything is too expensive today.. people do not even have enough to eat," said Passeba Moyemga, a shoe salesman, who joined the protest march in the capital.

Some nice local color from Voice of America:

In the capital Ouagadougou, a group of students chanted in the ethnic Mossi language More, demanding government action to lower prices.

They reprised the song in French, singing there is nothing to eat anymore, no rice and no corn. They sang that they woke up early, and are standing in the streets, because they want change.

A journalist covering the event, Zoumana Wonogo, said police were at every major intersection, but the protest was well organized and peaceful.

Another journalist, who was taking part in the march, explained why it was necessary. "Life in Burkina Faso is very difficult. Goods are expensive. Government does not do anything to help citizens. It is why we decided to go on the road and to protest against this way of life in Burkina Faso," he said.

A freelance translator who makes about $200 a month said people in Burkina Faso feel the government bears responsibility for the situation. "It has to take appropriate measure to just help the people to get the goods and some services at acceptable prices. The trade unions are demanding an increase of salaries of the workers and to reduce the prices of goods on the market, and also to try to achieve good governance," he said.

It’s popular, it’s fun, it’s expensive: Rice, the new meat

We’ve heard a lot of talk about how rising incomes has driven up the developing world’s demand for meats, which is helping fuel the increase of world food prices. (Cows have to eat something, you know.)

But here’s an interesting look from the Hindu Business Line (from Chennai) at how changing diets has lead to higher demand for rice. In the 1970s, many African countries ate rough grains like local corn, millet and sorghum. But now countries like Mali and Nigeria are on a serious rice bender, because it’s easy to produce (no milling involved), cooks quickly and remains relatively cheap, big bonuses for countries where more people live far from food sources, an effect of urbanization.

In other parts of Africa, especially those countries returning from the fog of conflict, rice consumption is also on the rise. (The story mentions Angola, Uganda and Mozambique.) African countries would rather import the rice because of its high start up costs for local production. Secondly, Africa doesn’t have nearly enough irrigation to grow a lot of rice. I’d add that social mores force people to often scorn locally grown rice, preferring to pay higher prices for imported rice.

All this demand for imported rice will keep its price high, even though only seven percent of world stocks are traded internationally. However, that number is increasing with demand, says the UN Food and Agriculture Organization. Nonetheless, rice prices have doubled in the past year and recently passed the $500-per-ton mark. FAO fears that demand will further outstrip production, reducing world rice stocks. However, if prices go too high, some believe that Africans will turn back to cheaper domestically produced goods, driving down demand.

Blue light special: Food production will increase in 2008, but don’t expect big price breaks

While food cereal production is expected to skyrocket in 2008, the UN’s Food and Agriculture Organization predicts that world food prices should remain at record highs for the next few months. That’s because the underlying causes for these elevated food prices – high energy and fertilizer prices, demand for biofuel in industrialized countries and low food stocks – will prevail in the medium term, says the World Bank.

First, the raw numbers. In the past five years, fertilizer prices – which account for 30 cents of every dollar charged for grains – have seen price increases of 150 percent. At least one-quarter of the U.S. maize crop went to biofuel production – and that amount is supposed to climb. Also, conservation programs in both the European Union and United States has cutback production, says the World Bank.

The balance sheet for the 2007 season across West Africa was generally positive. FAO estimated that cereal production was around 12 percent higher than the five previous harvests. Only Senegal, Cape Verde, northern Nigeria and to a lesser extent, northern parts of Ghana, saw production declines.

However, because West Africa’s food markets are very integrated, any reduction in Nigeria – the continent’s most populous country – means demand throughout the region could rise, sending prices even higher. This seems to be the case in the eastern part of the region as Nigeria’s immediate neighbors have indeed seen higher food prices than elsewhere. On the region’s western rim, food prices remain high, but they are driven mainly by the costly international food market.

“Throughout the subregion the impact of high food prices will be more severe in localized areas where yields were severely reduced by delayed rains or floods,” the FAO said. “In these areas populations may require assistance.”

While the FAO’s reports were written before recent demonstrations against high prices in Cameroon and Burkina Faso, the UN body reported that Benin and Senegal have begun implementing price controls and waiving certain tariffs.

