Think Forward blog

Food Dyes and Valentines

Posted February 12, 2009

Hearts Just about every corner store and grocery has its Valentine's Day candy on full display this time of year. And if you take a close look at the ingredients in those candy hearts, you'll likely find a number of petroleum-derived, synthetic food dyes like Yellow No. 5 and Red No. 3. Unfortunately, many of these purely cosmetic food dyes have been linked to hyperactivity and other disturbed behavior in children by a number of recent studies.

Last year, Britain's Food Standards Agency advised the food industry to voluntarily ban the use of six common synthetic food dyes, and many food companies are following suit. For example, Mars has removed its artificial colorings from Starburst and Skittles.

To help parents who want to reduce their child's intake of synthetic food dyes, IATP launched a new Web tool today called the BrainFoodSelector. The tool allows parents to search by food company, product or synthetic food dye. We also put together a Smart Guide to Food Dyes that outlines which food dyes have been approved by the Food and Drug Administration, the health concerns for children and what you can do to avoid them.

The Center for Science in the Public Interest (CSPI) has filed a petition with the FDA calling for a ban on the use of synthetic food dyes in the United States. CSPI has also set up a Web tool where consumers can report any health reactions they may have experienced from synthetic food dyes to the FDA.

"The good news is that there are safer alternatives to synthetic food dyes and many food companies are already making the switch,” said IATP's David Wallinga, M.D., in our press release. “We need the food industry and U.S. government agencies to catch up with the latest science and start protecting our children. Until then, parents need to be armed with information when they go to the supermarket.”

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Yoplait Joins the no rBGH Club

Posted February 11, 2009

Kudos to General Mills, who announced Monday that its Yoplait brand would stop using milk from cows injected with the synthetic hormone, recombinant Bovine Growth Hormone (rBGH).

"Yoplait joins the growing number of companies that have listened to consumers and rejected dairy from cows injected with rBGH," said David Wallinga, M.D., Director of IATP's Food and Health program in our press release. "The marketplace is following the public health community, which has long been cautioning about the unnecessary use of routine hormones and antibiotics in animals used for food."

When rBGH arrived on the market as Posilac in 1994, it was one of the first genetically engineered agriculture products. Posilac was marketed as a way for dairy farmers to improve income by slightly increasing milk production. But the economic benefits never materialized for farmers. Fifteen years later, U.S. dairy farmers are experiencing the largest price drop in 50 years.

And the cows didn't react too well either. A side effect (listed on the rBGH label) is the propensity for the hormone to make cows sick with udder infections, forcing farmers to increase their antibiotic use. There is now a scientific consensus that heavy antibiotic use in farm animals increases antibiotic resistance, often transmitted back to humans. Health Care Without Harm has put together an excellent, well-referenced fact sheet on public health concerns with rBGH.

Consumers have consistently rejected rBGH, with almost 60 percent stating that they would pay a premium price for dairy products coming from cows not treated with the hormone. This consumer sentiment has driven the rejection of rBGH by a host of food companies. Monsanto, the original manufacturer of rBGH, was finally forced to sell the product last year to Eli Lilly. We blogged on Monsanto's decision and the 15-year history of rBGH last year.

For Minnesota consumers, IATP has produced a new Smart Guide to Minnesota Dairy Without rBGH, which lists milk, cheese, butter, yogurt, ice cream and restaurants that do not source from cows injected with rBGH. Sustainable Table and Food and Water Watch have also put together a great rBGH-free Dairy Map that covers the country.

General Mills' announcement was another nail in the coffin of rBGH. Who will be the next food company to join the no rBGH Club?

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Joined at the Hip: The Food and Financial Crises

Posted February 9, 2009

Last week's headlines were blazing with Congressional hearings on the Bernie Madoff fraud scandal and President Barack Obama's proposal for some non-retroactive limits (no disgorgement of ill-gotten riches!) to Wall Street "senior executives'" (whatever that means) compensation (excluding options to buy stock at discounted rates) for financial institutions whose libertine imprudence has been rewarded with taxpayer bailouts.

