Friday, April 11, 2008

Rice prices spark fight for the right to food

The crisis around spiralling rice prices starkly demonstrates how food insecurity and hunger are built into the global system of food production.
Rice prices have shot up in the past few months. Thai rice, seen as the global benchmark, has almost doubled in price from January to March this year.
Rice is a staple food for more than half the world's population. In countries such as Bangladesh, Cambodia, Thailand, Burma and Vietnam, the majority of the population rely on rice for up to 80 percent of their calorie intake.
Millions consequently face food insecurity or severe hunger. Governments are desperate to stop riots and protests developing over rice prices.
In Bangladesh the army is overseeing the distribution of discounted rice. In the Philippines the government has called on restaurants to cut rice portions to protect stocks.
The most common response is to ban exports. Governments including China, India, Vietnam, Egypt and Cambodia have in recent months imposed total bans or serious curbs on rice exports.
This allows governments to temporarily protect their domestic supplies, but it is worsening the overall problem by pushing up rice prices further as traders rush to buy up and stockpile any available rice.
Rice is mostly produced for a domestic market – only 6 or 7 percent is traded on the world market.
But this international trade plays a crucial role in determining world rice prices. It is also where countries turn to for imports if they face rice shortages.
Rice stocks are at their lowest levels since the 1970s, so every market shortage becomes a crisis – or an opportunity, if you a trader.
As prices started rising, many rice traders started stockpiling and hoarding rice to sell at inflated prices when the crisis becomes more acute.
Commodity markets are the main factor behind price rises. But rising fuel prices and a lack of infrastructure to deal with extreme weather in countries such as Bangladesh have also played their part.
Long term trends in land use have also seen rice cultivation become static or even decline. In many countries land has been shifted in past years into more profitable crops, or taken over for commercial development.
The rising costs of wheat, corn and soya, are making the crisis worse for millions as it becomes impossible to switch to a cheaper food staple.
The problem is not just in Asia. Many countries in Africa were forced after 1995 by the World Trade Organisation to drop import controls and open borders to rice imports. This created an increased reliance on rice in those countries.
As Robert Zeigler from the International Rice Research Institute points out, we already know the devastating human costs of rising food prices.
"We have seen this before in the 1970s, associated with the oil price shocks," he says. "There was a serious spike in food price rises, in particular rice. The consequences were very serious.
"Bangladesh shortly after its independence could not source rice on the world market – it had no stocks and couldn't access credit – and according to colleagues in Bangladesh, up to three million died as a result."
It is obscene that the drive for profits is threatening to deny basic foods to millions today. The fight for the right to food is set to become a defining feature of our era.
Esme Choonara

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