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CHAPTER ONE Unpacking the World Food Economy

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Pause for a minute to reflect on how much you know about the path followed by the food you ate this morning as it made its way to your breakfast table. Of course, your understanding and knowledge depends very much on what exactly you had to eat. Some may know almost every detail of the production, transport, processing, and exchange relationships involved in the preparation of that meal – particularly those who choose to consume foods such as fresh eggs, oats, and strawberries from a local organic farm, or ethically traded shade-grown coffee from Nicaragua. Others may know very little, especially when they consume pre-packaged and highly processed foods like boxed cereal, frozen waffles, or instant hot chocolate. These latter items, most likely purchased from a neighborhood supermarket, made their way to your table after a long and winding journey through the global industrial food system. Most of us probably have a vague idea of our food’s origins and travels, as well as the power relationships that might be associated with it along the way, but we are not 100 percent sure.

The gap in our knowledge about the global food system can be understood as a kind of “distance” – which is often, but not always, related to the physical distance food travels from farm to table. Today, the average plate of food eaten in Europe and North America travels around 1,500 miles before it is consumed. The concept of “food miles,” picking up on the notion of physical distance, has attracted widespread attention in recent years, particularly because of growing concern about the greenhouse gas emissions associated with transporting food across great stretches of land and water. The distance between consumers and food can also be mental, as in the gap in knowledge we have about the social, ecological, and economic relationships associated with the foods we eat. And it can come in the form of power differentials between actors in the food system, where some experience its benefits while others absorb a disproportionate share of its costs. We often lack a full understanding of the natural and human conditions under which our food is produced and are only somewhat aware of who controls the various steps along the supply chains of the most basic and intimate resources necessary for human survival.1 In these various ways, we have become increasingly distanced from much of the food we consume.

Some say it’s not necessarily important for people to know all of the details of the functioning of the global food system – the web of relationships that span the production, processing, trade, and marketing of the food we eat. If that system conveniently provides safe, abundant supplies of food at affordable prices, then many consider that it is doing its job. Indeed, as the global reach of the industrial food system has expanded, with foods being traded across long distances, a greater variety of foods from around the world have become increasingly available to global consumers through the rapidly growing retail grocery market. This broader range of foods, such as fresh fruits and vegetables available year-round, can bring nutritional benefits to consumers. As scientific methods are employed to make foods last longer and better able to handle the journey to areas of the world that lack sufficient food supplies, wastage can be reduced. For the better part of the past fifty years, the system has outwardly appeared to provide the advantages of a truly global and stable food supply that could be accessed by an ever larger range of people. Its stability and abundance brought lower prices in addition to expanding its geographical reach. So long as the system is providing cheap and readily available food, why question it?

But questions have been raised about the benefits and costs associated with the way food is grown, processed, and marketed in the global industrial food system. Recent decades have seen heightened awareness of the ecological and social consequences of the current organization of that system. The increasingly obvious environmental side effects of large-scale industrial agricultural production, including biodiversity loss and exposure to toxins from the use of pesticides, have been of widespread concern since at least the 1970s. The commercial planting of genetically modified (GM) crops since the 1990s has raised questions about their potential ecological consequences. The reality of a warming climate, as demonstrated by extreme weather patterns in recent years, has added uncertainty to the productive capacity of the agricultural sector and has drawn attention to the fact that around one quarter of global greenhouse gas emissions is associated with the food and agriculture sector. As temperatures rise, analysts have stepped up warnings about potential food shortages in the not too distant future. These concerns have prompted calls for change, not just in production methods, but also toward more sustainable diets that move away from consumption of animal protein, such as eggs, dairy, and meat, which place a much higher ecological toll on the planet than plant-based foods. Meanwhile, approximately one third of the world’s food production is lost or wasted.

Uncertainty about the impact of environmental change on food is layered on top of what is seen by many to be unfair conditions for farmers in both rich and poor countries, as corporate actors have become more and more powerful in determining the circumstances of their livelihoods. There are 2.5 billion people – including 350 million indigenous peoples – engaged in small-scale agriculture and food production, who collectively manage approximately 500 million small farms. Estimates vary on the proportion of the world’s food supply that these small-scale farmers produce, ranging from 30–35 percent on the lower end, and up to 70–80 percent on the higher end. While it is difficult to know their precise production levels due to data limitations, there is growing understanding that small-scale and family farming is a major contribution to global food production, especially in sub-Saharan Africa and Asia. At the same time, these small-scale producers have access to only around 30 percent of the resources devoted to the sector. Many of these farmers practice sustainable forms of agricultural production, but their livelihoods are under threat.