Meanwhile on February 3-4, the U.S. House of Representatives Committee on Agriculture was holding unheralded hearings on the draft "Derivatives Markets Transparency and Accountability Act of 2009."  The bill is a revision of the "Commodity Exchange Transparency and Accountability Act of 2008," some of whose provisions IATP summarized in a short report on commodities market speculation and food security. The 2008 bill passed the House by a vote of 283-133. At the invitation of Committee staff, IATP submitted written testimony for the February 3 hearing to comment on the 2009 draft "Derivatives" bill.

The views of witnesses at the hearings (available here) can roughly be categorized into two camps. First, there were the Wall Street lobbyists who want to limit Commodities Futures Trading Commission (CFTC) regulation in order to enable "financial innovation" to contribute to economic recovery. They were concerned that limiting the number of contracts for investment instruments ("speculative position limits") derived from the value of underlying assets, such as corn, oil and real estate would eliminate Wall Street's ability to profit by managing price risks for its clients. These witnesses also criticized the bill's provisions to regulate the unlimited number of Over-the-Counter (OTC) trades among private entities that comprised a gargantuan "shadow" trading system unregulated by the CFTC. The bill would require that OTC trades be regulated on public exchanges, such as the Chicago Board of Trade. The proponents of current OTC practice maintained that the private trading system worked just fine for its clients and that the causes of the Wall Street meltdown were elsewhere, e.g., in subprime home mortgages, and not in the financial instruments used to spread the risk of the price collapse of those mortgages among investors.

Other witnesses supported the draft bill's provisions to expose to transparent and enforceable regulations the "shadow" system that flooded the commodities exchanges with speculative capital and "innovative" investment instruments, such as commodity index funds. One witness estimated that the agricultural and energy commodities bubble fueled by excessive speculation had cost the U.S. alone $110 billion in 2008. To allow the unregulated financial and trading system, bolstered by more than $1 trillion in taxpayer bailouts, to continue would be to invite further economic catastrophe. The National Farmers Union noted that its members could not sell their products at the high prices that prevailed until July 2008 because extreme commodity exchange price volatility meant that their buyers would not contract with farmers in advance of harvest. And now agricultural commodity prices have collapsed, while farmers are still paying high input costs. 

While IATP supported many provisions in the bill, we were concerned about "exclusions, exemptions and waivers" for regulation of OTC trades and the stripping (from the 2008 bill) of a provision for a thorough CFTC investigation into the effects of speculation in agricultural commodities markets. 

Soon the Senate agriculture committee will hold hearings not only on its bill to revise the Commodity Exchange Act, but also on the nomination of Gary Gensler, a Goldman Sachs partner and assistant secretary of Treasury during 1997-2001 at the beginning of deregulatory financial exuberance.

In a January 30 update to our commodities speculation report,  I noted that former Secretary of Treasury Henry Paulson, Gensler's former boss at Goldman Sachs, had proposed that the CFTC be merged into the Securities Exchange Commission (SEC). New SEC commissioner Mary Schapiro supports the merger, the argument for which is essentially that the CFTC should not have regulatory authority and that Congress' agricultural committees should not have legislative oversight of Wall Street. If the White House supports the merger, a House and Senate compromise bill to regulate the commodity exchanges might never arrive on President Obama's desk for signature. Given the past inefficiency delays in U.S. government agency mergers (think the Department of Homeland Security), it could be a long time before there are tough disciplines on speculation in the commodity exchanges. And firms like Goldman Sachs, which made an estimated $1.5 billion in commodities speculation, a third of its net income in 2008, according to a November 19 Wall Street Journalwill be able to continue to induce price volatility and profit from betting on it. These firms can even bet on the "fear index" of price volatility itself totally unmoored from any underlying commodity value.

IATP's testimony to the House hearing quoted a market consultant's newsletter to indicate just how dominant the market power of the financial speculators was over the commercial traders who buy and sell futures contracts to manage the price risks of the raw materials they use. The Brock Report of May 23 states, "No [commercial] speculator today can have a combined contract position in corn that exceeds 11 million bushels. Yet the two biggest index funds [Standard and Poors/Goldman Sachs and Dow Jones/American Insurance Group] control a combined 1.5 billion bushels." By taking profits on the price increases induced by such dominance of the market, traders like Goldman Sachs made a killing.

