The global food crisis won't go away any time soon. Capitalism has the average consumer by the belly. Amid growing signs of famine and outrage, the entire chain of commodities and resources of the world are now being cornered by giant corporations. Farmland, water, fertilizer, seed, energy, and most of the basic necessities of life are falling under corporate control, providing increased wealth and power to the ruling elite while the rest of humanity struggles.
Commodity scarcity in India was recently reflected in the need to distribute fertilizer from the police station in Hingoli. Now police have to control the lines that form outside of dealer outlets, because the dealers won't open for business otherwise. Without this intervention there would be no fertilizer for the planting that must take place before the rain comes. In Akola and Nanded, police involvement is also needed. Agriculture officers have fled their work places to escape angry farmers. In Karnataka, a farmer was shot dead during protests, while farmers stormed meetings and set up road blocks in other districts.
Despite the success of the genetically engineered Bt cotton crops, the trend in India is now back to soybeans because they cost less to grow and need less fertilizer than cotton.
And it's not just fertilizer that is scarce. Seeds are also in short supply which is being blamed on agitation that has interfered with freight train traffic. However, the shortfall in seeds is 60 percent, a level more indicative of corporate intervention to drive up prices than the actions of powerless farmers.
As farmers fume, the Wall Street Journal heralds the whopping 42 percent jump in the fiscal third quarter profits of huge agriculture giant Archer-Daniels Midland. This increase includes a sevenfold rise in new income in units that store, transport and grade grains such as wheat, corn and soybeans.
The soaring profits of fertilizer maker Potash Corporation of Saskatchewan are reflected in the parabolic movement of its stock price from a yearly low of $70.35 to its current price of $238.22 per share. Shares of fertilizer and animal feed producer Mosaic Corp. have risen from a yearly low of $32.50 to a current price of $159.38.
Similar windfall profits are reported by GMO seed and herbicide king Monsanto whose last quarterly earnings surged by 45%.
Some onlookers blame the financial speculators for driving up the prices of commodities related to agriculture as wealthy investors have piled on looking to cash in on the rising stock prices. And in many ways, today's commodity market resembles the dot.com boom seen at the turn of the century, as well as the housing boom now in the throws of its bust.
The Commodity Futures Trading Commission recently held a hearing to investigate the role that index funds and hedge funds are playing in driving up the prices of agricultural commodities. Total public fund investment in corn, soybean, wheat, cattle and hogs has risen by 37 billion dollars since 2006. This figure does not include the huge investments of hedge funds which don't have to make such disclosure. It also doesn't include the massive world wide investments in farmland made by the wealthy.
The corporate spin is that these investments are helpful to humanity because they will ultimately result in increased food production at a time of rising world demand. They cite the need for increased corporate profits to invest in and develop new technologies that will help farmers improve productivity. This is how GMO seeds are being driven down the throats of farmers, who are told that the modified seeds can squeeze even more yield from each acre of planting.
India has joined other developing countries in the decision to invest less in agriculture as advised by the World Bank-IMF, whose agenda has been to discourage crops for domestic consumption while encouraging production to spur export driven growth. This advice coupled with corporate sponsored deregulation has paved the way for corporate control of the farming process from seed to market. Research and development that was once the domain of universities has also fallen into corporate control.
Farmers in India are caught in a credit crunch. Even if they are able to get the needed fertilizer, they will not have the credit to pay for it. With no increase in farmer income, larger loans are not advanced. The outlook for the small farmer there is much the same as it was in the U.S. thirty years ago, during the height of the small farms falling to big agribusiness.
Corporations blame food shortages and rising prices on the people of China and India whose burgeoning income from manufacturing has allowed the average worker to increase both the amount and quality of his food consumption. But for the corporations, the increased demand for food is a guarantee of super profits to come.
Of course the other commodity you can't get along without is water, which is now the focus of huge multinational companies seeking to privatize water world wide, perhaps even patent it as Monsanto did with seeds. The fight over water may bring chaos, conflict and misery on a scale never seen before as corporations and governments go so far as to grab the wells from under people's houses.
And then there's oil. To produce chemical fertilizer you must make use of fossil fuel. So rising oil prices and rising food prices are joined at the hip. The behavior of corporations in the oil business has been so egregious that there is talk of a windfall profits tax here and abroad.
No, the food crisis will not go away anytime soon. North Korea, Burma and Western Sudan are currently feeling a real threat of starvation while western governments manipulated by corporations continue to promote the diversion of food into biofuels to further exacerbate the upward movement in food prices. Almost all U.S. corn production between 2004 and 2007 has gone into the production of ethanol. European production of ethanol has more than tripled during the same period. This has led to a fall off in grains relative to overall demand which is not a market phenomenon but is the direct result of the government sponsored, corporate backed programs. This comes at the expense of people looking for something to eat, particularly the world's poor who are now effectively priced out of the food market.
Barbara is a school psychologist, a published author in the area of personal finance, a breast cancer survivor using "alternative" treatments, a born existentialist, and a student of nature and all things natural.
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