Wednesday, August 27, 2008 Speak out: Reality on food prices By Jesus Sievert
ONE does not have to be a Nostradamus to be able to foretell the grim reality of the future.
The writing on the wall is very apparent.
High food prices will stay and it will be affecting negatively the least developed countries, like ours.
While we have seen successive rollbacks on fuel price, we still have to experience a price reduction in food commodities.
Since there is a greater connection now between food and energy prices than there is in the past, then why is it that food prices continue to spiral?
Has the equation changed?
If it has, then the world’s poor are in for a rough ride going into the 21st century.
In the past, the world’s agriculture and food industries could count on technology to increase crop and apply this increased yield to stave off hunger in poor nations all over the world, with still a lot of surplus to boot.
But the paradigm we have been seeing over the past several decades, of high world cereal and grain inventory and low prices, may be reversing.
For one, global climate change is disrupting crop production and has caused critical staple grains to decline precipitously.
There is also the problem of land availability for increased crop production that has become the bone of contention in Central and Southeast Asia in the wake of huge population explosion and improved economies.
Last, but not least, is the global boom on biofuel production as an alternative source of energy that irrationally brings the corn and other commodities away from human consumption resulting to increasing commodity price.
