Threats to Food Security Fall 2012 Lecture

Threats to Food Security Fall 2012 , Lecture 4

Food Crisis • Beginning in 2007, the world faced a food crisis • Food riots occurred in India, Mexico, and Yemen • In late October, the Russian government, hoping to ease tensions ahead of parliamentary elections early next year, announced a price freeze for milk, bread and other foods through the end of January • The principle cause was the rising price of oil, which had reached about $100/barrel near the end of the year 2

Food Cost Increases in 2007 • Inflation was driven by double-digit price hikes for almost every basic foodstuff § Dairy products prices rose as much as 200% in some countries § Maize prices hit a 10 -year high in February § Wheat was up 50%, rice up 16% and poultry nearly 10% • Retail prices are up 18% in China, 17% in Sri Lanka and 10% or more throughout Latin America and Russia. Zimbabwe tops the chart with a more than a 25% increase. 3

Biofuel vs. Food • Certain foods can be converted into biofuels, such as ethanol or biodiesel • Use of food for energy production drives up the price of food • World Bank’s food price index rose by 15% between October 2010 and January 2011, and was 29% above its level a year earlier • The quarterly increase was driven largely by increases in the price of sugar (20%), fats and oils (22%), wheat (20%), and maize (12%) 4

Maize (corn) • Maize prices have increased sharply and are affected by complex linkages with other markets • In January 2011, maize prices were about 73% higher than June 2010 - These increases are due to: § A series of downward revisions of crop forecasts § Low stocks (U. S. stocks-to-use ratio for 2010/11 is projected to be 5% the lowest since 1995) § Positive relationship between maize and wheat prices § The use of corn for biofuels 5

Use of Maize for Biofuel • Ethanol production demand for corn increases as oil prices go up, with sugar-based ethanol less competitive at current sugar prices • United States Department of Agriculture estimates show the share of ethanol for fuel rising from 31% of U. S. corn output in 2008/9 to a projected 40% in 2010/11 6

Impact of Rising Food Prices • World Bank estimates that the fourth quarter 2010 rise in food prices may have put 44 million people into poverty • 68 million people who fell below the $1. 25 person per day poverty line and 24 million net food producers who were able to escape extreme poverty, due to rising rice prices 7

Relation of Food and Petroleum Prices • Prices of oil affect food prices through: § Their effects on the prices of fertilizers § Their effects on transportation costs § Incentives for the diversion of food production into biofuels 8

Biofuels Animated Diagram • National Geographic Biofuels 9

Biofuel Sources • • Corn (maize) Sugar cane Jatropha Cellulose (crop residue) 10

National Corn Growers Association 11

Before Spin • “Ethanol production makes huge amounts of the nation’s corn disappear – some 1. 4 billion bushels went into ethanol production in 2004 – and that affects overall corn supply and helps shore up corn prices nationwide. ” • From NCGA website, July 2, 2005, as cited in “Thermodynamics of the Corn-Ethanol Biofuel Cycle” by Tad W. Patzek, Department of Civil and Environmental Engineering, University of California, Berkeley, page 2 12

Thermodynamic Analysis • Patzak concludes, “… the total energy inputs into ethanol production are equivalent to 4– 5 metric tonnes of gasoline per hectare • The ethanol’s calorific value is equal to 1– 1. 3 metric tonnes of gasoline. ” • This is based on an exhaustive analyses (96 page report) 13

Corn • Despite industry spin, corn is, at best, a marginal source for ethanol production • Ethanol has lower energy content per unit volume than gasoline, so a gallon of E 10 fuel does not propel a vehicle as far as a gallon of pure gasoline • Corn used to make ethanol converts 0. 5% of solar energy to fuel • Solar photovoltaic panels or solar thermal plants are about 15% efficient 14

Fuel Efficiency • “…vehicles will typically go 3– 4% fewer miles per gallon on E 10 than on straight gasoline. ” • “Flexible fuel vehicles operating on E 85 usually experience a 25– 30% drop in miles per gallon due to ethanol’s lower energy content” • From http: //www. fueleconomy. gov/feg/ethanol. shtml, “the official U. S. government source for fuel economy information” 15

• Interview with Mike Krueger, is the founder and President of The Money Farm • The Money Farm is a grain marketing advisory service located near Fargo, North Dakota, that works with individual farmers, country elevators and others associated with agriculture • He is a licensed commodity broker Mike Krueger Interview • This interview appeared on Oklahoma Horizon TV as Show 639, probably in 2007 16

Sugar Cane • Sugar cane has been used for ethanol production, starting in the 1970’s in Brazil • The ratio of output energy (renewable) to input energy (fossil) for sugar cane varies between are 8. 3 and 10. 2 • Both former presidents George W. Bush and Bill Clinton have endorsed the use of sugar cane for biofuel production • Clinton added a warning against deforestation, however 17

Jatropha • A plant native to Central America, which produces seeds which have long been used around the world as a source of lamp oil and soap • It is not a food crop, and can grow on eroded farmland or land considered non-arable for food crops • Jatropha seeds can be crushed to yield jatropha oil, which can be processed to produce biodiesel fuel suitable for use in a standard diesel car • The residue from crushing can be processed and used as biomass feedstock to power electricity plants or used as fertilizer 18

Jatropha Advantages • Can be ground on marginal land, not competing with food crops • Can be converted in very small scale plants to biodiesel fuel – say in a rural village § Grow crop § Press oil § Convert to biodiesel for use in village, with no transportation costs 19

Jatropha Drawbacks • Has not been domestically cultivated, although work is on-going in both China and India towards cultivation • Many species produce toxic compounds, and ingesting as little as three seeds of one species can be fatal 20

