The accelerated practice of land grabbing—where countries or corporations buy up agricultural land, usually in poor countries—is one of the most troubling responses we've seen to the sharp rise in food prices in late 2007 and early 2008. The Woodrow Wilson International Center for Scholars has published a valuable new book on the topic: Land Grab? The Race for the World's Farmland. It includes a diversity of perspectives on land grabs—including an article by IATP's Alexandra Spieldoch and Sophia Murphy on what this development could mean for food security and poverty reduction. Other articles cover potential "codes of conduct" for land grabs and regional case studies for Africa, Asia and Eastern Europe.
The NGO GRAIN is documenting land grabs around the world. Unfortunately, with rising hunger and energy prices we can expect this dangerous trend to continue.
As we step into a new decade, imagine we have an eraser to wipe away the tired yet relentless drive to further liberalize trade at nearly every corner—and instead, take a fresh look at what policies could help the over one billion people around the world without enough food to eat. How could we re-write trade and investment policies to support efforts by countries struggling with hunger to better feed themselves? How can we strengthen the resilience of agriculture to better adapt to climate change? How can we better stabilize highly volatile markets that make it so difficult for small scale farmers to make a living?
A new book, edited by FIAN's Armin Paasch and IATP's Sophia Murphy, makes a convincing case that by putting human rights, particularly the right to adequate, healthy food, at the center of economic and development policy we can better address hunger in the short and long term. The Global Food Challenge, with contributions by some of civil society's leading thinkers on food security and trade policy, outlines a series of proposals to integrate established human rights law into multilateral and bilateral trade negotiations. It includes chapters on trade policy, foreign investment, women's role in food production, speculation on agricultural commodities and climate change, and food security.
The book includes contributions by IATP's Alexandra Spieldoch and the UN Special Rapporteur on the right to food, Olivier De Schutter, among many others. You can read the Executive Summary and find the full book on our Web site.
IATP's Anne Laure Constantin has been following the agriculture negotiations at the global climate talks in Copenhagen. She gives a rundown of where the fast-moving agriculture talks are going in the video below.
When negotiators arrive in Copenhagen this week, they will quickly become immersed in jargon and highly technical drafts of text. But they shouldn't lose sight of an important fact: climate change occurs in a world of extreme social and economic inequality.
That is the message of a new briefing paper by IATP's Shalini Gupta and Dr. Cecilia Martinez. The paper looks at the disproportionate role wealthy nations have had in contributing to global greenhouse gas (GHG) emissions, contrasted with the role of poorer nations and people. It also looks at who has benefited the most from GHG-intensive development patterns and who is most affected by climate change. The paper links the eradication of the Indigenous commons in the U.S. and the capture of agriculture by agribusiness to the same market-based philosophy underlying the industrial world's approach to climate change.
You can watch a short video with author Shalini Gupta below.
IATP's Alexandra Spieldoch is blogging from Rome at the World Summit on Food Security.
Today at the World Summit on Food Security, there was plenty of lofty rhetoric. United Nation's Secretary-General Ban Ki Moon told delegates that "food is a basic right" and "our job is not just to feed the hungry, but to help the hungry feed themselves." And according to Bloomberg, Pope Benedict XVI cited "greed which causes speculation to rear its head even in the marketing of cereals, as if food were to be treated just like any other commodity."
Fine words. But, like so many of the international meetings the past two years on the food crisis, missing from the various statements of government leaders were clear financial commitments and regulatory reforms to address failures in agricultural markets, like speculation.
When it comes to action, the summit represents an opportunity for the Obama administration to lead on a global stage (and according to a new USDA report released today, food insecurity is also hitting close to home). Just prior to the summit, IATP and over 20 other U.S. based organizations wrote to the Obama Administration with 10 ideas for action at the summit. Unfortunately, thus far,“Our officials, along with U.S. agribusiness, are spreading the myth that more intensive production can feed the world, a message that is not only incorrect but dangerous in terms of its harmful impacts on sustainable livelihoods for the majority of food producers, and its exacerbation of the converging climate, economic, water and energy crises,” the U.S. groups wrote.
Today, we also delivered a specific proposal to government officials at the Rome meeting, urging their support for food reserves as a tool to better manage food supplies and address extreme volatility in agriculture markets. Last month, IATP and ActionAid USA organized a briefing in Washington on food reserves and how they might be used at the national, regional and international level.
