Globalisation of agriculture and rising food insecurity

Despite claims to the contrary, trade liberalisation and globalisation are resulting in declining food production and posing a threat to food security, particularly in the countries of the South. The same processes are also wiping out small efficient family farms and replacing them with inefficient and unhealthy industrialised food systems under corporate control.

THE Draft Plan of Action for the UN Food Summit to be held in Rome in November categorically states that 'trade is vital to food security'.

Trade liberalisation and globalisation of agriculture are supposed to increase production of food, increase efficiency of food production, improve the economic situation of farmers and improve patterns of food consumption. However, the evidence provided by the participants of an international conference on 'Globalisation, Food Security and Sustainable Agriculture' held in Delhi on 30 and 31 July pointed to the opposite direction.

In country after country, trade liberalisation is leading to declining food production, declining productivity, declining conditions for farmers in the North and in the South, and declining food security for consumers of the North and the South.

In her welcoming address which was on the theme 'Globalisation and Food', Dr Vandana Shiva said, 'The US and other industrialised countries of the North are trying to change the meaning of food security from being a fundamental human right to participation in global markets, which excludes the large number of poor without adequate purchasing power.'

'They are also trying to redefine food security to exclude food safety issues. Food security has always meant adequate, safe, nutritious and culturally safe food. While this meaning was inscribed in the earlier draft plans of action, it has been removed in the current draft of the World Food Summit,' she said.

Dr Shiva said the structure of governance that was being shaped 'is governments without rights, but with exclusive responsibilities for food security, and international organisations like the World Bank, International Monetary Fund (IMF) and World Trade Organisation (WTO) with absolute rights and no responsibilities. Since these organisations are controlled by the G7 group of countries, this structure has built into the North-South asymmetry of Southern governments with the largest number of poor and hungry people carrying responsibilities without rights for food security, and Northern governments pushing rights of their corporations without responsibilities for food security.'

Referring to the situation in India, she said, 'Land reforms (which put a ceiling on land holdings) are being undone in state after state to allow corporate superfarms for..... luxury production for international markets. Massive displacement of farmers is taking place, which can rapidly turn into a socially and politically explosive situation.'

Globalisation and Food Insecurity in the South

A paper on 'Globalisation and Agriculture in India' by Dr Vandana Shiva, Ms Radha Holla and Ms Kusum Menon showed through field studies how food production was being undermined by trade liberalisation policies. Food-growing land is being diverted to non-food crops such as flowers or luxury commodities such as shrimp. Farmers are being displaced on a massive scale and natural resources are being over exploited. Corporatisation of agriculture which is being pushed under trade liberalisation as a successor of the Green Revolution is leading to new poverty for small farmers as unequal and unfair contracts lock them into a new forms of bondage.

Farmers of Punjab who were contracted by Pepsico to grow tomatoes received only Rs.0.75 per kg while the market price was Rs.2.00. First the farmers rejected Pepsico and now Pepsico has abandoned Punjab and sold its tomato processing plant to a subsidiary of Levers.

Trade liberalisation is supposed to bring benefits to national agricultural economies. However, the beneficiaries are neither farmers nor governments of the Third World. A recent editorial of a business daily in India had the heading 'Freeing Wheat'. It is significant to ask what wheat is being freed from and whom it is being freed for.

This freedom to trade has mainly benefited the giant grain traders Cargill and Continental. They are buying wheat at $60 to $100 per tonne from India and selling it at $230-240 per tonne on the international market, making a neat $130-170 profit per tonne, while India is losing $100 million in exports because of the concentration of power in the hands of five merchants of grain.

The US grain giants are turning to the Indian market because the large- scale wheat farming in the US, has been wiped out in nearly 50% of the farm land by a combination of drought and the Karnal Bunt - a fungal disease. As a result of the US crop failure, India's wheat exports have increased dramatically. However, in the globalised world, it is ultimately not countries such as the US and India, which are exporting and importing grain, but corporations like Continental and Cargill. Treating countries as economic units in a free-trade world is misplaced since they have been replaced by corporations as the basic economic units. The gains and losses from globalised trade in food are more appropriately worked out at the level of people and corporations rather than at the level of countries. Globalised food trade is of course an opportunity in the trade perspective, but will have serious impacts on the entitlements of already vulnerable groups.

