Guest post by Doug Evans

Yummo! Doesn’t that look delicious? Now that I’ve got your mind off the on going soap opera in Canberra for a moment I’ve got a couple of questions for you. How much do you spend on food and is your choice constrained by price?

Prompted by a couple of recent articles in The Guardian on food insecurity in the developing world (that I have linked to below) I decided to try to find out what I could about the global dimensions of the problem and whether this is an issue also here in Australia.

In 1998-9 according to the Australian Institute of Family Affairs the average Australian household spent thirteen percent of its weekly income on food. Today according to the St Vincent De Paul Society (see below) it seems to be around fifteen and a half percent. For the poorest Australians the weekly food spend seems to be almost twenty percent. In the United States in 2012 the figure was nine percent. Not such a large percentage of (average) income. Most Australians can still afford afford to eat more or less whatever and whenever they want, and do, as indicated by our high levels of obesity and related disease. Although the world price of food has doubled in the last decade and is still climbing, with the price of food around one-seventh of income we are not seriously affected – yet. However, while steadily rising food prices are for most Australians not more than a reason to grumble:

“For those who spend 50–70 percent of their income on food, it is a serious matter. There is little latitude for them to offset the price rise simply by spending more. They must eat less. With prices rising, many of the world’s poorer families had already reduced their consumption to one meal a day. But unfortunately for many families, even this is no longer possible. Millions of households now routinely schedule foodless days each week—days when they will not eat at all.

A recent survey by Save the Children shows that 24 percent of families in India now have foodless days. For Nigeria, the comparable figure is 27 percent. For Peru, it is 14 percent. In a hungry world, hunger often has a child’s face. Millions of children are dangerously hungry, some too weak to walk to school. Many are physically and mentally stunted.”

According to Lester Brown, president of the Earth Policy Institute, a Washington, D.C.-based environmental research organization, the corn crop shortfall of 2012:

“… will accelerate the transition from the era of abundance and surpluses to an era of chronic scarcity. As food prices climb, the worldwide competition for control of land and water resources is intensifying. In this new world, access to food is replacing access to oil as an overriding concern of governments. Food is the new oil, land is the new gold. Welcome to the new geopolitics of food.”

Rising food prices are already a factor in global conflict.

“The Arab awakening was driven not only by political and economic stresses, but, less visibly, by environmental, population and climate stresses as well. If we focus only on the former and not the latter, we will never be able to help stabilize these societies.”

In North Africa:

“The world is suddenly paying attention to the oft-ignored North African country of Mali, as it is racked by its most recent in a long string of crises: a coup d’etat. This political and constitutional crisis sits atop an already extremely vulnerable situation – a volatile mix of climate change, drought, food shortages, migration and immobility, armed insurrection and heavy weapons proliferation that threaten to plunge the country into a state of instability not unlike Somalia.”

What is driving food prices up? Rising food prices are a function of increasing demand as populations and dietary expectations rise. Population growth is also a major driver of food price rises. World population, currently over 7 billion is expected to rise to 8.3 billion by 2030 and 9 billion by 2040.

Australia’s population growth is currently 1.4% which is well above the world population growth rate of 1.1% and above any other OECD nation (of all OECD nations Turkey has the next highest growth rate at 1.3%).

Australia’s population currently sits at 22.7 million. Australia’s population reached 11 million in 1963 and it took 46 years to double it to 22 million. If the current population growth rate was maintained then the population would double again within 46 years. The ABS Series A (assumes growth rates comparable to recent years) has Australia’s population in 2051 at 40.1 million.

Food price rises are also a function of decreasing food production but what is causing this? Increasing incidence of climate change driven extreme weather is already reducing global food production. Recurrent drought in the world’s food bowls is a factor and that is also increasingly true of Australia as indicated by this report from the ABC:

Irrigation for agriculture may be hard hit by climate change. The CSIRO says the best estimates for the Murray-Darling Basin suggest a 10-20 per cent decrease in rainfall could result in a 20-40 per cent drop in water available for farming. Given that agriculture uses about 70 per cent of the country’s extracted water, this could have a significant impact on food production in the future, even taking into account advances in new technologies for agriculture. In (2007) the CSIRO and the Bureau of Meteorology projected that Australia’s agricultural productivity would decline by 17 per cent by 2050 due to climate change.

