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Agriculture
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The generally steady evolution of
prices up until the early 2000s came to
be expected as a matter of course. This
sense of complacency was fostered by
a belief in technological progress—
associated in part with overconfidence
in the wake of the “green revolution”
of the 1960s and 1970s and in part
with the international organizational
infrastructure that created a big food
aid industry to supply spots mired in
sudden, acute scarcity. Chief among
these organizations were the United
Nation’s Food and Agriculture Organization
(FAO); the World Bank and
regional multilateral banks, such as
the Inter-American Development Bank,
the Asian Development Bank and the
African Development Bank; and superpower
agricultural producers, including
the United States and some of the
European Union member countries.
Along came the 2000s and with
them two great international agricultural
price shocks. In 2007–08, sudden
price increases in the previously placid
agricultural sector were responsible for
food riots in countries as different and
far apart as Burkina Faso, Egypt, Haiti,
Madagascar, Mexico, Philippines, Senegal
and Yemen.
Scholars, analysts, policymakers,
major agribusiness corporations and
farmers themselves have highlighted
a multiplicity of causes behind the
higher commodity prices.
On the supply side, the oil price
bull-run between 2003 and 2008 hit
agriculture significantly, given its high
contribution to the production cost per
unit in this sector because of fertilizers,
transportation and other industrial
agribusiness operations. Cereal stocks
fell to their lowest levels since the early
1980s. And, specifically in the United
States, growing proportions of the corn
crop were channeled into the production
of ethanol for use in transport.
On the demand side, experts identified
a structural shift in global patterns,
with higher consumption of animal
protein (itself raised through animal
feed based on basic grains) in the big
emerging market countries of Asia
and increasing demand for biofuels to
reduce carbon emissions. The latter
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