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Food Justice in a Resource-contrained World from OXFAM


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Food Justice in a Resource-contrained World from OXFAM

  1. 1. Growing aBetter Future Food justice in a resource-constrained world
  2. 2. Author: Robert Bailey This publication is copyright but text may be used free of charge for the purposes of advocacy, campaigning, education, and research, provided that the source is acknowledged in full. The copyright holder requests Acknowledgements that all such use be registered with them for impact assessment purposes. For copying in any other circumstances, or for re-use in other This report was written by Robert Bailey and coordinated publications, or for translation or adaptation, permission must be by Gonzalo Fanjul. Its development was a co-operative secured and a fee may be charged. E-mail effort, involving Oxfam staff and partner organisations. Published by Oxfam GB for Oxfam International under It draws on the findings of a research programme  ISBN 978-1-84814-852-9 in June 2011. Oxfam GB, Oxfam House, managed by Richard King, Javier Pérez and Kelly John Smith Drive, Cowley, Oxford, OX4 2JY, UK. Oxfam GB is Gilbride. Alex Evans, Javier García, Silvia Gómez, registered as a charity in England and Wales (no. 202918) and in Duncan Green, Kirsty Hughes, Richard King, Kate Scotland (SCO 039042) and is a member of Oxfam International. Raworth, Jodie Thorpe, Kevin Watkins and Dirk Oxfam is an international confederation of fifteen  Willenbockel made specific written contributions to the  organizations working together in 98 countries to find  report, which also draws on an extensive list of case lasting solutions to poverty and injustice: studies, notes and background research that can be Oxfam America (, found at Oxfam Australia (, Many colleagues contributed with extensive comments Oxfam-in-Belgium (, and inputs to the drafts of the report. Special mention Oxfam Canada (, should be made of Nathalie Beghin, Sarah Best, Phil Oxfam France (, Bloomer, Stephanie Burgos, Tracy Carty, Teresa Cavero, Oxfam Germany (, Hugh Cole, Mark Fried, Stephen Hale, Paul Hilder, Katia Oxfam GB (, Maia, Duncan Pruett, Anna Mitchell, Bernice Romero, Oxfam Hong Kong (, Ines Smyth, Alexandra Spieldoch, Shawna Wakefield,  Oxfam India ( Marc Wegerif and Bertram Zagema. Intermón Oxfam (, Oxfam Ireland (, Production of the report was managed by Anna Oxfam Mexico (, Coryndon. The text was edited by Mark Fried. Oxfam New Zealand (, © Oxfam International June 2011 Oxfam Novib (, Oxfam Quebec ( This report and information about the Grow Campaign are available at The following organizations are currently observer members of Oxfam International, working towards full affiliation: Oxfam Japan ( Oxfam Italy ( Please write to any of the agencies for further information, or visit For further information on the issues raised in this report, please e-mail: advocacy@oxfaminternational.orgii
  3. 3. Growing aBetter Future Food justice in a resource-constrained world
  4. 4. Contents ii Acknowledgements 43 3 The new prosperity 03 List of figures 44 3.1 Growing a better future 05 1 Introduction 46 3.2 A new governance for food crises 11 2 The Age of Crisis: 46 International reform a skewed and failing system 48 National approaches 12 2.1 A failing food system 50 A new global governance 14 2.2 The sustainable production challenge 52 3.3 A new agricultural future 15 Yield increases drying up 54 Four myths about smallholders 16 Policy making captured by the few 56 A new agricultural investment agenda 17 Natural resources squeezed 58 3.4 Building the new ecological future 19 Climate changing 58 Equitable distribution of scarce resources 21 Demography, scarcity and climate change: 59 An equitable transition a perfect storm scenario for more hunger 62  3.5 The first steps: Oxfam’s agenda 29 Meeting the sustainable production challenge 65 4 Conclusion 30 2.3 The equity challenge 68 Notes 32 Access to land 72 Images 33 Women’s access to land 34 Access to markets 35 Access to technology 35 Claiming rights 36 2.4 The resilience challenge 36 Increasing fragility 38 Food prices gone wild 38 Climate chaos 39 Government failures 39 A humanitarian system at breaking point 40 National level action 41 Time to rebuild02
  5. 5. List of figures12 Figure 1: Real food price changes predicted over 26 Figure 12: The predicted impact of climate change the next 20 years on regional staple food production to 203013 Figure 2: The challenge of increasing equity 26 Figure 13: The predicted increase in numbers within ecological limits of malnourished children in sub-Saharan Africa in the context of climate change15 Figure 3: The ecological footprint of food 27 Figure 14: Predicted dampening impacts of17 Figure 4: The share of land devoted to climate change adaptation on the price of maize agriculture has peaked 30 Figure 15: The food system is riddled with inequity18 Figure 5: The land grab legacy of the 2008 food price crisis 31 Figure 16: The number of hungry people worldwide21 Figure 6: The proportion of household expenditure 32 Figure 17: Where are the hungry people? allocated to food, with predictions to 2030 34 Figure 18: Who controls the food system?22 Figure 7: Predicted increases in world food 36 Figure 19: The increasing volatility of food prices commodity prices 38 Figure 20: Food prices and oil prices are linked23 Figure 8: Comparative growth rates in population and crop productivity: maize in sub-Saharan Africa 50 Figure 21: Who are the food superpowers? and rice in Asia 55 Figure 22: Investment in agricultural R&D24 Figure 9: Predicted food price increases for ignores Africa domestic users to 2030 56 Figure 23: Who is investing in agriculture?25 Figure 10: Predicted impact of climate change 60 Figure 24: Governments are good at investing on world market food export prices to 2030 in public bads26 Figure 11: The predicted impact of climate change on maize productivity to 2030 03
