Resources Research

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Posts Tagged ‘hunger

What the WTO-FAO alliance on food portends

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Campaign material by GRAIN and Via Campesina to stop seed laws that criminalise farmers and to defend local seeds.

Campaign material by GRAIN and Via Campesina to stop seed laws that criminalise farmers and to defend local seeds.

A convergence that the agri-business multinationals have long looked for is now beginning. The UN Food and Agriculture Organisation – whose constitution includes “bettering the condition of rural populations” as one of its four main purposes – has joined forces with the World Trade Organisation, whose concern for rural populations is precisely zero.

Both organisations call it a collaboration, but that term is a smokescreen. The FAO is technically being run under the supervision of its eighth director-general (since 1948; their tenures are far too long and Asian and South American members especially ought to have corrected this error long ago). José Graziano da Silva, the number eight, has since 2013 increased the pace at which the FAO also collaborates with the private sector – which means the international grain traders, the agricultural commodity cartels, the food and beverage multi-nationals, and last but not least the exceedingly powerful agricultural biotechnology corporations.

The WTO has described the new alliance as a “step up” on the issue of “trade and food security, as well as other issues”. The first item of collaboration by the trade body with the FAO will be to participate in the annual State of Agricultural Commodity Markets report, which this year will focus on trade and food security, and which the WTO has mischievously described as “the FAO’s flagship publication”. It isn’t, for the FAO’s State of Food and Agriculture is the flagship report, but that misappellation is a sign of the changes to come.

Grain_defend-local-seeds_201503_2What is being sought, from the WTO point of view, is “evidence and greater clarity on a range of issues related to trade and food security”. This is ingenuous, for the WTO’s ‘greater clarity’ has only meant more trade, justified with make-believe macro-economical models that pretend trade is good for low income consumers and smallholder farm producers alike, and to ignore ground truth. For the FAO on the other hand, ‘greater clarity’ on the question of food and trade has long been available in-house in the form of the food balance sheets maintained for every country in FAOstat, which is the voluminous FAO database.

But the tone is being set by the WTO, which has said: “Considering the important role of open and strengthened food markets in supporting food security objectives, the two directors-general discussed how trade and the multilateral trading system could help in creating a more favourable global environment for food security and sustainable agriculture.” It obviously doesn’t occur to WTO Director-General Roberto Azevêdo and his secretariat that ‘the multilateral trading system’ and ‘sustainable agriculture’ are fundamentally incompatible.

The FAO’s description of its new alliance is couched in milder terms. The organisation has said the collaboration offers “mutual assistance on critical themes such as the functioning of international grain markets” but also invokes “evidence and greater clarity” on “the governance of trade flows and the pursuit of broader food security”. FAO has resorted to using the non sequitur that food security is closely linked to trade and therefore this alliance is important. As with the WTO, internal contradictions don’t matter – if FAO is discussing smallholder family farms, then food security doesn’t include trade; if FAO is discussing organic cultivation, then food security doesn’t include trade. But under an alliance with WTO, unquestionably it does.

Grain_defend-local-seeds_201503_1FAO Director-general José Graziano da Silva has insisted that “food security and trade can together play a very important role to help fulfil FAO’s mandate”. What part of the mandate could be ‘helped’ by this alliance? The FAO member states are committed under its constitution to (1) raising levels of nutrition and standards of living of the peoples under their respective jurisdictions; (2) securing improvements in the efficiency of the production and distribution of all food and agricultural products; (3) bettering the condition of rural populations; and (4) contributing towards an expanding world economy and ensuring humanity’s freedom from hunger.

If called upon to do so by FAO member states – and I wish the G77 would summon up the critical voice to do so – the new alliance will probably be explained by the WTO and FAO as helping to fulfil the second and fourth objectives. Thus ‘improving the distribution’ of food and contributing to ‘expanding the world economy’ is what the alliance will use to show that the FAO’s mandated objectives (problematic as hey are already) are being followed.

What could the immediate implications be of the WTO now having a hand in setting the FAO’s ‘development’ agenda concerning the production of food staples and their use? Here is a short list:

1. The FAO overtly supporting the push, through the WTO, by the USA and other major grain exporting countries, for developing countries to increase their ‘trade facilitation’ measures – which means their physical and policy readiness to receive grain and manufactured food, no matter what the cost is locally.

2. This push will become stronger and energetic very quickly. So far, the Bali decision on public stockholding for food security purposes is to remain in place until a permanent solution is agreed and adopted. The WTO, the USA and the European Union want negotiations (which in their parlance means that all other countries accept their proposal) to be agreed to and adopted by 31 December 2015.

3. The new WTO-FAO alliance will immediately start exerting pressure on India, countries of the South and the G77 on Bali decisions concerning agriculture: tariff-rate quota administration, export competition and phasing out of cotton subsidies.

4. The FAO using trade-related arguments to defend the unacceptable biases in the existing WTO Agreement on Agriculture, and to beat down the developing countries stand (taken at the Bali ministerial meeting of the WTO in 2013) on the issue of public food reserves for food security.

5. The WTO using the FAO’s long experience in the field to sharpen its attack on the public food reserves systems of developing countries – which the US Trade Representative and its allies in the OECD calls ‘trade distorting’ – so that the socio-ecological institution of the smallholder farmer, and family farms, are done away with.