Dr Amitava Mukherjee, Executive Director, ActionAid India in his paper on 'International Trade and Food Security' confirmed that the area under food crop production in India is on the decline, as is evident from the fact that the index for the area under food grains (1981-82 =100) has declined from 100.7 to 97.3 in 1990-91 in 1994-95, while the index for the area under non-food crops increased from 120.0 to 125.7 during the period. Production of coarse cereals and pulses, the main food for the poor, has shown a declining trend.


Dr Abhijit Sen of Jawaharlal Nehru University showed how under liberalisation domestic production and consumption of food were declining. Removal of food subsidies had led to decrease in the amount of food purchase from the public distribution system. The off take of rice had declined from 10.1 metric tonnes in 1991-92 to 6.9 metric tonnes in 1995-96. The offtake for wheat has gone down from 8.8 metric tonnes to 3.8 metric tonnes. While agricultural exports as a percentage of total exports had gone down, cereals in exports had gone up from 1.4% to 3.4%, indicating that exports were increasingly based on the creation of domestic food insecurity.

Dr John Kurien of the Centre for Development Studies, Trivandrum elaborated how industrial aquaculture and fisheries were promoted with bilateral and multilateral aid for 'short-term "parking" of international capital in a specific location for a short duration of time during its race for profits'. This 'rape and run' industry is also based on the enclosure of the common resources of coastal communities. While the production feeds into the international luxury demand for humans and pets of affluent countries, they pose a threat to existing patterns of food production and a direct threat to national and local food security

Mr Victor Suares Carrera, Executive Director of the National Association of Peasant Maize Producers, Mexico said after 14 years of liberalisation under structural adjustment and two years of NAFTA in Mexico, 9,000 years of food security were being wiped out. Mexico, which like India was the centre of the origin of agriculture, from where corn expanded to the USA and the rest of the world, was now in danger in the wake of globalisation. Today, he said, his country was ruled by the law of comparative advantage. However, with NAFTA, the illusion of comparative advantage had evaporated. There was neither food security nor comparative advantage for Mexico under freetrade. Three years ago, Mexico imported half a million tonnes of rice. It now imports 7 million tonnes of rice.

While Mexico's corn economy is being destroyed, it was importing yellow corn from the US, which is used to feed animals in that country. Mexicans eat white corn which is culturally more appropriate to their food system. The government, he said, had abandoned its responsibility and there was no policy of food security and no employment policy. Everything had been left to market forces. The government had amended the Mexican land law and discarded the principles of the 1910 revolution. This had been done on the demand of the agri-business.

Referring to the Zapatista rebellion in Chiapas in Mexico on 1 January 1994, the first day of NAFTA, he said, 'When we entered the club of the rich people, while the political elite were celebrating the event, thousands of indigenous peasants went up in arms.' They cried against the policy of impoverishment of the farmers and the denial of their rights. People have demanded a change in the National Agricultural Policy and support for the domestic producers. They have argued that it is much easier to support domestic production than to buy from the US, when the country did not have foreign currency.

In 1992, Mexico imported 20% of its food. In 1996 it was importing 43%. Eating 'more cheaply on imports is not eating at all for the poor in Mexico'. One out of every two peasants is not getting enough to eat. In the 18 months since NAFTA, the intake of food has been destroyed by 29%. 2.2 million Mexicans have lost jobs and 40 million are in extreme poverty.

Dr Regassa Feyissa, Director of the Biodiversity Institute of Ethiopia, said Africa was being treated merely as a cheap source of labour. Kenya was importing 80% of its food, while 80% of its exports were accounted for by agriculture. In Kenya, grain imports have risen, subsidised by the European Union, undermining local production and creating poverty by oversupply. In 1992, Europen Union (EU) wheat was sold in Kenya at a price which was 39% cheaper than that at which it was purchased by the EU from European farmers. In 1993, it was 50% cheaper. In 1995, Kenyan wheat prices collapsed through oversupply. All this in a country which had been self-sufficient in the 1980s.

