There has been a great concern worldwide about the high increase in prices of essential foods. The high increase in food prices has been caused by low supply of basic foods. In order to ensure that there is enough supply of basics foods such as rice, wheat, soya and maize to meet the local and international demand, the congress should offer farmers incentives such as reduced prices for fertilizers as well as other farm inputs to encourage more farmers to plant basic foods.
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The economic effects of food crisis are great. For example, food shortages force the government to spend is a lot of its revenue in importing basic foods in order to meet the demand for its residents. However, subsidizing farming of basic foods will motivate more farmers to shift their farming from cash crops farming and particularly agro-fuel farming to embark on planting maize and wheat for local consumption as well as for export.
Through this strategy the government will save a lot of its resources in buying rice, maize and wheat for its population. In addition, the government will earn a lot of revenue from the maize and wheat imported to foreign countries.
In 2007/08 there was a great food crisis that resulted to high increases of prices of basic foods such as rice, soya, wheat and maize. The food crisis resulted to hunger of approximately 925 million people as reported by United Nations Food and Agriculture Organization (FAO). In 2007 prior to the food crisis, it was estimated that those people who were suffering from malnutrition was 850 million.
The number increased by 75 million in less than a year to a high of 925 million people by 2008. According to the current high rate of increase food shortage, it is estimated that by 2017, the number of those suffering from malnutrition will reach a high of 1.2 billion. It is believed that the current high shortage of basic foods is directly or indirectly affecting over half of the population worldwide.
A study conducted by FAO in 2009 indicated that the increase of prices of food have not stopped and are likely to escalate in the near future. The study revealed that food price index increased by 12% in 2005 to 2006 by 24% between 2006 and 2007 and by 50% in January and July 2008. A similar study conducted by World the same year showed that high fluctuation of prices of essential foods in the world.
In addition, it indicated that prices of basic foods have increased by over 83% in the past three years. Moreover the study indicated an increase of over 130% in the price of wheat, 87% increase in the price of soya and an increase of 74% and 31% in the prices of rice and maize respectively. The study predicated a continual rise in the prices of basic foods a condition that conceptualized to greatly affect poor countries (Vivas 130).
There are various reasons that explain the current great shortages in food supply. One of the reasons given is the current changes of climate in China, Australia as well as Bangladesh which are the main producers of basic foods. Another reason that has also contributed to global food shortages is the adoption of fast foods which has made people to increase their consumptions of meat mainly in Asia and in countries of Latin America.
The high adoptions of fast foods have resulted to most of available arable land being dedicated for keeping animals and birds to address the current high demand for meat. In addition, some of the available lands for agriculture have been dedicated for growing animal foods to supply the foods that are required for fattening of livestock.
This has resulted to importation of cereals by countries such as China or India that were previously self-sufficient in basic foods. These countries are densely populated which has increased the international demand for basic foods resulting to global escalation of food prices (Davis 45).
The 2007/08 food crisis was worse because of high prices of oil that resulted to a high increase in the prices of fertilizers and transports associated with food systems. Many farmers and mainly in the United States as well as in Brazil opted in production of plants for alternative fuels instead of planting basic foods. The United States, European zone as well as Brazil have subsidized the production of agro-fuel in response to oil shortages as well as a strategy to minimize green gas emissions.
However, the production of green fuel brings a competition to the production of food. In the United States of America, over 20% of the cereal produced in 2008 was used in making ethanol. Therefore as much as it is important for the United States of America to focus on changing its productions from heavily relying on fossil sources of energy to adopt alternative sources of energy that are more environmental friendlier, it is equally important for it to consider the resultant economic consequences that accompany such a move.
Instead of the United States concentrating on agro-fuels for the production of alternative fuel that is threatening production of sufficient basics foods, it should opt mainly in concentrating on developing solar energy that is equally environmental friendly like agro-fuels.
The price of a commodity is directly related to supply. Economist posit that the high the supply the lower the prices and vice versa. Thus, the United States of America should take this opportunity and develop its local food production to stop overlying on international markets for food supply.
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Farmers in the United States of America should be supported adequately through subsidization as well as being offered good prices for their foods in order to enable the country to produce adequate foods for its population as well as to earn foreign exchange through exportation of the surplus. This would entail increasing investment in the production of basic foods such as soya, rice, wheat as well as maize.
Public policies should be formulated in a manner to promote the production of indigenous foods which are sustainable, organic as well as free from chemicals and pesticides. Thus, the United States should adopt agro-ecosystems as well as biodiversity which are endangered by the modern methods of agriculture (Stevenson 90-101).
In the United States of America there is a need for changing the nature of the current political as well as economical institutions. This will be imperative in achieving a new model of development that will ensure sustainable and ecological growth. The transformation will entail an end in the current processes of production, distribution as well as consumptions of foods.
This will only be realized by engaging all concerned stakeholders to change the existing political, economical as well as social barriers that will ensure that the United States of America is self-sufficient in food supply and has surplus for export to enable it earn foreign exchange to improve its economic performance. Therefore, the congress should enact appropriate policies to support production of basic foods.
Davis, James. Causes and Effects of Food Crisis. New York: Prentice Hall. 2010, print.
Stevenson, Amos. Agro-Fuel Farming. New York: Prentice Hall. 2009, print.
Vivas, Esther, “Food Crisis: Causes, Consequences and Alternatives.” International View Point. 2009. Web.