Peasant seeds in resistance

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April 17, 2014, is the international day of peasants’ struggle. With more than 100 actions worldwide, the international farmers’ movement La Via Campesina reasserts the importance of local struggles and underlines the need for global resistance and organisation between the cities and the rural areas. Actions such as land occupations, agroecological festivities, debates and seed exchanges will be carried out until the end of the month as part of these global days of action.

Via_Campesina_17_April_actionA new documentary celebrates this day of international peasants’ and farmers’ solidarity. ‘The Jakarta Call’ is a 38 minutes film featuring the exchanges, debates and reflections of the movement’s VIth International Conference that took place in Jakarta in June 2013.

This new documentary highlights the cultural diversity and the values of solidarity and unity converging in this political project. It reflects the multitude of local struggles for the defence of a food system by and for the people.

La Vía Campesina has said the movement “denounces laws and interests that seek to prohibit the use, exchange and access to peasant seeds that we consider a heritage of the people at the service of humanity, as well as food sovereignty as part of a commitment to end hunger in the world”.

To defend our seeds also means the defence of the rights of women and men farmers. Seeds in hands of peasant farmers guarantee a dignified and autonomous future in agriculture.

Of Elsevier, Monsanto and the surge for Seralini

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Support for the team of scientists led by Giles-Eric Séralini, a professor of molecular biology at Caen University (France), is growing quickly every day following the appalling (but unsurprising) turfing out of the famous Seralini study from the journal Food and Chemical Toxicology.

The industrial combines that work with governments, multilateral lending agencies, corrupt politicians, venal bankers and (to add to this merry list) scrupleless publishers have been hard at work in the last week. Through their public relations peons, they have swamped the world’s newspapers and television channels with reports claiming that the ‘retraction’ by the Elsevier journal, Food and Chemical Toxicology, of the Seralini study is a step forward for science and a step closer to helping end hunger.

The level of public awareness about the dangers of GM food and seed needs independent and credible science as a partner. Here, anti-GM protesters in Bangalore, Karnataka, India

The level of public awareness about the dangers of GM food and seed needs independent and credible science as a partner. Here, anti-GM protesters in Bangalore, Karnataka, India

This is the most virulently cynical twisting of the truth in a long and gory history of truth being twisted in order that the food and cultivation options of millions remain, not a choice of options but the diktat of the corporations (GM seed, poison pesticide, poison fertiliser).

What did the Seralini group find? Their toxicological study on GM maize and Roundup herbicide involving 200 rats was done over two years, and found an alarming increase in early death, large tumours including cancers, and diseases of the liver and kidney. The study, published in 2012 by this journal (which has condemned Elsevier to lasting infamy and driven a spike through the cankerous heart of the sponsored scientific journals ancillary industry) was not the first to show the effects of Monsanto’s packaged poison (farmers in every country know the truth), nor was it the only one to show adverse health impacts from GM feed or Roundup herbicide.

What then? At the end of 2013 November (about a fortnight ago) PRNewswire reported ‘Elsevier announces article retraction from journal Food and Chemical Toxicology’ (2013 November 28).

This immediately set off the mobilisation amongst the hundreds, then thousands, who had been following the course of the Seralini study and the repugnant reactions to it by the GM food and seed industry (Monsanto, Bayer, Dow, DuPont, Syngenta, BASF and their subsidiaries and national partners).

In an open letter to the editor of Food and Chemical Toxicology the European Network of Scientists for Social and Environmental Responsibility (ENSSER) bluntly said that the journal’s retraction of the Seralini team’s paper “is a travesty of science and looks like a bow to industry”. ENSSER reminded the worldwide audience that the Séralini group had found severe toxic effects (including liver congestions and necrosis and kidney nephropathies), increased tumor rates and higher mortality in rats fed Monsanto’s genetically modified NK603 maize and/or the associated herbicide Roundup. There it was, clear as day.

ENSSER went on: “Even more worrying than the lack of good grounds for the retraction is the fact that the journal’s editor-in-chief has not revealed who the reviewers were who helped him to come to the conclusion that the paper should be retracted; nor has he revealed the criteria and methodology of their reevaluation, which overruled the earlier conclusion of the original peer-review which supported publication. In a case like this, where many of those who denounced the study have long-standing, well-documented links to the GM industry and, therefore, a clear interest in having the results of the study discredited, such lack of transparency about how this potential decision was reached is inexcusable, unscientific and unacceptable. It raises the suspicion that the retraction is a favour to the interested industry, notably Monsanto.”

Elsevier is attempting to erase from the public record results that are potentially of very great importance for public health. The support for the Seralini study and studies like it will ensure that does not happen.

Elsevier is attempting to erase from the public record results that are potentially of very great importance for public health. The support for the Seralini study and studies like it will ensure that does not happen.

The Elsevier journal, coming under baleful condemnation from all quarters for its cowardly act, essayed a response meant to be collective but which mired itself in administrative cover-thy-bum murkiness and addressed none of the substantial matters raised by the open letters which are gaining supported every day. Unable to see the writing on the crumbing frankenfood wall, The Economist, that gormless right-wing leaflet despised by fish’n’chips vendors, stumbled in with an editorial titled ‘Fields of beaten gold: Greens say climate-change deniers are unscientific and dangerous. So are greens who oppose GM crops’.

