The headlines tell us every day: In 2021, the U.S. farm economy is booming. We are facing record cash crop receipts in the United States and record agricultural exports. Farmland prices skyrocket, up 7% from 2020 in August, and agtech investment set to be 70% higher than in 2020 – $ 4.3 billion invested in the middle of the year. And yet there is a downside.
It is estimated that 957 million people in 93 countries do not have enough to eat. The 2021 United Nations Food Systems Summit put it bluntly: 2021 will be a bad year for world hunger. After two months of decline, the food price index (managed by the Food and Agriculture Organization of the United Nations) rebounded up 3.9 points in August 2021. The average of the August index of 127.4 points is 32.9% higher than last year at the same period.
This means that food costs are higher than almost anywhere over the past six decades, according to the FAO. Or as Alastair Smith, senior lecturer in global sustainability at the University of Warwick, notes in a Bloomberg report: “Food is more expensive today than it has been for the vast majority. of modern recorded history. ”
As I mentioned before, these events parallel the 2011-12 economic scenario of high commodity prices and high harvest volumes. While promising for US producers and investors, rising food prices threaten stability in areas facing poverty. Food prices are further pushed up by extreme weather conditions, high shipping costs and labor shortages. Hunger is an obstacle to peace, and as the saying goes, hungry people are dangerous people. Hunger also disrupts other economic activities that deprive people of daily productive capacities.
If we look at history as a guide, we can expect that accelerating instability will match inflation and escalating food prices and food insecurity. I’m not the only one ; global economists have sounded the alarm bells on an ongoing food insecurity crisis, and politicians around the world are testing subsidies, giveaways and new policies to halt the impact of the price spike and stem the unrest.
Should we follow this same pattern?
“Bread, dignity and justice”
The season of revolution is spring. The European political revolutions of 1848 were known as the “people’s spring”. The Czechoslovak uprising of 1968 was the “Prague Spring”. And in 2011, we saw the “Arab Spring”.
In the Arab Spring, food insecurity was a major catalyst for conflict. The CMI (Institut Chr. Michelson, an independent, non-profit research company that focuses on social issues) noted: “In late 2010 and early 2011, as protests erupted first in Tunisia and then in Algeria, in Yemen, Bahrain, Jordan and Egypt, the price of food was widely seen as an important, if not the main, factor in inciting unrest. (Emphasis added.) The report goes on to note that the food price index has been on the rise since early 2009, and by the time it peaked in February 2011, the index had registered an increase. And the grain price index rose even more than 75.5% over a shorter period, from a low in June 2010 to a high in April 2011.
A second food-related factor was the Russian ban on wheat exports and Vietnam and Thailand doing the same with rice, causing further spikes in food grain prices that specifically contributed to an increase. 50 percent of world wheat prices by the end of the year. These facts in no way detract from the fervor of the social and political unrest that marked the Arab Spring, making Tahir Square “the epicenter of people’s demands for bread, dignity and justice”, as CMI describes it.
Now, 10 years later, the conditions that led to the Arab Spring are once again in place. Bloomberg notes that international food prices are nearing their 2011 highs, making headlines: “Redux of the Arab Spring? The Middle East most exposed to food prices. In a pricing environment similar to 2011, some countries are again seeing policy measures aimed at reducing exports in order to mitigate the risk of their own food inflation. This exacerbates the price risks on import-dependent countries and penalizes farmers in exporting countries. Russia stepped in again with an export tax on wheat, Kazakhstan and Argentina are considering one, and Argentina recently capped beef exports.
Can we change course?
The United States has risen to the challenge in the past. Consider the Food for Peace Act, enacted in 1954 by President Dwight Eisenhower and now part of the regularly renewed Farm Bill, and President John F. Kennedy’s creation in 1961 of the United States Agency for International Development with its Office of Food for Peace. Think Norman Borlaug, Nobel Peace Prize winner in 1970, who saved a billion lives thanks to his improved wheat varieties that dramatically increased yields and started the Green Revolution. His willingness to share technology in collaboration with farmers around the world, a practical act of humanitarianism, has led to recognition on the world stage.
Dr Kenneth Quinn, former Ambassador and Chairman Emeritus of the World Food Prize Foundation and Senior Advisor to Roots of Peace, has dedicated decades to championing “peace through agriculture”. In defending the role of farmers as diplomats and humanitarians, he is quoted: “The role of agriculture in building peace, promoting peace, is one of the most incredible strengths of this noble profession. .
This month, Dr Elliott Dossou-Yovo, the 2021 recipient of the Norman Borlaug Prize for Research and Field Application, raised an important point in his acceptance. “Agriculture is the wisest investment we can make,” he said, “because it will ultimately contribute the most to real wealth, morality and satisfaction. More than ever, our collective actions are necessary.
“The smartest investment we can make.
Investments in agriculture and technology are a step that individuals, farmers, venture capitalists and Big Ag can take towards peace. Investment in agricultural technologies and innovation, in particular, can now play a leading role in tackling food insecurity – overcoming supply chain and distribution challenges, reducing waste and deterioration of food, increasing yields and nutritional content – correlating directly with poverty reduction and stability.
Let us not lose this chance to let our innovations change the patterns caused by the lack of bread, dignity and justice.