SOME MORE FOOD FOR THOUGHT?

Biofuels were suppose to save us and the planet from a combination of global warming and an over reliance on fossil fuels. The problem is that many biofuels are reliant on monoculture cropping and industrial agricultural systems, massive fertilizer inputs, large quantities of water and huge amounts of oil. One result of this is that biofuels may end up accelerating global warming by leading to the destruction of forests and other natural ecosystems when land is cleared for the cultivation of biofuel crops.

Another result is that biofuels end up in the developing world competing with food for land, increasing food prices and hunger. The biofuels industry is also supported by a number of different policies in both the USA, Brazil and the EU including various tax subsidies, trade barriers, government grants and loans. We need to bring to an end policies that directly support the production of environmentally harmful biofuels, and make room for sustainable energy alternatives and more environmentally friendly and socially responsible biofuels.

A recent report by Chatham House says the growing reliance on sustainable liquid fuels will also increase food prices . Basically biodiesel made from vegetable oil is worse for the climate than fossil fuels. The report noted that the UK’s use of biofuels is “irrational” and will cost UK motorists around £460 million over the next 12 months. The EU plan (underwritten by law) is for biofuels to make up 5% of the UK's transport fuel as of 15th April. The UK (since 2008) has required fuel suppliers to add a growing proportion of sustainable materials into the petrol and diesel they supply.

Many of these biofuels are distilled from ethanol which is sourced  from corn and biodiesel made from rapeseed, used cooking oil and tallow. Chatham House research suggests that reaching the 5% level will result in UK motorists having to pay around an extra £460 million pounds a year because of the higher cost of fuel at the pump and from filling up more often as biofuels have a lower energy content. The report states that if the UK is to meet its obligations to EU energy targets the cost to motorists is likely to rise to £1.3 billion pounds per annum by 2020.

The problem with the EU biofuel mandates are that they have huge distorting effects in the marketplace. As a result of used cooking oil being regarded as one of the most sustainable types of biodiesel, the price paid for it has soured. By the end of 2012 used cooking oil was more expensive than refined palm oil. Another concern is that taking EU land out of production to grow rapeseed oil in particular will end up creating more climate problems than it solves.

The more fuel of this type that is put into cars the bigger the deficit created in the edible oils market. This had resulted in increased imports of palm oil from Indonesia, which is often produced on illegally deforested land. As the UK reaches its 5% of liquid fuels target, the government faces some tough decisions on how to move forward as it may end up facing a tripling of the costs for motorists by 2020.

The UK Westminster government may prefer to try and get do a deal with Brussels on the impacts of indirect costs which might restrict what exactly counts as biofuel. There are problems with this, especially when it comes to reaching an agreement with those EU countries which have powerful agricultural sectors who rake in the cash from the current biofuels arrangements.

Outside of Europe there are other consequences with the acquisition of land by multi nationals for development or to acquire resources at the expense of local people. This is bound to be a touchy subject especially when little medium to long term sustainable benefit is delivered to the indigenous inhabitants. What's happening now in Africa is subtly different, there is a race going on between multinational companies on one hand and the emerging economic giant of the Peoples Republic of China on the other hand to acquire land, not so much for the minerals (although that is a factor) but to acquire the ability to grow food.

An interesting report (produced by the Oakland Institute) has noted that Hedge funds are now getting involved in acquiring land in Africa to produce food and biofuels, which will all boost their profits.  The report notes that foreign firms and hedge funds) have been quietly purchasing large chunks of land in Africa, often without any proper contracts and that this activity has led to the displacement of millions of small farmers, who are losing out as multinational firms try to secure their hold of the global food markets. Food production is often sacrificed to make space for cash crops for export, including flowers and biofuels, which fetch a tidy profit.