IATP's Alexandra Spieldoch is in Rome following the discussions, briefing government officials and working with civil society organizations. Government leaders still have two more days to step up.
This week in Barcelona negotiators are making one more attempt to resolve some of many differences for a new agreement to implement the United Nations Framework Convention on Climate Change (UNFCC). There are three UNFCC “flexibility mechanisms” intended to enable countries to meet their Greenhouse Gas (GHG) reduction commitments. One mechanism is the buying and selling of “carbon allowances,” i.e., permits to pollute, and “carbon offset credits,” largely based on agricultural or forestry projects to reduce or avoid GHG emissions. Industrialized countries claim that Article 17 of the Kyoto Protocol authorizes them to extend the primary carbon trading market into the world of financial derivatives.
As part of IATP’s preparations for the UNFCC summit, December 6–18 in Copenhagen, Denmark, as a member of the Commodity Markets Oversight Coalition (CMOC), we helped to draft and signed an October 30 letter to Senators John Kerry and Barbara Boxer. The CMOC does not take a position on the overall Senate energy and climate change bill. Instead the letter outlines dangers that the carbon derivatives market poses to the realization of U.S. GHG reduction goals. The letter notes that Congress has yet to agree to fundamental reforms to the financial and commodity derivatives markets in which carbon derivatives would be traded. Indeed, there is strong opposition to most of these reforms from the financial services industry, which has created new loopholes in draft legislation that could induce extreme price volatility in derivatives markets, including that for carbon. Volatile and confusing carbon price signals would delay and inhibit investments in GHG reduction technology. Such investment delay would be a global warming accelerant.
To reduce the likelihood of extreme carbon price volatility, the CMOC letter calls for mandatory exchange trading—in other words, no more trading in the shadow banking markets. This demand is strongly opposed by the Coalition of Derivatives End Users, who claimed in an October 2 letter, that being forced to post the margin requirements to trade on exchanges would harm their economic interests. Most of the signatories to the letter—which originated when the U.S. Chamber of Commerce, acting on behalf of the taxpayer, bailed out “too big to fail” banks—will be trading carbon derivatives.
The CMOC letter also calls for banning commodity index funds and exchange-traded funds from trading carbon derivatives. In a November 2008 paper, IATP showed how the bundling of agricultural futures contracts into index funds was partly responsible for the extreme price volatility in agricultural futures contracts. The role of index funds in driving price volatility was confirmed in a June 24 U.S. Senate investigation of excessive speculation in wheat contracts. This price volatility made the use of futures contracts by both U.S. farmers and developing country importers too expensive and unpredictable. The price increases contributed to food riots in more than 30 countries, according to the United Nations Food and Agriculture Organization (FAO).
Finally, the CMOC letter called on Congress to commission studies on the effects of a carbon derivatives market on agricultural, energy and other non-agricultural futures contracts. The Commodity Futures Trading Commission (CFTC) estimates that by 2017, the carbon derivatives market will trade $2 trillion in contracts. In 2008, the estimated value of all CFTC regulated contracts was $4–5 trillion dollars. No climate change bill should be passed before Congress has had time to review studies on carbon derivatives price volatility and the effect of carbon derivatives on other futures contracts, including contracts where carbon is bought to offset financial risks in the deregulated world of “mixed swaps” (i.e., with both security and commodity features).
When USDA Deputy Secretary Kathleen Merrigan toured the St. Paul School Commissary earlier this week, the first thing she talked about was how complicated the logistics are when trying to provide healthier school lunches—particularly for larger urban districts. Heads in the meeting room immediately nodded. (see photo: IATP's JoAnne Berkenkamp and USDA Deputy Secretary Merrigan)
Yet, despite these challenges, the urgency of improving school lunch programs is rising. The Centers for Disease Control reported last month that most kids aren't getting enough fruits and vegetables. And the Institute for Medicine also published a paper last month citing school lunch and breakfast programs as critical to ensuring the health of our children.
Farm to school programs are seen as one tool toward providing healthier food to kids—and communities around the country are recognizing this. There are now over 2,000 farm to school programs around the country.
In Minnesota, we have been working with the Minnesota School Food Service Association to expand farm to school programs. “It’s exciting to see Farm to School participation growing all over the state—in the cities, in the suburbs and throughout greater Minnesota. This movement is growing by leaps and bounds,” IATP’s JoAnne Berkenkamp said in a press release we sent out today.
This fall and early next year, Congress will renew the Child Nutrition Act—an important opportunity to expand resources for farm to school programs.
