UN: Food riots 'warning sign'
REUTERS/ EDUARDO MUNOZ
Demonstrators form a barricade in the town of Les Cayes, Haiti April 7, 2008 during demonstrations over rising food prices. High food prices could bring unrest and instability around the world, official says.DUBAI, United Arab Emirates –
The recent outbreak of food riots is a warning sign that rising food prices could cause unrest and instability across the world, the UN's top humanitarian official said Tuesday. Combined with the negative impact of climate change and soaring fuel prices, a "perfect storm" is brewing for much of the world's population, said John Holmes, undersecretary general for humanitarian affairs and emergency relief co-ordinator.
"The security implications (of the food crisis) should also not be underestimated as food riots are already being reported across the globe," Holmes told a conference in Dubai, addressing challenges facing humanitarian work. His comments came after two days of rioting in Egypt, where the prices for many staples has doubled in the past year. And violent food protests were continuing for a second day in the capital of Haiti."Current food price trends are likely to increase sharply both the incidence and depth of food insecurity," Holmes said, noting a 40-per-cent average rise in prices worldwide since the middle of last year. Holmes said that the biggest challenge to humanitarian work is the effects of climate change and the resulting "extreme weather" that has doubled the number of recorded disasters – from an average of 200 a year to 400 per year in the past two decades.
Adding food scarcity and expensive fuel to the mix have made for a very volatile situation, he said. "Compounding the challenges of climate change in what some have labelled the perfect storm are the recent dramatic trends in soaring food and fuel prices," he said. One of the factors pushing food prices higher and sparking protests all over the world is more expensive diesel fuel, which is used to transport most of the world's food.
Along with the riots over food scarcity in Haiti and clashes with police over high prices in northern Egypt, UN employees in Jordan staged a day-long strike for pay raises due to a 50-per-cent rise in prices there. A teenager injured in the clashes in the northern Egyptian city of Mahalla al-Kobra has died from his wounds.
In Port-au-Prince, the Haitian capital, UN peacekeepers fired rubber bullets and tear gas into a crowd outside the presidential palace Tuesday on the second day of protests over soaring food prices. Some protesters were trying to break down the palace gates before the UN troops established a security perimeter around the building. ``We are trying to deal with the situation," said Fritz Longchamp, chief of staff to President Rene Preval who was at work inside the palace. The food unrest began last week when Haitians burned cars and attacked a UN police base in the southern city of Les Cayes. At least five people were killed there. The demonstrations reached the capital Monday as thousands marched past the National Palace, some of them crying out: "We're hungry!"
John Powell, the deputy executive director of The United Nation's World Food Program, emphasized the need for developed countries to help governments in the developing world. Developing countries experiencing unrest over high food prices need help in developing "social safety net programs," he said. "Riots today mean you need a solution tomorrow," Powell said. Governments with no "policy space" and under pressure from organized discontent in urban centres "is not likely to be the best decision" in trying to solve the problem, he said.
Powell said the planet is getting hungrier with four million people added to the list of those in most dire need for food to survive. The rise of fuel and food prices is unlikely to stop soon and it affects everyone, Powell said. In the past, natural disasters, wars and ethnic conflict made the rural areas most vulnerable to poverty and hunger. Now, the most vulnerable live in the cities, Powell said.
"They see food on the shelves but they cannot afford to buy it," said Powell. He called urban poverty the "new face of hunger."
Tuesday, April 8, 2008
food riots breaking out across the globe
Monday, April 7, 2008
Wheat prices causing export suspensions
Kazakhstan is the largest grower of wheat in central Asia. Double digit inflation on various commodities has caused them to reduce and consider freezing grain exports. This can only exacerbate the grain inflation gripping again at the moment, especially as rice shortages and hoarding have caused people to shift to other more available staples.
These kinds of stories are far from front page news, the price of wheat and rice hitting record highs fail to garner the attention that $100 oil and $1000 gold do, but their impact to billions of people could be just as serious when food supplies tighten.
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Kazakhstan considers suspending grain exports
By Raushan Nurshayeva
ASTANA, April 7 (Reuters) - Kazakhstan will examine proposals to suspend grain exports or introduce export duties to tame domestic inflation, the country's prime minister said on Monday, reversing a previous decision not to curb exports. Kazakhstan, central Asia's top wheat grower and a country with ambitions of becoming the world's fifth-largest grain exporter this season, has long threatened export limits to rein in double-digit inflation.
Similar tactics have been used by ex-Soviet countries Russia and Ukraine, leading to a drastic decline in grain exports from the Black Sea region at a time of high world demand and prices. Kazakh grain traders, wary that exports could soon be forbidden or limited, said they were shipping as much as possible now as the country aims for a seasonal export record of 10 million tonnes.
"I have ordered the Agriculture Ministry, together with the Industry Ministry, to look into the possibility of introducing a grain export duty or suspending exports altogether," Kazakh Prime Minister Karim Masimov told a government meeting. "Either this or that. Please submit your proposals by the end of the week."
Officials reassured exporters last month that Kazakhstan would not limit exports following a deal with local producers and traders to ensure at least 1.2 million tonnes of wheat are supplied to the domestic market at fixed prices. But a rise in global prices has alarmed Kazakh policymakers, concerned with booming bread prices and a threat of possible shortages across the steppe nation of 15 million people.
"The global trend is quite alarming. Global prices are rising relentlessly," Masimov said.
NO ROOM TO RELAX
Masimov said Kazakhstan had performed well in limiting first-quarter 2008 inflation to 2.5 percent, largely unchanged from 2.6 percent recorded in the same period of last year, state statistics show. "But we should not relax, because there are global trends to which we should pay attention," Masimov said. "Curbing prices for bread and basic goods ... should be kept under constant control."
High world prices have made exports more profitable than domestic sales, making it tougher for millers to secure wheat. A rise in grain prices and temporary shortages of bread last year helped propel Kazakh inflation to double digits.
Annual consumer price inflation in central Asia's biggest economy was 18.8 percent in 2007, compared with 8.4 percent in 2006. Kazakhstan harvested a record 20.1 million tonnes of grain last year and had planned to export about 10 million tonnes in the current season -- 7 million of which had already been shipped by the end of February.
"We're loading in April and we're making plans for May," said a major grain trader in Almaty, Kazakhstan's largest city. "We are trying to export as much as we can as quickly as possible, because the situation could change at any moment. Bread could get more expensive."
Russia introduced a prohibitive export tariff on wheat from Jan. 29, which has been extended until at least July 1. Ukraine has also banned or limited exports through a series of quotas in the last two seasons. While Kazakhstan may follow suit, traders said other measures were also open to the government. These could include a certificate system allowing only selected firms to export, or limits on wagon allocations by the state-owned rail operator.
Railway wagons are crucial in facilitating exports due to Kazakhstan's limited port capacity and distances to sea.
(Additional reporting by Robin Paxton in Moscow, writing by Maria Golovnina) ((maria.golovnina@reuters.com; +7 727 250 85 00; Reuters Messaging: maria.golovnina.reuters.com@reuters.net))