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PM appoints team to tackle looming food crisis

BY CONRAD HAMILTON Observer senior reporter hamiltonc@jamaicaobserver.com

Tuesday, August 28, 2012    

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THE Portia Simpson Miller Cabinet has established a committee to formulate Jamaica's response to the possibility of a significant increase in food prices, stemming from the severe drought affecting sections of the United States.

What has been described as the worst drought since the 1930s has been scorching crops and farmlands in US midwestern states, sending global corn and soybean prices soaring to record highs.

The drought has also contributed to an increase in overall food prices, a situation compounded by lower crop yields in other major grain-producing countries like Ukraine, Russia and India.

The United States-based International Food Policy Research Institute, which is supported by governments and international organisations, is indicating that the price of corn has now reached a record US$8.49 a bushel, a 57 per cent hike since early June.

Already, some countries are taking steps to monitor grain exports to ensure that their populations have ample supplies.

Last week, Russia — the world's third largest wheat exporter — admitted that a poor harvest will force it to considerably cut its foreign deliveries despite worrying spikes in global food prices.

The United Nations Food and Agriculture Organisation is also indicating that some entities, particularly companies involved in commodities trading, are trying to exploit the crisis.

That concern led the UN food agency and other aid agencies to lash out against the head of one of the world's leading commodities and agriculture companies after he declared that the current global food crisis has created an environment that is good for business.

"The environment is a good one. High prices, lots of volatility, a lot of dislocation, tightness, a lot of arbitrage opportunities. We will be able to provide the world with solutions... and that should also be good for Glencore," said the company's director of agriculture trading, Chris Mahoney in an article published last Thursday in the British newspaper, The Independent.

Following the controversial comment, the aid agencies explained that while the commodity trading companies will make huge profits, the poor, particularly those in developing countries, are likely to suffer.

Several international organisations, including the International Food Policy Research Institute, are also contending that the effect of the drought in the United States has been worsened by the reluctance of that country's Government to scale down its biofuel programme that diverts 40 per cent of its corn output to energy production.

In light of the uncertainties and the possible impact of the crisis on Jamaica, a source close to the Simpson Miller Administration told the Jamaica Observer that the prime minister has assembled a team comprising representatives of the ministries of agriculture, and industry, investment and commerce.

Contacted for a comment, Agriculture Minister Roger Clarke confirmed that a committee has been established and that the team also includes officials of the Ministry of Finance.

"Although the ministers are not there meeting with this committee on a daily basis, meetings have been held," said Clarke. "The committee is looking on the possibilities of forward buying, if that is possible. It is also looking at areas outside the US where you could get supplies; prices, as well as what can we do at the local level to mitigate some of those difficulties."

In relation to the spike in the price of corn, Clarke is encouraged by the decision of the Jamaica Broilers Group to venture into corn production in order to reduce the quantities imported to manufacture animal feeds. He added that another entity based in Westmoreland is also preparing 250 acres of land for corn production.

The Jamaica Agricultural Society (JAS) is also responding to the looming crisis and says it is encouraged by the Jamaica Broilers venture. According to JAS President Senator Norman Grant, the Jamaica Broilers Group will be planting in excess of 500 acres of corn locally. Grant said his association will be approaching the company to explore opportunities for local farmers.

"The JAS is hoping to do a national corn planting project. We want to see our Jamaican farmers going into corn planting again because there are marginal lands that are available that can do that. Over the next two months I will be engaged in discussions with companies such as Jamaica Broilers to see if we can have a relationship where the farmers can plant the corn and they buy it from these farmers," said Grant, who took over the presidency of the farmers' association earlier this year.

"Even though we are in a problem, we are looking at the opportunities that we could capitalise on to address the problem over the medium to long term," he added. "That is why we are focusing on national projects that will increase our production and productivity and have the ability to drive the food security strategy and result in the normalisation of prices over a long period of time."

Meanwhile, Grant noted that his association has been encouraging local farmers to resume peas production, and as part of that thrust will be distributing planting material to all JAS parish associations.

Many local farmers have not been engaged in peas production because of competition from cheap imports. However, with the drought affecting sections of the United States, the price of imported peas is also expected to increase.

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