Wheat prices hit new price record

Food prices are still increasing, which is what people predicted for the first few months of the new year. But how long will this last?

From BBC:

Wheat prices have hit record levels as supplies dwindle, raising concerns about growing food inflation.

Chicago Board of Trade (CBOT) wheat for delivery in March rose the maximum 90 cents allowed to $11.99 a bushel in electronic trading in Asia.

High-protein spring wheat on the Minneapolis Grain Exchange rose by almost 25% to record levels on Monday.

Kazakhstan has become the latest country to put export restrictions on wheat as it battles against inflation.

Russia and Argentina have already imposed similar export restrictions.

Briefings from the other (vegetable) oil crisis

“The oil palm (Elaeis guineensis) is a native of West Africa,” the Cambridge World History of Food informs us. This light red, and I would argue, vaguely sour smelling cooking oil may be popular throughout the world, but it’s still king around the region, where seven out of 10 people consume industrially processed oil daily.

That’s not to say other oils suffer in comparison. Vegetable oils as a group form of strange culinary religion in West Africa; they are additives to nearly every food imaginable. So popular they are, development organizations have begun fortifying cooking oil with vitamin A, a cheap way to introduce important nutrients into peoples’ diets. Malnutrition remains a problem across the region, so these vegetable oils have become an important source for calories. (Anyone who has eaten street food in the region can attest to that.)

West Africans use palm oil as important ingredients in soups and sauces of all flavors and in the dough made from cassava, rice and plantains. In some countries, it is used in casseroles. (Not my mom’s casseroles, mind you, but these are indeed casseroles.) Finally, people use it here to fry dough balls or fish or plantains.

The best part is palm oil is good for you. Kind of. If the oil has been processed by hand – which still happens in the village – it can be quite nutritious, providing a rich source of carotenoids. However, when processed industrially, which is mostly the case around the world, the palm loses many of its natural nutritional benefits.

For many reasons, palm oil has become a victim of its own success. A recent story in the New York Times points out, an acre of palm oil produces the equivalent of eight acres of soybeans, making it popular with planters. This ratio not gone unnoticed by biofuel producers, who have begun purchasing palm oil on the market, further driving up demand (and prices).

It’s also a cure for obesity. Ok, not really. But because of the health problems related with obesity, many municipalities in the U.S. (most famously, New York City) have tried to forbid restaurants from using unsaturated trans fats, driving up palm oil imports nearly 100 percent in the past year.

When you add up all this rising demand, and take into account the insubstantial 2.7 percent increase in supply – you understand the nearly 70 percent price jump in palm oil during the past year. This is our take-away lesson.

That puts the hurt on people in places like Burkina Faso. Here people are spending a small fortune just so their families can continue digesting vegetable oils. Last year, a liter of corn oil set people back roughly 990 CFA. Today that same bottle costs 1450 CFA. (Let’s go with the currency conversion rate of $1 = 450 CFA.) Brands of industrial vegetable are usually made up of a combination of oils – palm, maize, cottonseed, etc. – and these prices have all skyrocketed. The brand Colza sold for 1,000 CFA per liter a year ago and now runs 1,300 CFA. 750 CFA would get you a bottle of Dinon, but you can’t walk out of the shop with one for anything less than 1000 CFA. Budget constraints force many people to buy oil in smaller quantities. This type of oil is usually sold in clear plastic sacks, and these customers are now hurt doubly. First, the price of oil will increase; secondly, merchants will most likely reduce the volume of oil in the bag. Simple oil, which is unrefined palm oil, sold for 600 CFA a bag in this fashion and now runs about 850 CFA.

Where is OPEC?
As pointed out before, the palm tree grows naturally in West Africa, although people have been transporting the seedlings and replanting them in holdings for centuries. It grows well with other West African staples like cassava and yam and is best tended in small fields. Larger, European-run plantations did exist during colonial times, but they never really took off. However, the plant, along with groundnut, has a long, complicated history with slavery.

The British industrial revolution spurred the European demand for palm oil, where machinists used it to lubricate moving parts in England’s factories. Candle makers also employed the oil to fabricate wax. Colonial rulers in present-day Benin, Ghana, Nigeria and places further north like Burkina Faso planted acres and acres of palm. A tributary in the Niger River was named the Palm River due to the trees planted in its swamps and the production facilities situated next to the water.

