While Covid-19 spikes rapidly with over 6 million confirmed cases around the world, the Ebola virus has struck back alongside the river of Congo.
To make matters worse, Ebola, a highly deadly virus that rages through South Africa for years, has returned in the northern province, Congo. Despite the devastating economic crisis and social impact, the seriousness of the potential food crisis should be given primacy and attention to what the future holds.
Food is the most basic necessity of everything to us, as human beings. The prediction of the result of the food crisis outbreak on a worldwide scale is much more than the idea of hunger. One thing leads to another, we could be facing something that could damage the whole society, eventually leads to a world-wide riot. The idea of a food crisis on a world scale is way exceeded to be contained within our current global economic and political structure.
2020 has been tough on the earth. When you take everything into account, the plague of locusts, Covid-19, now even joined by the Ebola virus. The chance of a catastrophic food crisis is getting more and more likely if we do nothing.
Following Vietnam's announcement to ban all rice exports, 12 countries also announced restrictions on food exports, and 2 additional countries joined the initiative. Despite Vietnam's announcement to begin exporting again, this initiative has caused global waves and fears that as pandemic spreads, more countries could follow and restrict food exports, thus hitting global food supplies and threatening global food security.
A. The last time - Ebolavirus
The recent pandemic outbreak resembles the 2014 Ebola outbreak in West Africa. The 2014 Ebola outbreak spread through Africa for over a year, infecting about 30,000 people and killed about 10,000 people. During that time there was wide-spread panic in Africa.
The data was sourced from Wikipedia, the charts were produced by WPS Office
During this time, the Ebola outbreak had broken the supply chains to agricultural markets. The inability many farmers faced to selling their food, coupled with government restrictions on working outside the country led to a significant decline in the labor force and created a serious impact on food production.
In Liberia at that time, 47% of farmers were unable to farm the land. Restrictions and market closures disrupted the supply flow of food and other essential goods. The supply shortage led to higher prices for essential goods. The economic decline reduced the household purchasing ability and also reduced access to food. As a result, the population became undernourished and hunger increased the spread of the epidemic and social unrest.
The lesson from the 2014 Ebola outbreak is therefore very clear, even though health needs have become urgent and of primary concern, we mustn't lose sight of maintaining livelihoods or food security. Additionally, if livelihoods are destroyed, this can lead to tensions and social unrest.
B. This is a complex issue, multiple factors intensify the problem
In the long term, the causes of a food crisis are both "natural disasters" and "man-made disasters". The primary factor for "natural disasters" are many, some include the locust plague and pandemic. For "man-made disasters" the main causes are government policy and market speculation.
1. Locusts
While the world is focused on the new coronavirus, East Africa continues to struggle with another extensive crisis, the continued growth of greedy locust swarms. The scale of both of these crises is a global rarity, so is the high spread rate, causing governments to do their everything to control the situation.
Photograph by the Food and Agriculture Organization (FAO) of the UN
2. Pandemic
After the outbreak of pandemic, several countries began to restrict the movements of its people. In East Africa, this has had disastrous results for farmers. Since farmers couldn't go out and deworm their crops, the locust plague has become even more severe.
On the other hand, due to the epidemic restricting trade and exchange among countries, many regions have had difficulty accessing advanced agricultural and deworming equipment, as such production has declined significantly. While some food-producing countries have restricted or banned food exports, making it difficult for major food-importing countries to obtain adequate food.
Data is from the Food and Agriculture Organization's (FAO) website. The chart was produced by WPS Office
3. Speculation
The value of the US dollar has depreciated against the Euro and other notable currencies, this has caused a price increase for goods priced in US dollars. Many investment funds, such as pension funds, hedge funds, and index funds have purchased agricultural commodities as a response to inflation.
Speculative investment in food commodities has been on the rise since 2007. After the collapse of technology stocks and the real estate crisis, agricultural commodities became the next hot target high-return investment. Due to heated speculation regarding the prices of agricultural commodities, the actual prices of agricultural commodities either spiked or dipped. This deviated from the original intention of using commodities to eliminate trade risks, but it exacerbated the volatility of the agricultural commodities market. This greatly affected farmers' expectations for future income and wasn't conducive to maintaining enthusiasm for continued farming.
C. Is there enough food to eat? What is the food pricing trend?
Although there are a variety of current incentives, these incentives are still difficult to quantify, so the grain production situation and price changes are difficult to predict. Therefore, we have used actual data for "food production" to show the global grain production situation over recent years and the current situation. As well as the "food price index" to show the price fluctuations to various food sub-categories.
1. Grain production status
Is there really not enough food to eat? The following image presents three sets of data provided by authorities.
