Food production - we need a rethink

By Matt Dempsey

We are living from harvest to harvest. It's easy for rich Europe with a static population, good land and a generous social welfare system with few real extremes of weather to take such a view.

But is it prudent and ethical for the world to have run down its cereal stocks close to zero so that there is little to cope with the inevitable problems of drought, regional crop failure and famine?

Stocks were run down by seven years of consuming more than was produced, as grain farmers all over the world saw their crops cost more to produce than the market returned. Policy makers ignorant of both history and economics mumble about extra volatibility being an essential part of a new globalised world and that this is the market mechanism at work. This is a perfectly logical approach for international commodity traders with access to the most competitive producers and most affluent consumers.

It is however bereft of anything approaching what is morally right in a Chinese and Indian context, or politically possible.

This week, the Australian Government announced that the hoped for wheat harvest of 22 million tonnes was utterly unattainable and the harvest due in the November - January period would be at least a third lower than this and even the revised estimate of 15 million farmers looks extremely optimistic. The only other major southern wheat exporter is Argentina and it will not stop a further run down of wheat stocks on its own.

So already the world is counting on an excellent Northern Hemisphere harvest in 2008. Suddenly for the first time at the informal agricultural meeting in Portugal, the whole question of food security has been raised again - a phrase which was forbidden until very recently. Intervention stocks were seen as a mark of the CAP's failure in today's new climate, they would be seen as a success.

We talk about significant buffer stocks of energy to guarantee supply. Energy flows and production are much more predictable than basic food stuffs, yet we have ditched such thinking in relation to food. It's time for a basic rethink.