According to the Cambridge World History of Food, people learned to hydrogenate oils and fats into products like margarine at the turn of the 20^th century, leading to another spike in demand for all types of oils: groundnuts, coconuts and to a lesser extent, palm oil. After World War II, new technology allowed people to use mostly un-hydrogenated palm oil for food products in Western countries.

From the Cambridge Food History:

A rapid expansion of the palm oil export trade followed, accompanied by a marked growth in the plantation sector of production. Between 1962 and 1982, world exports of palm oil rose from about 500,000 to 2,400,000 million tonnes per annum, and Malaysia emerged as the world’s largest producer, accounting for 56 percent of world production and 85 percent of world exports of palm oil in 1982…

By the last decade of the century, yearly world production ran about 11 million tons.

What, me worry: Why are world food prices so high?

A couple weeks ago, I questioned how certain expanding African economies could be stepping up their export industry while maintaining sizable trade deficits. It seems that this recent food issue has shed a little light on the problem.

This food issue – because I refuse to call it a crisis – has cropped up in the past few weeks because of what a spokeswoman at the UN Food and Agriculture Organization termed the “perfect storm” of bad weather, tight food supplies and strong demand has lead to a 21 percent increase in the world’s food bill. Developing countries may end up paying even more.

The press has made much out of the worried reactions of consumers around the world. Food riots took place in Mauritania and the once-pacific Senegal; the Russian government freezes prices; Italians boycotted pasta, Argentineans turned their backs on tomatoes because they became more expensive than meat.

But are things really that bad? FAO claims that price volatility has always been distinctive characteristic of the world agriculture market. The Economist claims Russian President Vladimir Putin froze prices for political gain. The Mauritian government claims the food riots there were orchestrated.

Flat bread for a flat world?
Granted, these arguments don’t lend too much optimism. The defining factor of this year’s overcharged food market is that consumers have seen simultaneous price increases in nearly every commodity.

The big price gainers include the world’s most important staples:

• Wheat: Poor seasons due to bad weather in Europe, Pakistan, Morocco and Australia created a 50 to 65 percent increase compared to last year’s price. However, high prices may bring down demand, thus depressing prices;
• Rice: Even after reaching its highest price in 20 years in October, rice is still rising slower than other commodities. Experts predict this year’s large harvest will bring prices down;
• Maize: After an initial run due to an interest in biofuels, corn products hit a ten-year high in February before falling. Massive plantings have been reported around the world, making experts confident still-high prices will continue to fall;
• Sugar: After two years of processing setbacks, white gold posted 25-year highs last year, but has since drastically fallen.

Some may point out that simple supply and demand is at work here. Demand is up because food production has increased at 1.3 percent a year, below the 1.35 percent escalation to the world’s population.

FAO researchers point out that globalization is a culprit in these high prices. Where West African floods and Australian droughts used to be considered local events, food markets are now more tightly intertwined. With a limited amount of breathing space between production and consumption, consumers can literally feel these local shocks rippling through the world markets.

But globalization is only an effect. It’s not the cause of across-the-board high prices. For this, the Rome-based FAO has found many.

• High petroleum prices: Yes, oil remains an easy journalistic scapegoat to explain away a complicated issue, but petroleum does affect food prices in many subtle ways. Often an important ingredient in fertilizers, expensive petroleum drives up the price of crop inputs. It’s well known that near record oil prices have increased interest in biofuels and other natural energy sources, which divert agriculture crops reserved for feeding livestock, pushing up prices for cattle (and meat). Increased interest in biofuels will also raise the demand for other feed stocks like sugar, maize, rapeseed and soybean.

• Increased freight rates: Like higher petroleum prices, this is not a cut-and-dry issue. Yes, oil prices affect the cost of shipping goods, but not as much as you think. Increased value for petroleum has increased the demand for iron ore and coal. These products are transported in the same type of ships as foodstuffs. Ship makers introduced fewer new ships onto the market than expected this year, so competition for these boats became fierce. In some cases, foodstuffs stayed in port, lessening supplies and further increasing prices. Finally, as merchandise prices rise, shipping costs increase due to higher insurance rates. All these factors combined to drive up shipping freight rates 57 percent between June and October.