  6. 6. 1Introduction Chapter 1: Introduction
  7. 7. Niger is the epicentre of hunger. Here, it is chronic. The list of answers routinely given is bafflingly long,  Corrosive. Structural. Systemic. Over 65 per cent of often crude and nearly always polarized. Too much people survive on less than $1.25 a day.1 Nearly one in international trade. Too little international trade. The two children is malnourished.2 One in six dies before commercialization of agriculture. A dangerously they reach the age of five.3 romantic obsession with peasant agriculture. Not enough investment in techno-fixes like biotechnology.  Families are fighting a losing battle against soil depletion,  Runaway population growth. desertification, water scarcity, and unpredictable  weather. They are exploited by a tiny elite of powerful Most are self-serving, designed to blame the victims or traders who set food prices at predatory levels. to defend the status quo and the special interests that profit from it. This is symptomatic of a deeper truth:  Shocks rain down upon them like hammer blows: a power above all determines who eats and who does not. compounding series of disasters, each one leaving them more vulnerable to the next. The drought of 2005. The Hunger, along with obesity, obscene waste, and food price crisis of 2008. The drought of 2010. These appalling environmental degradation, is a by-product of events stole lives, shattered families, and obliterated our broken food system. A system constructed by and on livelihoods. The consequences will be felt for behalf of a tiny minority – its primary purpose to deliver generations. profit for them. Bloated rich-country farm lobbies,  hooked on handouts that tip the terms of trade against Chronic and persistent hunger. Rising demand on top of farmers in the developing world and force rich-country a collapsing resource base. Extreme vulnerability. consumers to pay more in tax and more for food. Self- Climate chaos. Spiralling food prices. Markets rigged serving elites who amass resources at the expense of against the many in favour of the few. It would be easy to impoverished rural populations. Powerful investors who dismiss Niger, but these problems are not unique – they play commodities markets like casinos, for whom food is are systemic. The global food system is broken. Niger is just another financial asset – like stocks and shares or  simply on the front line of an impending collapse. mortgage-backed securities. Enormous agribusiness At the start of 2011, there were 925 million hungry people companies hidden from public view that function as worldwide.4 By the end of the year, extreme weather and global oligopolies, governing value chains, ruling rising food prices may have driven the total back to one markets, accountable to no one. The list goes on. billion, where it last peaked in 2008. Why, in a world that produces more than enough food to feed everybody, do so many – one in seven of us – go hungry?06
  8. 8. An age of crisis The paralysis imposed upon us by a powerful minority risks catastrophe. Atmospheric concentrations of2008 marked the start of the new era of crisis. Lehman greenhouse gases are already above sustainable levelsBrothers collapsed, oil reached $147 a barrel, and food and continue to rise alarmingly. Land is running out.prices leapt, precipitating protests in 61 countries, with Fresh water is drying up. We have pushed ourselves intoriots or violent protests in 23.5 By 2009, the number of the ‘Anthropocene Epoch’ – the geological era in whichhungry people passed one billion for the first time.6 human activity is the main driver of planetary change.Rich-country governments responded with hypocrisy,professing alarm while continuing to throw billions of Our bloated food system is a major cause of this crunch.dollars of taxpayers’ money at their bloated biofuel But it is also rapidly becoming a casualty. As resourceindustries, diverting food from mouths to petrol tanks. pressures mount and climate change gathers pace, poorIn a vacuum of trust, governments one after another and vulnerable people will suffer first – from extreme imposed export bans, pushing up prices further. weather, from spiralling food prices, from the scramble for land and water. But they won’t be the last.Meanwhile the profits of global agribusiness companies rocketed, the returns of speculators soared, and a new New research commissioned for this report paints a grimwave of land-grabbing kicked off in the developing world, picture of what a future of worsening climate change andas private and state investors sought to cash in or to increasing resource scarcity holds for hunger. It predictssecure supply. international price rises of key staples in the region of 120 to 180 per cent by 2030. This will prove disastrousNow, as climate chaos sends us stumbling into our for food importing poor countries, and raises thesecond food price crisis in three years, little has changed prospect of a wholesale reversal in human suggest that the global system will manage any betterthis time around. Power remains concentrated in thehands of a self-interested few.‘We lack food. We’re facing hunger, but we can’t buy much. ... This year things are much worse than before. Worse than in 2005 when things were bad. Then not everybody faced hunger... just some areas. But now, everyone is facing hunger.’Kima Kidbouli, 60 years, Niger, 2010.Opposite: Families in Flinigue, Niger receive foodvouchers from Oxfam. The vouchers give them thefreedom to choose what they buy in a specified store. (August 2010)Right: Kimba Kidbouli, 60 years, Niger. Growing a Better Future 07 Chapter 1: Introduction
