The Environmental Food Crisis

transport costs and stimulated biofuel production (see box). This coupling can have devastating implications for global pov- erty and food security. The impact of climate change is a particularly difficult issue in the long-term forecasts for agricultural prices. Forecasts of the rise in temperature and its impact on agriculture over the next two decades are extremely uncertain. Climate change threatens yields in many developing countries, although most of this ef- fect is not likely to be felt until after 2030. The World Bank assumes an overall decline in agricultural productivity of be- tween 1–10% by 2030 (compared with a future where average global temperatures remain stable), with Canada and Europe least affected and India, Sub-Saharan Africa, and parts of Latin America most affected. Were there to be no climate change be- tween now and 2030, global agricultural productivity would be nearly 4% higher and the world price of food 5.3% lower. Over the longer term, the impacts of climate change could be much more serious, with agricultural productivity in many develop- ing regions, notably Africa, potentially declining much higher than the global average (Cline, 2007). In Global Economic Prospects 2009, the World Bank has run a number of simulations to quantify possible outcomes. Should global agricultural productivity rise by only 1.2% per year on average, instead of the 2.1% projected in the baseline, then prices, rather than declining, can be expected to rise by as much as 0.3% per year. If cereal production could increase as projected without any environmental constraints, it is expect- ed to grow by 1.5–1.5% to 2030 according to demand, and by 0.9–1.0% between 2030 and 2050 (FAO, 2006; World Bank, 2008). However, the current scenarios of losses and constraints due to climate change and environmental degradation – with no policy change – suggest that production increases could fall to 0.87% towards 2030 and only 0.5% between 2030–2050 (World Bank, 2008). Alternatively, biofuels could have a significant impact on food prices if oil prices remain high or the cost of biofuels produc- tion declines. With a permanent increase in the rate of growth of demand for food products as source material for biofuels (as-

suming a doubling in biofuel production compared to the base- line), food prices will decline by only 0.5% a year. In general, OECD-FAO estimates confirm this sensitivity to key assump- tions about yield and biofuels production (OECD-FAO, 2008). Overall, soaring food prices are blamed for their impacts on hu- man vulnerability. However, there are two sides to this picture. Increasing food prices do have a positive effect on net food-sell- ing households (FAO, 2008), augmenting their incomes and allowing more possibilities for farmers to afford investments in production inputs. This underlines the need to minimize short- term price volatility and stimulate slow increases in long-term food prices, in order to enhance investments in the agricultural system and bridge the gap between developed and developing countries as well as between rural food producing and urban food consuming regions. Ideally, these developments should take the environmental aspects previously described into ac- count to achieve sustainable agricultural systems that will meet the food demand of all the world citizens and eradicate hunger. However, increasing yield and food supply without simply con- tinuing the conventional expansion of cropland and rangeland and use of fertilizers and pesticides – at the cost of biodiversity and future generations – will require major investments and implementation of food energy considerations in the entire food production and consumption chain.

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