Cellulose • Plant residue is composed mainly of cellulose • Cellulose is an organic compound with the formula (C 6 H 10 O 5)n • It is a a polysaccharide consisting of a linear chain of several hundred to over ten thousand linked glucose units (the n in the formula) 21

Uses of cellulose • Cellulose is used to make paper and paperboard • It may be converted to cellophane or rayon • Research is underway to convert cellulose to cellulosic ethanol as an alternative fuel source • No cost effective method exists today • Cellulose offers a vast source of energy, if such a method is developed, so there is economic incentive • Cellulosic ethanol would not compete with food 22

Negative Impacts of Biofuel Production • Increased biofuel production is expected to have large impacts on biological diversity in the coming decades § Habitat loss mainly from cropland expansion will be most important impact • In Brazil, the planted area of sugar cane comprised 9 million hectares in 2008 (up 27% since 2007). • In Southeast Asia, palm oil expansion – for food and non-food purposes – is regarded as one of the leading causes of rainforest destruction • Two-thirds of the current expansion of palm oil cultivation in Indonesia is based on the conversion of rainforests, one third is based on previously cultivated or to-date fallow land 23

Negative Impacts, cont. § Increased invasive species and nutrient pollution. • Species and genotypes of grasses suggested as future feedstocks of biofuels may become critical as invaders § Nutrient emissions to water and air resulting from intensive fuel cropping will impact species composition in aquatic and terrestrial systems. § Modeling the future biodiversity balance for different crops on different land types has shown that GHG reductions from biofuel production would often not be enough to compensate for the biodiversity losses from increased land use conversion, not even within a time frame of several decades 24

Negative Carbon Offset • In a study by Lapola et al. , which appeared in PNAS, the authors conclude that, “The planned expansion of biofuel plantations in Brazil could potentially cause both direct and indirect land-use changes. ” § Biofuel plantations replace rangelands § Rangelands replace forest • Any resulting deforestation can offset carbon savings through biofuel use 25

Negative Carbon Offset 2 • Palm oil would cause the least land use change, and resulting negative carbon offset • Lapola et al. recommend that, “a closer collaboration or strengthened institutional link between the biofuel and cattle-ranching sectors in the coming years is crucial for effective carbon savings from biofuels in Brazil” 26

Bioethanol Production 27

Biodiesel Production 28

OECD-FAO Food Price Forecast • OECD-FAO Agricultural Outlook states that over the coming decade real prices for cereals could average as much as 20% higher and those for meats as much as 30% higher, compared to 2001 -10. 29

OECD-FAO Agricultural Outlook • The OECD-FAO Agricultural Outlook 2011 -2020 says, “Higher prices for commodities are being passed through the food chain, leading to rising consumer price inflation in most countries • This raises concerns for economic stability and food security in some developing countries, with poor consumers most at risk of malnutrition, the report says” 30

Agricultural Outlook Report • When inflation is factored in, the nominal prices – what people actually pay – will be still higher, making food bills yet harder to stomach. • “People are going be forced, either to literally eat less, or find other sources of income, " said Angel Gurría, the head of OECD • The world’s “slow growing” supply of food coupled with high demand will be to blame for the rising prices, according to the experts behind the report. 31

Voice of America Newscast • Aired 812 -12 32

KCCI Video • Video segment from Des Moines TV station, 8/6/12 33

Changing Dietary Preferences • Economic growth, urbanization and rising affluence are influencing diet preferences • Higher demand for § Convenient, processed foods § Meat § Dairy products • A western diet! 34

Malnourishment • Under eating, leading to starvation • Overeating, leading to obesity, diabetes, etc. • Increasing strain on health-care systems 35

Over-Indulgence and Waste • In 2007, the average American ate more than twice as much meat as the average Chinese resident • At the same time, consumers in rich countries waste almost as much food as the entire food production of sub-Saharan Africa 36

Different Patterns of Obesity • In the U. S. , seven of the 10 states with the highest poverty levels are also among the 10 states with the highest rates of obesity • In emerging countries obesity tends to be concentrated in the middle classes – those who lead more sedentary lifestyles and consume more processed foods. • Countries such as Mexico and South Africa are having to increasingly deal with problems of the over-fed at the same time as those of the under-fed. 37

Livestock • One kilogram of beef requires: § Twelve times the water needed to produce 1 kg of wheat § More than five times as much land 38

Protein Prices • Aired 8 -7 -12 • WTHI TV, Terra Haute, Indiana 39

Crop Yield and Fertilizer Input “Green revolution”: • High-yielding crop varieties • Chemical fertilizers • Pesticides Global Fertilizer use • Irrigation • Mechanization 40

Corn, Wheat Comparison • Recent increase in corn production due to use of corn for biofuel production • Input costs have been stable over the last 10 years, increasing with inflation; however, fertilizer has more doubled in price • Per acre, the cost of a nitrogen-based fertilizer is now almost double that of the seed cost • Why has fertilizer cost outpaced that of labor, machinery, land, and 41 seed costs?

Energy Costs of N-fertilizer • Production of 1 kg Nitrogen fertilizer requires an amount of energy equal to 1. 5 liters of diesel fuel (1) • The cost of natural gas now accounts for up to 90 percent of the cost of making nitrogen fertilizer, according to the U. S. Government Accountability Office (2) • Sources (1) and (2) are shown in lower pane (applies to all future presentations) 42

U. S. Food System • The US food production system uses about 50% of the total US land area, 80% of the fresh water, and 17% of the fossil energy used in the country • The heavy dependence on fossil energy suggests that the US food system, whether meat-based or plant-based, is not sustainable 43