Food Security and Macro-Policies

An insightful piece in the Guardian discusses the importance of "food intelligence," touching on issues of price volatility, unreliable or asymmetrical information about food production/supplies, sticky macroeconomic politics/trade policies, the dangers of speculators, and (the lack of) international food storage.

Some excerpts follow--

"...'The big drive of commodity price volatility, and of price spikes, is storage volumes, on which we have terribly unreliable and incomplete statistics,' said food security expert Chris Barrett.

....In the absence of accurate planting data from many countries, the FAO and the US Department of Agriculture rely on satellite imagery to produce crop estimates.

'But you cannot really tell [from a satellite image] whether it is maize or wheat; besides, you need information on other food crops, such as cassava and potato, to build a comprehensive food security scenario,' said Abbassian.

'We need to look at innovative solutions and new technologies, such as the use of cellphones. Farmers could use cellphones to let a central authority know how much they had planted, or simply whether the expected harvest was "good" or "bad."'

....UNCTAD pointed out that in the absence of accurate reliable public information on food stocks, traders formulated price expectations on the basis of partial and uncertain data, which "may lead them to focus on a small number of available signals, with the attendant risk of herding and copying the behaviour of others".

These signals could be provided by unscrupulous commodities speculators, who were often substantial investors and sometimes manipulated markets by sending signals that would work to their advantage."

Some related reading material:

Katherine Gustafson: "Global grain reserves are key to food security," Huffington Post, 11 october 2010.

Financial Times poll on who the public faults for higher food prices (warning: poorly reported article, and unclear how many were polled or how, but interesting food for thought nonetheless), 10 october 2010.

The FAO on measures for aid relief and development investments, given protracted food crises