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Geo Politics

The Geopolitics of the Global Food crisis
Adnan Khan, Wednesday, 10 September 2008.

In April 2008 global food commodity prices skyrocketed around the world, the price of food led to riots around the world from Haiti to Egypt. What was most shocking was how quickly food prices soared, the World Bank reported that global food prices rose 83% over the last three years and the FAO cites a 45% increase in their world food price index during just the past nine months. The Economist’s comparable index stands at its highest point since it was originally formulated in 1845. As of March 2008, average world wheat prices were 130% above their level a year earlier, soy prices were 87% higher, rice had climbed 74%, and maize was up 31%.
Although their are some specific factors that led to the price hike; their still remain a number of underlying trends that have been taking shape for the last three decades and are fundamental to the current crisis and a future crisis. The protests around the world at the height of the crisis in March and April 2008 were not crazed “riots” by hungry masses. Rather they were angry demonstrations against high food prices in countries that formerly had food surpluses, and where government and industry are unresponsive. In order to understand the crisis and the trends in agriculture and the world’s food system the evolution of the current system needs to be traced from its origins as well as the different players who have shaped it.

Understanding the Food Cycle

The food one has for dinner, forms part of a global supply chain which spans the world and has many components. If any multinational was to acquire a large portion of any section of the chain then a bottleneck would be created, where such a company could dictate terms. The global food system is currently worth $3.2 trillion and works as follows:

Farmland – All food in origin is grown on farms hence the ownership of land and which commodity will be given priority will...