Canadian Mennonite
Volume 12, No. 10
May 12, 2008


God at Work in the World

Hungry mouths may go unfilled

Rising food prices put a crimp in Canadian Foodgrains Bank’s ability to meet Third World demand

Aaron Epp

National Correspondent

WINNIPEG

A woman in Bangladesh carries a sack of rice from Canadian Foodgrains Bank. Rising commodity prices may be good for Canadian farmers, but they are having a negative impact on the ability of agencies like the Canadian Foodgrains Bank to meet the rising demand.

Canadian Foodgrains Bank will be forced to feed at least 25 percent fewer people this year than last, due to rising food prices.

A spokesperson for the international food aid organization says that unless donors and the government come through with increased funding, it will not be able to meet the growing demand for its serv-
ices. “It’s an extra challenge, but we hope it’s a challenge we can find a solution for,” says Manitoba regional coordinator Harold Penner.

The price of food staples such as wheat, rice, corn, soy, milk and meat has risen dramatically in the past year, causing riots and social unrest in several countries including Indonesia, Ethiopia, Egypt and Haiti (see “MCC staffer victim of carjacking during Haitian food unrest,” April 28, page 23).

Maureen Fitzhenry says the reason for the price increases is because five of the world’s top wheat exporting nations have experienced two years of bad weather in a row. “In a nutshell, we have a shortage of wheat in the world right now,” says Fitzhenry, the media relations manager for the Canadian Wheat Board, a marketing agency for western Canadian wheat and barley growers. She adds that the rising price of other foodstuffs is happening for the same reason.

Bad weather isn’t the only reason, though, according to the Foodgrains Bank. The agency names “a complex set of factors,” beginning with the fact that over the past decade almost every year the amount of cereals consumed globally has exceeded the amount produced by farmers. Although the amount has been small, it has gradually reduced global food stocks from about five months of consumption in 1998 to less than two months in 2006. This, together with “several relatively sudden changes or shocks” that have occurred in the last two years, has caused food prices to increase abruptly.

These changes include rising consumption of meat and dairy products in emerg-
ing economies like India and China, the use of cereals and oilseeds to make biofuels and increased speculation by financial markets.

Penner says it is not clear yet how long, and to what extent, food prices will rise, describing it as a mixed blessing. Higher commodity prices are good news for farmers in developed countries, he says, but they make it difficult for the most vulnerable people in the developing world to access food.

“In North Korea, for example, a bag of rice that feeds a family for just a few days costs more than 30 percent of a month’s salary,” stated Willie Reimer of Mennonite Central Committee (MCC) in a prepared statement. Reimer is director of MCC’s Food, Disaster and Material Resources programs, and MCC is one of the 15 Canadian agencies the Foodgrains Bank represents.

Since its inception in 1983, the Foodgrains Bank has provided $531million in food aid and services in 77 countries. Last year, it collected a record $8.4 million in grain and cash.

The Foodgrains Bank’s fiscal year began April 1, and by the end of the month the agency had received more requests for aid than it believed it would be able to handle all year.

Still, Penner says the staff at the Foodgrains Bank is optimistic. “I’m sure we will appeal to our donors,” he says, “and we’re hopeful that CIDA [Canadian International Development Agency] will also come through with increased funding.”

Sowing optimism alongside fear

Rise in grain prices a boon to some farmers, a death knell for others

Evelyn Rempel Petkau

Manitoba Correspondent

Canada

The rising price of grain is a double-edged sword for Canadian farmers. Grain farmers, like those pictured below in southern Manitoba, are somewhat optimistic, while beef farmers who feed their cattle the expensive feed are reeling.

Two years ago, farmers were losing money on grain production. Since then, grain prices have doubled and wheat has reached its highest price in three decades.

“The last time the market spiked like this was about 1974,” says Abe Elias, a grain farmer from Sperling, Man., who is looking at this planting season with renewed optimism. But that optimism is tempered by fears that the increase in fuel, ferti-
lizer, pesticides, equipment and land may be with the farmers longer than the now-spiralling grain prices. “For the price of wheat to go back to what it was, would be catastrophic,” he says.

Peter Froese, a grain farmer from Roland, Man., speaks with cautious optimism. “[Our optimism] is always tempered,” he says. “Input costs have also gone up, in some cases doubled. It costs me $1,000 to fill my tractor with fuel.”

“There is optimism this year, but I’m not sure it is all warranted,” cautions Mark Reusser, who sits on the board of directors of the Ontario Federation of Agriculture and mingles with farmers from every sector of the business and every area of the province. He sees the situation for cattle farmers as being the bleakest. “The margins for beef cattle farmers are terrible,” according to him. Reusser has heard of cattle farmers in more northern parts of Ontario considering plowing up their pastureland for crops.

This is also happening in parts of Manitoba and Alberta, where cattle farmers see greater profitability in plowing their marginal land for growing crops rather than raising cattle.

John Kuhl, a Mennonite cattle farmer near Graysville, Man., feels the pinch. “Cattle are a drain instead of an asset,” he says. He is hoping to put more of his pastureland into cash crops this year and move the cattle onto community pastures, where room has opened up as other cattle farmers are getting out of the business.

Last summer, Lyle Brown, an Alberta cattle farmer, had 600 head on grain feed and kept waiting for the sale price to improve, but the market only worsened instead, as he continued to feed them expensive barley. Finally, he sold them at a $150,000 loss.

This year, his feedlot stands empty. He will plant canola and barley, and take advantage of the high grain prices, although, like in other parts of the country, drastically increased input costs tighten that margin. Nevertheless, “we’re optimistic,” Brown says. “We’ve got to be.”


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