Since 2009 foreign firms the report noted that have acquired land equivalent to the size of France (nearly 60 million hectares) from questionable but lucrative deals with a combination of gullible traditional leaders or corrupt government officials in Ethiopia, Tanzania, South Sudan, Sierra Leone, Mali and Mozambique. I have no doubt that the foreign firms make many promises of progress, development and jobs to local communities, but they don't necessarily come close to delivering on the promises.

Investors benefit with a wide range of incentives written into their contracts from unlimited water rights to tax waivers, but, are clearly not there to help feed starving Africans. Sounds familiar doesn't it - not that much of step from the old days of the WDA throwing wads of cash of foreign investors, who got all sorts of benefits (grants and incentives), promised much (I seem to recall the magic figure of 6,000 jobs kept cropping up in the 1980's, 1990s and early 2000's) yet in the end never quite delivered all that was promised.

OUR DAILY BREAD?

As fuel prices creep upwards, as we are waiting to get hit by price rises from the energy cartel, the next hard blow to our wallets will come in the form of rising food prices. The poor summer across the northern hemisphere (either too wet or too dry) is impacting on global food prices which have risen by 10% in the month of July, which has raised the fears of soaring prices for the planet's poorest, as noted by the World Bank.

Oxfam has noted that when extreme weather events drive local or regional price spikes, the people living in poverty face a double shock as they have to cope with higher prices, just like the rest of us. The difference between the developed and developing world is that this often comes at a time when the direct effects of extreme weather events have often already depleted their assets, destroyed their crops and stripped them of their livelihoods.

Back in 2011 the emergency in the Horn of Africa and the 2012 Sahel food crisis clearly showed how this combination can lead to hunger on a mass scale. The small-scale subsistence farmers and the pastoralists ended up getting hit hard in both regions, where the loss of livestock and crops reduced available food stocks and also reduced the value of people’s assets so that they were unable to afford to buy food

The World Bank has warned that the affects of the US heat wave and drought in parts of Eastern Europe were partly to blame for the rising food costs. Key grains such as corn, wheat and soybean saw the most dramatic price increases, something that will hit those countries that import grains particularly badly. Between June to July (2012), corn and wheat prices rose by 25% and soybean prices increased by 17%. The World Bank noted that only rice prices fell by some 4%.

In the USA, the worst (and widespread) drought for fifty years has wrought havoc on the corn and soybean crops while simultaneously in Russia, Ukraine and Kazakhstan, the wheat crops have been badly damaged. To make matters worse, the World Bank noted that the continued use of corn to produce ethanol biofuels (which absorbs around 40% of US corn production) played a key role in the sharp rise in the price of US maize.

While we (the food consumers) will all loses out, the impact on developing countries in North and Sub-Saharan Africa and the Middle East who will be the most exposed to price rises because significant quantities of their food is imported and food bills make up a large proportion of average household spending, will be harsher. .

Already maize prices had increased by 113% over the past quarter in Mozambique, and the price of sorghum had risen 220% in South Sudan. Last time this happened (back in 2008) there was widespread unrest. Other potential factors could make a potentially bad situation worse and force grain prices still higher. The World Bank is concerned about a combination of food exporters pursuing panic policies, a severe El Nino, poor Southern hemisphere harvests and strong increases in energy prices.

The World Bank's Food Price Index (which tracks the price of internationally traded food commodities) was six percent higher than in July 2011 and one percent up from the previous peak, which was back in February 2011. Why is this important? Well aside from the fact that the most vulnerable in poorer countries will lose out? While we won’t starve, in the developed world as food (and fuel) prices go up, our purchasing power goes down (and we spend less), something that will hit the wider economy.

THIS LAND IS NOT FOR SALE!

In the end it always comes down to the land, Who owns it? Who farms it? And who lives on it? Or who makes a living from it? Since Humans have been living in relatively settled communities land has been bought, sold and stolen fuelling grievances both real and imaginary. What is a relatively new in recent years is that land deals have become a new form of international trade. In recent years, sub Saharan Africa has been the public focus for this trade (the reality is that is been going on around the world for many years). A combination of commercial companies and the various commercial arms of the People’s Republic of China (PRC) have been chasing profits (and land) in Africa pursing profits and (in the case of the PRC) foodstuffs for the world (and the Chinese) market.