From 2017 - 2018 the world's grain supply was 3.418 billion tons, with a total demand of 2.6 billion tons, leaving 817 million tons to be stored;
From 2018 - 2019 the world's grain supply was 3.444 billion tons, with a total demand of 2.642 billion tons, leaving 801 million tons to be stored;
From 2019 - 2020 the world's grain supply was expected to be 3.467 billion tons, with a total demand of 2.671 billion tons, leaving 797 million tons to be stored
Data is from the Food and Agriculture Organization's (FAO) website. The chart was produced by WPS Office
We can see that without factoring in the locust plague, there is no problem with the supply or stocks of grain from previous years. If countries resume trade, the food supply issue will be greatly improved. The good news is that on April 7th, Vietnam said it would begin exporting rice, of which it has already stockpiled 700,000 tons. At the request of Vietnam's Ministry of Industry and Trade, they will export 800,000 tons of rice.
Whatever the reasons, exporting food abroad again is a contribution to solving the world's food crisis, which is both commendable and encouraging.
2. Food price index
Let's examine food prices, which everyone is concerned about. According to the latest figures from the UN's Food and Agriculture Organization (FAO), the food price index averages 172.2 points during March 2020. That's down 7.8 points (4.3%) since February, but still 4.6 points (2.7%) higher than in March 2019. The sharp fall in March marked the second consecutive month of month-on-month declines to the index, largely caused by shrinking demand caused by the pandemic outbreak. While vegetable oils and sugars showed the most prominent price drops, other sub-indexes also fell in March.
Data is from the Food and Agriculture Organization's (FAO) website. The chart was produced by WPS Office
- Grain Price Index: March averaged 164.6 points, that's down 3.2 points (1.9%) from February, the price remaining almost unchanged since March 2019. This is due to falling export prices of major grains, except rice, for the last two months.
- Vegetable Oil Price Index: March averaged 139.1 points, that's down 19.0 points (12%) from the previous month, that's the lowest value since October 2019.
- Dairy Price Index: March averaged 203.5 points, that's down 6.4 points (3.0%) from February. This marked the first fall in prices after a four-month rise. Due to this, the index also fell slightly from the same period last year.
- Meat Price Index: March averaged 176.0 points, that's down 1.0 point (0.6%) from February, marking the third consecutive month of decline, but still posting 11.6 points (7.0%) higher than the same month last year.
- Sugar Price Index: March averaged 169.6 points, that's a 40.1 point (19.1%) drop from February. This month's sharp drop in price was due to the impact of the pandemic outbreak, as some countries introduced measures that curbed consumer demand.
From this breakdown of price indices, the prices for major food categories are all on a downward trend, coupled with the FAO food price index which showed a continued decline in March. Therefore, as long as prevention and control of the locust plague and work regarding pandemic are carried out, except for major food-importing countries, there should be no significant increase in food prices to other countries for the short term.
D. What's missing isn't "food" but "confidence"
The pandemic outbreak has mainly been in large cities, having a low impact on rural food production. This will not lead to a significant reduction in global food production but will have a greater impact on the global food supply chain.
As pandemic continues to spread, some countries must balance between protecting the lives of their people with severe economic losses. Strict restrictions on people and logistics from outside their country would cut off the normal flow of economic activity, while at the same time cutting off the grain supply chain to the world.
Ma WenFang, an agricultural analyst at Iger, stated, "There isn't a global food shortage crisis, the problem mainly lies with food circulation." Many countries in East Africa have been hit by locust plagues, affecting agricultural production in those countries. For countries that haven't suffered from the locust plagues food is still in abundance, thus open trade will greatly alleviate the food crisis.
Data is from the Food and Agriculture Organization's (FAO) website. The chart was produced by WPS Office
At the same time, we have also received good news, the FAO has made a targeted response to the locust plague. Action has been taken in several countries severely affected by the locust plagues. In February a total of 136,000 hectares (ha) were cleared and another 165,000 ha were cleared in March.
E. Don't Panic, Don't Stockpile Food
The outbreak of pandemic and the spread of the locust plague are indeed a fatal blow to food production, but as stated by the Iger agricultural analyst, there isn't a global food shortage crisis, the problem mainly lies with food circulation. By resuming the import and export of grain, assisting major food-deficit countries, and reducing speculation the supply and demand of food will be back on track.
So as a people, we don't need to rush off and stockpile food. We believe this pandemic epidemic will be defeated by cooperation between countries, and then trade will be freed at last.
If the older ones in your family are still stockpiling food they can't eat, then show them this article. After all, fresh food is delicious.
Note: All of the above charts were produced by WPS Office
Related links:
Gaupp, F., Hall, J., Hochrainer-Stigler, S. et al. Changing risks of simultaneous global breadbasket failure. Nat. Clim. Chang. (2019) DOI: 10.1038/s41558-019-0600-z.