Food security can not be taken for granted

With the corona crisis, many have discovered that the security of supply of products in today’s complex world cannot be taken for granted. It causes severe headaches for companies. It becomes extremely insecure when supply problems also arise in the food markets. It is important that there is a good overview of the supply chain’s vulnerabilities. The fact that it has been a long time in Europe that things really went wrong on a large scale, in itself creates the danger of too little vigilance in this regard …

With the corona crisis, many have discovered that the security of supply of products in today’s complex world cannot be taken for granted. It causes severe headaches for companies.

It becomes extremely insecure when supply problems also arise in the food markets. It is important that there is a good overview of the supply chain’s vulnerabilities. The fact that it has been a long time in Europe, where things really went wrong on a large scale, in itself creates the danger of too little vigilance in that regard.

Long chain

With the financial crisis, critical economists made the analysis that the financial system suffers from the problem of the ‘long chain’. If this weakens the morale of responsibility, this can certainly become morbidly problematic. The analysis was that the central banks’ ruthlessness encourages a lot of risky behavior. This is because of their cheap money policy. Unfortunately, today’s high inflation cannot be seen in isolation. But analogous to the banking crisis, the food price crisis also has a more systemic side.

System crisis

On to the food sector. George Monbiot (among others columnist for Guardian) says in his new book Regenesis: To feed the world without consuming the planet that there is also a structural and long-growing systemic crisis in the food system. Where I follow him is that it is always a matter of taking care of derailments, for human arrogance often plays a trick on us. This combined with cognitive blinding of all kinds.

If there is complacency and hubris around our food supply, then that blindness may have its roots in the idea that for so many decades there has been a downward trend in the number of malnourished people globally. That curve may have put many to sleep.

Critics argue that the features that make the food system less vulnerable at key nodes have been weakened. Instead, there has been greater convergence and synchronization of business strategies. Less redundancy, modularity and backup systems So. According to one approach, four mastodons control up to 90% of the global grain trade.

Robust?

The key question is whether our food system is robust. At this point, it still seems justified to say that it is to a greater extent than many other systems. It has certainly a resilience, for even during the corona crisis, there has always been an offer despite questions about it.

It is, of course, a complex system, which means that it can contain vulnerabilities without us being able to easily identify them. A reliable system contains redundancy. This means that duplication is built-in, so that in the event of an error there is a fallback position. To reduce the fragility of a system, failure at some point should not threaten the entire network. This financially involves a number of different business models.

In the financial crisis, there were too many banks operating in exactly the same way. There are tendencies towards one-sidedness with a declining diverse food ecosystem. In addition, it should also be mentioned that there are plenty of alternatives to many nutritional elements.

Offer: West vs. Rest

We must be aware of the risks described above. The food system in the West seems to be less vulnerable than in many other parts of the world. The corona crisis showed that international trade can act as a buffer, whereby a shortage on one continent can be compensated with supplies from another continent. Europe in particular seems to benefit greatly from this, but a continent like Africa, which is already fragile in so many ways, much smaller.

Of course, we in the EU are also experiencing problems with rising food prices due to the combination of the pandemic and, above all, the invasion of Ukraine† However, this does not mean that the market does not work, on the contrary. However, you need to be careful.

chickens

Because neighboring Malaysia no longer wants to export chicken, no fewer than 3.6 million chickens a month disappear from the market. It is not yet clear how long the export ban will last. Brazil, Australia and the United States continue to supply Singapore with chicken meat.

Yet it is once again clear how risky almost total dependence on food imports is, especially for countries with few alternatives. Indonesia previously kept palm oil within its own borders. India also chooses to stop the export of cereals and high food prices have sparked strong protests in Sri Lanka. Citizens of Singapore, meanwhile, are being advised to buy protein substitutes.

Vulnerabilities

What should give extra attention to countries in the West is the extent to which financialization has also introduced vulnerabilities in the food sector. Concentration of the market in only a few key players and excessive debt positions therefore appear to be vulnerabilities that should not be underestimated.

One of the most frustrating elements of the banking crisis was that the population felt that the problematic developments in the financial sector, given its importance, were being monitored seriously and critically. Given the importance of the food sector to humans, it would be bad if we were to come to the dismay that the risk of a global food crisis is not sufficiently foreseen.

affordability

In order to address the global crisis of affordability, it is important that the conflict with Russia does not mean that Ukraine’s agricultural land remains inaccessible in the long term. One of the most vulnerable points, also in the west, is the availability of fertilizer.

According to Green Markets North America Fertilizer Price Index fertilizer prices are almost 150% higher than last year. However, it does not have to ration the food supplies in the west. Half of our food production in Flanders depends on the use of artificial fertilizers.

If manure is treated properly, it can be an acceptable alternative to fertilizer. To do this, Flanders must be prepared to ask the EU to amend the Nitrates Directive, which will allow a more circular application of livestock manure. It is an example of how flexibility makes it possible to secure the food supply.

In 2011, I pleaded in the agricultural magazine Countrymen of VILT already for more prudent thinking around agricultural policy with an appropriate place for buffers and reduction of vulnerabilities. Like The Economist pronounced, the combination of disappointing harvests in China due to excessive rainfall, heat and drought in India as well as the US and Africa is currently creating extraordinary stress on the food system. For us, it is essential that global trade can play its role as a buffer, in addition to a willingness to act wisely with rules that should be seen more flexibly in times of crisis.

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