Tuesday, February 15, 2005

Additional China stuff

One of the more interesting tidbits from the EPI thing I mentioned earlier: China's grain production, after peaking in 1998, has now declined by an amount equal to Canada's entire annual grain harvest. At the moment, they're drawing down their own grain reserves, but it's unlikely they can do so for longer than a couple more years. When the reserves run out, China will have to make up it's shortfall by importing. Food prices, already increasing by double-digit rates, are bound to increase even more dramatically when that happens. Not to overuse a cliche here, but we've got a perfect storm of declining fertility, declining arable land available, increasing global demand for food, and soon (maybe) increasing energy and fertilizer costs as we reach Hubbert's Peak.

Two possible upshots: Third World agriculture (Africa and parts of South America) is still far less efficient than western agriculture - often ridiculously so. As world food prices rise, we will need to finally get rid of our foolish food subsidies and tariffs here in the west, bringing some of the world's poorest regions some much-needed foreign exchange. Increasing the efficiency of African agriculture may make the difference between famine and not-famine. Also, increasing energy and fertilizer costs may make organic agriculture the norm rather than the exception by 2020.

The second upshot? Higher food costs put obese westerners on a diet, for christ's sake! Actually, this isn't that funny - think of food costs as a regressive tax. They have a disproportionate impact on the poor, so this is unlikely to be a pleasant time. Think a cross between Blade Runner (Asian hegemony), Mad Max (systemic stress as the energy supply dwindles) and Soylent Green (as we look for creative solutions to food shortages...)

I think over reading week (if I can get some schoolwork done too) I'll write up an optimistic forecast for the world, circa 2020. I can never decide whether I'm optimistic about the future or not...

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