At the same time, a “triple burden” of malnutrition has emerged that threatens human wellbeing. These are: (1) chronic undernutrition (inadequate intake of sufficient calories, affecting over 820 million people); (2) overnutrition (excessive intake of calories, affecting over two billion people in the form of overweight and obesity); and (3) micronutrient deficiencies (inadequate intake of vitamins and minerals, affecting over 1.5 billion people). One or more of these categories of malnutrition affect a significant proportion of the world’s population, in rich and poor countries alike.2

Worries about these issues have spurred a small but growing movement that seeks to promote alternative food systems that maximize the ecological, social, and health benefits of food, rather than profits. These movements highlight the fact that there are, in fact, many food systems that operate at local and national levels, many of which have different priorities. These food systems, however, are still dwarfed by the size of the global industrial food system, which affects both producers and consumers in myriad ways, even if they participate almost exclusively in alternative food systems.

Further impetus for questioning the current global food system came with the sharp increase in food prices on global markets in 2007–2008 and again in 2011–2013. These price spikes served as a stark reminder of the gap in our knowledge about the forces that control outcomes in the global food system. When food prices began to rise quickly and dramatically, there was a great deal of uncertainty, even among experts, as to what exactly caused these major disruptions in global food markets. Some cited a misalignment of supply and demand fundamentals as the principal culprit. But others dismissed those explanations and pointed to other factors, including macroeconomic conditions, biofuel policies, trade practices, and financial speculation on commodity markets.

That food prices could change so abruptly, and immediately affect access to food for people across the world, was remarkable. The impact of these price spikes were felt most intensely in the world’s poorest countries – countries that had once been agricultural exporters, but which had gradually become net importers of food over the previous fifty years. The poorest members of society in developing countries often spend upwards of 50–80 percent of their income on food. When prices shot sky high, many people’s access to food immediately became severely restricted. The food riots that broke out across the developing world in early 2008 – from Haiti to Egypt to the Philippines – illustrated their frustration. Food prices continued to be high and volatile, with prices reaching new record highs in 2011 and 2012, exacerbated by drought in North America, a major grain-producing region. For those affected by this crisis, particularly young children, the impacts are likely to be lifelong, as even short periods of severe malnutrition in the very young (in the first 1,000 days of life) can have a permanently negative impact on human health, wellbeing, and long-term livelihood potential.

This jarring disruption to the global food system was highly unusual. After all, food prices on world markets had been low and falling for most of the previous thirty years. An earlier sharp spike in food prices occurred in the mid 1970s, but this episode had gradually faded in people’s minds as the problem of low farm incomes persisted for decades. The major concern of the 1980s to early 2000s was with ensuring decent farmer incomes and food security for agricultural producers, especially those in less industrialized countries who, although they produced food, were still net buyers of food and often did not have enough income to secure their own nutrition at adequate levels. To suddenly see such a dramatic new trend of rapidly rising food prices, which so deeply affected many people’s food security, underscores the importance of gaining a better understanding of the way in which the global food system functions and its impact on people around the world. Food prices stabilized somewhat after 2014, but stayed higher than they were before the crisis and the threat of a return to more volatile food prices remains.

More recently, world agricultural markets experienced fresh turmoil in 2018 and 2019, due to growing trade tensions between two of the world’s largest economies – the United States and China. In 2018, US President Donald Trump began to impose tariffs on imports from China, seeking to reduce the US trade deficit with that country. China, which had been importing significant amounts of soybeans from the United States over the past decade, retaliated with its own tariffs against products it imports from the United States, with a particular focus on agricultural goods. As a result, US exports of soybeans plummeted, as did prices for US soybeans on world markets, while China shifted its soy purchases to alternative suppliers – mainly to Brazil and Argentina, which have both been expanding soy production in recent years. Meanwhile, the rapid increase in the spread of the deadly African Swine Fever virus after 2018 resulted in the deaths of a quarter of all pigs globally, including hundreds of millions of pigs in Asia and Europe. The epidemic contributed to an increase in meat prices not seen since 2014 and growing demand for imported meat into affected regions.