With the retraction of the Seralini team paper by the Elsevier journal, the Economist’s leader gibbered feverishly, “There is now no serious scientific evidence that GM crops do any harm to the health of human beings. There is plenty of evidence, though, that they benefit the health of the planet. One of the biggest challenges facing mankind is to feed the 9 billion-10 billion people who will be alive and (hopefully) richer in 2050. This will require doubling food production on roughly the same area of land, using less water and fewer chemicals. It will also mean making food crops more resistant to the droughts and floods that seem likely if climate change is a bad as scientists fear.” As you can see, this specious and laughably binary argument is the kind that the CGIAR and its thought-control institutions (such as the International Food Policy Research Institute) have sloshed through governments in the South for the last decade, mostly successfully.

But the world’s scientists cannot be bought and cannot be bullied en masse. The Institute of Science in Society wrote and circulated an open letter on the retraction and also included in it a “Pledge to Boycott Elsevier” – this letter has now been signed by 454 scientists and 813 non-scientists from 56 different countries!

The ISIS letter to the feckless Elsevier journal has said, very firmly: “Your decision to retract the paper is in clear violation of the international ethical norms as laid down by the Committee on Publication Ethics (COPE), of which FCT is a member. According to COPE, the only grounds for retraction are (1) clear evidence that the findings are unreliable due to misconduct or honest error, (2) plagiarism or redundant publication, or (3) unethical research. You have already acknowledged that the paper of Séralini et al (2012) contains none of those faults.”

Moreover, the ISIS open letter has addressed in one fiery sweep the GM food and seed industry and their craven partners in governments, the journal publishers and their smarmy influence brokers alike: “This arbitrary, groundless retraction of a published, thoroughly peer-reviewed paper is without precedent in the history of scientific publishing, and raises grave concerns over the integrity and impartiality of science.”

Elsevier is already notorious for having published six fake journals sponsored by unnamed pharmaceutical companies made to look like peer reviewed medical journals; this particular journal, Food and Chemical Toxicology, had recently appointed ex-Monsanto employee Richard Goodman to the newly created post of associate editor for biotechnology; Elsevier remains the target of a still-current boycott initiated by eminent mathematician, Sir Tim Gowers, as a protest by academics against the business practices of Elsevier, especially the high prices it charges for journals and books; and this now thoroughly invalidated journal had also retracted another study finding potentially harmful effects from GMOs.

Indexing food prices the FAO way

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The FAO food price index for 2013 October which includes the calculation and measurement changes. Spot the differences? I can't.

The FAO food price index for 2013 October which includes the calculation and measurement changes. Spot the differences? I can’t.

Why has the Food and Agriculture Organisation (FAO) changed the way it calculates the monthly FAO Food Price Index? But hold on, let us scrutinise first what the FAO Food Price Index is for 2013 October.

The FAO has said: “The FAO Food Price Index rose slightly in October, averaging 205.8 points. This was 2.7 points, or 1.3% above September, but still 11 points, or 5.3% below its October 2012 value. The slight increase was largely driven by a surge in sugar prices, although prices of the other commodity groups were also up.”

The usual blue pair.

The usual blue pair.

In substance, this sort of commentary for the FAO monthly food price index barely differs from the standard tedious template, in tone and tenor, that FAO has applied throughout 2013. The tone has been, as we begin to close 2013, that food prices have not moved very much through the year, and the tenor has been that food price volatility is being reined in.

Based on the evidence provided by real prices I experience in India – real markets (or bazaars or mandis) in which real vendors sell actual produce to real household buyers – I have no idea what the FAO Food Price Index is talking about. Nor do tens of millions of urban and rural households all over the world when they try and correlate the numbers of the FAO index to what they must confront every time they make a food purchase.

This is because of what the FAO Food Price Index measures which, I wearily point out, is a criticism levelled time and again. Why call it a food price index when it is in fact a food exporters’ and importers’ price indication?

Impressive equations, but where's the connection with the local markets you and me buy our veggies from?

Impressive equations, but where’s the connection with the local markets you and me buy our veggies from?

Now, with a change in its calculations, the FAO index includes the following 23 commodities: wheat (10 price quotations monitored and reported by the International Grains Council), maize (1 quotation) and rice (16 quotations) for cereals; butter, whole milk powder, skimmed milk powder (2 quotations for each) and cheese (1 quotation) for the dairy group; poultry (13 quotations), pig (6 quotations), bovine (7 quotations) and ovine (1 quotation) for the meat dairy group; sugar (1 quotation); the oils group consists of one oil price quotation for soybean, sunflower, rapeseed, groundnut, cotton seed, copra, palm kernel, palm, linseed and castor. This construction, thus, includes the use of 73 price series.

The FAO has said: “The Index, which is a measure of the monthly change in international prices of five major food commodity groups (including 73 price quotations), has undergone some changes in the way it is calculated, although the new approach did not significantly alter the values in the series.” (See the Food Outlook released in 2013 November.)