But there has been a very high price to pay for such a killing. In 2008, the United Nations Food and Agriculture Organization (FAO) very conservatively estimated the global food import bill would top $1 trillion for the first time, an increase of 23 percent over 2007 and 64 percent over 2006. Much of this food import bill is paid with precious hard currency reserves by the two-thirds of developing countries who depend on imports for much of their food security. On January 26, at a UN Task Force Meeting on the Global Food Crisis, FAO Secretary General Jacques Diouf pointed to a very conservatively estimated 963 million people in 2008 who weren't getting enough to eat, an increase of more than 100 million since 2006. Diouf pleaded for much greater public and private agricultural investment in developing countries to improve their national production capacity, both for domestic consumption and for exports. 

But investors need well-regulated markets in order to estimate price trends, costs and their investment rates of return. Public officials in charge of investments likewise need well-regulated markets, in order to judge investment proposals and what public financial contribution will be needed to secure an investment to improve domestic food security. They need well-regulated markets that honestly assess internationally influential commodities reference prices for agricultural export planning. Instead, the commodity exchange markets of the last decade have offered no such regulation, only an environment in which crony capitalists made killings, sure in the knowledge that they were too big to fail and that former Wall Streeters in the U.S. government would come to their rescue. Taxpayer bailouts are now in the hands of these monumentally undeserving financial institutions. 

Yet it is not too late to regulate the commodity market exchanges, to prevent a further reign of Business As Usual, and to make those markets serve agriculture and food security. Indeed, a properly regulated futures and options market could have helped--in combination with managment of physical stocks--prevent the wild swings in rice prices, and consequent food riots. The draft "Derivatives Trading Transparency and Accountability Act of 2009" takes important steps toward making commodities exchange markets a real financial service, instead of a financial predator on food and energy security.

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This is what colonialism looks like

Posted February 6, 2009

When I landed in Geneva for a conference in mid-November, after the usual grueling 35 hours or so of travel from Adelaide, one of my first treats was to order a "renversé" (Genevois for café au lait) and to sit down to read the Financial Times, one of my favorite papers. It arrives in Adelaide so late and so expensive that I rarely get to indulge off-line. The story that grabbed my attention, and clearly that of the FT's editors as well, was about Madagascar. The South Korean firm, Daewoo, was announcing a deal with the government of Madagascar that would give the firm a 99-year lease on half the country's arable land. The proposal was that for no money at all, Daewoo would get the land to grow crops for the South Korean market (primarily maize and palm oil). Labor would be imported rather than local. And Madagascar would get to keep Daewoo's investment in the infrastructure needed to bring the production to port for export. 

I was shocked. Not into silence—I could hardly talk to anyone in the following weeks without bringing up the story. But shocked nonetheless, and at many levels. What of food production? Madagascar was and continues to be in misery, with an estimated 20 million people who are poor, hungry and, increasingly, angry. (That leaves about 40,500 people with enough to live well. Some, inevitably, live very well). What of the people who lived on or from that land? What of the need to create local employment? What were the implications of building infrastructure to service exports rather than local markets? What right does an elected (and contested) government have to sign anything away for 99 years?
 
More than one person I talked to shook their head sorrowfully and said, "Well, the country probably needs the money." But what kind of investment was this anyway? The land could be outright sold and perhaps generate more for the government. And surely there are 1,001 ways that an investment in land could both make a profit for the investor and meet some of the local priorities, like increasing access to food, creating local jobs, and strengthening the national economy through decreased dependence on food imports.

Earlier this week, I caught a new story about the situation in Madagascar. Law and order is breaking down as a political crisis drags on. Between 40 and 100 people are thought to have been killed in the violence. Madagascar's problems are not all related to land grabs, but it is hard to imagine that a government that rules thanks to a High Court decision after a hotly contested election (yes, it happens in other countries, too) thinks it can sign away half the country's arable land and win over the half of the country that liked the other guy better.