  9. 9. A new prosperity All of this will require overcoming the vested interests that stand to lose out. There is growing appetite to do so This future is not certain. Crisis on the scale we are as these issues rise up the political agenda, pushed by experiencing today almost always leads to change: the events and by campaigners, or grasped by leaders with Great Depression and the Second World War led to a a sense of moral purpose. Though the banks fight reform  new world order, the United Nations, the Bretton Woods tooth and nail, public outrage has seen legislative system, and the spread of welfare states. The oil and measures passed in the USA, and steps toward economic crises of the 1970s replaced Keynesianism regulation in the UK and elsewhere. And a financial  with laissez-faire economics and the Washington transactions tax is on the agenda in the EU and at the Consensus. G20, alongside measures to rein in commodity The challenge before us today is to seize the opportunity speculation and reform agricultural trade. Though for change and set course towards a new prosperity, an special interests continue to pervert food aid in many age of co-operation rather than competition, in which the rich countries, a concerted public campaign in Canada well-being of the many is put before the interests of the succeeded in freeing it to work effectively; Canada now few. During the last food price crisis, politicians tinkered leads international negotiations to achieve the same at the margins of global governance. This time they must outcome globally. Though agricultural subsidies remain deal with the root causes. Three big shifts are needed: enormous, some reform has reduced their negative impacts in developing countries. Though dirty industry • First, we must build a new global governance to avert continues to block progress on climate change, food crises. Governments’ top priority must be to tackle responsible companies have broken ranks with them.7 hunger and reduce vulnerability – creating jobs and A growing number of countries are adopting bold investing in climate adaptation, disaster risk reduction, greenhouse gas reduction targets or making ambitious and social protection. International governance – of investments in clean technologies. Global investments in trade, food aid, financial markets, and climate finance  renewable technologies overtook fossil fuel spending for – must be transformed to reduce the risks of future the first time in 2009.8 shocks and respond more effectively when they occur. But what is needed is a step change. Strong political • Second, we must build a new agricultural future by leaders with unambiguous mandates from their peoples. prioritising the needs of small-scale food producers Progressive businesses that choose to break ranks with in developing countries – where the major gains in laggards and blockers. Customers that demand they do productivity, sustainable intensification, poverty  so. And it is needed now. The window of opportunity may reduction and resilience can be achieved. be short-lived, and many of the choices that must be Governments and businesses must adopt policies taken are already upon us: if catastrophic climate change and practices that guarantee farmers’ access to natural is to be avoided, global emissions must peak within the resources, technology and markets. And we must next four years;9 if we are to avoid a spiralling food reverse the current gross misallocation of resources price crisis, fragility in the global system must be which sees the vast majority of public money for addressed today. agriculture flow to agro-industrial farms in the North. • Finally, we must build the architecture of a new ecological future, mobilizing investment and shifting ‘We need to address the question of global the behaviours of businesses and consumers, while hunger not as one of production only, but crafting global agreements for the equitable distribution also as one of marginalization, deepening of scarce resources. A global deal on climate change will be the litmus test of success. inequalities, and social injustice. We live in a world in which we produce more food than ever before, and in which the hungry have never been as many.’ Olivier de Schutter, Special Rapporteur on the Right to Food at the FAO Conference, November 2009 Opposite: Women from Dola village construct a pond to irrigate their vegetable gardens. Nepal’s hill districts have lacked investment in agriculture and are faced with a rise in food prices and reduced crop yields as a result of climate change. (Nepal 2010)08
  10. 10. Oxfam’s vision Many other organizations – global civil society, producers’ organizations, women’s networks, foodOxfam has been responding to food crises for nearly 70 movements, trade unions, responsible businesses andyears – from Greece in 1942 to Biafra in 1969, Ethiopia in empowered consumers, grassroots campaigns for low1984, and Niger in 2005, plus countless other silent carbon living, food sovereignty or the right to food – aredisasters that play out beyond the gaze of global media. promoting positive initiatives to alter the way we produce,All have been entirely avoidable – the result of disastrous consume and think about food. Together we will build adecisions, abused power, and perverted politics. More growing global movement for change. Together we willrecently, Oxfam has found itself responding to growing challenge the current order and set a path towards anumbers of climate-related disasters. new prosperity.Prevention is better than cure, and so Oxfam alsocampaigns against the vested interests and unfair rulesthat corrupt the food system: rigged trade rules, pork-barrel biofuel policies, broken aid promises, corporatepower, and inaction on climate change. Growing a Better Future 09 Chapter 1: Introduction
  11. 11. 2The age of crisis: a skewed andfailing system Chapter 2: The age of crisis: a skewed and failing system