Perhaps. We will not know for another few months. If a change was needed that made sense to consuming households, then FAO should have ensured the index reflected what households pay for the food the buy in the markets near their homes. If the FAO must serve multiple audiences, then it must devise food price indexes for these audiences separately (but the IGC already serves the food traders, and FAO’s own Agricultural Market Information System already serves the policymakers and the major international blocs).

Appraising World Food Day 2013

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FAO-world_food_day_2013It must be difficult to be a senior official in the Food and Agriculture Organisation (FAO) of the UN these days, especially if the official is above 40 years old and has spent the last two decades working “in the field” (which usually means away from some capital city somewhere, in discomfort that is amusingly relative to most of us proletarian toilers). For, I do think that there is still a majority of folk in the FAO who care about their work and the aims of the organisation, muddled though these get when 190-odd member states each bring their own version of reality (and ambition) into the proceedings.

More difficult it is nowadays in an FAO that is being shepherded more closely into the embrace of the OECD, the World Bank-International Monetary Fund, World Trade Organisation embrace, with its murmuring old boys’ clubs all shadowy in their suits, adept at facilitating the trade of political positions for corporate board seats. And more difficult it is nowadays in an FAO that is scrutinised every day by NGOs and civil society groups that have successfully ensured that negotiations called ‘multi-lateral’ must be open before public gaze and can no longer hide behind empty principles when hunger – FAO’s single problem – stalks the planet.

Perhaps that is one reason why the FAO has called this year’s World Food Day ‘Sustainable Food Systems for Food Security and Nutrition’ – and notice the addition of ‘nutirion’, there’s no getting away from the N-word these days, so loaded has it become. The theme, to borrow from the typically bland FAO pronouncement, “gives focus to World Food Day observances and helps increase understanding of problems and solutions in the drive to end hunger”. Well said, for the umpteenth time.

Via_Campesina_food_sovereigntyBut there have been departures from the corporate script lately which are surprising. On 2013 October 04 the Director General of FAO, José Graziano da Silva, formalised a tie with La Via Campesina, recognising it as the most important voice of small food producers worldwide. This is seen by Campesina as “yet another welcome step in a series of ongoing reforms of the FAO, which have created a unique and unprecedented space to collaborate with civil society and democratize the arena of global food policy”. Easier wished for than done, as Campesina well knows, because the financiers and bankers, agri-commodity trading oligopolies and mafioso, the crooked politicians in the European Union and their willing partners in the ‘developing’ world are not going to quietly let this happen.

These reforms are aimed at giving the FAO not just more political legitimacy by becoming more inclusive, but also at reviving it as the cornerstone for international cooperation in the area of food security, starting to take such policy decisions out of the hands of the World Bank (WB) or the World Trade Organization (WTO.) While these developments are welcome, the global peasants’ movement remains realistic about the amount of energy that should be put into the UN, maintaining its greatest strength on the ground mobilizing farmers and building alternatives.

The IFPRI Global Hunger Index 2013 world map, blatantly patronising in its North-South exclusion. The white areas are not even in the map legend. They correspond to the OECD/'industrialised' world, and the IFPRI/CGIAR view is that the chronic mis-nutrition of western societies has no place in a report on global hunger. Nor does this map consider the growing effects of working class poverty in the OECD countries.

The IFPRI Global Hunger Index 2013 world map, blatantly patronising in its North-South exclusion. The white areas are not even in the map legend. They correspond to the OECD/’industrialised’ world, and the IFPRI/CGIAR view is that the chronic mis-nutrition of western societies has no place in a report on global hunger. Nor does this map consider the growing effects of working class poverty in the OECD countries.

In 2012, at the 39th session of FAO’s Committee on Food Security (CFS), the G20 approached the CFS and asked the Committee to agree with what it said on price volatility in agricultural commodities, which since 2007 has dragged tens of millions of households in South and North into hunger and debt. When that happened, and when a compromised CFS agreed, the civil society delegation to the session walked out. The NGOs, social movements, representatives of peasants’ federations and associations who were present had, on the contrary, demanded strong regulation of the commodity futures markets that fuel price volatility and the food insecurity of the poorest. But the G20 (and that means the investors in a global agribusiness industry) won that round.

With the help of the CGIAR, what for the sake of convenience we call the G20 will want to win every time. The CGIAR is the Consultative Group on International Agricultural Research which runs 15 centres around the world that are described as “independent, non-profit research organizations, innovating on behalf of poor people in developing countries” and as being “home to almost 10,000 scientists, researchers, technicians, and staff working to create a better future for the world’s poor”. The descriptions about ‘independent’, ‘non-profit’ and ‘for the poor’ are lies, as they have been for every single one of the 40 years of this plague called the CGIAR. But the CGIAR system is large, powerful, almost invisible and little understood except by those in agricultural research systems (such as those in the Indian Council of Agricultural Research) in ‘developing’ countries.

And that is why the release, a few days ago, of the ‘Global Hunger Index’ 2013 needs to be interpreted for what it is, because it is the product of one of the CGIAR centres, the International Food Policy Research Institute (IFPRI). The annual index offers a ranking of hunger, or food insecurity/security for many countries but not all (see the image of the map and its caption). The IFPRI functions worldwide as a motivated think-tank that commissions carefully scripted research to fulfil pre-determined outputs that serve the interests of those who profit from the industrial agricultural system and retail food system.