Dr Kamal Malhotra, co-Director of FOCUS on the Global South, referring to South Korea, reported how the country had shifted from food self-sufficiency 40 years ago to dependence on the US today. During the five-year period from 1986 to 1991 agricultural imports in South Korea went up from US$1.8 billion to US$5 billion. In the Philippines acreage under rice was declining, while the area under 'cut flowers' was increasing. Three hundred and fifty thousand rural livelihoods will be destroyed by shifting from corn, rice and sugarcane to cut flowers and vegetables for export. The import of 59,000 metric tonnes under the minimum access requirement of GATT would displace 15,000 families annually.

Globalisation and Food Insecurity in the North

Referring to the massive growth of food insecurity in Britain, Dr Tim Lang, Professor of Food Policy at Thames Valley University, said there were mountains of food in his country and miles of supermarket shelves but many Britishers could not afford an adequate diet due to rising unemployment and declining social welfare. One-fifth of the population was classified as not being able to afford a nutritious diet. Poverty, he said, was a reality, even in rich countries.

Five companies controlled 70% of the food market in the UK. There was growing food insecurity even in rich countries as the food system became more centralised. The distance for shopping for food had increased from 2 miles to 5 miles, increasing 'food miles' embodied in food and creating a motorway food system. Long-distance transport and intensification of agriculture were linked. Tim Lang said that Britain had shifted from a policy for small farmers to a policy against farmers. The British model of farming, where farmers were systematically thrown out of agriculture, was being spread to other parts of the world.

The Mad Cow Disease, he said, was the result of the intensification of agriculture. The disease had affected dairy cows and beef cows, had totally undermined the UK beef trade and had led to the extermination of 165,000 cows because of the risk of the transfer of the infection to humans. The farmers, he said, were now questioning intensification of agriculture, adding that the big lesson for the public was that you cannot squeeze nature to the maximum.

The Mad Cow Disease was challenging freetrade, as 'passports' for sources of beef were becoming necessary to regain consumer confidence.

'We must stop intensification. We must re-inject food security in the system,' Tim Lang said.

Philip Lymbery from the Compassion in World Farming, UK said the repercussions of the Mad Cow Disease were going to be immense. It proved the pitfalls of factory farming. Since World War II, half a million farmers had disappeared following the corporatisation of agriculture in the UK. Displaying slides he showed how cattle were reared in inhuman conditions. In the UK alone, he said, 600 million broiler chickens were raised annually. They were kept in cages, too small for their well-being, with the result that 75% of the chickens were dying of heart failure. In intensive dairying, male calves were useless and were kept in inhuman conditions in cages till they were six months old and ready for slaughter. They are then exported. One of the biggest popular movements in the UK had emerged as a result of this violence to veal calves.

Mika Iba, Coordinator, Network for Safe and Secure Food and Environment, Japan said the story of the success of Japan on the economic front was also the story of failure on the food front, undermining the country's food security. The experience of the past 50 years was the undoing and selling out of the Japanese farmer for the country's economic growth. Today 90% of the farmers were part-time farmers, who lived on other incomes.

Ms Iba said 30% of land could be cultivated and there was competition for this land between housing and agriculture. Only 22% of the food was produced in the country. The remaining 78% came from abroad. Only in rice was Japan self-sufficient, while other grains were imported.

Accepting more food imports, she said, also meant accepting more additives in the form of chemicals and pesticides. In 1950, Japanese food imports had 78 food additives. In 1995, this had risen to 345. In 1996, there were 1,051 food additives in food imported by Japan.

In Russia, as reported by Vera Matusevich, an Agricultural Economist, World Bank, production and consumption of food had dramatically declined as a result of trade liberalisation and a transition to a market economy. One-third of Russians were now below the poverty line. Fifty per cent of food was being imported. Production had declined by 33% between 1990 and 1995. The livestock sector had declined by 40%. Meat production had fallen from 8.3 million tonnes in 1992 to 5.9 million tonnes in 1995. At the same time imports of meat had increased from 1.4 metric tonnes to 2.1 metric tonnes i.e. in 1995 imported meat had accounted for about 25% of all meat consumption. These imports are concentrated in big cities which account for 70% of retail turnover. Mafias linked to trade are dumping contaminated food on Russian consumers.