One overlooked feature of globalization is ocean shipping costs remain roughly the same rate as they were in the early 1970s. African nations, however, still pay higher shipping charges than the rest of the world. That’s because they don’t do a lot of trading with other nations, so pulling a ship off popular routes to stop in port in Lomé or Dakar or Tema is expensive. Also, West African countries have heavy trade imbalances. What this means in practical terms is that when containers are unloaded at African ports, not many exports are loaded back on. Half-full boats don’t help shipping firms, who must charge higher shipping costs.

• Weak dollar: FAO points out that currency issues affect all markets, but they have rarely wreaked so much havoc as the dollar has this year in agriculture markets. The U.S. dollar’s gradual decline against other currencies has boosted demand for American exports. High demand eventually turns into higher prices, which we have seen in the wheat market. It’s a real-life version of Whac a Mole: If the price of one commodity increases, more farmers will rush to plant that product, driving up the prices for the commodities farmers ignore.

• Border decisions: Most West African governments collect a great amount of revenue through import taxes. In a decision to help local rice growers, the government of Senegal decided to institute a 20 percent surtax on imported rice, which increases the cost of a sack of rice in the local markets. At the beginning of next year, all ECOWAS countries will harmonize rice duties at five percent for paddy rice and 10 percent for milled or broken rice. This does not help consumers in the short term, however.

Drilling for food
If we take another step deeper into West African food supplies, it is best to examine the imports of Senegal and Mauritania, two counties which have already faced riots against high prices.

Like many African states, Senegal is a net food importer. The interesting fact is this country, where millet was once a dietary staple, now ranks rice as its primary import. In fact, the country imported more than 536,000 metric tons of milled patty rice in 2000, roughly twice as much as the second most popular product, Wheat. By 2004, the last year statistics are available, broken rice became the number one import (oddly, it wasn’t on the top 20 before) with 799,863 metric tons. Wheat stays number two with 313,777 metric tons.

Let’s return to the above discussion regarding the country’s surtax on imported rice: It was a classic solution to protect a fledgling domestic industry. However, domestic rice can’t be grown fast enough to satisfy Senegal’s population, and the FAO admits the industry most likely won’t survive without the protection.

There’s something else at play here: purchasing power. Most Senegalese won’t buy products they feel are socially beneath them. If you can afford fish in your rice, you don’t procure pounded dried fish that’s used to feed the poor. The same goes for rice. Those who can find the money for Thai rice don’t purchase local rice. (That’s a truth in Burkina Faso, also.) There’s a large caveat with this argument: For one, it’s a pretty large generalization, but one that I’ve heard elsewhere.

Since I am at it, I’ll paint another generality. More people eat rice because they are busier. What I mean is more of their time is spent working or being economically occupied. This may be a good thing, for working women have less time to sit around and cook millet, which often takes longer to prepare than rice. (Generalizations aplenty today!) Urbanization may also play a part in falling millet stocks. Families might feel the need to put down some of the village traditions in lieu of becoming more modern, urbanized. There’s also the fact that perhaps millet – or the right millet, because it varies by region – may not be found in all urban markets throughout the city.

Moving on from broad strokes, let’s look at Mauritania, a country where I’ve been able to collect far less information. In 2000, the country’s number one import was raw sugar, when these hard-core tea drinkers brought in 112,327 metric tons. Tea must have something to do with it, because refined sugar ranked fourth: 93,458 metric tons. Wheat also played a big role in the market with 72,991 metric tons.

2004 is when things get a little weird. Wheat still remains high with 148,509 metric tons. Refined sugar still takes home number two with 189,840 metric tons. But, there’s no raw sugar to be found. Instead, the number one import goes to….Cigarettes: $66,325,000 worth of puffy treats. (I knew I liked this country.)

I can’t tell you where raw sugar went; nor can I tell you were Joe Camel came from. (Cigarettes may always have been immensely popular, but perhaps the cigarette importers knew a way to, um, “sidestep” import duties.) Going back to the food imports, I will say they may be skewed because the country receives quite a bit of food aid from the World Food Program. In fact, between 2003 and 2006, Mauritania averaged more than 33,000 tons of donated food, compared to roughly 11,000 tons for Senegal. How this affects a country’s grocery list, I don’t know.