Between 2008 and 2009 the World Bank noted media reports of land deals that added up to something like 60 million hectares. The traditional UK media unit of measurement, Wales, won't help to illustrate the scale of the issue, that all adds up to something like the land equivalent to the Ukraine – some two-thirds of the land acquired happens to be in Africa. The evidence points to the fact that land deals are taking place on an unprecedented scale and at an increasing rate. Some of the specific land deals are pretty big, a recent deal in Liberia involved some 220,000 hectares.

The western media has tended to focus on the land deals signed by Middle Eastern and Asian government-backed operators but in reality Western commercial companies and Hedge Funds have also been heavily involved in the process – they don’t like the glare of publicity. One of the reasons why commercial companies are seeking to acquire land is because there is potentially big money to be made with cash crops as world food and commodity prices are expected to increase because of increasing demand for foodstuffs and also bio-fuels from China and India. Some of this is being driven by governments who are chasing land acquisitions abroad as a way to secure affordable food for their people at home.

In 1961 at or on the edge of independence Africa largely fed itself and even managed to export surplus crops. This is no longer the case, partially due to a neglect of the agricultural sector in many African countries, political instability, corruption and a chronic lack of investment to improve productivity and the means of getting surplus crops to both local and international markets. It goes without saying that not all types of investment is good and evidence is beginning to pile up that suggests that large scale land deals have a detrimental impact on indigenous local farmers.

Research by the International Land Coalition suggests that a growing number of these large scale land deals are failing due to a combination of poor soil types, financial problems, local resistance and unrealistic business plans. Some of these land acquisitions have resulted in some pretty raw deals for local people and as a consequence have fuelled dissent and resistance (in Ethiopia and Madagascar to name but two).

Now this does not mean that African states and peoples should steer clear of all land deals. What is needed is for land deals to be implemented properly, transparently, with safeguards for local people and local involvement. Some of the world's poorest people are losing the land, water and natural resources that have supported their livelihoods and their communities for generations. In Uganda, Oxfam has noted that some 20,000 people who claim to have been evicted from their land have taken their case to court seeking redress.

Part of the problem is because of the massive power imbalance between multinational companies, African governments and local farmers and landholders. Many of these land deals are negotiated behind closed doors without transparency, without local consultation something which fuels local dissent and anger. Across much of Sub Saharan Africa, as noted by the International Institute for Environment and Development, there is lack of secure land tenure which affects local farmers, herders and gatherers. This is partially down to a lack of written documentation and also because a great deal of land is owned by the state, which can obviously allocate it to outside investors even against fierce local opposition.

There are some pretty successful business models out there that show what can be done by local people, one co-operative of 60,000 cocoa farmers (in Ghana) has been in business for almost twenty years and owns 45% of a UK company that manufactures and distributes chocolate. There are ways to improve productivity and market access that can support local farmers or at least give them a realistic chance of competing.

Many international companies are able to successfully source agricultural produce from local family farmers, and have invested in other activities along the production line to help secure their supplies and improve local livelihoods. Some farmers associations (in Mali and Zambia) own shares in the company they collaborate with, which gives them monetary benefits and a greater say. Co-operatives have reduced their costs by working with large numbers of farmers.

Some land deals could bring many benefits including increased food production; access to improved agricultural skills, secure land tenure for indigenous farmers and more sustainable development in rural communities. This is something that could help to slow one of sub Saharan Africa's greatest problems rural to urban migration. Civic groups in sub Saharan Africa are demanding far greater transparency and openness from their governments and from investors. If this is done right then local indigenous communities can be helped to become equal partners rather than ending up as victims.

FEED THE WORLD...

