On February 12, the Bureau of France's Economic and Social Council (CES) adopted a report presented by Jocelyne Hacquemand on behalf of the Agriculture and Food section entitled "Hunger in the World and Agriculture and Food Policies: Review and Outlook." 1
While this study calls into question the validity of the WTO-promoted strategy to completely open agricultural markets – a position that has become increasingly common within the international community – it goes even further than the proposals that have traditionally been made. It draws all of the conclusions of the "agricultural exception" and lays the foundations for what could be a new strategy for global agriculture. This approach is wholeheartedly supported by momagri, which, for several years, has been showing the need to reconsider a form of global agricultural governance based on an appropriate and realistic diagnosis and a strategy adapted to this diagnosis.
If there were just one unique characteristic to keep in mind for agriculture, it is the extreme structural volatility of prices for agricultural raw materials. Indeed, any imbalance, no matter how minute, between supply and demand causes severe price variations that undermine food security, particularly in developing countries. To illustrate its point, the CES highlights two examples of social unrest caused by skyrocketing food prices from recent news, which, unfortunately, abounds with such cases: social tensions linked with rising baguette prices in Morocco and protests against the sharp increase in tortilla prices in Mexico.
These two examples reveal a fact ignored by international decision makers: 70 percent of those suffering from hunger are small farmers, and the consequences of agricultural market fluctuations go well beyond the purely economic domain, because the very security of nations is at stake.
As a result, as CES states, these situations "demand reasoned and specific responses," and national and international decision makers cannot turn to market forces alone to calm these tensions. It is precisely for this reason that there are agricultural policies whose aim is to support agricultural production and are justified by an undeniable truth: "in agriculture, the free play of markets does not automatically lead to balance" or – even less so – to development. There are indeed many flaws that can be observed in agricultural markets, which are related to the inelasticity of demand and, even more so, to supply. Indeed, the report's authors show that the vagaries of weather, long production cycles and emergence of health crises all limit farmers' forecasting ability. Therefore, "for these reasons and others such as energy and freight costs, harvest volumes in other countries, stock levels and current exchange rates, it is difficult for farmers to determine the prices that will prevail when the products are marketed." The fact that supply does not automatically adjust to demand – which momagri has been stressing since December 2005 – explains in part 2 the instability of prices on agricultural markets faced by producers and consumers.
As the CES shows, the consequences on food security are immediate: "the maintenance of a system of specialization in exporting agricultural raw materials and the liberalization of global trade imposed by the international organizations have exacerbated hunger and poverty."
While we can applaud the widespread awareness that now exists – one that unfortunately cannot be dissociated with the recent hunger riots – the proposals made by international organizations nonetheless remain focused on the further liberalization of agricultural markets, even though we already know that such a strategy is inconsistent with the diagnosis.
That is why we welcome the CES initiative. It shows that market forces alone cannot guarantee food security for consumers, just as they are unable to give farmers a "clear long-term vision." Finally, it calls indirectly for the construction of a new framework of action and adapted guidance tools in order to reconcile economic efficiency and food security in all of the regions of the world.
1 "Faim dans le monde et politiques agricoles alimentaires : bilan et perspectives," Report by the Economic and Social Council presented by Jocelyne Hacquemand on behalf of the Agriculture and Food section at the Bureau meeting on February 12, 2008. http://lesrapports.ladocumentationfrancaise.fr/BRP/084000210/0000.pdf
2 Speculators on the futures markets also play an important role. |