A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Pierre Pagesse, President
of Limagrain. It brings together, managers from the agricultural world and important people from external
perspectives, such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
The rise in agricultural prices threatens food security in developing countries
Global Development Finance
In a report entitled Global Development Finance published on 29th May this year, the World Bank shows concern about the possible consequences of cereal price increases on food security in developing countries (DCs).

This price increase is mainly due to the combination of two factors:

- A strong decrease in stock levels of wheat and rice which have, for the first time in 25 years, fallen below the minimum safe level established by the FAO, which is 17 % of global consumption. The reason for this decrease is a combination of exogenous (droughts in Australia and Ukraine) and endogenous factors (policies designed to reduce stocks in China and in most countries in the world);
- The sudden increase in demand for agricultural products for energy purposes. The USA, the world’s leading producer and exporter of maize, is expected to devote 25 % of its harvest to the production of ethanol in 2007. In spite of an increase of 15 % in the land dedicated to production of this kind, prices have increased by 75 % since the summer of 2006.

But because this increase has extended through a substitution and contagion effect to other cereals, the World Bank fears a much higher general increase, this time approaching 40%. The consequences would therefore be disastrous for the populations of DCs: in Kenya for example, maize supplies on average 36% of the population’s calorie intake and this can reach 58% in the poorest homes.

As well as cereals, the price increase affects a much wider range of agricultural products: according to the FAO, the price index of meat increased by 7.6% between March 2006 and March 2007; and the index of dairy products has increased by 46% since November 2006. This is the result of an increase in consumption in China, drought in Australia, India’s suspension of powdered milk exports and export taxes levied in Argentina.

DCs will therefore be subject to an increase of 9% in their global food import expenditure in 2007, which could be even higher for countries with low incomes and a lack of subsistence farming. Since 2000, the FAO estimates the average price increase of the “food import basket” for the least developed countries to be almost 90%!
Rising prices alert
Advocating for
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Paris, 08 February 2012