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Surging food prices bite across Asia

Surging food prices bite across Asia
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First Published: Mon, May 05 2008. 12 03 PM IST
Updated: Mon, May 05 2008. 12 03 PM IST
Sydney: From the rice paddies of Asia to the wheat fields of Australia, soaring price of food is breaking budgets of the poor and raising spectre of hunger and unrest, experts warn.
Billion people in Asia are seriously affected by surging costs of daily staples such as rice and bread, the director general of the Asian Development Bank, Rajat Nag, has said.
“This includes roughly about 600 million people who live on just under a dollar a day, which is the definition of poverty, and another 400 million who are just above that borderline,” he said.
Globally, the World Bank last month estimated that 33 countries were threatened with political and social unrest because of the skyrocketing costs of food and energy.
Across Asia, workers made a campaign against high food prices their May Day battle cry last Thursday in marches through cities including the capitals of Indonesia, the Philippines and Thailand. While the demonstrations were mainly peaceful, concern is growing over the potential for political instability and unrest if high prices persist.
Second agriculture revolution needed
M.S Swaminathan, eminent farm scientist and architect of the 1960s “Green Revolution says that India needs a second agricultural revolution to boost food supplies or face huge social turmoil.
Experts blame high food prices on a confluence of factors, including increased demand from a changing diet in Asia, droughts, the rising use of crops for biofuels, and growing energy and fertiliser costs.
In Australia, which usually ranks second after U.S. as a global wheat exporter, several years of drought cut harvests to just 13 million tonnes last year from an average of 22 million tonnes.
So while consumers are struggling, Australian farmers are not getting rich on the backs of the poor, said National Farmers Federation chief executive Ben Fargher.
“It’s been the worst drought in our history and many, many farming families are under significant financial and emotional stress and it will take our communities a long time to recover,” he said.
Rich nations like Australia feeling the squeeze too
Even in a relatively prosperous country like Australia, people are feeling the squeeze in supermarkets, prompting the government to launch an inquiry into how to stem rising grocery prices.
Impact on other countries in the region
India: General strike against spiralling food prices paralysed Kolkata on 21April as thousands of police were deployed across West Bengal state to stop protests turning violent. New Delhi slashed food duties and banned exports of lentils and other staples, and has said it will not hesitate to further “sacrifice revenues to control prices,” according to finance minister, P Chidambaram.
Afghanistan: Mllions of Afghans are finding it “problematic” to meet their basic food needs with prices of staple, wheat, doubling in some areas over recent months, the World Food Programme(WFP) said. About 400 people demonstrated in eastern Afghanistan last month, blocking a key road linking the eastern town of Jalalabad to the capital Kabul and demanding the government step in to control prices at food markets.
Bangladesh: One of the world’s poorest nations, Bangladesh has been hit by a doubling in the price of the main staple, rice, in the past year and many low paid workers say they have been forced to make do on only one meal a day. Last month about 20,000 garment workers rioted near the capital Dhaka for higher wages to cover food prices.
Cambodia: Soaring rice prices have forced the World Food Programme (WFP) to indefinitely suspend a programme supplying free breakfasts to 450,000 poor Cambodian schoolchildren.
China: Chinese Premier Wen Jiabao told a meeting of the State Council last month that high prices were the biggest problem in the domestic economy.“The inflation is led by food price rises, which especialy hurt the poor,” said Ma Qing, a Beijing-based analyst with the CEB monitor group. “So the pressure (on maintaining social stability) is certainly quite large.” FM announced special 100% duty on exports of fertilizers and raw materials used to make them in order to ensure domestic supply over the ploughing season and “guarantee this year’s grain harvest”.
Indonesia: Anger over rising food prices was a focus for some 10,000 Indonesians who took to the streets in Jakarta during Labour Day rallies. High prices for rice, cooking oil and soybeans helped drive annual inflation rate to 8.17% in March.
Japan: In resource-poor Japan, which relies on imports for 60% of its food, companies hiked prices on everything from beer to beef, mayonnaise and “miso” paste made from fermented soy beans in recent months. Although Asia’s largest economy has been struggling for years to end deflation, rising food and commodity prices have not been welcomed because of the pain they inflict on small businesses and low-income households in particular.
Malyasia: Anger over rising prices was a major factor in March elections which saw the ruling coalition lose a third of parliamentary seats and five states in its worst results in half a century.
Nepal: Nepal last week banned export of grains as prices soared. “There is a high possibility of food crisis in a poor country like ours where domestic production is not enough,” said Hari Dahal, spokesman at the ministry of agriculture.
North Korea: North Korea’s food crisis has already seen people starve to death in remote rural towns. Also prices of staple foods have almost tripled last year.
Pakistan: Analysts say public anger over food shortages, particularly wheat flour for the staple roti bread, was a factor in the defeat of President Pervez Musharraf’s allies in elections in February.
South Korea: Rising rice prices abroad have almost no impact on South Korea, which imports less than 5% of its annual consumption and heavily subsidizes its rice farmers.
Singapore: Singapore is the wealthiest economy in Southeast Asia but charities say inflation is driving more people to join queues for free meals. Consumer price inflation reached 6.6% in Jan-Feb.
Taiwan: Taiwan is self-sufficient in rice. so international prices have no impact. However, domestic rice prices hit a 26-year high earlier this year due to typhoons affecting the harvest.
Thailand: In Thailand, export and domestic rice prices have risen about 50% in a month. Some farmers have taken to farming themselves and staking out their fields at night to protect their precious crop from rice thieves.
In a phrase particularly chilling for Asia, the World Food Programme has described rising food prices as a “silent tsunami”.
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First Published: Mon, May 05 2008. 12 03 PM IST