food security - a proposal for south africa
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DESCRIPTIONAt the same speed at which the credit crunch and recession in the Developed World reached the inhabitants across the world, the food-price crisis disappeared from the radars of leaders in the Northern Hemisphere. Researchers and policy makers, however, are hard at work and their results are to be seen in quite a number of protectionistic measures to improve food security.
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Digital Re-print - July | August 2010 Food security - A proposal for South Africa
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At the same speed at which the credit crunch and recession in the Developed World reached the inhabitants across the world, the food-price crisis disappeared from the radars of leaders in the Northern Hemisphere. Researchers and policy makers, however, are hard at work and their results are to be seen in quite a number of protectionistic measures to improve food security.
The fundamentals that have driven the food prices in 2007/08 are still there and are just temporarily cov-ered by the recession.
As soon as the world awakens from the reces-sion we will see the oil prices surging; followed by maize prices driven by the biofuel sector.
Global freight rates will increase from their current levels of US$40/tonne-$90/tonne again. China, India and Brazil will increase their demand for proteins, for example in poultry meat production, etc and this will support grain prices.
We could have shortages in electricity producing pap and bread in SA. High food prices are a drop in the ocean compared to food unavailability!
We currently have a window of oppor-tunity to do something about food security whist the recession last.
DefinitionsFood security is defined by the availability
of food which is the responsibility of the free market. This will ensure enough safe food to be physically accessible to all.
The second leg of food security is affordability which is the responsibility of Government providing a policy environment whereby competition will drive down prices, economic growth and job creation will pro-vide the means to buy the food and a social safety network to assist those in distress.
Lastly, affordability also necessitates infra-structure provision by Government to ensure a proper support system for the market.
Food self-sufficiency, however, has to do with surplus produc-tion, no imports and exports of surplus food. In South Africa the self-sufficiency index (production as percentage of con-sumption) for white maize over the past 10 years has been 131 percent. For yel-low maize the self-sufficiency index for
the same period was 116 percent but for wheat the self-sufficiency index is only 77 percent.
South Africa: A ProposalIn an effort to maintain food security in
South Africa, we would like to propose the following as the building blocks for healthy food security in our country:
Maintain the free market - We need to maintain the free market mechanism as a system to ensure the availability of food to all. Although tempting to increase the self-sufficiency
indices of the various staple foods in the coun-try, the free market system remains the most credible system to ensure enough food to the people of South Africa.
Invest in infrastructure - The agricultural sector has been left with very poor infrastruc-ture and disinvestment by the South African Government over the past 10 years.
If we want to avoid a similar experience than that which happened with Eskom, we need serious investment in especially our rail infrastructure.
In the 1980s 85 percent of all grains was transported by rail and the processing sector has been developed for rail intake. The current percentage transported by rail is in the vicinity of 30 percent and is 2030 percent less expensive than road transportation.
This inefficiency in our rail system is add-ing substantial cost to the price of basic food products in South Africa. The goal should be to transport 85 percent of grain in South Africa on rail by 2012.
This will not just save consumers substantial costs in basic foodstuffs, but also a tremendous saving in the maintenance account of our road system as well as a decrease in the conges-tion especially around our cities. It has been reported that the road infrastructure in South Africa is built to past 20 years.
Recently some data was released that showed 78 percent of the roads in South
Africa are already older than 20 years. The fixing of all the main grain corridors is essential for farm-ers to maintain their access to the mar-kets. Quite a number of grain silos in this country have been delisted on the JSE
FOOD SECURITYA proposal for South Africaby Jannie de Villiers, Executive Director, SA Agricultural Processors Association, South Africa
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sector role players in agriculture need to be supported. Jointly they are providing the critical support services to new black farmers that become part of the main stream economy.
Other opportunitiesWe would also like to list a few other legs
to the proposal of a food secured South Africa: No food should be used for the
manufacturing of biofuels The speculation on the JSE Securities
Exchange (Safex) should be lim-ited where it affects food
South Africa should strive to become a preferred food aid sup-plier to the World Food Programme especially in our African region
Higher prices will be best cured by higher prices and let the market react to that
It is also of huge importance that the World Trade Organisation final-ise its DOHA Round to improve a free and fair trade environment in agriculture internationallyLastly, we would like Government to con-
tinue with their fight against collusion and to increase competition to drive prices down. This is an essential part of a healthy free market. The Competition Commission in South Africa has done us a great favour in their recent offensive action against collusion practices in South Africa.
ConclusionsIn conclusion, the proposal for healthy food
security in South Africa is not to panic with ad hoc policy decisions that would have a long term detrimental impact on South Africa.
The Government has done very well thus far and did the sensible thing in its reaction towards the food price crisis. We do however, need a much bigger commitment in terms of investment in agriculture to ensure the smooth supply of food at affordable prices to the people of South Africa in future.
Lastly, consumers in the country as well as policy makers need to be educated that food prices eventually must carry the cost to be food secured as well as to protect the environment in which the food is produced.
processing plants remains an essential part of food security. The basic rule applies: no electricity = no food.
We need to ensure a proper supply of the skills needed to produce and process food for South Africa.
Market information: Crop estimates
In analysing the w