With the planet's population due to top seven billion very soon worrying about where the next meal is going to come from is going to be a real issue for a significant proportion of us. As our planet's population continues to increase (it's estimated to reach around 9.2 billion people by 2050) there will be a corresponding rise of around 70% in demand for food (UN).Around half of the planet's undernourished citizens are dependent on small farms for their food. Some 80% of food consumed in Asia and sub-Saharan Africa is produced by small farms. Who produces it? who owns the land? and to whom do they sell it to? and at what price? may also become pretty important questions.

LAND AND POWER

As multi nationals and the People's Republic of China (PRC) continue to chase to attempt to secure control of the worlds resources one thing they are both seeking to secure control of (for different reasons) is food and the land it grows upon. With purchasable governments in certain quarters of the world it's the small farmer who's felling the pinch, losing both his land, the ability to feed his family not to mention the ability to feed other people. Planet-wide it has been estimated that there are some 500 million small farms (less than two hectares in size) which feed around one third of the planets population.

Half of the planet's undernourished citizens are dependent on small farms for their food. Some 80% of food consumed in Asia and sub-Saharan Africa is produced by small farms. As our planet's population continues to increase (it's estimated to reach around 9.2 billion people by 2050) there will be a corresponding rise of around 70% in demand for food (UN). So with the PRC chasing food as well as minerals to feed it's population and it's economy and the multi nationals chasing a fast buck no doubt at the expense of local indigenous inhabitants who won't be able or willing to pay top dollar or euro for foodstuffs that are destined for distant foreign markets.

Local people will be driven into dire poverty, they lose their land in the process along with the ability to feed themselves and other peoples. Oxfam's recent  report 'Land and Power' makes interesting and alarming reading. One of the great ironies is that many of the developers are working with local governments who are being helped out by the world Bank and the International Monetary Fund - this surely is the kind of alleged 'free market' development much of Asia and sub-Saharan Africa can well do without.

DEVELOPMENT COSTS

The first quarter of the 21st Century may be written up by future Historians as the years when the Peoples Republic of China (PRC) rose to greatness and flexed its muscles on a global if not an imperial scale. Future historians may also note that these were the years when the PRC's influence in sub Saharan Africa grew at an exponential rate. There has been an almost imperial acquisition of resources in the sub-Sahara with one of the most sweeping, bare-knuckled, and bare faced acquisition of resource to feed the PRC's population and it's economy.

The USA (and the West) have been struggling economically and politically with the consequences of the War on Terror and the consequences of the World wide Banking crisis. In barely a few years, the PRC has become one of the more aggressive investor-states in Africa. This admittedly commercial invasion has been (and is) probably the most important economic and political development in the sub-Sahara since the Cold War ended, the economic map of the world has been quietly redrawn.

There are more Chinese citizens resident in Nigeria than there were Brits during the height of their empire. Chinese state-owned and state-linked corporations and small entrepreneurs have roll led across the continent in an almost unstoppable wave. It has been estimated that potentially around a million Chinese citizens are at work in sub-Saharan Africa. The PRC has created collateral economies and population monuments across the continent as it searches for and seeks to develop and control minerals and food resources.

No other world power has come close to showing the same interest (or muscle for that matter) or sought to cosy up to Africa's leaders. Now this is no War on Terror, democracy (flawed or not) is no being encouraged, nurtured or spread by the PRC - this is solely about finding what the PRC needs to feed China (figuratively and literally). Aside for having a political impact and snaffling up increasingly scare resources there has been an impact within the Sub Saharan African nations.

This has been manifested as trade unions begin to fight against some pretty grim (PRC imposed) working conditions (obviously and somewhat ironically the People's Republic of China (a notional communist and pretty repressive state) is obviously no great lover of any real trade union's and any political opposition for that matter. And as indigenous local farmers (and their families) find themselves pushed off their land as governments swayed by the PRC's largess sells  the land form underneath them. Pro and anti Chinese candidates fight elections in those Sub Saharan states where meaningful elections take place that is, and you can guess which ones get the benefits of PRC funding.