These shifts in the global trade of major commodities in the past several years have had not only economic repercussions – in some cases positive, and in some cases negative – for farmers and agricultural traders, but have also been associated with ecological impacts. For example, pressure for further expansion of soy production in South America has been associated with deforestation, climate change, soil exhaustion, and the heavy use of agricultural chemicals.3

Together, the ecological, economic, and social dynamics of the global food system have profound impacts on both producers and consumers around the world. This book aims to contribute to a fuller understanding of some of the key forces that influence and shape the current global food system. It focuses in particular on the interface between the international political and economic dimensions of the global industrial food system – what I refer to as the “world food economy.” This world food economy is characterized by an increasingly global market for food, with more and more of it traveling through global production, trade, and processing supply chains, influenced by myriad international economic and political forces. Much has been written in recent years on the theme of food systems, particularly on movements that promote alternatives at the local level, as noted above. But the ways in which even alternative food systems are influenced and shaped by the global political and economic forces that have given rise to the dominant global food system are often left unpacked, only partially examined, or are ignored altogether.4

Yet the international economics and politics of food have significant implications for other scales and dimensions of food systems – from access to food for hungry people in specific locations such as a small, remote village in Africa, Latin America, or Asia; to local sustainable food movements in Europe or North America; to diet-related nutrition and health issues more broadly. Taking a step back to the bigger picture, to look at the wider forces that shape the world food economy and how they reinforce one another, helps to build a richer understanding of these other important dimensions of food systems. While there is always a risk of missing the specificity of the dynamics in particular locations or the impact on certain groups when stepping back to take a global perspective, gaining an understanding of the big picture helps to contextualize the local. Indeed, diverse local level food initiatives that seek to provide alternatives may be difficult to scale up and out precisely because the world food economy creates conditions that push against those efforts. In other words, both place-based local studies and global overviews of broader structural dynamics are needed to gain a comprehensive picture. This book aims to contribute to a deeper understanding of the global political and economic dimensions of food, with the hope that it will complement studies that are grounded in more local case studies or which are more focused on specific issues or groups.

As outlined in the chapters of this book, the expansion of the world food economy did not just emerge on its own overnight. It was shaped by a variety of forces over an extended period of time. Although global food markets emerged well over a century ago, they were given a further push by industrialized countries, and the United States in particular, from the 1940s and 1950s onwards. This phase of expansion in the world food economy saw the promotion of a global adoption of the industrial agricultural model, as well as the development of major international markets for foodstuffs. These developments paved the way for subsequent forces that reinforced the spread of the world food economy in more recent decades. These additional forces include the establishment of new global norms for the liberalization of international agricultural trade; the rise of transnational corporations (TNCs) as dominant agents of global food production, processing, trade, and distribution; and the dramatic increase in the transformation of agricultural commodities, farmland, and agrifood firm shares into financial products bought and sold by investors.

But the expansion of the world food economy is not the entire story. These forces, as they have unfolded, have opened up a greater number of what I call “middle spaces” within that economy, where control and influence over how it operates has become concentrated in the hands of powerful actors who have an interest in seeing that system expand. More intermediaries in the world food economy have become involved in a multitude of activities related to the business of food along expanded food supply chains. It is within these middle spaces of activity where norms, practices, and rules that govern the world food economy are shaped by the very forces and actors that are leading to its expansion. The economic forces and powerful actors that shape the governance systems that guide the expansion of the global food system may seem far removed from the big questions of compensation to agricultural producers; who has access to food in a particular location; and with what effect ecologically and socially. But understanding the influence of global economic forces and the middle spaces they have opened up for powerful intermediaries to set the rules of the game is essential for explaining food outcomes in rich and poor countries alike.

The world food economy today is characterized by growing distance, as powerful actors in its middle spaces increasingly treat food like any other commodity, where its profit generating abilities are prioritized over its other essential functions such as nourishment, livelihood, and culture. It is also characterized by asymmetry and volatility, and as a result is susceptible to crises where the world’s poorest and most marginalized people are typically affected the most. Finally, it is also characterized by increasing ecological fragility, putting at risk the very foundation on which food and agriculture is based. These features of the world food economy have not gone unnoticed. Resistance movements that seek to promote alternatives to the current world food economy are on the rise. Although still small in scale compared to the global trend in world food markets, these movements signal a momentous shift in thinking on a broad scale about the implications of the food we eat every day.

Food

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