As Deputy Secretary Merrigan said, "The need is great, the challenges are great, but just because they're great doesn't mean we're not ready to tackle them."
There is an old African saying “Whether elephants make love or war, the grass suffers.” The two elephants in the agricultural seed business are now making real war, although they have been wary of each other for years. Monsanto, a relatively recent entry into the business, has become the “dominant male” in the battle after moving to acquire a large number of formerly independent seed companies. Pioneer, content for years to be the premiere corn breeder in the world, has found itself suddenly defending its turf and trying to find ways to move into the new biotech ball game. The Des Moines Register recently covered this ongoing saga.
Monsanto has long been targeted as a corporate villain. From dioxin-laced Agent Orange for Vietnam to the industrial chemical, polychlorinated biphenyl (PCB), Monsanto was known as producer of persistent, deadly chemicals. Lassotm, the alachlor-based pre-emergent grass herbicide with a long list of toxicity issues, was their first foray into agricultural chemicals.
Monsanto’s bottom line was being hurt by lawsuits and clean-up costs associated with dioxin and PCB pollution. Enter Roundup™ (glyphosate), launched in 1976. This is the chemical that made Monsanto the powerhouse it is today. Glyphosate is a broad spectrum nonspecific herbicide that has low acute toxicity and does not persist in the environment. It should be noted however that many questions remain regarding the long-term toxicity of glyphosate.
By 1982 they had the first genetically modified plant cells. Depending on definitions, humans have been genetically modifying crops for thousands of years. More correctly, these are termed transgenic crops, which involves inserting a gene that is not acquired by pollination. I have used genetically modified (GM) because it has become the standard term. Now plant life is patented, permitting GM companies to control technology, and prohibit use of seed from the GM crop.
In 1926, Henry A. Wallace and others founded the Hi-Bred Corn Company in Des Moines to develop and market the expanding hybrid seed corn business. Pioneer was added to the name in 1936. They moved into soybean seed operation in 1973, and soon became the leading corn and soybean seed producers. Pioneer gained the number the one corn seed sales spot in 1982 from its longtime rival, Garst. Pioneer, when I first came to the Leopold Center in 1988, was a family company: friendly, environmentally aware and benevolent. Its advances were based on classic plant genetics, not biotechnology. It was not to last.
Monsanto bought its way into the seed business by acquiring established companies including the number two seed corn producer, Garst. This predatory approach (Monsanto often paid more than market value for the seed companies) combined with its big breakthrough—developing genetically modified corn and soybeans resistant to glyphosate—gave them a huge market advantage. This initiated the trend to GM crops that is now dominant in the seed industry.
The predator habits of Monsanto long made Pioneer nervous. Patented Roundup Ready soybeans were first introduced by Monsanto in 1996. One year later, Pioneer had biotech corn and soybeans on the market, buying the technology from Monsanto. Pioneer Hi-Bred was purchased by DuPont (20 percent in 1997 and the remainder in 1999). Lawsuits began soon after.
By 2000, corn borer protection had been added by Monsanto (called YieldGardtm) and Pioneer had to enter into agreements to use the Monsanto technology in its corn. Pioneer paid big bucks to use the Roundup Ready and YieldGard traits. Now Monsanto is suing Pioneer over infringement of these patent rights and Pioneer is moving ahead with a new set of seed traits called Optimum GAT. Monsanto saw red, and has countersued. Monsanto also became very unhappy when Pioneer recently co-sponsored an anti-Monsanto seminar in St. Louis, the home of Monsanto. The issues are complex, and involve “stacking” of seed traits. This means that genetic characteristics for two or more traits are included in a single seed. Often these stacked seeds have not had full evaluation regarding their safety and efficacy. In the meantime, Pioneer slipped to No. 2 in seed sales.
Monsanto now licenses these traits to about 200 seed companies. Their powerful monopoly has blocked competition. They will not even allow experimenters to evaluate the seed corn for efficacy in other environments.
During this time, the price of seed corn and Rounduptm escalated rapidly. But now Monsanto is starting to lose money on its Roundup herbicide, mainly because it is off patent and others are now undercutting Monsanto on price. Furthermore, the pent up demand for glyphosate in South America had raised prices earlier, but this market now is being met.
