Food Supply and The Global Food Market

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FOOD SUPPLY AND THE GLOBAL FOOD MARKET. Worldwide, the food supply available to people depends on a variety of environmental, technical, and sociopolitical factors, the relative importance of which have varied considerably in time as well as geographically. Environmental factors have governed food production and availability throughout history, and this remains so for many societies. However, in a world where food is abundant as never before, food supply is extremely vulnerable to economic and political interests, as well as technical factors, such as transportation and communications.

Food Supply through the Ages

Before the advent of agriculture and the domestication of animals (c. 10,000 B.C.E.), hunting, fishing, and gathering provided enough food for small groups of people such as bands of wanderers. Along with agriculture came a sedentary way of life, and self-sufficient agricultural settlements appeared in every region of the world. In this type of environment, food supply was direct and immediate. Careful management of produce ensured the survival of every household member until the next harvest. Except for times of warfare or environmental calamities, the balance between food demand and food supply remained fairly stable. Though hunting and gathering societies are almost extinct today, agricultural villages still endure in many parts of the world.

As some of these villages grew into towns, however, things began to change. Societies became more complex as certain groups of people ceased to be directly involved in the production of food. Food supply and distribution became dependent on an increasingly complex set of relations among groups of different professions and ranks. Surplus food (mainly grains) was traded with neighboring settlements. Concentrated in a few hands, food became a means to political power.

The growth of empires is associated with the emergence of a professional specialist, the merchant, who ventured into new territories exchanging food and other goods across borders, often between far-off places. Food began to be regarded as a commodity subject to the rationale of profit, and it eventually became the responsibility of the state to ensure an adequate food supply for its citizens.

The Industrial Revolution of the late eighteenth century was also an agricultural revolution that dramatically changed the way food was to be produced, distributed, and used in most of the world. Farming, fishing, and other food-production activities became large-scale enterprises, organized according to the principles of maximum productivity and maximum profit. Capital-intensive agriculture produced surpluses of a magnitude never before possible. The modernization of transport and communications, and the emergence of food-processing and food-packaging industries, made it possible to extend food trade on a global scale. In urban centers, supermarkets can offer not only frozen and packaged food, but also fresh produce year-round from all over the world. For some this increased food supply has created a sense of plenty, albeit a localized and exclusive one.

Food Supply as a Political Weapon

In the twentieth century, food supply came under the rules of a new political and economic order. Large food stocks have proved to be one of the main geopolitical assets of rich nations. Most affluent countries are or have been large exporters of food, and they control the global food market to their advantage. Food prices are set at the major stock exchange institutions in North America, Europe, and Japan. In competing for the hegemony of the global food market, the United States, the world's main food exporter, has been engaged in "food wars" with Japan and the European Union. International organizations, such as the recently formed WTO (World Trade Organization), have been created to defuse these conflicts, as well as to balance the "market distortions" that affect less powerful nations.

The global food market is dominated by the most affluent countries, which, on average, have controlled almost 70 percent of the total value of imports and over 62 percent of the total value of exports of all agricultural products in the world since 1961 (see Table 1). During the last quarter of the twentieth century, these countries have been reducing the value of their imports while expanding the value of their exports. Food imports by these countries typically concentrate on specialized agricultural items, such as tropical fruits and selected vegetables, as well as coffee, tobacco, sugar, and tea, none of which is a staple in its place of origin. In order to meet the domestic demand for staples, many of the exporting countries of such products have to import large quantities of basic staples in exchange. From 1961 to 2000, the countries of Africa and Latin America increased more than eight times their imports of cereals, those of Asia more than four times, and those of Oceania more than five times.

