Food on the table

Instead of disputing survey results showing self-rated hunger going up, President Aquino should just take it as a challenge to do better on several fronts.

Self-rated hunger can depend on many factors, including higher prices of cooking gas and more mouths to feed despite an expanded conditional cash transfer program to the very poor.

Since Christmas 2010, prices of certain basic food items such as sugar have jumped up by as much as 20 percent. Among non-essential food commodities, the increase, for example, in the price of butter can stop my heart faster than the cholesterol it contains.

P-Noy should prepare for the situation to get worse before it gets better. The latest Food Price Index prepared by the World Bank (WB) and released April 14 in Washington showed global food prices approaching their 2008 peak, driven in large part by soaring fuel prices and severe weather conditions in several major grain exporting countries.

As of last month, the global food index was 36 percent higher than its level a year earlier, with the biggest price increases recorded in corn, wheat, soybeans and sugar. Futures prices of corn, wheat and soybeans slipped further after the March 11 triple whammy that hit Japan.

As a result, according to the WB report, 44 million people worldwide have been added to the estimated 1.2 billion living below the $1.25 a day poverty line since June last year – coincidentally around the start of the Aquino administration.

If the price index rises another 10 percent, it will add 10 million to the ranks of the global poor; a 30 percent price spike means an additional 34 million.

Compared to better-off economies, low-income and lower-middle-income countries are suffering more, experiencing an average food price inflation of five percent.

Soaring fuel prices have increased demand for biofuels using food products such as corn, vegetable oil and sugar. Also going up as a result are the prices of fertilizer, irrigation, other farm inputs, and food transport costs.

In February this year, food price inflation in the Philippines stood at single digit, according to the WB report; it stood at 11 to 17 percent in China, Indonesia and Vietnam.

There is one bright spot in the WB report: the global rice supply. P-Noy might be interested in checking it out.

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The report notes good rice harvests in key exporters (and major sources of Philippine imports) Thailand and Vietnam. As of last February, global rice prices remained stable, with the benchmark price about 32 percent lower than the peak during the 2008 crisis.

Global stocks in fact are at the highest level since 2002-2003 – something that has “generally put to rest anxieties about upward pressure on the export price of rice,” the report said.

Apart from the United States Department of Agriculture (USDA), there are several other agencies and non-government organizations with websites that post relevant and reliable information on prices and supply of rice in the international market. P-Noy can scan some of them if he wants to avoid an agricultural scandal erupting under his watch.

Already questions are being raised about his government’s importation of rice, after agriculture officials announced that the country had so much supply of the staple some of the buffer was even rotting in storage.

Foreign observers in the international rice market are amazed by the information contained in a recent report on the Philippines’ rice situation, attributed to the National Intelligence Coordinating Agency. Some NICA officials have disowned the report.

One observer described the story as “one of the more amazing ‘misinformation’ events that I have seen.”

“There are so many errors in it, I can only assume that it was deliberately done,” the observer, whose opinions carry weight in international circles, remarked.

Contrary to the supposed NICA report, official data compiled by the USDA projects larger harvests for India, China and Cambodia, and flat but still record tying harvests for Thailand and Vietnam. Pakistan is seen to have a smaller harvest, but not the Philippines.

Again contrary to the report, Malaysia has not “locked up” 800,000 metric tons of rice. Certain agencies are trying to determine the source of the forecast that Indonesia plans to import 3.2 million MT of rice. The sources of much of South Korea’s rice purchases are also not the same as the Philippines’ (last year, the bulk of Korean imports came from China and the US, with Thailand accounting for only a fifth).

The stocks of the National Food Authority as of April 1 stood at 1.45 million MT – three times the five-year norm, according to the observer. All things considered, the observer estimates that the NFA could get by with stocks of only 200,000 MT.

During the rice crisis in 2008 – the first time in decades that the nation saw long, snaking lines of people waiting for rice rations – the Philippines was blamed by other governments for further pushing up the price of the staple in the world market due to its buying binge.

Filipinos have often wondered why the country that produced the so-called miracle rice and is home to the renowned International Rice Research Institute cannot be self-sufficient in its staple and has to import from its neighbors, mainly Vietnam and Thailand.

Several Filipino and foreign agriculture officials have explained to me that some crops are more efficiently grown elsewhere and sometimes importing such products are more cost-effective for a country. Think of wheat, which doesn’t grow in the tropics and is needed for flour, which is used for pan de sal and burger buns and instant noodles.

But rice is grown in this archipelago, the harvest has been good, and shouldn’t the country have enough of the staple at affordable prices to keep self-rated hunger down?

Answering that question is P-Noy’s challenge.