  12. 12. Figure 1: Real food price changes predicted over the next 20 years 2030 baseline 2030 climate change 180 160 Increase in world market export prices relative to 2010 (%) 140 120 100 80 60 40 20 0 Other processed Processed meat Processed rice Livestock Wheat Other crops Paddy rice Maize food products Source: D. Willenbockel (2011) ‘Exploring Food Price Scenarios Towards 2030’, Oxfam and IDS 2.1 The food system is buckling under intense pressure from climate change, ecological degradation, population growth, rising energy prices, rising demand for meat and A failing food dairy products, and competition for land from biofuels, industry, and urbanization. system The warning signs are clear. Surging and unstable international food prices, growing conflicts over water,  the increased exposure of vulnerable populations to drought and floods are all symptoms of a crisis that may  soon become permanent: food prices are forecast to increase by something in the range of 70 to 90 per cent by 2030 before the effects of climate change, which will roughly the double price rises again (see Figure 1).12
  13. 13. Figure 2: The challenge of increasing equity within ecological limits 2010 2050 Population: 7bn Population: 9bn Planetary boundaries Ecological impact of global resource use Resource share of the worst-off 20% of peopleWe face the unprecedented challenge of pursuing There are three major challenges that must be met:human development and ensuring food for all, in ways • The sustainable production challenge: we mustthat will both keep the planet within essential ecological produce enough nourishing food for nine billion peopleboundaries and end extreme poverty and inequalities. by 2050 while remaining within planetary boundaries;Figure 2 illustrates the task at hand. • The equity challenge: we must empower womenEven as global population significantly expands,  and men living in poverty to grow or to buy enoughwe must: food to eat;• Reduce the impacts of consumption to within • The resilience challenge: we must manage volatility in sustainable limits, and food prices and reduce vulnerability to climate change.• Redistribute consumption towards the poorest. Running through each are fault lines along whichAchieving the vision for 2050 requires a redistribution struggles for power and resources will play out. Thisof power from the few to the many – from a handful of chapter sets out each in detail.companies and political elites to the billions of peoplewho actually produce and consume the world’s food.A share of consumption must shift towards those living inpoverty, so everyone has access to adequate, nourishingfood. A share of production must shift from pollutingindustrial farms to smaller, more sustainable farms,along with the subsidies that prop up the former andundermine the latter. The vice-like hold overgovernments of companies that profit from environmental degradation – the peddlers and pushersof oil and coal – must be broken. Growing a Better Future 13 Chapter 2: The age of crisis: a skewed and failing system
  14. 14. 2.2 Agriculture faces a daunting challenge. It must dramatically increase food production while completely transforming the way in which food is produced. On The current trends, demand for food may increase by 70 per cent by 205010 due to population growth and economic development. The Earth’s population is expected to grow sustainable from around 6.9 billion today to 9.1 billion in 2050 – an increase of one-third11 – by which time an estimated production seven out of ten people worldwide will live in Low-Income Food Deficit Countries (LIFDCs).12 These are forecasts with big margins of error. challenge Greater investment in solutions that increase women’s empowerment and security – by improving access to education and healthcare in particular – will slow population growth and achieve stabilization at a lower level. But the Malthusian instinct to blame resource pressures on growing numbers of poor people misses the point, because people living in poverty contribute little to world demand. Skewed power relations and unequal consumption patterns are the real problem. The global economy is forecast to be three times bigger by 2050, with emerging economies’ share of output rising from one-fifth to well over a half.13 This is a good thing, and fundamental to addressing the challenges of equity and resilience. But for this level of development to be viable, an unprecedented shift to more sustainable consumption trends must take place in both industrialized and emerging economies. ‘We started this irrigation scheme because we were facing problems with the climate. ... It’s impossible to harvest enough for the whole year when you have to rely on the rain. Now we have access to water during the dry months we are able to plant several crops in a year – wheat, rice and tomatoes. We no longer see the problems other people face.’ Charles Kenani, farmer, Malawi Right: Charles Kenani standing in his rice field. The  Oxfam-funded Mnembo Irrigation scheme has helped 400 families in Malawi by transforming their traditional small low-yield crops into year-round, high volume harvests that provide continuous food and a source of income. (Malawi, 2009)14
  15. 15. At present, higher incomes and increasing urbanization The US Department of Agriculture’s Economic Researchleads people to eat less grains and more meat, dairy, Service observed in 2008 that global consumption offish, fruit, and vegetables. Such a ‘Western’ diet uses far  grain and oilseeds outstripped production for seven ofmore scarce resources: land, water, atmospheric space the eight years between 2001 and 2008.17(see Figure 3). Modern agro-industrial farming is running faster andIn the meantime, in more than half of industrialized faster just to stand still. Put simply, increasing irrigationcountries, 50 per cent or more of the population is and fertilizer use can only get us so far, and we’re nearlyoverweight,14 and the amount of food wasted by there. With the exception of parts the developing world,consumers is enormous – quite possibly as much 25 the scope for increasing the area under irrigation isper cent.15 disappearing.18 Increasing fertilizer use offers ever diminishing returns and serious environmentalYield increases drying up consequences.In the past, rising demand has been met and surpassed But it