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The Saudi Arabia of Food

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It’s not easy to find any silver lining in the dark cloud of spiraling food costs and hunger that hangs over the world’s poor. But there is some good news for Americans in the global food crisis.

The United States may have been a significant part of the problem — with its annual $6 billion in subsidies to produce ethanol from corn. But the United States is also almost certain to be part of the solution because it is to food what Saudi Arabia is to oil: the swing producer that can most easily and swiftly increase the world’s food supply.

The United States remains the world’s breadbasket. It produces slightly more than 30 percent of the world’s wheat exports, about 70 percent of the world’s corn exports and close to 40 percent of its soybean exports. Food exports, at nearly $70 billion, are one of the biggest earners from foreign trade, well ahead of chemicals or general machinery or aircraft.

Among the biggest export markets for American foodstuffs, after Canada and Mexico, are the Middle Eastern and African oil producers. Just as American motorists have been fuming at the higher gas prices, Saudi and Nigerian and Iraqi and Mexican customers have been complaining about the higher prices they are paying to eat.

There is a symmetry here. Modern food production is energy intensive, starting with the fertilizer. It takes 33,500 cubic feet of natural gas to make one ton of anhydrous ammonia fertilizer. It takes fuel to plough the fields, to sow and weed and harvest the crop and take it to market. So the more Americans pay for oil, the more Arabs and Africans pay for food.

The irony is that prices for wheat, coarse grains like corn and rice are all soaring, even though world crops are at record highs. The U.N. Food and Agricultural Organization, or FAO, reckons that this year’s total world cereal crop will be 2,164 million tons, up 2.6 percent from last year’s total, which was the previous record.

The problem is that the world is consuming more cereals than it produces — partly because of more mouths to feed, partly because of the ever-increasing demands of livestock as countries like China clamber up the protein chain from rice to hamburgers. It takes 7 pounds of cereal to produce one pound of beef. About 750 million tons, over a third of the world’s cereal crop, goes to feed livestock. Humans eat only 1.006 million tons, less than half the total crop.

The other factor is the new fashion for biofuels, particularly in the U.S., which this year will use at least 81 million tons of corn to make ethanol — 37 percent more than last year. To put this in perspective, despite a sharp increase in wheat plantings, the U.S. will produce only 60 million tons of wheat this year.

But that flexibility of U.S. farmers to switch crops in response to market signals is the reason not to panic, despite grim news pictures of food riots in Haiti and Egypt and signs of panic in the Philippines.

Another reason not to panic is that last year’s exceptional weather, with droughts in the Ukraine and Australia, is unlikely to be repeated this year. The FAO sees the European Union producing a bumper 137 million tons of wheat this year, and Russia and Ukraine producing another 7 million tons.

There is, however, one big problem looming ahead in the world food industry. Unless the scientists get very lucky very soon, we shall soon all be hearing a lot more about something called Ug99. This is the name of a variant of the stem rust fungus, Puccinia graminis, that attacks wheat.

It was first identified in Uganda in 1999, hence the name. But this year it spread dramatically, its spores drifting on the wind across the Red Sea to Yemen and across the Persian Gulf to Iran.

The wheat stem rust, also known as wheat black rust, is capable of causing severe losses. It can destroy entire wheat fields. The FAO estimates that as much as 80 percent of all wheat varieties planted in Asia and Africa are susceptible to this new strain.

“Global wheat yields could be at risk if the stem rust spreads to major wheat-producing countries,” warns FAO Director-General Dr Jacques Diouf. “The fungus can spread rapidly and has the potential to cause global crop epidemics and wheat harvest losses of several billion dollars. This could lead to increased wheat prices and local or regional food shortages. Developing countries that are relying on wheat and do not have access to resistant varieties will be particularly hit.”

There are two big problems here. The first is that Ug99 has defeated the two main gene complexes, Sr 31 and Sr 24, that protect most wheat strains from stem rust. It appears to resist most fungicides. Stopping it may not be a foregone conclusion.

“Of the 50 genes we know for resistance to stem rust, only 10 work even partially against Ug99,” warns Rock Ward, leading the fight against it at the international Maize and Wheat Improvement Center.

The second problem is the nightmare scenario. Having jumped the Red Sea and Persian Gulf, it is not clear how Ug99 gets stopped before it heads east into Pakistan and India, and north into Russia, Ukraine and Europe.

“This thing has immense potential for social and human destruction,” says Nobel laureate Norman Borlaug, now 93 and known as the father of the Green Revolution in agriculture. “We know what to do and how to do it. All we need are the financial resources, scientific cooperation and political will to contain this threat to world food security.”

If the worst happens, then in the short term the survival of much of the human race is likely to depend on the farmers of the Western hemisphere, led by the United States. If Ug99 does cross the oceans to these shores, the world’s last life-saving reserve could be the corn and soy and sorghum farmers of America.

  • Martin Walker, senior director of the Global Business Policy Council, is chief global affairs columnist for UPI, He is senior scholar at the Woodrow Wilson Center and the author of “The Cold War: A History” and “Makers of the American Century.“*

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