Sunday, April 24, 2011

land grabbing

“Nothing will bring a government down faster than hungry people,” says Robert Thompson, former director of rural development at the World Bank.“If a country can’t supply its food domestically, it wants assurances that supplies will be there through thick and thin and that exporting countries will allow trade to flow,” he says.

India’s government is considering buying or leasing millions of acres of land in Central and South America. The purpose: to grow crops that will help feed India’s 1.1 billion people. North of Buenos Aires, Argentina, a Japanese company is growing corn and soybeans for shipment back to Japan. In Africa, a Japanese aid agency works with partners from Brazil and Mozambique to convert part of Guinea’s vast savannah into corn, soybean and cotton production. A leading Malaysian palm-oil producer is looking at plans for a 300,000-hectare (720,000-acre) palm-oil plantation in Cameroon. Bahrain currently produces bananas on 2,400 acres in the Philippines. Kuwait is interested in another 2,400 acres there for rice production. Saudi investors are negotiating for an additional 2,400 acres for aquaculture and are already pumping money into a 12,000-acre project to grow basmati rice, corn, bananas and pineapple. In Mongolia, South Korea has bought more than 800,000 acres to develop “an overseas food base” to procure more food resources. In Romania, nearly 2.4 million acres of farmland are now foreign-owned – about 12% of the country’s base farmland. Most examples involve richer countries with large populations and limited agricultural resources attempting to improve their food security by controlling land and agricultural production in poorer, less developed nations. The growing trend is fueling concerns that the purchases are another form of colonialism.

China is looking to buy 200,000 hectares of farmland in Russia, Australia, Argentina and other countries, the Des Moines Tribune reported in March. In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia. China has already invested $85 million since 2005, the Register adds. “In Venezuela and Zimbabwe, they provide machinery and laborers in return for 20% of the harvest. In Australia they buy local land and in Brazil and Argentina they tend to rent. They also rent in Russia and Mongolia,” the Des Moines Register reported.

Demand for good agricultural land has exploded around the globe. Before 2008, global farmland expanded on average by fewer than 10 million acres annually, but expansion plans in 2009 totaled more than 100 million acres, according to the World Bank. More than 70% of the demand has been in Africa, where Ethiopia, Mozambique, Sudan and other countries have transferred millions of acres to investors. In the food prices crisis of 2008 a number of exporting countries went to either taxing or banning exports, and many food importers like China began to get nervous about food availability. With the erosion of confidence in the ability of world markets to assure supplies, they are thinking that if they own the farms, they have a better chance of getting the food out.
Jay O’Neil, senior agricultural economist at Kansas State’s international grains program, argues that big investments in foreign farmland don’t do much to solve nations’ food security fears. “In countries like China, the leaders get up each morning and ask ‘How are we going to guarantee food security for the coming years?’” says O’Neil. “They don’t realize that buying land doesn’t solve the question. It has zero effect on domestic price inflation, and it doesn’t guarantee that the grain will go to whoever owns the land. It doesn’t mean governments wouldn’t slap on export controls as Russia did in 2010. Probably when they most need grain is when they would be at the most risk of restrictions,”

Taken from here

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1 Comments:

Blogger Carla said...

Corn sales are not good but the market senses that the same Chinese buying of beans over dryness in Brazil may surface in corn, if world number two corn producer exporter Argentina continues to see hot and dry conditions. The tourist industry is the only one emerging in Argentina. The real estate market is gaining power (I travelled to Argentina a few months ago and got an apartment there with a company called 4rent Argentina and the lady that was showing the place to me said that hey had most of the flats booked for the following months) that means the property market is growing so the crops are not as important as they were before!

6:49 pm, August 29, 2012  

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