is not like this everywhere. Throughout theby increasing crop yields, but the dramatic achievements developing world, there is huge untapped potential forof the past century are running out of steam. Global yield growth in small-scale agriculture.19 With the rightaggregate growth in yields averaged 2 per cent per year kind of investment this potential can be realised – helpingbetween 1970 and 1990, but plummeted to just over to meet the sustainable production challenge while1 per cent between 1990 and 2007. This decline is delivering agricultural development for people in poverty.projected to continue over the next decade to a fractionof one per cent.16Figure 3: The ecological footprint of food BEEF 15,500 16 7.9 6 2470 CHICKEN 3,900 4.6 6.4 1.8 1650 EGGS 3,333 5.5 6.7 1430 MILK 1,000 10.6 9.8 610 WHEAT 1,300 0.8 1.5 3400 RICE 3,400 1300 1 Kg Water footprint (litres)i Emissions (Kg CO2e)ii Land use (m2)iii Grain (for feed) (kg) Calories (Kcal)i Assumes an average egg weighs 60g, and the density of milk is 1kg per litre.ii Based on production in England and Walesiii Based on production in England and Wales, assumes all production is on land of an equal gradeSources: Water; emissions and land use UK DEFRA (2006),; grain National Geographic,; calories USDA National Nutrient Database, Growing a Better Future 15 Chapter 2: The age of crisis: a skewed and failing system
  16. 16. Policy making captured by the few In the aftermath of the 2008 food price crisis, rich countries at the G8 Summit announced the l’Aquila Food Sadly, investment in developing country agriculture, Security Initiative: a commitment to mobilize $20bn over despite the huge potential benefits, has been pitiful.  three years for investment in developing countries. If this Between 1983 and 2006, the share of agriculture in was an attempt to atone for past sins, it was, at best, official development assistance (ODA) fell from 20.4  underwhelming. The pledge amounted to a derisory per cent to 3.7 per cent, representing an absolute decline fraction of the subsidies that rich countries were lavishing of 77 per cent in real terms.20 During this time rich on their biofuels industries at the time – one of the key country governments did not neglect their own drivers of the 2008 price hike.25 Incredibly, a large portion agricultural sectors. Annual support spiralled to over of this figure has turned out to be recycled from past  $250bn a year21 – 79 times agricultural aid22 – making it promises or double-counted against other commitments. impossible for farmers in poor countries to compete. In the case of Italy, the l’Aquila commitment actually Confronted with these odds, many developing country represented a reduction in aid.26 governments chose not to invest in agriculture, further compounding the trend. Rich country governments have spectacularly failed to resist the capture of agricultural policy making by their The costs of rich country support are borne not only by farm lobbies. The results? Drastically reduced poor farmers in the developing world, but also by people agricultural productivity and increased poverty in the in rich countries, who pay twice – first through higher  South, and the plunder of hundreds of billions of dollars tax bills, and second through higher food prices. It is a year from taxpayers in the North. estimated that in 2009, the EU’s Common Agricultural Policy (CAP) added €79.5bn to tax bills and another €36.2bn to food bills.23 According to one calculation, it costs a typical European family of four almost €1,000 a year. The real irony is that the CAP purports to help Europe’s small farmers, but it is the rich few that benefit  the most, with about 80 per cent of direct income support going into the pockets of the wealthiest 20 per cent – mainly big landowners and agribusiness companies.24 Never, in the field of farming, has so much, been taken  from so many, by so few.16
  17. 17. Figure 4: The share of land devoted to agriculture has peaked Agricultural area (% of global land area) Agricultural area (hectares per capita) 38 1.6 37 1.4 36 1.2 35 1.0% of global land area hectares per capita 34 0.8 33 0.6 1961 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 Source: Calculated from FAO, Natural resources squeezed Increase in demand is not likely to be met by the expansion of production area. Nevertheless, whatever The huge increase in demand for food must be met land there is will surely be prized. The vast majority looks from a rapidly depleting resource base, squeezed by to be in sub-Saharan Africa and Latin America.29 biofuel production, carbon sequestration and forest conservation, timber production, and non-food crops. Water, the lifeblood of agriculture, is already scarcer As a result, the share of land devoted to food production than land. Nearly three billion people live in areas where has peaked (see Figure 4). demand outstrips supply.30 In 2000, half a billion people lived in countries chronically short of water; by 2050 the At the same time, the amount of arable land per head is number will have risen to more than four billion.31 By decreasing, having almost halved since 1960.27 Nobody 2030, demand for water is expected to have increased really knows how much land remains, but it isn’t much.28 by 30 per cent.32 Very often, land that may be termed idle or marginal in fact plays a critical role in the livelihoods of marginalized Agriculture accounts for 70 per cent of global fresh water people such as pastoralists, indigenous peoples use,33 and is both a driver and increasingly a victim of and women. water scarcity. Climate change will only exacerbate an already acute problem, particularly in already stressed regions. Shrinking glaciers will reduce flows in crucial ‘For with the land comes the right to rivers – for example, the Ganges, Yellow, Indus, and withdraw the water linked to it, in most Mekong Rivers all depend on the Himalayas. Rises in countries essentially a freebie that sea level will salinate fresh water, while floods will  contaminate clean water. increasingly could be the most valuable part of the deal.’ Peter Brabeck-Lethmath, CEO, Nestlé Opposite: Rice prices in Cambodia soared in 2008. The pile of rice on the left was bought in 2008, and the pile on the right shows what the same money would have bought in 2007. (Cambodia, 2008) Growing a Better Future 17 Chapter 2: The age of crisis: a skewed and failing system