Kristin Dawkins, Director of Research Institute for Agriculture and Trade Policy of the United States, said the US government had led the world in promoting globalised monopolies through international trade agreements, assisted by such bullying tactics as the use of Section 301. She said under encouragement from the US government food corporations controlled US agriculture and were now attempting to control world agriculture.

Dawkins said in 1994-95, 10 cents out of every food dollar spent in the United States went to Philip Morris and another 6 cents went to CongAgra. Four companies - IBP, ConAgra, Cargill and Beef America - sold 87% of all slaughtered beef. Two companies - Kelloggs and General Mills - sold two-thirds of all ready-to-eat breakfast cereals. Campbells sold 73% of all canned soups. Frito-Lay sold 85% of all corn chips and 40% of all potato chips. Kraft is owned by General Foods, (the latter is owned by Philip Morris) sold more than half of all sliced processed cheese.

The dispensability of small farmers

Small farmers are paying the price for this corporatisation. They have been seen as dispensable in the US and the dispensability of the small farmer is now being globalised through trade liberalisation. As Kristin Dawkins reported, in 1962, the Committee on Economic Development which advised the White House recommended 'moving off the farm about two million of the present farm labour force, plus a number equal to a large part of the new entrants who would otherwise join the farm labour force.' Kenneth Boulding, an agricultural economist from the University of Michigan, described their plan bluntly: 'The only way I know to get toothpaste out of a tube is to squeeze, and the only way to get people out of agriculture is likewise to squeeze agriculture. If the toothpaste is thin, you don't have to squeeze very hard, on the other hand if the toothpaste is thick, you have to put real pressure on it.'

A V Krebs, Director, Corporate Agribusiness Research Project and author of Corporate Reapers, reports that in 1990 nearly 22% of US farm operator households had incomes below the official poverty threshold, twice the rate of all US families. In 1993, over 88% of the average farm operator household income was derived from off-farm income.

From 1982 to 1993 the index of prices received by farmers rose only 7.5% while the index of prices paid by farmers for inputs multiplied over threefold to 23%.

As Krebs queried: Is it any wonder that our farmers during the period from 1990 to 1994 saw an almost minuscule 1.98% return on their investment?

Is it any wonder that from 1987 to 1992 in the US farm entries dropped to less than 67,000 per year while 'exits' averaged 99,000 per year, resulting in the net loss of 32,000 farms a year.

The myth of the unproductive small farmers and fisherfolk

The main argument used for the industrialisation of food and corporatisation of agriculture is the low productivity of the small farmer. However, even the World Development Report has accepted that small farms are more productive than large ones.

In Brazil, the productivity of a 0-10ha farm was $85/ha while the productivity of a 500 ha farm was $2/ha. In India, a 0-5 acre farm had a productivity of Rs.735/acre while a 35 acre farm had a productivity of Rs.346/acre.

The state of Bengal was showed the highest rate of growth of 6.5% for agriculture as a result of land reform, while the rate of growth for India was a mere 3%.

Even biologically, small diverse farms have higher productivity than large monoculture farms.

Productivity of monocultures is low in the context of diverse outputs and needs. It is high only in the restricted context of output of 'part of a part' of the forest and farm biomass. For example, 'high yield' plantations pick one tree species among thousands, for yields of one part of the tree (e.g.pulp wood).

'High yield' Green Revolution cropping patterns pick one crop among hundreds e.g. wheat for yields of one part of the wheat plant (only grain).

These high partial yields do not translate into high total (including diverse) yields. Productivity is therefore different depending on whether it is measured in a framework of diversity or uniformity.

A recent article in Scientific American has developed this approach further and has shown how the economic calculations of agricultural productivity of the dominant paradigm distort the real measure of productivity by leaving out the benefits of internal inputs derived from biodiversity as well as the additional financial and ecological costs generated by purchase of external inputs to substitute for internal inputs in monoculture systems.

In a polyculture system, five units of input are used to produce 300 units of food thus having a productivity of 1.5.

In an industrial monoculture, 300 units of input are used to produce 100 units of food, thus having a productivity of .33.