But drought is not the only factor. Loss of productive land to bio-fuel production, changing consumption patterns and financial speculation are also significant factors driving food price rises. But it’s not just food that is becoming more scarce. As climate change driven drought becomes more common in key food production areas and, driven by population increases, demand continues to rise farmers increasingly source their water from ground water aquifers. Further, there is a global problem of agricultural land degradation reducing food production capacity.

A reduced area of productive land threatens our capacity to feed a growing world population estimated to be over 9 billion by 2050. In his book ‘The Coming Famine’, Julian Cribb points out that of the 1.5 billion hectares of global farmland, a quarter is affected by serious degradation, up from 15% two decades ago. The seriousness of this is clear when we are told that the world demand for food is growing many times faster than the area of land being farmed.

Agriculture is Australia’s most extensive form of land use, occupying 60 per cent of the total land area (461 million hectares). Livestock grazing is by far the most extensive use of agricultural land, and areas of arid or semi-arid lands held under grazing licences make up 88 per cent of agricultural land use (406 million hectares) across the continent.Very few of Australia’s soils are naturally suited to agriculture, with most being shallow, high in salt stores and low in nutrients. Only 6 per cent of the land is arable without irrigation and large areas are naturally affected by salt, sodicity, waterlogging or acidity. In Australia, about two thirds of agricultural land is degraded. The major types of land degradation are soil erosion, soil salinity, soil acidity and soil contamination. The implications of this for food production are obvious.

But who knew that world-wide we are currently using ground water at 3.5 times the rate the aquifers can replenish themselves? Who knew that this over consumption occurs almost completely at a handful of large and very important aquifers on which 1.7 billion people are dependent for water? These aquifers are being depleted at between five and more than twenty times their replenishment rate. At this rate of consumption how long until they run out?

The Guardian reports: ‘The real threat to our future is peak water’. As population rises, over-pumping means some nations have reached peak water, threatening food supply. Another Guardian article quoting Lester Brown (see above) states:

“Wells are drying up and underwater tables falling so fast in the Middle East and parts of India, China and the US that food supplies are seriously threatened.”

None of these aquifers is in Australia but despite being one of the driest continents, Australia has the highest per capita consumption of water in the world. Some 70 per cent of this consumption is used to support agriculture. Average rainfall, at 469 mm/year, is not especially low, but only 12 per cent of this runs off to collect in rivers. River flow is also highly variable and these factors are exacerbated by a high degree of variability in climate.you might like to consider this evaluation of our groundwater prospects.

“Australia faces the twin problems of limited renewable water resources and economic scarcity exacerbated by the uneven distribution of water, relatively abundant in the less populated north but more scarce in the densely populated south, extraction of water for drinking and industrial use in cities can create pockets of economic water scarcity and for some cities such as Perth, rainfall run-off is projected to decrease which will result in further pressure on the water resources.”

“In the southern regions, irrigated agriculture draws large volumes of water from the Murray-Darling Basin which accommodates over 40% of the agricultural income, but where only 6% of the national run-off occurs. This has led to shortages in the past, for example in 2007 when water was reserved only for drinking supplies as the inflows of water to the basin fell to record low levels. This has serious economic impacts on the agricultural sector, as drought relief funds are needed to support farmers and maintain jobs.

“The situation has been exacerbated by extensive extraction for agriculture as infrastructure has blocked and diverted the flow. Extraction of water consumes a large proportion of the average flow, but because of the variability of the flow caused by the effects of the El Nino phenomenon, allocations can easily exceed the true flow of the rivers and existing caps on extraction are frequently exceeded. Reforms of the governance of the basin improved the situation and trading of water has allowed more efficient water use but has the potential to disadvantage small farmers and benefit large professionally run farms.”

– See more at: http://www.rtcc.org/australias-acute-water-shortages-mapped/#sthash.U4lVJCwX.dpuf

“Australia faces the twin problems of limited renewable water resources and economic scarcity exacerbated by the uneven distribution of water, relatively abundant in the less populated north but more scarce in the densely populated south, extraction of water for drinking and industrial use in cities can create pockets of economic water scarcity and for some cities such as Perth, rainfall run-off is projected to decrease which will result in further pressure on the water resources.”