That such an obvious fifth column finds residence and a willing ear in India ought to be a matter of shame to us. Here is a small example why. The IFPRI, in the 2013 Global Hunger Index, has distributed its ‘recommendations’ which are from the typical neo-liberal charter of subjugation of the working classes and the denial of choice, all camouflagued by whichever development jargon is found to be currently in vogue.

The cover of the Global Hunger Index 2013 report. Read the recommendations to grasp why this has been released, ignore the data.

The cover of the Global Hunger Index 2013 report. Read the recommendations to grasp why this has been released, ignore the data.

Hence “broader policy coherence for development is also a key requirement for efforts to strengthen resilience. Policies that undermine resilience must be revised. To foster resilience to undernutrition, policies should be designed with the intention of improving nutrition outcomes and realising the right to adequate food” in fact means – do away with policies that still see a role for the state and the public sector, hide this behind trendy concepts like ‘resilience’ and ‘right to food’, but include nutrition (which I mentioned earlier) because that is the route the MNCs have successfully used.

Hence “encourage and facilitate a multisectoral approach to resilience (as the Scaling Up Nutrition movement encourages a multisectoral approach to nutrition, for example), coordinating plans and programs across line ministries” in fact means – phase out your thinking and replace it with ours, which comes with a United Nations endorsement and which places private business at the centre of policy and its implementation.

Hence “adjust policies and strategies that undermine the resilience of poor and vulnerable groups, such as the low import tariffs or the structural neglect of smallholder agriculture in Haiti” in fact means – remove barriers to food imports, stop subsidies and subventions that the poor, marginalised and vulnerable have a right to in your country (consider the ruckus the World Trade Organisation has been making about India’s new National Food Security Act) and spout righteous claptrap about ‘neglect’.

Hence “ensure that policies and programs draw on a wide range of expertise such as collaborative, multiagency, and multisectoral problem analysis. National governments should support the emergence of multistakeholder platforms and make active use of such forums” in fact means – the expertise will be foreign and provided by the CGIAR and its numerous allies in all garbs, these ‘multi’ platforms will be public showcases to conceal an agenda already set.

[The full IFPRI Global Hunger Index 2013 report is here. The ‘issue brief is here’ for those who want a condensed dose of dangerous neo-liberal vitamins. And the obligatory data set used to support the well-set arguments is here.]

There is no comparison between the IFPRI propaganda and the annual report of the Right to Food and Nutrition Watch 2013, the sixth edition of which was released in 2014 October. The Watch identifies a number of policies that generate hunger and malnutrition instead of reducing them. The Watch insists on the need for meaningful participation – at every level – of people and communities in the development of those public policies which affect their lives.

You will find here national case studies and analysis that show (1) policies that foster violence and discrimination against women with regard to equal access to natural resources, inheritances, equal wages and political decision-making, (2) policies that systematically limit and exclude large groups, including peasants, agricultural workers, fisherfolks, pastoralists and indigenous peoples from participating in those decisions that affect their very livelihoods and (3) policies on a global level that facilitate land grabbing, concentrated ownership of natural resources and the commodification of public goods that deprive smallholders and other people of their food resources.

Of an India behind the new poverty ratio

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Mural titled 'In the name of development', at Jawaharlal Nahru University, New Delhi

Mural titled ‘In the name of development’, at Jawaharlal Nahru University, New Delhi

New poverty claims from the government of India are being interpreted as (a) proof that the economic liberalisation is working, (b) that the ruling coalition has begun its preparation for the 2014 general election by claiming the largest percentage reduction of poverty ever, (c) that the ruling coalition by lowering the poverty line (and therefore the number of Indians identified as poor) will slash its social subsidies outlay, (d) that the way India measures poverty is desperately in need of repair, if not altogether in need of renewal.

The new state poverty lines table (see below for xls link)

The new state poverty lines table (see below for xls link)

India’s English-language media (in particular the financial and business press) has either repeated what the Planning Commission has released, or has reported reactions to the latest claim from opposition parties. Here is a selection:

“The proportion of people living below poverty line (BPL) has came down from 37.2 per cent in 2004-05 to 21.9 per cent in 2011-12 — a decline of 15.3 percentage points in a period that roughly coincides with the first eight years of the United Progressive Alliance.”
“The sharp drop was attributed to the high real growth in recent years, which raised the consumption capacity. The number of India’s poor fell to less than a quarter of its population in 2011-12, giving the government a reason to cheer amid the recent raft of disappointing macro economic data.”
“Over the last decade, poverty has witnessed a consistent decline with the levels dropping from 37.2% in 2004-05 to 29.8% in 2009-10. The number of poor is now estimated at 269.3 million, of which 216.5 million reside in rural India.”
“One theory is that this is the outcome of the trickle-down impact of the record growth witnessed in the first decade of the new millennium.”
“The BJP slammed the figures as a ‘political gimmick’ and a ‘conspiracy’ of the Congress to deprive the poor of the benefits of government schemes while CPI(M) said it amounted to ‘adding salt to the wounds of the poor’.”