Main importers and exporters of total agricultural products, 19612000
(Value of imports/exports in US$1,000)
Countries 1961 1970 1980 1990 2000 Decadal average
Germany 4,191,324 7,214,668 27,890,046 38,652,300 34,488,729 22,487,413
United States of America 3,836,796 6,301,029 18,410,350 27,088,094 44,949,426 20,117,139
Japan 2,022,576 4,140,227 17,747,335 28,659,121 36,153,814 17,744,615
United Kingdom 5,362,951 5,776,370 16,309,835 22,952,289 25,877,168 15,255,723
France 2,125,596 3,262,917 14,867,182 22,613,082 23,224,627 13,218,681
Italy 1,450,729 3,386,200 14,856,545 23,651,782 21,608,095 12,990,670
Netherlands 949,437 2,121,927 11,637,467 17,962,752 16,218,531 9,778,023
USSR 1,380,364 2,478,054 17,643,338 19,714,301 0 8,243,211
Belgium-Luxembourg 823,180 1,657,552 8,247,905 12,547,486 15,484,230* 7,752,071
China 759,895 890,765 7,984,003 9,791,156 15,349,290 6,955,022
Canada 806,618 1,261,845 4,602,644 7,100,642 11,441,510 5,042,652
Spain 350,254 852,784 4,391,220 8,039,331 10,541,845 4,835,087
United Arab Emirates 3,752 31,980 1,077,403 1,692,884 18,705,047 4,302,213
China, Hong Kong SAR 349,333 671,188 3,161,775 6,821,872 8,485,711 3,897,976
Korea, Republic of 87,280 438,935 3,303,414 6,459,074 8,297,395 3,717,220
Total 24,500,085 40,486,441 172,130,462 253,746,166 290,825,418 156,337,714
World total 34,748,770 56,630,704 255,355,968 353,147,624 447,497,428 229,476,099
% of world total 71 71 67 72 65 68
Countries 1961 1970 1980 1990 2000 Decadal average
United States of America 5,187,350 7,507,566 42,921,186 45,210,987 56,479,900 31,461,398
France 1,246,491 2,962,836 18,519,111 33,432,321 33,390,182 17,910,188
Netherlands 1,267,473 3,149,676 16,091,315 30,927,503 27,884,332 15,864,060
Germany 388,354 1,362,708 11,021,979 20,374,986 24,147,297 11,459,065
United Kingdom 983,067 1,420,838 8,242,790 12,766,968 16,684,026 8,019,538
Australia 1,558,811 2,333,963 9,216,112 11,749,559 14,698,447 7,911,378
Canada 1,260,268 1,815,641 7,071,758 9,181,264 15,684,949 7,002,776
Italy 701,212 1,219,583 5,677,448 11,134,930 15,603,562 6,867,347
Brazil 1,169,525 1,946,375 9,320,492 8,763,781 12,761,338 6,792,302
China 380,869 1,147,785 4,554,142 10,207,810 13,076,473 5,873,416
Spain 375,823 767,164 3,566,320 7,825,934 13,999,088 5,306,866
Argentina 906,064 1,498,609 5,518,628 6,976,824 10,776,094 5,135,244
Denmark 826,872 1,191,745 5,222,539 8,290,189 8,788,582 4,863,985
Belgium-Luxembourg 341,240 1,095,694 6,369,385 11,787,599 17,619,979 3,918,784
Thailand 392,234 493,986 3,344,140 5,387,818 7,273,564 3,378,348
Total 16,985,653 29,914,169 156,657,345 234,018,473 288,867,813 145,288,691
World Total 32,217,186 52,075,640 234,255,267 326,243,879 410,548,587 211,068,112
% of world total 53 57 67 72 70 69
*Addition of data for Belgium and Luxembourg
source: Food and Agriculture Organization of the United Nations (FAOSTAT, on-line May 2002.

Since the end of World War II, the global supply of cereals, the basic staples for most of humanity, has largely depended on the production and export capacity of some fifteen countries. In 1999, major cereal exporters held close to one-half of global cereal stocks (Food and Agriculture Organization of the United Nations, 2002; hereafter FAO). In the year 2000, the four largest cereal exporters, the United States, France, Canada, and Australia, produced over 495 million metric tons of cereals (wheat, maize, rice, sorghum, oats, and others), which amounted to 24 percent of the total world production, and exported 164.8 million metric tons of cereals, 61 percent of the total world exports of cereals for that year. However, in past decades this proportion had been much larger, reaching as much as 78 percent in 1980 (see Table 2).

In addition to trade, food transfers between main producers and main consumers include "food aid." Between 1970 and 2000, more than 336 million metric tons of cereals were shipped as food aid to countries in need.