Nor do I really know about what these lists say about these two countries. These countries happen to import a lot of food – and a lot of food that now happens to be expensive. But you could say that about any commodity right now. You may also say they import more food because they have more money to pay for it…Well, at least until this year. That’s why, West Africa for the most part, these high food prices remain a pocketbook issue and don’t have to become a food security issue.

It’s on you, Nigeria
Here we should mention Nigeria, by far the region’s largest food market. If Nigeria doesn’t prove to have a good harvest, they’ll be looking to purchase food stocks elsewhere in West Africa. Not a bad thing, if you don’t remember 2005 when food from less bountiful Niger was bought up to relieve Nigerian demand, creating a food crisis. We term 2005 a crisis because not enough food was available in Niger; this year's issue is presently due to expensive food. Countries have learned from the issue in Niger. In Burkina Faso, at least, safeguards have been put in place to make sure local markets are not needlessly losing food stocks to foreign consumers.

The prognosis for Nigeria is so-so. Droughts ruined a lot of crops in the northern part of the country, but Fewsnet hopes this could be made up from the higher than expected rains in the south. Of course, if it goes like the rest of the world, we could be in for a long dry season.

How to learn to love biofuels and win this war

The argument exists: The production of eco-friendly biofuels could inadvertently create food security issues as farmers will rush off to plant sugar beets while ignoring growing maize or wheat or other crops humans consume.

However, the Government of Mozambique is pushing ahead with its first convertible biofuels plant. The plant, located just an hour north of Maputu, will be able to produce more than 5,000 litres of biodiesel an hour from plant oils, reports IRIN.

The facility remains idle because the quality of the organic crops are not up to standards, but the government remains committed to the idea.

The production of biofuels will reduce the country’s dependence on the expensive and volatile petroleum market, said the country’s Minister of Energy.

“They are labour intensive, and can generate agricultural and agro-industrial employment, self-employment and income, particularly in rural areas, where the incidence of poverty is highest," he told an international conference on biofuels in Brussels.

Tough talk on biofuels
Last month, Jean Ziegler, a UN consultant on food rights, called for a five-year ban on the production of food to fuel because the conversion of maize, wheat and corn to fuel was driving up food prices worldwide.

Ziegler used incendiary language to denounce the practice. "It is a crime against humanity to convert agriculturally productive soil into soil which produces foodstuffs that will be burned into [as] biofuel,” he said at a press conference.

The UN Food and Agriculture Organization recently referred to his comments as regrettable.

In other news, his much too-nuanced talk got him a rebuke from Africa Flak.

IRIN quoted Jeff Tschirley, head of the FAO's Environment Assessment and Management Unit: "FAO strongly feels that food security and environmental considerations must be fully addressed before making investments or policy decisions, and we are actively working to ensure this happens.

Meanwhile, back at the ranch
However, at least two development consultants claim that small farmers will not be able to participate in marketing biofuels because of markets of scale: These farmers grow crops like sorghum on small plots, but biofuel plants like the one waiting completion near Maputu will rely on large plantations with large labor forces.

Another problem facing these farmers is poor infrastructure – which coincidentally is a major contributor to food security – where farmers’ crops are stuck in rural areas, far away from food markets and biofuel plants.

Marcos Freire, a project coordinator at the the Mozambique Institute of Agrarian Investigation, said urban dwellers will feel the effect of higher food prices. This won’t be so bad, he said, because farmers will be paid more for their work.

The dark side of biofuels?

Rich counties should think twice about turning food crops into biofuels, says UN food expert Jean Ziegler. In fact, he proposes a five year moratorium on the process.

With two agriculture powerhouses, the U.S. and Brazil, among rich nations searching for alternative fuels and other methods to cut greenhouse gases, using crops for biofuels are creating dangerous unintended consequences: driving up food prices and sparking food shortages, which increasingly harm the world’s poor.

The story points out that Zeigler claims “it takes 232 kilograms of maize to produce 50 liters of ethanol. That maize could feed a child in Zambia or Mexico, where maize is the staple crop, for a year, he said.”

The five-year moratorium will allow technology to catch up and increase the possibility of making biofuels from agriculture waste.

