New England Complex Systems Institute

Post image for Study Links Ethanol Policy to Food Price Increases, Mideast Turmoil

A report published in October 2012 by the New England Complex Systems Institute (NECSI) links soaring corn and agricultural commodity prices to food riots and turmoil in North Africa and the Middle East.

Although several factors may contribute to political unrest, acknowledge Dr. Yaneer Bar-Yam and two co-authors, “the timing of violent protests in North Africa and the Middle East in 2011 as well as earlier riots in 2008 coincides with large peaks in global food prices.” In poor countries with little or no local agriculture to “buffer” swings in global supply conditions, the central government “may be perceived to have a critical role in food security. Failure to provide security undermines the very reason for existence of the political system.”

In short:

When the ability of the political system to provide security for the population breaks down, popular support disappears. Conditions of widespread threat to security are particularly present when food is inaccessible to the population at large.

Soaring food prices triggered food riots in both 2008 and 2011.

Figure explanation (references omitted): Time dependence of FAO Food Price Index from January 2004 to May 2011. Red dashed vertical lines correspond to beginning dates of “food riots” and protests associated with the major recent unrest in North Africa and the Middle East. The overall death toll is reported in parentheses. Blue vertical line indicates the date, December 13, 2010, on which Dr. Bar-Yam and colleagues submitted a report to the U.S. government, warning of the link between food prices, social unrest and political instability. Inset shows FAO Food Price Index from 1990 to 2011. [click to continue…]

Post image for Do Biofuel Mandates and Subsidies Imperil Food Security?

Do biofuel mandates and subsidies inflate food prices? Do they increase world hunger ? There was a rip-roaring debate on the food security impacts of biofuel policies in 2007-2008, when sharp spikes in wheat, corn, and rice prices imperiled an estimated 100 million people in developing countries. Food price riots broke out in Bangladesh, Burkina Faso, Cameroon, Ivory Coast, Egypt, Indonesia, Mexico, Mozambique, Senegal, Somalia, and Yemen.

Experts attributed the rapid rise in food prices to several factors including high petroleum prices, drought in Australia, a weak U.S. dollar, commodity speculation, and rising demand for grain-fed meat by China’s rapidly expanding middle class. But some also laid part of the blame on biofuel policies, which artificially increase global demand for corn and soy while diverting those crops and farmland from food to fuel production. A July 2008 World Bank report argued that biofuel policies accounted for as much as two-thirds of the 2007-2008 price spike. A July 2010 World Bank report, on the other hand, concluded that rising petroleum prices were the dominant factor. “Biofuels played some role too, but much less than previously thought,” the report stated.

Where does the debate stand today? Recent reports by the National Research Council (NRC), the New England Complex Systems Institute (CSI), the UN Committee on World Food Security (CWFS), and Iowa State University (ISU) all acknowledge that biofuel policies put upward pressure on food and feed prices. The NRC and ISU studies argue that U.S. biofuel policies have only modest impacts on grain prices whereas the CSI and CWFS studies indicate that biofuel policies contributed significantly to the 2008 global food crisis and/or pose significant risks to global food security today.

Links to these reports and key excerpts follow. [click to continue…]