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UN to hold crisis talks on food prices as riots hit Mozambique

David Smith, Guardian
The UN has called an urgent meeting on rising global food prices in an attempt to head off a repeat of the 2008 crisis that sparked riots around the world.

Seven people, including two children, were killed in Mozambique this week during three days of protests triggered by a rise in the cost of bread. There has also been anger over increasing prices in Egypt, Serbia and Pakistan, where floods destroyed a fifth of the country’s crops.

The UN’s announcement came after Russian prime minister Vladimir Putin extended the country’s ban on grain exports. The ban has been partly blamed for a 5% increase in global food prices worldwide over the last two months, hitting their highest level in two years. The price of wheat has had its biggest monthly rise for 37 years. “In the past few weeks, global cereal markets experienced a sudden surge in international wheat prices on concerns over wheat shortages,” the UN Food and Agriculture Organisation said.

“The purpose of holding the meeting is for exporting and importing countries to engage in constructive discussions on appropriate reactions to the current market situation.”

Agency spokesman Christopher Matthews said the meeting of the inter-governmental committee on grains will be held on 24 September, most likely in Rome. He added a large number of member countries had expressed concern about a possible repeat of the food crisis two years ago. But agency officials and other experts have stressed that conditions are different from 2008, when high oil prices and growing demand for biofuels pushed world food stocks to their lowest levels since 1982…
(3 September 2010)
See the official FAO announcement about the meeting here.

U.N. Raises Concerns as Global Food Prices Jump

Neil MacFarquhar, New York Times
UNITED NATIONS — With memories still fresh of food riots set off by spiking prices just two years ago, agricultural experts on Friday cast a wary eye on the steep rise in the cost of wheat prompted by a Russian export ban and the questions looming over harvests in other parts of the world because of drought or flooding.

Food prices rose 5 percent globally during August, according to the United Nations, spurred mostly by the higher cost of wheat, and the first signs of unrest erupted as 10 people died in Mozambique during clashes ignited partly by a 30 percent leap in the cost of bread.

“You are dealing with an unstable situation,” said Abdolreza Abbassian, an economist at the United Nation’s Food and Agriculture Organization in Rome.

“People still remember what happened a few years ago, so it is a combination of psychology and the expectation that worse may come,” he added. “There are critical months ahead.”

… But the world also has to come to grips with changing weather patterns due to climate change, argued Prof. Per Pinstrup-Anderson, an expert in international agriculture at Cornell University.

“We are going to have much bigger fluctuations in weather and therefore the food supply than we had in the past, so we are going to have to learn how to cope with fluctuating food prices,” Professor Pinstrup-Anderson said.
(3 September 2010)
Suggested by Jim Barton. -BA

Sowing Seeds of Fear

Liam Pleven and William Mauldin, Wall Street Journal
In Russia, Farmers Take to Fields as Supply Concerns Grow

With Russia playing an increasing role in the international food chain, the health of the new winter wheat crop is being watched by traders, food companies and aid agencies around the globe, amid fears that the world could face a possible food shortage next year. . . . A drought decimated the nation’s spring wheat crop, prompting the (Russian) government to halt grain exports. . . .

“We have set up the conditions where governments might begin to panic” if there’s another shock to global food supplies beyond Russia’s borders, said Scott Irwin, an agricultural economist at the University of Illinois at Urbana-Champaign.

A “What If” scenario (a hypothetical future news item):

With Russia playing an important role in international energy markets, new Russian oil & gas fields are being watched by traders, oil & gas companies and governments around the globe, amid fears that the world could face a possible energy shortage next year. . . . A production decline hurt the nation’s oil and gas production, prompting the (Russian) government to halt natural gas exports and to severely curtail oil exports . . .

“We have set up the conditions where governments might begin to panic” if there’s another shock to global energy supplies beyond Russia’s borders, said an energy economist.
(11 September 2010)
Suggested by EB contributor Jeffrey J. Brown. Article is subscriber only, with a preview available to the public. -BA