Can I quote you?
With the characteristic subtleness you may find in your average university undergrad, this UN expert connected the dots and labeled the continued use of cereals and sugars to produce fuels an atrocity.

"So it's a crime against humanity — it's a crime against humanity to convert agricultural productive soil into soil ... which will be burned into biofuel," The Associated Press quoted Ziegler at a news conference. "What has to be stopped is ... the growing catastrophe of the massacre (by) hunger in the world."

(An atrocity, yes, but only for the reporters present at the news conference if they wouldn’t take that quote and run with it.)

The UN goal of reducing extreme poverty by half by 2015 will not be met because of growing world hunger due to increasing prices, he said. With more than 100,000 people dying everyday due to the consequences of malnutrition and another 800 million chronically undernourished, now is not the time to engage in wasteful and expensive biofuel projects.

He has a point. At least on prices. According to this website by Corn Products International, the price of corn, a major ingredient in the biofuel ethanol, has increased from $15 in 2002 to $23 in 2005 and $40 in 2007. Prices for wheat in the U.S., the world’s largest exporter, are also hitting all-time highs. According to USA Today:

Wheat for December delivery closed at $9.33 a bushel in Chicago, more than double the price from a year ago. Drought in Australia and poor crops in other nations helped drive U.S. and world supplies to the lowest levels in decades. U.S. wheat stocks are pegged at 362 million bushels in 2007-08, the tightest since 1973-74.

The reason for the high price? Domestic harvest is down from its 1981 peak because farmers have moved to other cereals that produce higher yields and the U.S. government’s ethanol-friendly tax breaks. (Don’t, don’t call them subsidies.)

"We've placed so much demand on … feed grain to turn into fuel, we can't play catch-up quite as fast globally," USA Today quotes Joe Victor, vice president of Allendale, a commodity research advisory firm.

The real culprit?
The search for biofuels is certainly driving up world prices. However, how much would falling cereal prices help those who already face malnutrition? In 1990, FAO counted 823 million malnourished people. One year ago, the organization estimated 820 million remain malnourished, still far off from the UN Millennium Development Goal of reducing the total 412 million by 2015.

According to FAO, three out of every four hungry people live in rural areas, where infrastructure is poor (good roads often provide better food security) and education rates remain low.

Thus, for the world’s undernourished, isn't the real issue the availability of food and not its price?

Reforming the $2 billion a year food aid budget has certainly become an issue for the Food and Agriculture Organization. Much of the problem, FAO asserts, rests with in-kind food aid, which means the aid is tied to special conditions. For example, countries receiving the aid must purchase the food from the donating country instead of purchasing food from regional or local stocks. Researchers argue that this in-kind aid, which makes up one-third of all food aid, unfairly hurts local merchants and farmers by introducing foreign food into the market, driving down prices. This has been a sticking point since 2001 in the Doha trade talks, says TIME.

Secondly, this food aid can be sold on the domestic market, which is called “monetization.” For example, American NGOs such as Catholic Relief Services (and until 2009 CARE) monetize U.S. rice (or corn or wheat) by shipping it to countries (using U.S.-based carriers) and selling this rice on its domestic market. The profits these organizations then make can put to funding development programs.

Main recommendations of the report include (I quote):

• Eliminate programme, or government-to-government food aid, which, by definition, is not specifically targeted to needy groups. Stop the “monetization” of aid, whereby one out of every four tonnes of food aid is sold in local markets of recipient countries to generate funds for development;
  
• Deliver aid in the form of cash or food coupons where possible, and use in-kind food aid only where food insecurity is due to a shortage of food rather than to such problems as access to food. Assistance aimed at improving markets – by repairing roads or improving rural infrastructure, for example – is liable to be more effective;
• Use local and regional food-aid procurement where appropriate, as this can be of great benefit to agricultural development in many low-income developing countries. Such purchases are not always desirable, however, as they can increase local prices.

The U.S. and Brazilian governments’ policies on biofuels do not constitute perfect solutions to climate and fuel concerns, but these problems are no where near the extent of worries envisioned here. However, world prices should be closely monitored going forward. In my mind, the inability to reform food aid from the prospective of donors and donor agencies will only do more to hurt those in need.