Global food crisis after stock shortage
We are in the middle of a global food crisis, suggest international monitoring agencies. The estimated production of rice and wheat for 2007-08 is much below the actual consumption, and as a result the global buffer stock has depleted substantially.
Since the global availability of wheat and rice is likely to remain low, the prices may move up further, said a senior official of Ministry of Consumer Affairs, Food and Public Distribution.
According to latest estimates of International Grains Council, wheat production is estimated to be 604 million tonnes as against the consumption of 612 million tonnes — a gap of 8 million tonnes. The intergovernmental organisation concerned with grains trade has estimated that global rice production was at 420.6 million tonnes, against the consumption of 423.7 million tonnes.
The buffer stocks are estimated at 72 million tonnes, which is the lowest in the past two decades. China, which is not an exporter, accounts for 36 million tonnes of it, as a result of which the exportable surpluses are estimated to be the lowest in recent years.
According to the UN’s Food and Agriculture Organization, 36 countries are currently facing a food crisis — 21 of them in Africa. Last year, Australia experienced its worst drought in over a century and its wheat crop has shrunk by 60%, which has contributed to the fall in global production. Globally, grain stocks are at their lowest in 30 years.
There’s another contributing factor. “A number of wheat and rice exporting countries have introduced measures to discourage export and in some countries exports have been banned altogether,” said the ministry official. Egypt has banned rice exports from April. On Wednesday, India notified a ban on non-basmati rice, meant to tide over domestic price rise.
Sources said even though the present estimates of world production is 642 million tonnes, the forecast may undergo change depending on the climate condition in major wheat-producing countries. Wheat production has continuously declined since 2004-05, and so has the stock level -- an estimated 112 million tonnes in 2007-08.
Given the price trend on the Chicago Board of Trade, the future prices of wheat have also risen substantially since January 2007. Wheat price for the month of September has gone up to $377 per tonne as against the May price of $ 182.61 per tonne.