  18. 18. Figure 5: The land grab legacy of the 2008 food price crisis FAO Food Price Index (2002–2004 = 100) Number of monthly media stories on land grabs 250 200 150 100 50 0 Jan 2002 Jan 2003 Jan 2004 Jan 2005 Jan 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Sources: FAO and The Middle East offers a taste of what may be to come. Research from the International Land Coalition, Oxfam Aquifers are rapidly becoming exhausted and the area Novib and partners identifies over 1,200 land deals  under irrigation is in decline. Saudi Arabia has reportedly under negotiation or completed, covering experienced precipitous falls of over two-thirds in wheat 80m hectares,37 since 2000 – the vast majority of them production since 2007, and on current trends will become after 2007. Over 60 per cent of the land targeted was entirely dependent on imports by next year.34 Middle in Africa.38 Eastern states are among the biggest land investors in Of course, investment can be a good thing. But price Africa,35 driven not by a lack of land but a lack of water. rises like the one we saw in 2008 spark a frenzy among Many governments and elites in developing countries investors, with many acting speculatively or in fear of are offering up large swathes of land amid clouds of losing out. And why not? The land is usually dirt cheap, corruption at rock bottom prices. Companies and apparently idle and, anyway, investing in land is a investors are cashing in, while food-insecure one-way bet these days: the price will only go up as it governments are rushing to secure supply. The becomes more and more scarce. Investors have been scramble began with the 2008 food price crisis, and acquiring land in much larger quantities than they could continues unabated: in 2009, Africa saw 22 years’ possibly use, leading the World Bank to wonder if the worth of land investment in 12 months (see Figure 5).36 purpose is to lock in the highly favourable terms currently on offer and avoid future competition.39 The most comprehensive research to date suggests that 80 per cent of projects reported in the media are undeveloped, and only 20 per cent had begun actual farming.4018
  19. 19. For people without the incomes, savings, access to Box 1: A new breed of land investor healthcare or social insurance enjoyed in industrialized Where there is scarcity, there is opportunity. And countries, shocks from climatic disasters or shifting financial investors are quick to turn opportunity into  seasons often force them to go without food, sell off profit. Numerous hedge funds, private equity funds,  assets critical to their livelihoods, or take their children sovereign wealth funds and institutional investors are out of school. Short-term coping strategies can have now buying up farmland in developing countries. One long-term consequences, causing a downward spiral is Emergent Asset Management, currently enjoying of deeper poverty and greater vulnerability. the arbitrage opportunity presented by ‘very, very Despite the scale and urgency of the challenge, inexpensive’ land values in sub-Saharan Africa.41 governments have failed to take adequate action to Emergent points out that Zambian land, though some reduce emissions, collectively or individually. Instead of the most expensive in sub-Saharan Africa, is still they have listened to their industrial lobbies – the small one-eighth the price of similar land in Argentina or number of companies that stand to lose from a transition Brazil, and less than a twentieth of that in Germany. towards a sustainable future from which the rest of us Emergent assumes that land will generate strong would gain (see Box 2). returns as prices rise – in part because of increasing demand for land from the food powers of Brazil Box 2: Dirty industry and grubby lobbying and China.42 Lobbying from dirty industries has kept Europe locked One of Emergent’s stated strategies is to identify into low ambition on reducing its greenhouse gas poorly managed or failing farms and buy them up at emissions, marginalizing its influence in negotiations  distressed prices, then turn them around in order to and preventing a transition to a low-carbon economy. boost returns. Rapidly appreciating land prices Others, meanwhile, race past – most notably China, provide a ‘backstop’ should this risky strategy fail. now the world’s biggest sovereign investor in renewables.46 Some of the most intense lobbying Agricultural investment is desperately needed. And comes from steel, oil and gas, chemicals, and paper Emergent argues that it is not simply building up land companies and the associations that speak on their banks – it also invests to increase productivity and behalf,47 as well as from wider cross-sectoral umbrella brings in new techniques and technologies, as well as groups, most depressingly of all BusinessEurope – making ‘social investments’ in schools, hospitals and the general European employers’ association – to housing. But the risk remains that some investors will which most major companies that profess deep be interested only in the easy return on land, rather concern about climate change belong. These faceless than the trickier business of growing food. associations have low public profiles, allowing  supposedly ‘responsible’ companies to keep their hands clean.Climate changing Companies not only lobby against greater climateClimate change poses a grave threat to food production. ambition, they also lobby to capture regulation forFirst, it will apply a further brake on yield growth. themselves. For example, ArcelorMittal, the world’sEstimates suggest that rice yields may decline by 10 per largest privately owned steel company, has lobbied tocent for each 1°C rise in dry-growing-season minimum secure free allowances under the EU Emissionstemperatures.43 Modelling has found that countries in Trading Scheme (ETS). The company has profited sub-Saharan Africa could experience catastrophic nicely from its lobbying, ending up with allowances todeclines in yield of 20–30 per cent by 2080, rising as spare – potentially allowing it to increase its emissionshigh as 50 per cent in Sudan and Senegal.44 in the future. All these surplus allowances depress theSecond, it will increase the frequency and severity of carbon price and remove the incentives for investmentextreme weather events such as heatwaves, droughts in clean technologies that the carbon market wasand floods which can wipe out harvests at a stroke.  