Panic buying can dramatically impact prices. Fatima Al Mutawa / The National
Panic buying can dramatically impact prices. Fatima Al Mutawa / The National

Natural disasters could make food market volatile



WASHINGTON // Bad weather, growing demand and market speculators drove up the price of food in 2010 and the cost may well keep rising, analysts say.

Experts are warning that further food-supply disruptions this year could trigger more price rises around the world and in Arab regions.

Analysts say countries need to develop strategies to dramatically increase global food production to meet the growing challenges of increased demand in developing nations, population growth and global warming.

For now, rice and wheat prices are still below the peaks of 2007-2008, and while Algerians took to the streets on Sunday over rising prices, the unrest has yet to become as widespread as in 2008, when riots erupted in 32 countries. If there are no major supply disruptions this year, the market should stabilise and prices gradually fall.

Much depends, however, on how global food production fares this year. Last year, prices rose when drought and fires caused Russia to suspend its wheat exports.

The floods in Queensland, Australia, are driving prices up, and the country has cut its forecast for sugar and wheat exports. With political instability in some countries in Africa and South America, drought in Argentina and flooding in India and Pakistan, the food market looks volatile and prices are likely to remain high over the next several months.

"Markets behave on news a lot of the time," said Julian Lampietti, programme co-ordinator for agricultural and rural development at the World Bank's Middle East and North Africa division.

Mr Lampietti said last year's food price rise came in part as a response to predictions that yields were going to decline, predictions that did not factor in stocks that had been amassed since the 2008 crisis and that helped mitigate the rise.

Panic buying can dramatically impact prices, affecting poorer countries and those that rely mostly on imported food, such as in the Gulf and Arab countries generally.

The Arab world as a whole imports more than 50 per cent of the calories their populations consume, according to the World Bank. That figure is much higher in the drier Gulf countries, where less water means less domestic agriculture and greater wealth means greater demand.

Experts say there is no easy answer to improving food security in Arab countries absent a comprehensive strategy that not only addresses supply-side issues but also addresses environmental factors to mitigate the effect of climate change and tackles consumer behaviour by providing better nutritional education, family planning and social safety nets.

By 2050, according to a December study by the International Food Policy Research Institute (IFPRI), the price of maize could rise by 42 to 131 per cent, rice by 11 to 78 per cent and wheat by 17 to 67 per cent.

Gerald Nelson, co-author of the report, said: "Only with a comprehensive effort to increase global productivity, developing agriculture in poorer countries, improving infrastructure and technology, increasing water yield and investing in genetically modified crops is it possible to avoid a major food crisis by 2050.

"Beyond that, once you get to 2100, if we don't put some downward pressure on greenhouse-gas emissions so that the temperature increases aren't as great as currently predicted, I am a lot more pessimistic about the ability to deal with this."

The key aim for Gulf countries and others that rely on imported food is to diversify and look at the broader global food infrastructure, said Mr Lampietti.

"Maybe you're better able to address your food security issues by owning the assets that actually handle all the food and being involved in the global trade itself," said Mr Lampietti. "Focusing on supply chains and systems that enable you to bring food into your country in times of crisis is a very good solution. And the idea of owning or buying the biotechnology around the production is another very interesting way [Gulf countries] could use their capital to have more influence on global food markets."

Buying up agricultural land in other countries is valuable as a development strategy, Mr Lampietti said, insofar as it contributes to the development of agriculture in those countries. But in a time of crisis, it might not be of much use.

"Acquiring land in other countries is always an iffy thing," said Mr Nelson. "Because just as the Russians said 'we are going to ban exports of wheat this year because we have a problem', why couldn't Tanzania do that in a crisis, even if the land was owned by the Emirates?"

One of the greatest threats to food price stability generally is export bans such as the ones witnessed last year in Russia and Ukraine.

Last week, Caroline Spelman, the UK's environment minister, said it should be illegal for countries to halt food exports even at times of national crisis.

But multilateral agreements to regulate the international agriculture trade are difficult to reach, and is one of the main reasons the World Trade Organisation's Doha Development Round has reached an impasse. Those talks seek to lower barriers to trade worldwide. They have been stalled since 2008, with agriculture proving one of the most divisive issues.

"The first best thing that Gulf and other countries could do is make sure that the Doha round gets passed," Mr Nelson said. "What that does is it makes it more politically challenging for countries to do what Russia did, which was to ban wheat exports. Countries will do that even if they sign some international agreement, but it makes the political cost of doing so higher."

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE. 

Read part four: an affection for classic cars lives on

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative 

COMPANY PROFILE

Company name: Revibe
Started: 2022
Founders: Hamza Iraqui and Abdessamad Ben Zakour
Based: UAE
Industry: Refurbished electronics
Funds raised so far: $10m
Investors: Flat6Labs, Resonance and various others

Where to donate in the UAE

The Emirates Charity Portal

You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.

The General Authority of Islamic Affairs & Endowments

The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.

Al Noor Special Needs Centre

You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.

Beit Al Khair Society

Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.

Dar Al Ber Society

Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.

Dubai Cares

Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.

Emirates Airline Foundation

Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.

Emirates Red Crescent

On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.

Gulf for Good

Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.

Noor Dubai Foundation

Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).

Green ambitions
  • Trees: 1,500 to be planted, replacing 300 felled ones, with veteran oaks protected
  • Lake: Brown's centrepiece to be cleaned of silt that makes it as shallow as 2.5cm
  • Biodiversity: Bat cave to be added and habitats designed for kingfishers and little grebes
  • Flood risk: Longer grass, deeper lake, restored ponds and absorbent paths all meant to siphon off water 
Key developments

All times UTC+4

The years Ramadan fell in May

1987

1954

1921

1888

Maestro

Director: Bradley Cooper

Starring: Bradley Cooper, Carey Mulligan, Maya Hawke

Rating: 3/5


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