The panic triggered by the rapid and dramatic price increases in most agricultural commodity markets over about a year, from mid-2007 to last July, prompted quite a few wealthier countries to look around for land beyond their shores on which to grow more food. The NGO GRAIN has kept track, and their briefing on the subject includes an annex that lists more than 100 recent contracts for land. 

I don't know how the trend can be stopped. The breakdown in accountable politics is deep and in some countries will be hard to uproot. Many of the governments involved will likely ignore any attempt to set even guidelines at the multilateral level. But at the least, guidelines might offer governments that did want to do better a chance to join in some collective thinking on what kinds of agriculture investment make sense, versus those that are profoundly exploitative. Looking ahead, our immediate future offers us depleted soils, exhausted aquifers and ever less certain rains, coupled with a population of people living with hunger that has started once again to increase after several decades of shrinking. Surely we can hope these circumstances might prompt at least some governments to act? And not by signing away the land their people need to survive.
 
Governments just got home from Madrid and a follow-up UN meeting on the global food crisis. The verdict was lukewarm—IATP had this to say; La Via Campesina released this statement. Some are disappointed; others relieved that (from their perspective) the situation was not worsened. The Special Rapporteur on the Right to Food, Olivier de Schutter, just published his statement. The statement notes that the summary by UN Secretary General, Ban Ki-moon, embraced the right to food as a mechanism for "analysis, action and accountability." Hooray! The Special Rapporteur provides a much stronger framework for realizing this goal than the governments agreed to in Madrid. His summary focuses on four points: The importance of national strategies for the realization of the right to food; the need to transform trade into a tool against hunger; the need to redress violations of labor rights in the agricultural sector; and, the need to protect the rights of landusers. 

In making that final point, Dr. de Schutter writes: "The questions of rights on the land and of responsible governance of land resources should therefore be central to the efforts of the international community to provide sustainable answers to the current challenges." Precisely. I hope the governments of South Korea and Madagascar, as well as Daewoo's Board of Directors and shareholders, are listening.
 
Last year was a wake-up call for food and agriculture. Those of us who collectively have been talking about a food revolution for decades need to use that momentum. The world—governments, local communities, farmer organizations, investors and agribusinesses—needs to sit down and rethink food and agriculture. It is not that we cannot do it: yes we can. What we cannot do is continue with business as usual. It won't be as profitable for some (frankly, I categorize as obscene the amount of money some companies made out of last year's hunger). And it won't be a local food system utopia, either. But it will move us closer to something that is healthier, fairer and more stable.

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Global Partnership on Food and Agriculture: Where Is It Going?

Posted February 5, 2009

From January 26-27, I attended the High-Level Meeting on Food Security for All in Madrid, with participation from 126 governments, several inter-governmental organizations, and representatives from the private sector and civil society. The meeting was organized as a follow-up to the Rome Summit on the Food Crisis that the UN's Food and Agriculture Organization convened in June 2008, in the midst of an unprecedented global food price spike (see IATP's Carin Smaller's blogs from the Rome Summit).

Food Crisis panel The most sensitive discussions in Madrid revolved around the idea of a new “global partnership” for food and agriculture, a concept that emerged in Rome in June and has since then been discussed mostly among G8 members. In preparation for the Madrid meeting, the Spanish government circulated a document titled the “Madrid Process Towards an Inclusive Global Partnership on Agriculture and Food Security (GPAFS)." It lays out a proposal for the Global Partnership as a multi-stakeholder effort to increase the efficiency of the fight against hunger at both local and global levels. The document puts forward initial ideas for what the focus of the partnership should be and how it should work in terms of policy coherence, coordination of national action plans and clearer mechanisms for cooperation. It calls for an independent panel of experts and scientists or a “contact group” on a wide range of issues relevant to food and agriculture who would organize a series of consultations and identify mechanisms for review and action.

Officials seem to generally agree with the idea of a Global Partnership even if they have their own vision of what it might look like. There are broadly three visions for the Global Partnership. The first is that it would be a dynamic that builds on UN leadership but includes a mix of stakeholders. The second would be solely a UN initiative, with more funds being funneled into reform of existing agencies to be able to act quickly and accordingly. The third would be more of a direct relationship between donor countries and recipients to mobilize resources.

