Your Excellency, Minister Theera Wongsamut
Madame Supatra Thanaseniwat, Permanent Secretary, Ministry of Agriculture and Cooperatives,
Ladies and gentlemen,
I am very honoured and grateful to be invited by His Excellency Minister Theera to be present at this Special World Food Day Celebration and deliver a short statement.
The 31st World Food Day celebration, commemorating the establishment of FAO 66 years ago, is held word-wide under the theme "Food prices - from crisis to stability".
Price swings, upswings in particular, represent a major threat to food security in developing countries. Hardest-hit are the poor. This year’s theme sheds light on this trend and what can be done to mitigate its impact on the most vulnerable.
On World Food Day 2011, let us look seriously at what causes swings in food prices, and do what needs to be done to reduce their impact on the weakest members of global society.
At the level of net food importing countries, price spikes can hurt poor countries by making it much more expensive for them to import food for their people. In 2010 the world’s Low Income Food Deficit Countries (LIFDCs) spent a record US$164 billion on food imports, representing a rise of 20 percent on the year before.
At the level of individuals, people living on less than US$1.25 a day may need to skip a meal when food prices rise. Farmers are hurt too because they badly need to know the price their crops are going to fetch at harvest time, months away. If high prices are likely they plant more. If low prices are forecast they plant less and cut costs.
Rapid price swings make that calculation much more difficult. Farmers can easily end up producing too much or too little. In stable markets they can make a living. Volatile ones can ruin them while also generally discouraging much-needed investment in agriculture.
Today’s turbulent commodities markets contrast sharply with the situation that characterized the last 25 years of the twentieth century. Between 1975 and 2000 cereal prices remained substantially stable on a month-to-month basis, although trending downwards over the longer term. For despite rapid population growth – world population doubled between 1960 and 2000 – the Green Revolution in the 1960s helped food supply to meet and even exceed demand in many countries.
But the picture today is a very different one. The global market is tight, with supply struggling to keep pace with demand and stocks are at or near historical lows. It is a delicate balance that can easily be upset by shocks such as droughts or floods in key producing regions. In order to decide how, and how far, we can manage volatile food prices we need to be clear about why, in the space of a few years, a world food market offering stability and low prices became a turbulent marketplace battered by sudden price spikes and troughs.
Some countries, mainly large ones, were able to shelter their food markets from the international turbulences through a combination of trade restrictions, safety nets for the poor and releases of food stocks. However, trade insulation increased prices and volatility in international markets and compounded the impacts of food shortages in import-dependent countries,
Food price volatility featuring high prices is likely to continue and possibly increase, making poor farmers, consumers and countries more vulnerable to poverty and food insecurity.
What needs to be done? The entire international community must act today and act forcefully to banish food insecurity from the planet. Governments must ensure that a transparent and predictable regulatory environment is in place, one that promotes private investment and increases farm productivity.
We must reduce food waste in developed countries through education and policies, and reduce food losses in developing countries by boosting investment in the entire value chain, especially post-harvest processing.
More sustainable management of our natural resources, forests and fisheries are critical for the food security of many of the poorest members of society.
When farmers react to higher prices with increased production it is essential to build on their short-term response with increased investment in agriculture, with emphasis on initiatives that support smallholders, who are the main food producers in many parts of the developing world.
At the same time, targeted safety nets are crucial for alleviating food insecurity in the short term. They must be designed in advance in consultation with the most vulnerable people.
In summary, investment in agriculture remains critical to sustainable, long-term food security. Key areas where such investments should be directed are cost-effective irrigation, improved land-management practices and better seeds developed through agricultural research. That would help reduce the production risks facing farmers, especially smallholders, and mitigate price volatility.
Regarding our joint cooperation in the field, over the last five years, 2007 to 2011, FAO mobilized a total of USD 3.9 million support for Thailand. This total consists of seven TCP projects (USD 1.7 million), 18 TCPF projects (USD 0.5 million), two Trust Fund projects (USD 1.6 million) and nine TeleFood projects (USD 70 640).
The estimated total delivery of the FAO field programme in Thailand – including both national and regional/global projects – for the period 2007 to 2010 was USD 7. 6 million, with national project delivery of around USD 1.7 million against an estimated delivery of global/regional projects of USD 5.9 million.
While increased investment in agriculture should be one of the main responses to high food prices, I take this opportunity to emphasize the exemplary role of the Thai government and its ministry of agriculture and cooperatives to cooperating with FAO at international, regional and national fora on a wide era of inter-related issues, ranging from food governance (in the Committee on World Food Security), to the provision of technical expertise of FAO programmes and – as a latest novel move – to awareness raising about the problem of hunger.
After the success of the 2010 1BillionHunger campaign in Thailand, FAO is now focusing awareness raising activities for youth and students.
Allow me to end these few words with once again expressing our gratitude to you and your staff for the support rendered to FAO’s work in the region.