designed to provide. By 2012 ArcelorMittal couldMeanwhile, creeping, insidious changes in the seasons, potentially make over €1bn from these freesuch as longer, hotter dry periods, shorter growing handouts,48 turning on its head the principle at theseasons, and unpredictable rainfall patterns are heart of the ETS – that the polluter pays.bewildering poor farmers, making it harder and harderfor them to know when best to sow, cultivate, and harvesttheir crops.45 Growing a Better Future 19 Chapter 2: The age of crisis: a skewed and failing system
  20. 20. Box 3: Palm oil – eating the world’s forests The oil palm is a remarkable crop. It is high-yielding and About 80 per cent of palm oil ends up in food,55 but a fast-growing. Its oil provides a versatile ingredient used growing amount is used for biodiesel. Regulations in throughout the world, though few of us realize it. Palm the EU, USA and Canada that require minimum oil can be found in chocolate, bakery products, sauces, biofuels content in gasoline and diesel are further chips, margarine, cream cheese, sweets, and ready driving deforestation either directly or because palm oil meals. It is produced mainly by major plantation is replacing other edible oils diverted for biodiesel use. companies in Malaysia and Indonesia, and bought in Oxfam estimates that even if the EU excludes all vast quantities by food manufacturers such as Unilever, biodiesel produced from deforested land, its mandate Kraft, and Nestlé. could raise emissions from deforestation by up to 4.6bn tonnes of CO2 – nearly 70 times the annual CO2 saving Our hunger for palm oil appears insatiable. Demand is the EU expects to make by reaching its target to derive expected to double from 2000 to 2050.53 This holds 10 per cent of its transport energy from biofuels by terrifying implications for the rainforests of Indonesia, 2020.56 where every minute plantations eat one more hectare further into one of the planet’s most carbon-rich major ecosystems.54 Climate change not only threatens agriculture, the way we now farm also threatens the climate. While not the ‘... nowadays when it comes to the rains only contributor to greenhouse gas emissions, nor even sometimes you get too much and it the greatest, agriculture accounts for a significant share  of the damage: somewhere between 17 and 32 per cent destroys the crops. Sometimes you don’t of all human-induced greenhouse gases.49 Key drivers get any at all and the crops just wilt. If are emissions from fertilizer use and from cattle.50 that happens, you don’t have any food Alarmingly, both are set to increase significantly.51 the next year. About the rains, I don’t The biggest contributor by far to agricultural emissions, know what we can do.’ however, is land-use change;52 converting wilderness to agriculture can release large amounts of greenhouse Killa Kawalema, farmer, Malawi gases, particularly in the case of forests and wetlands. (See Box 3)20
  21. 21. Figure 6: The proportion of household expenditure allocated to food, with predictions to 2030 2004 (baseline) 2020 2030 60 50Proportion of household expenditure on food (%) 40 30 20 10 0 N America S Asia India W Africa C Africa E Africa Demography, scarcity and climate Headline figures such as this provide only a partial  picture of the scale of threat. Over the lifetime of a single change: a perfect storm scenario for generation, the world is losing an opportunity to remove more hunger the spectre of hunger from an under-five population  Predicting the future is a hazardous endeavour. When it larger than all of the children in that age group living comes to agricultural production and nutrition, there are today in France, Germany and the United Kingdom many unknowns. Yet detailed scenarios and projections combined. Standing by and failing to prevent that developed for this report point unequivocally towards an outcome would represent an abdication of responsibility overwhelming conclusion: the world faces a real and and failure of international leadership without precedent; imminent risk of major setbacks in efforts to combat the not least because this is an avoidable tragedy if – and scourge of hunger.57 That risk is not a remote future only if – governments act decisively in the next few years threat. It is emerging today, will intensify over the next to avert it. decade, and evolve over the 21st century as ecology, Why the focus on food prices? First, because world food demography and climate change interact to create a prices provide a useful barometer of how the tectonic vicious circle of vulnerability and hunger in some of the shifts in demography, ecology and climate might play out world’s poorest countries. within the food system. Rising prices signal imbalances There are alternatives. But the central message to in the supply response to rising demand. Second, food emerge from the scenario analysis is that the prices have a major bearing on hunger because they international community is sleepwalking into an influence the capacity of poor people – and poor  unprecedented and avoidable human development countries – to gain access to calories. Of course, prices reversal. Research carried out for this report explored a cannot be viewed in isolation: purchasing power is also range of food price scenarios for 2020 and 2030 using influenced by income. But in many of the developing  international trade models.58 In the absence of urgent regions facing the gravest challenges with malnutrition, and aggressive action to tackle global warming, prices food still accounts for around half of average household of basic staple foods are expected to skyrocket in the spending – and for an even greater share of spending by coming two decades. Using a different model that people living in poverty (see Figure 6).60 nevertheless forecasts a similar trend, the International ‘Exploring Food Price Scenarios Towards 2030’ Food Policy Research Institute (IFPRI) has recently calculated that 12 million more children would be consigned to hunger by 2050, compared with a scenario with no climate change.59 Growing a Better Future 21 Chapter 2: The age of crisis: a skewed and failing system
  22. 22. International price projections for the major traded food Global projections of this type simultaneously obscure staples reflect the severe stresses under which the food  and understate scenarios for different regions. system is buckling. Over the next two decades, prices for Disaggregated data for four African regions points to commodities such as rice, wheat and maize are forecast a large and sustained divergence between population to rise by between 60 and 80 per cent (see Figure 7). growth and baseline productivity growth in agriculture. This will hit the poorest people the hardest. For example, These are regions with a collective population of over although food accounts for 46 per cent of an average 870 million and some of the world’s highest levels of West African household’s spending, in the poorest 20 malnutrition. In West Africa, the population will increase per cent of Malian households, food consumes 53 per by 2.1 per cent per annum on average, while a simple cent of all household spending; and although in much of continuation of past productivity gains would increase South Asia 40 per cent of all household spending goes maize productivity by 1.4 per cent per annum to 2030 on food, for the poorest 20 per cent of Sri Lankans, the (see Figure 8). figure is as high as 64 per cent. 61 In South and South-East Africa, maize productivity growth is projected to be barely any higher, though population growth is projected to be slower. While the productivity–population growth divergence is less marked in other parts of the world, projections for East Asia (excluding China), India, and the rest of South and Central Asia all point to a future in which agriculture struggles to keep pace with the demands associated with a growing population (see Figure 8b). Figure 7: Predicted increases in world food commodity prices 2020 2030 100 90 Increase in world market export prices relative to 2010 (%) 80 70 60 50 40 30 20 10 0 Other processed Processed meat Processed rice Wheat Livestock Other crops Paddy rice Maize food products22
  23. 23. Figure 8a: Comparative growth rates in population and crop productivity: maize in sub-Saharan Africa South and SE Africa population W Africa population C Africa population C and E Africa maize South and SE Africa maize W Africa maize E Africa population 220Indexed population and crop productivity growth (2004=100) 200 180 160 140 120 100 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Figure 8b: Comparative growth rates in population and crop productivity: rice in Asia Other E and SE Asia population India population Other S Asia population C Asia population Other E and SE Asia rice India, Other S Asia, C Asia rice 160Indexed population and crop productivity growth (2004=100) 150 140 130 120 110 100 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Growing a Better Future 23 Chapter 2: The age of crisis: a skewed and failing system
  24. 24. Figure 9: Predicted food price increases for domestic users to 2030 2020 2030 180 Increase in domestic user price of crops relative to 2010 (%) 160 140 120 100 80 60 40 20 0 C Africa wheat C Africa maize Andean wheat Andean maize Russia maize Russia wheat China wheat China paddy rice Regional price projections reflect underlying shifts in  The bad news is that these are good case scenarios supply and demand. Figure 9 provides an insight into the because they do not factor in climate change effects. magnitude of food staple price inflation for a number of  Climate change is a potent risk multiplier in agriculture. crops and regions. In Central Africa, consumers of maize Our projections capture the simulated impact of climate face the prospect of a 20 per cent increase in prices over change on world prices for the major traded food staples the next decade, with an equivalent increase over the (see Figure 10). In the case of maize, the incremental following decade. effect of climate change on price inflation is around  86 per cent. There are also marked effects for rice and In the Andean countries, wheat and maize prices will wheat. In summary, these expected effects would wipe rise by 25 per cent to 2020; and, in the case of maize, out any positive impacts from expected increases in by 65 per cent to 2030. household incomes, trapping generations in vicious circle of food insecurity. Opposite: Rice sellers Sok Nain and Mach Bo Pha in Dem Kor Market in Phnom Penh. Sellers say their profits have  fallen by 30 per cent as rice prices in Cambodia soared in 2008. (Cambodia 2008)24
  25. 25. Figure 10: Predicted impact of climate change on world market food export prices to 2030 2030 baseline 2030 climate change 180 160Increase in world market export prices relative to 2010 (%) 140 120 100 80 60 40 20 0 Other processed Processed meat Processed rice Livestock Wheat Other crops Paddy rice Maize food products Growing a Better Future 25 Chapter 2: The age of crisis: a skewed and failing system