George Bush has proposed spending an additional $US770 million in emergency food assistance to poor countries in response an impending international food crisis that has already seen rioting around the globe over rising food prices. These funds would increase total US food assistance to $US2.6 billion, however additional funds would not be available until the next financial year begining in October, not soon enough for many people. Global food prices have risen 43 per cent between March last year and this year.

While famines have killed many people during the last century, whether because of natural disaster such as through flood or drought, or the actions of tyrants, such as Mao’s Great Leap Forward, these food shortages have generally been relatively short-lived, and not had significant effects on a global scale. Recent food shortages which have seen rioting in Egypt, Yemen, Ethiopia, Cameroon, Bangladesh, Malaysia, Indonesia, Cote d’Ivoire, Mauritania, Mozambique, Senegal and Haiti, are believed by many to be the result of a range of deep underlying issues, that if not attended to could continue to place world food supplies in a precarious position indefinately.

According to hte US Commodity Futures Trading Commission, over the past 12 months the price of rice has risen by 122 percent, wheat by 95 percent, soybeans by 83 percent and corn 66 percent. The World Bank estimates that prices for all foods have risen 83 percent in the past 3 years. Behind this staggering rise is a multitude of factors, some of which can be remedied.

In Australia we have been hearing about the massive drought, that has decimated wheat harvests, meanwhile other recent droughts in places such as Russia, and East Africa are threatening the supply of food. Meteorologists in the United States also estimate that due to La Niña conditions there is a 68 percent chance of a below trend corn yield in the US in 2008. Many people also believe that climate change could have seriously alter the Earth’s climate, leading to more erratic weather conditions such as increased frequency of droughts and floods.

The growing middle class in China and India is another factor contributing to food shortages. As the population in China and India and other developing countries accumulate wealth their diets are changing to include more meat from grain fed live stock. Since it takes about 700 calories worth of animal feed to produce a 100 calorie piece of beef, this change in diet increases the overall demand for grains.

The price of oil is also pushing up the price of food. Oil is needed for the production of fertiliser, the running of farm machinery, and the transportation of food to consumers. With oiil over $100 a barrel food suppliers are facing increasing costs. “In addition to increasing food prices, we see at the same time farmers in developing countries planting less, producing less, due to the escalating cost of fertilizer and energy,” said U.N. Secretary-General Ban Ki-moon.

Moves in recent years to find renewable fuels has led to a growing interest in biofuels. Massive subsidies in the United States are largely the result of domestic political concerns. Purpotedly to promote energy independence and help limit global warming, appears to be simply wasting cropland. Even by optimistic estimates, producing a gallon of ethanol from corn uses most of the energy the gallon contains. it is estimated that filling the fuel tank of a standard four-wheel-drive with ethanol uses the same amount of corn needed to feed a child for a year. While producing ethanol from corn is an inefficient process, other options such as cellulosic ethanol may in the future prove to be good alternatives, although they still require land to be diverted from food production, and arable land is becoming a scarce resource.

Over the past three decades the amount of arable land worldwide has stagnated at about 1.5 billion hectares (3.7 billion acres). While new agricultural lands have been added in Russia and South America, more and more land is being lost to residential and industrial development in Europe and Asia. In China, eight million hectares of land under cultivation have vanished within a decade. This is compared to just under 12 million hectares of land used for agriculture in Germany.

Rough calculations by Lester Brown from the Earth Policy Institute in Washington found that in order to feed the addition to the world population each year would take 640 square miles of good farmland. This is roughly the size of greater London, or 18 million football fields. While tropical forests in Indonesia, the Congo, and the Amazon region are being chopped down for timber and farmland, desertification means that the amount of farm land around the world is actually shrinking.

The World Food Program currently faces a $755 million shortfall, however U.N. Secretary-General Ban Ki-moon suggested that African countries could double their food production over a very few years for a relatively modest $8 billion to $10 billion annually. Stating that focus should be placed on Africa in order to ensure long-term food supply. This investment money could be used to purchase farm equipment, fertiliser and other products to increase yields towards another ‘Green Revolution’. The U.N.’s Food and Agriculture Organisation has developed a $1.7 billion plan to provide seeds to farmers in the world’s poorest countries.

A major four-year U.N. Study by 400 scientists released recently called for a radical change in the way the world grows food. The report stressed the need for increased investment in agricultural science, education and training, which it claimed had been in decline.

A unique perspective is offered in a recent article in British current-affairs magazine the New Statesman, which puts a large part of the blame for the high prices of food on speculative investors. “The rocketing price of wheat, soybeans, sugar, coffee - you name it - is a direct result of debt defaults that have caused financial panic in the west and encouraged investors to seek ‘stores of value’.” The credit crisis is seen as the only real explanation for how incredibly quickly the crisis has arisen, particularly over the last 18 months. “The reason for food "shortages" is speculation in commodity futures following the collapse of the financial derivatives markets. Desperate for quick returns, dealers are taking trillions of dollars out of equities and mortgage bonds and ploughing them into food and raw materials. It's called the "commodities super-cycle" on Wall Street, and it is likely to cause starvation on an epic scale.” The credit crisis has seen debt defaults and financial panics, causing investors in the west to seek ‘stores of value’. This is a vicious cycle, as food commodity prices rise investors will be more likely to invest to seek profits from the rising prices. The falling value of the US dollar is seen as the result of the continuing interest rate cuts undertaken by the US Federal Reserve even in the face of rising inflation. If interest rates fall below the rate of inflation investors have to keep moving frunds from sector to sector creating bubbles.

European and US agricultural subsidies are also contributing to rising food prices and the destruction of small-scale farming in the South. Europe the US and other developed countries provide $1 billion a day in subsidies to their farmers while at the same time forcing countries in the developing world to open their markets. Farmers in developing countries can not compete and are therefore forced into poverty.

In response to the food crisis countries have begin placing restrictions on exports. Indonesia, India, Egypt, and Vietnam have curbed exports of rice, Kazakhstan, a major grain exporter suspended wheat exports until September, while Argentina , Russia and Ukraine have all announced restrictions on grain exports. Argentina the world’s third largest beef exporter has also placed restrictions on beef exports. While these actions are understandable in intending to secure domestic supplies and control rising prices, they could make the situation worse by reducing the supply of food to the international market. It is also feared that protectionism could affect production, the UK has responded by emphasisng trade as a more effective method for combating the crisis. Others feel that developing countries are justified in their actions as long as rich nations continue to provide massive subsidies to farmers. French Prime Minister Nicolas Sarkozy has made it clear he is keen to maintain EU subsidies at current levels.