Jacques Diouf, the head of the FAO, states that institutions already exist and that new ones are not needed. His position is that the FAO should be the underpinning of any partnership. David Nabarro, head of the UN High-Level Task Force on the Food Crisis, seems more open to the Global Partnership having leadership in the UN but a mandate that could be broader. The representative from Italy, currently Chair of the G8, suggests that the developed nations should lead a global partnership.

Agribusiness groups such as Monsanto are active and present in this formulation of the Global Partnership while other representatives from the private sector--producers’ cooperatives for instance--are noticeably absent. IATP and others worry that this partnership could end up providing more space for corporate interests to shape the global political agenda on food in support of intensive agriculture, rather than bringing together different stakeholders on an equal footing to promote food security and resilient food systems. Although civil society is mentioned throughout the Spanish proposal for a Global Partnership, there is no clear mechanism through which to include them in a more official capacity; neither is there any mention of the need to mobilize funding to allow for farmers' participation.

The long and the short of it: While governments may have good intentions, genuine commitment to developing proper consultation among various stakeholders still needs to be evidenced. A Global Partnership has potential, but the process moving forward is quite unclear. We know already the pitfalls of not getting it right: more hunger, more global warming, more poverty and more inequality. We cannot let this one slip.

Civil society must absolutely shape any partnership moving forward to ensure that the UN is strengthened, that the Right to Food is prioritized, that market volatility is dealt with and that farmers and peasants’ voices frame the process for multilateral cooperation.

For more on the Madrid meeting, you can read IATP's statement at its conclusion, as well as a report from the UN Special Rapporteur on the Right to Food, Olivier de Schutter.

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World Social Forum Calls for a New Economic System

Posted February 2, 2009 by Alexandra Strickner   

IATP's Alexandra Strickner is reporting from the 9th World Social Forum in Belém, Brazil.

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Localization, Global Crises at the World Social Forum

Posted February 1, 2009 by Alexandra Strickner   

IATP's Alexandra Strickner is reporting from the 9th World Social Forum in Belém, Brazil.

This is now my fourth World Social Forum and I continue to be fascinated by how the many discussions occuring at the same time help us to move forward in the building of a better world. What perhaps was new to this forum is that several groups targeted key themes, such as the financial crisis, climate change, labor and globalization or water, to name a few.

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World Social Forum Marches On

Posted January 29, 2009 by Alexandra Strickner   

IATP's Alexandra Strickner is reporting from the 9th World Social Forum in Belém, Brazil.

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Who Will Feed China. . .Again!

Posted January 28, 2009

A press release from the University of Leeds last week announced a new study projecting that if current trends continue, China’s industrial growth and changing land use - combined with climate change - could threaten global food supplies.

"At the moment the Chinese government claims that China is 95% self sufficient in terms of grain supply," read the press release. "If China were to start importing just 5% of its grain (to make up a shortfall produced by low yields or change of land use to more profitable crops) the demand would hoover up the entire world's grain export. . .The pressure on grain availability for international grain markets could, in turn, have a huge knock-on effect. Poorer countries are particularly vulnerable, as demonstrated by the 2007-2008 food crisis.”

So why might China start importing more grain? The study points to decreasing harvests, increasing vulnerability to drought, low grain prices and the loss of high-quality farmland to urbanization. In fact, this is a message we’ve heard before. In 1995, Lester Brown published Who Will Feed China?, an entire book dedicated to the very topic of China’s demand for grain starving the rest of us. Here’s a good summary by the Worldwatch Institute.

Brown focused on the country’s growing population, loss of productive land to development, diminishing water supplies, rising demand for feedgrains as China’s diet became more meat-oriented, and the fact that---according to his calculations---China’s farmland productivity had peaked. He claimed that China would inevitably increase imports of grain, and that “China's rising food prices will become the world's rising food prices.”

Remembering the rather panicked response when Brown’s prediction was made (I was in China at the time, and some observers credited his book with an increase in government investment in agriculture the following year) and seeing the same basic hypothesis again being put forward ---15 years later---as a possible future scenario, the interesting question, it seems to me, is: “Why haven’t the Chinese starved us yet?”

