Relationships between food, energy and environment security

Popp, József – Potori, Norbert

Keywords: food prices, structure of consumption, manufacture of bio-fuels, GM crops, agricultural politics

Since the commercial year of 2006/2007 the price of most agricultural products began to rise and broke record levels. The food-price index of FAO between January 2006 and January 2008 increased by more than 60%. Variations in prices did occur before but the latest price shocks were caused by a number of factors acting concurrently. Of these the depletion of the world’s corn and oil-seed supply takes possibly no.1 position: the balance sheet of Earth’s food supply has not shown such little reserves for decades. Short-sighted economic policies inevitably contributed to the present situation. At the same time the international media tends to lay the blame on the transformation of food consumption in some developing economics (e.g. China and India) and on increased use of agricultural crops for bio-fuel productions. We can divide the factors causing the price shock into three categories:
1.Factors of ecological and biological nature affecting agriculture and trade.
2.Factors affecting the macro-economic environment (increases in population and consumers’ income, drastic increases in world oil prices, etc).
3.Factors arising from agricultural and commercial policies (trade limiting measures, reforms, incentives for bio-fuel production, etc).
Some of the examined factors bring about change on short term, whereas others on long term. While decline in production of leading agricultural producers and exporters may affect markets over a period of a single year (cyclically), some macro-economic factors may bring about structural changes that span over many years. The application of bio-technology is one of the tools for alleviating the “unpleasant side-effects” of cyclical oscillations and fundamental structural alterations for stabilizing the markets.
The random occurrence of GMO’s banned by the European Union displays zero tolerance in spite of the fact that their distribution is allowed in any other third country. The practice of EU licensing procedure differs significantly from that of a third country especially in terms of time. While the procedure of EU licensing may often take three years, the procedure in the US for example can be completed within 15 months showing the green light to cultivation of a new GM line. The lack of common licensing procedure leads to a situation where the production, distribution and use of some GM crops are allowed in a number of different countries in the world whereas they are banned in the European Union. Zero tolerance of banned GM products will seriously affect both at present and in the future the imports of GM soya and maize and their derivatives (soya groats, maize gluten feed, DDGS) into the EU. This is a concern because the European Community has been for many years unable to satisfy her internal demand of high protein fodder from own resources, much of it is imported from South and North America, where a considerable fraction of exporting countries produce soya, rape and maize manipulated by gene technology.
In future a number of new GM products are expected to be introduced into the EU markets. Agricultural production will still be concentrated on land used at present where increase in productivity is the primary task. This places unavoidably the emphasis on the application of bio-technology. GM crops will be produced in an increasing number of countries throughout the world whether or not the European Union will or will not license their marketing. It is also evident that the community is unable to reduce her dependence on imports of agricultural row materials. Therefore the EU faces two possibilities: either she accepts reductions of internal food supply and increases of food imports (especially meat products) or accepts the changes in international markets and subjects her politically and emotionally not unmotivated licensing procedures to this situation while maintaining strict risk assessment.
The creation of a balance between food, energy and environment security is an important task in the EU. The appropriate listing of priorities is a controversial subject in member countries, because that is what determines future reforms of the present system of agricultural supports. But this is important also because the food industry has to compete for land (water resource) usage with the fodder, energy and chemical industries (manufacture of degradable wrapping material) and the demands of environmental protection, biodiversity and recreation puts further value on arable land. The list of priorities for food, energy and environment security seriously affects the finance of the common agricultural policy (CAP) for the period of 2013-2020.

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