So what does all this mean? I first encountered Monsanto in the early 1970s when at a regional research meeting in St Louis they invited the committee to tour their operations. At that time they were just getting into biotech and no one really saw its potential to make money.Then, about the time I was getting the Leopold Center programs underway, Roundup Ready soy field trials were under way on a site east of Ames. I had a tough decision to make on funding for field work that might involve GM materials, and decided we would not fund such work, but it soon became hard to delineate the lines between GM and non-GM. When Pioneer went over to Roundup Ready, and then both companies began stacking genes, I knew the game was lost.
Genetically modified corn and soybeans dominate, especially in countries with high input agriculture. Claims that GM crops will “Feed the World” abound, especially around the time of the World Food Price presentations earlier this month. Other claims include the lowering of pesticide use and lessening of soil erosion.
Monsanto now bills itself as a Sustainable Agriculture company!
These are issues deserving of future blogs. I worry about how the world’s farmers are being shortchanged in the quest for improved and adapted seed varieties at reasonable costs. Now they cannot save seed for fear of the Monsanto cops taking them to court and ruining their lives. The seed industry is no longer competitive because about 90 percent of it is in the hands of two companies and the cost of seed is out of reach of small farmers. I worry about how the food system is now dependent on genetically engineered corn, soybean, cottonseed, canola and sugar beets (recently taken back off of the market). GM wheat, rice and other staple crops could follow as pressure continues to adopt these crops. The industry essentially says "We build it, you will use it."
We need to be smarter about these crops, question each claim and insist the government enforce antitrust laws. We should resist the claims that they will solve the food shortage in countries where their use will do more harm than good. Specifically, this means the next food frontier, Africa, must not become a new “Green Revolution” based on the failed western world high technology model, rooted in GM crops.
One of the political challenges in talking about food reserves, at both the national and international level, is that they are too often dismissed as a tool that has failed. Of course, food reserves have seen success and failure. And because many reserves have been mismanaged, agriculture economist Dr. Daryll Ray reminds us, "We need to delineate between the concept of the reserve and the way it's administered."
Roger Johnson, President of the National Farmers Union, addressed this political obstacle at a meeting we organized with ActionAid on food reserves last week. "At this point in history, we've entered an era that government is looked upon as the problem, not the solution. And that the private sector should be in charge of everything, including food aid."
"There is this sentiment that reserves are an old idea," said Johnson. "Nobody wants to talk about an old idea. The other side will say, 'we tried that, it didn’t work.'" But he believes that there is a new political opportunity to gain wider support for reserves, and that could involve emphasizing the benefits for consumers and the disadvantaged of the world.
"Reserves accomplish a lot of the same things whether you are a farmer or consumer," said Johnson. "The predictability in pricing is a good thing for both. It is essential for lesser developed countries. If they are going to become more developed, the most common way to grow is through agriculture."
Larry Mitchell, former CEO of the American Corn Growers Association, emphasized the national security implications of not having a food reserve. "Our current reserve is in the hands of multinational corporations," said Mitchell. "We are one short crop away from being at the mercy of their benevolence. We need a public option for food."
"This is pretty scary to me," said Mitchell. "When we went to war in March 2003, we had less than a day’s worth of corn and soybeans. The impacts of a reserve are well-past hunger. It is also an issue of national security. I know why we are at war in the middle east. I don’t know who we’ll be going to war with when we need food."
Mitchell compared the deregulatory effects of the 1996 Farm Bill on agriculture to the repeal of the Glass-Steagall Act in 1999 on the banking industry. He emphasized the need to return to sound food management through a food reserve. A new reserve system could include more than just traditional grain and would benefit both the livestock industry and the emerging bioeconomy.
"Most farmers I know are willing to give up $7 corn if they can get a consistent and guaranteed $4, and a proper food reserve can help us accomplish that," said Mitchell.
Victor Suarez, IATP board member and director of the National Association of Rural Commercialization Enterprises in Mexico, highlighted the urgent need for government intervention in agricultural markets, not only to address the food crisis, but also as a counterweight to big agribusiness companies.
"When we start talking about strategic food reserves what we’re really talking about is state intervention into the market," said Suarez. "Markets are not self-regulating, particularly with regards to food. There’s always been a need for organized societies to prevent risks. In Mexico, when food prices rise, the free market logic is that people simply stop eating. One thing we have learned is that organized small farmers cannot confront alone organized monopolies. It is in no way a free market."
Instead, Suarez stressed the need for people and governments to work together to address the breakdown in the global food system—because we all are affected.
You can find video interviews, powerpoint presentations and more blog postings from our meeting on global food reserves at our web site.