“In the southern regions, irrigated agriculture draws large volumes of water from the Murray-Darling Basin which accommodates over 40% of the agricultural income, but where only 6% of the national run-off occurs. This has led to shortages in the past, for example in 2007 when water was reserved only for drinking supplies as the inflows of water to the basin fell to record low levels. This has serious economic impacts on the agricultural sector, as drought relief funds are needed to support farmers and maintain jobs.

“The situation has been exacerbated by extensive extraction for agriculture as infrastructure has blocked and diverted the flow. Extraction of water consumes a large proportion of the average flow, but because of the variability of the flow caused by the effects of the El Nino phenomenon, allocations can easily exceed the true flow of the rivers and existing caps on extraction are frequently exceeded. Reforms of the governance of the basin improved the situation and trading of water has allowed more efficient water use but has the potential to disadvantage small farmers and benefit large professionally run farms.”

The map below produced by risk analysts Maplecroft, highlights the acute water shortages the country faces – and maps these over mining operations across Australia. Secure access to water is crucial for the development of the mining sector. Australia has huge quantities of iron, nickel, opal, copper as well as uranium deposits. It’s also the world’s largest coal exporter – ahead of Indonesia and Russia – and the balance future governments will have to strike between coal production and water consumption is plain to see. No room for complacency here in the wide brown land either.

As if this was not already reason to get seriously concerned food production itself is negatively impacting on water quality. Not only is water availability decreasing but available water is being severely degraded by agricultural pollution.

Hedge fund manager Jeremy Grantham is one of the few leading financial figures who understands both global warming and growing food insecurity. In a worrying report he suggests:

“We are five years into a severe global food crisis that is very unlikely to go away. It will threaten poor countries with increased malnutrition and starvation and even collapse. Resource squabbles and waves of food-induced migration will threaten global stability and global growth. This threat is badly underestimated by almost everybody and all institutions with the possible exception of some military establishments.“

Food is already too expensive for many millions of people to be able to afford to eat every day and prices are rising. Aquifers on which more than a billion people depend both for food production and drinking water are being depleted at a frightening rate. Famine driven mass migrations are already a fact of life in sub Saharan Africa. These will only increase and spread through other poorer parts of the world.

Food security is also beginning to be a major issue for Australia’s most vulnerable citizens. A study by Gavin Dufty Manager of Policy and research for the St Vincent De Paul Society reveals that while the average Australian household spends between fifteen and sixteen percent of income on food Australia’s poorest are already using almost 20% of their weekly income to keep food on the table. A 2012 Anglicare study ‘When there’s not enough to eat’, the 12th edition of Anglicare Australia’s State of the Family report reveals that “In the 12 months up to Jun 2011 the price of food increased 6% with the bulk of the increase shown to be for fresh fruit and vegetables (35% increase in cost).”

This study’s findings compiled from surveys of people accessing emergency relief services across the Anglicare Australia network reveals a (to me shocking) tale of vulnerable Australians going without food because they can’t afford to purchase it.

Among the respondents to the report:

• 3 out of 4 adults regularly ran out of food in the last three months and could not afford to buy more.
• 73% of adults were cutting the size of meals and 62% were regularly skipping meals altogether.
• 1 in 3 adults regularly did not eat for an entire day.
• 65% of households with children said they regularly could not provide enough variety of food for their children.
• 38% said their children were regularly not eating enough and 29% of cases they said children were regularly going hungry.

The immediate source of the food insecurity experienced by this group is niggardly social security payments and the chief recommendation of the Report was that the Federal Government increase the Newstart Allowance and other allowance payments for single persons by at least $50 per week. Ironically (and cruelly) the response of the Gillard government desperately in pursuit of a budget surplus was to cut entitlements to this group of 80,000 Australians by $50. However this is another story. My point here is that driven by the same environmental and economic forces that are causing the food crisis in the ‘developing’ world Australian food price increases are outstripping increases in real income for most Australians. Only the poorest and most vulnerable are experiencing food insecurity yet, but inexorably we are sliding down the same slope towards food insecurity as our poorer less developed neighbors. As population rises, demand rises and productive land decreases food prices will rise and the pool of those affected will spread unless serious thought is devoted to the problem by our elected representatives. Now there is a problem worth some attention in Canberra.