It was only last year, in 2012 June, that the Planning Commission constituted an ‘expert group’ chaired by a former head of the Reserve Bank of India to “review the methodology for the measurement of poverty”. In the hoary tradition of Indian bureaucratese, this expert group is now “deliberating on this issue” (said the Planning Commission) and is expected to submit its report by the middle of 2014.

What is the main substance of the new claim? The note from the Planning Commission (titled ‘Press Note on Poverty Estimates, 2011-12’ and dated July 2013) has stated that the “percentage of persons below the poverty line in 2011-12 has been estimated as 25.7% in rural areas, 13.7% in urban areas and 21.9% for the country as a whole”. [A spreadsheet with the new statewise rural and urban poverty lines is available here.]

Government-friendly infographics from a financial newspaper

Government-friendly infographics from a financial newspaper

Thereafter the myth of the descending poverty line is outlined: that in 2004-05 the respective poverty ratios for the rural and urban areas were 41.8% and 25.7% and 37.2% for the country; that in 1993-94 the ratios were 50.1% in rural areas, 31.8% in urban areas and 45.3% for the country. And, in triumphant tones, that hence the 407 million Indians below the poverty line in 2004-05 had by 2011-12 dwindled dramatically to 270 million – a reduction of 137 million persons over a short seven years! And that indeed, it is all the more significant that for the last eight years it is the UPA (that is, the Congress) that has ruled India. So flows the polemic.

In the eagerness to find ‘rural’ and ‘urban’ and a ‘national’ poverty line, the tales of the deciles of the NSS surveys, referred to only fleetingly, are of importance (for the 43rd, 50th, 55th, 61st, 66th and 68th rounds, all of which we hope are being studied by the Rangarajan expert group). The deciles in the 68th round tell us that in rural India, the average monthly expenditure per person of Rs 153 on cereals would buy 7.3 kg of rice or 8.5 kg of wheat, and that the Rs 40 spent per person on pulses would buy 0.85 kg of pulses, both monthly measures (outside the fair price shop) being well under (13.8 kg and 1.2 kg respectively) the recommended dietary allowances.

India’s 681 million hungry rural citizens

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RG_NSSO_68_MPCE_pic1What do and what can rural residents spend on food and the essentials of living in India? This chart gives us an indication. It is based on new data contained in the latest revelation (my word, not theirs) from the National Sample Survey Office and is titled ‘Key Indicators of Household Consumer Expenditure in India’ (the 68th Round of sampling, for those who follow the extraordinary programme of this sterling statistical organisation).

There is data enough in the volume to inform us, clearly and starkly, that the cumulative impact of several years of food price inflation is hurting households more with every passing quarter. Consider what this new data release tells us:

RG_NSSO_68_MPCE_pic3* That the average rural monthly expenditure per person was lowest in the states of Odisha and Jharkhand (around Rs 1,000) and also in Chhattisgarh (Rs 1,027).
* In Bihar, Madhya Pradesh and Uttar Pradesh, the rural monthly expenditure per person was about Rs 1,125 to Rs 1,160.
* In urban India (not shown in this chart, but I will add to this posting with an expanded update) Bihar had the lowest monthly expenditure per person (called monthly per capita expenditure by the NSSO and abbreviated to MPCE) of Rs 1,507.
* In Chhattisgarh, Odisha, Jharkhand, Uttar Pradesh and Madhya Pradesh, urban MPCE was between Rs 1,865 and Rs 2,060. These six were the six major states with the lowest MPCEs for both rural and urban citizens.

But those are averages, and in this data release, the NSSO has divided its usual ten deciles even further for the lowest and highest deciles. (The decile is the surveyed population divided into tenths, with these being classified by expenditure level.) Doing so gives us a better view of the elastic expense trends in the top ten per cent of the population, the class which is so pampered by the central government. For rural India then, the 5th percentile of the MPCE distribution was estimated as Rs 616 and the 10th percentile as Rs 710 – and these are all-India averages.

[The spreadsheet with the table and chart is here. You can find the highlights of the NSSO study here.]

RG_NSSO_68_MPCE_pic4About half the total rural population is thus estimated to have a MPCE below Rs 1,198. Only about 10% of the rural population reported household MPCE above Rs 2,296 and only 5% reported MPCE above Rs 2,886 (this is using what is called the ‘modified mixed reference period’ or MMRP, in which the person interviewed is asked to recall purchases made over two different lengths of time, for different sorts of goods). The bottom-line is that food accounted for about 53% of the value of the average rural Indian’s household consumption during 2011-12.

This included 11% for cereals and cereal substitutes, 8% for milk and milk products, another 8% on beverages and processed food, and 6.5% on vegetables. Among non-food item categories, fuel for cooking and lighting accounted for about 8%, clothing and footwear for 7%, medical expenses for about 6.5%, education for 3.5%, conveyance for 4%, other consumer services for 4%, and consumer durables for 4.5%.

This ought to be a ringing alarm about access to food for the country’s planners, who are otherwise obsessed with GDP growth and whether India is cosmetically dolled up enough to attract global finance capital. It hasn’t sounded even a muted gong, and even if it had, one stunning inference from this table has been ignored – that this is an indicator of food and multi-dimensional poverty and that millions of rural residents are unable to afford food and basic services.