Back in the 1990s, researchers from the scientific community did not take long to pounce on Brown’s methodology and assumptions, focusing on his serious underestimation of China’s arable land area. Not long after Who Will Feed China came out, remote sensing surveys revealed that China’s cultivated land area was 30-40 percent larger than Brown’s estimate. This underestimation led him to conclude incorrectly that there was little possibility for increasing productivity, (calculated as yield X area) and to over-estimate the relative severity of land losses from urbanization.

But from the perspective of agriculture and trade policy, there was another assumption in Who Will Feed China? that was just as dubious: the idea that China would fully integrate itself into the global food trade system, and buy large quantities of grain on world markets. The mainstream economics of the 1980s and 1990s told us that food was like any other tradable commodity, and therefore countries that had a comparative advantage in something other than food production should simply import food rather than growing it themselves. According to this logic, it is irrational and disruptive of the smooth operation of markets for governments to try to achieve food security through tariffs, subsidies or other policy measures. It was precisely in the name of eliminating “market distortions” that governments of developing countries were urged or forced by multilateral finance institutions and Western donors in the 1980s and 1990s to abandon subsidies for domestic food producers, open their markets to imports (even when those imports were being sold at below market prices), and sell off state-controlled grain reserves.

So, for example, among the 50 poorest countries on earth, between 1990 and 2005 net imports of rice increased by 124 percent, and those of wheat by 130 percent. (Over two-thirds of developing countries are now net food importers.) These countries, the ones who listened to the World Bank and IMF, are precisely the places where the food crisis has had the most devastating impacts. By contrast, China has experienced relatively small price increases, and no real food shortages. One important reason for this is the fact that China did not integrate itself into the global food system in the ways that many assumed they would. China’s history of famine---and famine-induced political turmoil---made a deep impression on the long memories of the country’s leaders. Despite having what is generally considered one of the more “open” economies on the planet in the manufacturing sector, China has maintained strong food security policies. These are not the loony, commune-level demands for self-sufficiency in grain that Mao decreed, but a sensible package of policy carrots and sticks: limits on the percentage of annual grain demand that can be imported, government grain storage, public support for ag research, subsidies for key farming inputs, preferential pricing for staple grains, and restrictions on the cultivation of biofuel feedstocks on arable land.

So although some of Lester Brown’s predictions did come true---China’s economy did grow rapidly, as people got wealthier their diets did change to include much more meat, more and more arable land continues to be swallowed up by urbanization----the massive imports of basic grains have not materialized, and China’s food security policies seem thusfar to have largely insulated it from the volatility of global grain markets. (Dr. Darryll Ray of the Agriculture Policy Analysis Center has written an interesting series of columns on this.)

But just because disaster hasn’t struck yet doesn’t mean it never will. The fact that Lester Brown had a few assumptions wrong doesn't change the validity of the basic argument that we live in a finite world and that the US is exporting a development model that is disastrously unsustainable. The vulnerabilities pointed out in the University of Leeds study are real as well, and their focus on climate change as a source of growing instability adds urgency to their findings. Meanwhile, there are economists in China who want to abandon the notion of domestic food security altogether, and the country's leadership seems confused on this issue. China’s demand for soya has skyrocketed in the past year, and there are large imports of many other non-staple products. The government seems to have burned through most of its grain stores. The gap between the incomes of farmers and city dwellers continues to grow, and the government’s chief response in 2008 was to promote land consolidation and pledge further support for unsustainable chemical and bioengineered agriculture. The government has assumed that the labor-intensive export manufacturing sector would absorb people fleeing the difficult lot of the farmer.  But the global economic slowdown means tens of millions of laid off workers who returned to their rural hometowns for Chinese New Year this week have little to celebrate.

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IATP at the World Social Forum in Belém

Posted January 27, 2009 by Alexandra Strickner   

IATP's Alexandra Strickner is reporting from the 9th World Social Forum in Belém, Brazil.

From January 27-February 1, the 9th World Social Forum will take place in Belém, in Pará state, Brazil. The city is one of Brazil's busiest ports, about 60 miles upriver from the Atlantic Ocean. Belém is built on a number of small islands intersected by channels and other rivers.

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