Main cereal exporters, 19612000 (Qty., Mt)
Countries 1961 1970 1980 1990 2000
World Total 79,466,691 114,423,775 223,191,018 226,234,678 272,236,822
United States of America 31,796,032 40,406,383 112,905,797 92,615,939 87,358,248
France 4,180,590 10,283,517 19,637,116 30,897,774 32,746,384
Canada 12,112,152 14,896,455 21,866,888 23,092,252 22,885,090
Australia 6,205,202 8,357,127 19,466,766 15,013,192 21,819,313
Total 4 54,293,976 73,943,482 173,876,567 161,619,157 164,809,035
% of world total 68 65 78 71 61
Argentina 3,643,362 10,217,977 9,909,358 10,442,436 23,728,443
Germany 1,256,903 2,893,628 2,414,667 4,732,186 14,391,914
China 222,434 1,720,698 1,514,152 4,202,888 13,952,775
USSR 7,844,833 6,913,415 2,286,962 1,539,083 0
Thailand 2,140,932 2,517,588 5,158,421 5,280,948 6,206,293
United Kingdom 180,439 269,335 2,796,403 6,610,689 5,429,248
South Africa 1,181,180 1,299,770 3,780,404 2,229,861 632,776
Netherlands 304,489 1,479,634 1,659,856 4,225,808 1,214,274
Italy 284,749 1,385,875 1,845,074 2,435,261 2,179,490
Denmark 141,553 351,483 1,139,087 3,250,496 1,974,970
Belgium-Luxembourg 78,846 887,484 3,366,919 2,199,432 2,827,038*
Total 15 71,573,696 103,880,369 209,747,870 208,768,245 257,346,256
% of world total 90 91 94 92 87
*Addition of data for Belgium and Luxembourg
source: Food and Agriculture Organization of the United Nations (FAOSTAT, online, May 2002.

Over half of these shipments came from the United States alone. In 1990, the United States donated 7.2 million metric tons of cereals, 43.3 percent of which went to African countries, 21 percent to Latin American countries, and another 21 percent to countries in Asia. Despite its humanitarian character, food aid can also be used to the advantage of food donors through the conditions that may be attached to shipments and the adverse effects that these shipments may have on the domestic markets of the recipient countries (Mittal, 2002).

Food power has been used directly to pressure nations for a desired change of policy. In the second half of the twentieth century, food sanctions were applied against a handful of countries for a variety of purposes. For example, the United States embargoed a number of nations including Cuba, Iraq, Iran, Libya, and Sudan, impeding or severely restricting food trade between the United States and those countries.

Food Supply in the Twenty-First Century

In the twenty-first century, the food supply is conditioned by the rules of the global food market and global geopolitics, which affect decisions concerning the production and distribution of food at the national and local levels. The effective demand (purchasing power) of high-income buyers has precedence over the real demand of the nutritional needs of populations. For most people on earth, access to food depends on access to money and, for some, on access to charity, and the expansion of agribusiness to the countries of the so-called Third World has seriously affected these countries' self-sufficiency in food. Food trade and food markets have become subject to rules over which the majority of farmers have no control, and this has serious implications for the livelihoods of entire populations.

In the large urban centers of the world, the regular supply of fresh produce concentrates in the expensive supermarkets of wealthy neighborhoods, while a large proportion of the population can go without enough to eat. Lack of access to food leads to undernourishment, a problem that affects more than 800 million people in the world, including many living in the rich, food-exporting countries.

Food supply has become subject to a complex set of interests that governments are finding increasingly more difficult to mediate. Cereal stocks at the global level seem to have begun a diminishing trend due to an overall decline in production and an overall increase in utilization. Estimates for the year 2000 indicated an expected 4 million tons, down from the opening levels (FAO, 2000).

Though the per capita supply of cereals has been growing steadily since 1961 in most regions of the world, food shortages afflict a large number of countries. In 2002, the FAO reported that a state of emergency existed in the food-supply systems of as many as thirty-four countries on four continents, including Europe (FAO/ GIEWS, 2000). One of the factors that adversely affects real food supply per capita in many countries is the utilization of cereals as animal feed, which in 1999 amounted to 35.1 percent of total world cereal stocks (Faostat, World Food Balance Sheet, May 2002). Unless local small-scale production for self-consumption is protected and encouraged, continuous and adequate access to food cannot be guaranteed for the rural populations of the world. With rural-urban migration on the rise almost everywhere, the majority of populations in the world will soon be concentrated in cities, contributing to the expansion of already impoverished slums.

A series of fundamental changes in global trade and the international financial system is in order if food security for all is ever to be attained. In this regard, the efforts of civil organizations fighting for fair trade and a more egalitarian world society are crucial.

See also Food Supply, Food Shortages; Political Economy.


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