How so? Look at the chart again. Imagine, at just above the line marking 2,000 rupees, a dotted red line at a level of around 2,070 rupees. That is the equivalent (before the recent fall in the rupee’s value against the US dollar) of USD 1.25 a day, which has (ill-advisedly) been cemented in development wisdom as a poverty line that can be applied in countries like India. Let’s accept that in order to focus on what the new NSSO data tells us.

RG_NSSO_68_MPCE_pic5At the Rs 2,070 level we see that for a relatively prosperous state like Haryana (a former Green Revolution state) about 50% of the rural population cannot spend, per person per month, this amount. The percentage of the rural population below and above this line is similar, more or less, for Punjab (also a former Green Revolution state) and for Kerala (which is not, but has income from economic migrants abroad).

But the entire rural populations of Bihar, Chhattisgarh, Jharkhand and Odisha cannot spend this amount, because they do not earn it. How many is that? Using the 2001-2011 population growth rates (for rural populations of states) this means 98.96 million in rural Bihar, 20.65 million in rural Chhattisgarh, 26.52 million in rural Jharkhand and 36.19 million in rural Odisha are below this line. What of other states with large rural populations?

In Assam, Madhya Pradesh, Uttar Pradesh and West Bengal, 90% of the rural population is below this line and that means 25.23 million in Assam, 49.90 million in Madhya Pradesh, 147.25 million in Uttar Pradesh, and 57.26 million in West Bengal. In Gujarat, Karnataka, Maharashtra and Rajasthan, 80% of the rural population is below this line and that means 28.52 million in Gujarat, 30.66 million in Karnataka, 50.77 million in Maharashtra and 43.55 million in Rajasthan. In Andhra Pradesh and Tamil Nadu, 70% of the rural population is below this line and that means 39.64 million in Andhra Pradesh and 26.56 million in Tamil Nadu.

Taken together those rural populations are 681.72 million (more than twice the population of the USA). They are 78% of India’s 2013 rural population, almost eight out of ten rural citizens.

A Jekyll and Hyde food price index

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FAO's usual winsome twosome, the food price index and food commodity price index charts.

FAO’s usual winsome twosome, the food price index and food commodity price index charts.

Why does the perversity of international food price monitoring continue when all evidence tells us food price inflation is raging just as it was in 2007-08? Here is an example of how persistent this perversity is.

Maize in Malawi at 280%, maize in Tanzania at 110%, maize in Mozambique at 60%, maize in Zambia at 50%. Wheat in Tajikistan and in Russia at 55%, wheat in Kyrgystan and Afghanistan at 40%, rice in Myanmar at 35%. Maize in Haiti at 55%, maize in Honduras at 40%, wheat and rice in Brazil at 30%, maize in Nicaragua at 30%, rice in Bolivia at 25%.

Those are the annual increases in the prices of these cereals in the countries named. The estimates come from the charts found in the FAO Global Food Price Monitor for 2013 May (which has prices for up to April). The charts however are at the end of the Monitor. On the first page, the Monitor offers very short summaries. Like this one:

“In Eastern Africa, maize prices mostly strengthened for the second consecutive month following seasonable patterns. However, prices stabilized or started to decline in some countries where new harvests are about to start.” Is that what is being described with a 110% increase in Tanzania?

Or this one:

“In Asia, domestic prices of rice and wheat generally weakened with the arrival of the 2013 early season rice and winter wheat harvests.” Is that what is being described with a 35% increase in Myanmar?

Or even this one:

What FAO's own charts tell us about rising food prices for staples worldwide. These are from the FAO Global Food Price Monitor for 2013 May.

What FAO’s own charts tell us about rising food prices for staples worldwide. These are from the FAO Global Food Price Monitor for 2013 May.

“In Central America, maize prices strengthened in April with the onset of the lean season and in some countries were at high levels. Bean prices remained low, pressured by abundant supplies from bumper crops in the 2012-13 cropping season.” Is that what is being described with a 40% increase in Honduras?

Who are these summaries really for and why does FAO persist in releasing to the public these misleading pictures of food prices (when it means export prices), and especially when its own price monitoring tools tell us very clearly that many many people are struggling under crushing inflation in the prices of food staples?

To take the food price opera further, this is what the FAO Food Price Indexwhich is one of the world’s primary indices and referred to thousands of times a day by planners, the food industry, policy-makers, bankers (always bankers), commodity traders, foreign exchange brokers, bond market artists and rogues, warehousing tycoons, the purveyors of genetically modified seed, the cigar-smoking CEOs of grain trading companies, and the smarmy corrupt political cronies of all of the above – says about cereals:

“The FAO Cereal Price Index averaged 234.6 points in April, down 10 points (4.1%) from March, but nearly 11 points (4.9%) above the corresponding period last year. Most of the decline in April was triggered by weaker maize prices on expectation of higher closing stocks and favourable 2013 crop prospects. Wheat prices changed little, as the downward pressure stemming from expectation of larger inventories was offset by the upward pressure resulting from concern over the poor growing conditions and spring crop planting delays in the United States. Rice prices were marginally down …”

Read that again, 4.9% above the corresponding period last year. The smallest of the annual percentage increases in the second paragraph of this posting is five times as much as 4.9% which is why we must ask FAO, again and again, who the beneficiaries of this large international effort to collect and distribute food prices really are.