The polyculture system which has been called 'low yielding' and hence incapable of meeting food needs is therefore five times more productive than the so-called 'high yielding' monoculture.

Quoting Mr Obaidullah Khan, Head of FAO's Regional Office for Asia and Pacific, Martin Khor of Third World Network said the intensive model of Green Revolution agriculture was not sustainable due to rising costs and falling yields.

As in the case of crop production, industrial fisheries and aquaculture also consume more resources than they produce. As Dr John Kurien pointed out, in 1988, global shrimp aquaculture consumed 180,000 tonnes of fish meal derived from an equivalent of 9 lakh tonnes of wet-weight fish. It is further estimated that by the year 2000 about 570,000 tonnes of cultured fish will be produced in Asia. The feed requirement for this will be in the order of 1.1 million tonnes. This is equivalent to 5.5 million tonnes of wet-weight fish, nearly double the total marine fish harvested in India today. Fish meal provides the crucial link between industrial aquaculture and industrial fisheries since the fish used for fish meal is harvested from the sea through trawlers and purseines which totally deplete marine stocks. This falsifies the often-used argument by agencies like the World Bank that promotion of aquaculture is like moving from hunting and gathering to settled agriculture in fisheries and will reduce the pressure on marine resources.

Genetic engineering

Other experts from India who presented papers at panels were Dr B D Sharma, Dr D Bandopadhyay, Dr Sultan Ismail, Dr Vijayalakshmi, Mr Pandhari Pandey, Prof Ramakrishnan, Dr Santosh Satya, Dr Indira Hirway and Dr Darshini Mahadevia. They gave details of the impact of structural adjustment on agriculture and food security and also developed the sustainable alternatives available to ensure safe and adequate food for all.

In spite of all evidence pointing to the high diversity, productivity and sustainability of small family farms, globalisation is wiping out these efficient systems and replacing them with inefficient and unhealthy industrialised food systems under corporate control.

The myth of low productivity of diversity-based small farms is also being used to promote genetic engineering. In her paper on 'Biodiversity and Biotechnology', Beth Burrows called genetic engineering a form of Structural Adjustment but directed by Ciba-Geigy and Monsanto rather than by the World Bank and IMF.

Vandana Shiva pointed out how the same corporations which want regulation for Intellectual Property Rights, want deregulation for biosafety. They want organisms to be treated as 'novel' when it comes to claiming property rights and as 'natural' when it comes to taking responsibility.

These corporations pushed for trade liberalisation of agriculture under the Uruguay Round of GATT. They are now demanding total freedom of investment as a right. As Martin Khor of the Third World Network stated, the industrialised countries are now threatening to launch a new Uruguay Round at the WTO Ministerial Meeting to be held in Singapore at the end of the year. The biggest issue was the Multilateral Investment Agreement, under which no country would have the right to screen foreign investment. Corporations wanted the right to enter and establish themselves with 100% equity, and total freedom to repatriate profits. They could buy farmers' land , set up plantations and fisheries and also undertake livestock rearing.

Everywhere across the world, less food is being produced and less diverse food is being grown, and less is reaching the poor and hungry. Fewer farmers are finding a place in agriculture and even privileged consumers have no food security in the sense of access to safe and nutritious food. BSE-infected meat and hazardous chemicals are creating new health threats to the consumers even in affluent countries.

The corporations are the only beneficiaries of freetrade and they are not in the business of ensuring food for all. As Senator McGovern of the US Senate had stated, 'Food security in private hands is no food security at all' because corporations are in the business of making money, not feeding people.

When trade liberalisation policies were introduced in 1991 in India the Agriculture Secretary stated that 'food security is not food in the godowns but dollars in the pockets'. Dr Shiva pointed out that the dollars go to the pockets of the Cargills, Continentals and Pepsicos, not the pockets of Indian farmers or fisherfolk. The centralised government-controlled food distribution system run by the Food Corporation of India depending on long-distance transport had its flaws, but these flaws can hardly be corrected by replacing it with an even more centralised corporate-controlled food system which promotes the export of Indian food grains and then imports food at high social, economic and political costs to people and the country. - TWN