Not the populations of Mzuzu, Kampala and Milange or Jalalabad, Yangon and Sughd, or Tegucigalpa, Sao Paulo and Jacmel, all of whom must find their own means of measuring the burdens of food price increases, and who have in the last year, cut down on health care and perhaps even the education of their children, only to not go hungry too often, too painfully.

AMIS for us, we hope, but wheat and maize look scarce

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Welcome tables from the FAO AMIS, with USDA, IGC and FAO forecasts for major crops. Note the declines in production

The UN Food and Agriculture Organisation’s (FAO) Agricultural Market Information System (AMIS for short, although whether it Francophonically proves to be an ‘ami’ of the cereal trader or the food consuming household we shall know in the months to come) has released its Market Monitor Number 3 which is for 2012 November.

Here, in a bland paragraph that tells us nothing about the travails of households budgeting for their evening bread, ‘roti‘, or rice, the AMIS Market Monitor has said: “World supply and demand situation continues to tighten for wheat and maize but rice and soybeans have eased.”

Here’s the rest of the snapshot paragraph: “In recent weeks, unfavourable weather conditions affecting some winter wheat growing areas in the northern hemisphere and maize and soybeans in the southern hemisphere have become a concern. In addition, contradictory reports about possible export restrictions by Ukraine also influenced the market.”

Two familiar blues and a new green. The IGC Commodity Price Indices chart in the company of the FAO’s Food Price and Food Commodity Price Indices charts.

What I find useful is that the tables provided now include the USDA estimates and the IGC estimates. And moreover, in a generous display of collegial latitude (perhaps the AMIS has its good points after all) the Monitor has included the IGC index chart alongside the FAO index chart.

But as the World Food Programme (WFP) tirelessly warns, From Africa and Asia to Latin America and the Near East, there are 870 million people in the world who do not get enough food to lead a normal, active life (see the WFP’s hunger map here in Englishen français, en español. What does that do to households who are not the primary audience of the AMIS?

This report from IRIN has said that now in Pakistan, more than half of households are food insecure, according to the last major national nutrition survey. The prices of staple grains like wheat and rice have been stable but are “significantly higher” than 2011, according to the World Food Programme’s (WFP) October 2012 Global Food Security Update. A 25% rise in fuel prices has also pushed up the price of food, as it becomes increasingly expensive to transport. WFP says rising food prices in international markets recently may also lead to price hikes in Pakistan. Clearly, we need to find a way to filter the AMIS outputs (or screen its inputs) so that the Monitors are more directly useful to houseolds and their struggle to find enough healthy food at affordable prices.

Moorosi Nchejana is one of 40 farmers in the village of Mabalane in Lesotho’s Mohale’s Hoek district who participated in a pilot programme by the UN’s Food and Agriculture Organization to strengthen farmers’ capacity to adapt to climate change (June 2012). Photo: IRIN / Mujahid Safodien

Persistent high food prices and a winter’s tale of the FAO index

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This chart, using data from the FAO food price index and considering the period 2006 Jan to 2012 Sep, shows the four sections of price plateaus, with the longest – and most severe – being what we are experiencing now.

In this chart I have divided the period from 2006 January till 2012 September into four sections. These four sections represent different phases of the global food price rise and consequent levels of persistent food price inflation. As with all price series movements, the sections flow into and from one another, but with the five components taken together (I have omitted the sugars index, so these five are food, cereals, oils, dairy and meat) the sharp upward and downward gradients become visible. These differences help find the four different sections of prices over the last six years and nine months.

Index close-up: 2007 May to 2008 Nov

Most conspicuously, what is immediately clear from the main chart is that the current period of high food prices (and high levels of food price inflation coupled with volatility in global, regional and local food markets) began in 2010 June and established a new set of plateaus by 2010 August. It is now therefore two years of such a plateau, and the worrying indications are that, as happened in 2009 August and September, we may be on the cusp of an even higher upward movement of prices.

Index close-up: 2010 Jun to 2012 Sep

The thin lines representing averages for the five separate index components (four plus the main food index) are visible for each of the four sections. These provide more evidence of the higher overall index and graphically show the very worrisome duration of the current elevated plateau of prices – the averages for the 2010 June to 2012 September period are higher than the averages for the 2007 May to 2008 November period. Thus the optimistic pronouncements by FAO on the monthly variation in its index – such as this month’s “the FAO Cereal Price Index is 7 percent higher than in the corresponding period last year but still 4 percent below the peak of 274 points registered in April 2008” – fail to present the context, that it is not how far below the 2008 peak but how much the current average is higher than the 2007-08 average that matters.

Indeed, using the FAO food price index data released early in 2012 October (covering the period till 2012 September) this may be the FAO confirmation of the signal that the widespread droughts of 2012 have begun to affect food prices even at this already elevated level. It is all the more worrying since, in the period since 2006 January and which includes the 2007 May to 2008 November period, this is the longest period of sustained high food prices recorded by the FAO food price index. These are the long-term signals that are not conveyed by FAO’s standard monthly chart, which you can see here.

Written by makanaka

October 8, 2012 at 20:07