A rice farmer in Indonesia. Photo: David Snyder for Mercy Corps

While we all hoped that the worst of the food crisis was over, it looks like food prices are again on the rise — imperiling the health of maybe a billion people.

The credit freeze has left many of the world's farmers unable to secure loans for seeds, fertilizer and equipment. Some farmers are simply not planting crops or resorting to private creditors charging usurious rates of interest.

Even though food prices have declined since their peak in 2008, world grain prices are still 27 percent higher than in 2005, according to the director general of the UN's Food and Agriculture Organization, and are likely to climb.

“It's possible the tally of undernourished people in the world will surpass one billion, from 963 million in 2007, as the full brunt of higher food prices filters through,” the director general, Jacques Diouf, told reporters at a biennial UN food-policy conference in Bangkok.

While some countries are setting aside funds for agricultural investment, many food-policy specialists worry that the money isn't enough to make up for the loss of private-sector credit.

This is why the UN World Food Program is calling on G-20 leaders to commit funding to fight hunger at their meeting in London this week.

The UN Food and Agriculture Organization (FAO) has developed a new tool to measure the state of a country's food system and its ability to withstand global shocks. Rather than just predicting food crises through its current early warning system, the new tool will help to measure a region's resilience — defined, in humanitarian terms, as "the ability of a system to withstand stresses and shocks in an uncertain world."

Luca Alinovi, a senior economist at FAO, explains that the logarithm for measuring resilience was developed in the Palestinian Territory, which serves as an example of a vulnerable, but ultimately resilient society. "The Palestinians have been living under incredible stress for a long time; everyone is vulnerable there," explained Alinovi. "Despite that, they continue to live and work in that situation — they are a particularly resilient community."

Data is collected according to five pillars: existing social safety nets, access to public services, assets, income and food access, households' capacity to adapt, and the stability of food supply. The goal is that this data will complement the FAO's early warning system — which focuses mainly on immediate upcoming crises — and allow for more effective long-term aid and planning. For example, stronger public services in a country that is highly susceptible to annual drought might mean less personal hardship if and when such droughts occur.

While critics may dismiss the new tool as no more than semantic brouhaha, there are real signs that the notion of resilience suggests a genuine paradigm shift. Mafa Chipeta, a FAO Representative in Ethiopia, recently spoke much less theoretically about resilience by underscoring the need for improving access to water, protecting natural resources, and addressing land tenure. "We need to think beyond responding at the consumption end and start putting resources on the production end," says Chipeta. "Scarce resources are better spent on increasing production than on subsidizing food. If you subsidize grain, next year you have to subsidize it again."

In other words, we need to put aid money into developing successful food systems, rather than waiting to spend money on one-time aid when a crisis hits. After all, without investments into a resilient agricultural sector, an eventual crisis is inevitable. Seen in this context, the FAO's new tool is representative of recent major shifts in food policy — reflecting growing consensus that in the long run, food aid fails to address genuine need. For millions of vulnerable people who have seen the pattern of crisis hit time and time again, this may be one critical step toward breaking that cycle for good.

Photo: Jason Sangster for Mercy Corps

The UN head of food and agriculture, Jacques Diouf, is urging oil-producing countries to reinvest oil revenues into local agricultural programs out of concern for rising food prices. The oil-rich countries termed by the UN the Near East (which includes most North African and Middle Eastern countries) has seen steady declines in agriculture productivity during the last two decades, and external food aid has dropped significantly as well. However, according to the FAO, the number of undernourished people in the region has grown from 33 million in the early 1990s to over 100 million by 2004.

With plans to feed as many as 73 million people this year, the UN World Food Program is alarmed by recent price increases, according to the New York Times editorial, "Priced Out of the Market". Increasing food prices in themselves are not extraordinary, but the fact that grain and wheat producers, among others, are shifting their effort away from food to alternative energy production will dangerously complicate the situation - higher prices combined with a global food shortage will prove deadly.

The FAO's Hunger Map shows that most of the countries with the most dire need for food aid are not high producers themselves. While Near Eastern countries are still able to find enough food resources to feed their people right now, the Financial Times quotes Mr. Diouf's warning that “it is a difficult balance for governments to respond to the need of their populations by importing food at very high prices, and also to ensure that the poorest of their populations get access to food at reasonable prices.”

Biofuel production. Photo: Benjamin Weller (flickr)

Jacques Diouf made a compelling argument last fall. The chief of the Food and Agriculture Organization of the UN stated that it is absolutely the responsibility of wealthy countries to ensure that a significant part of the emerging biofuel market is produced by the developing world. Right now, the U.S., European Union and Brazil are the leading producers and consumers of biofuels. If this situation remains into the future Diouf says,

“It will mean that we had a chance to honour all our solemn pledges to banish hunger and poverty but chose to look the other way.

If we get it right, bioenergy provides us with a historic chance to fast-forward growth in many of the world’s poorest countries, to bring about an agricultural renaissance and to supply modern energy to a third of the world’s population.

To focus debate exclusively on bio¬fuels for transport is therefore to miss much of the point about bioenergy’s potential for poverty reduction. This lies more in helping 2bn people to produce their own electricity and other energy needs than in keeping 800m cars and trucks on the road.”

Mr. Diouf has called for a world summit on food security, to be held in Rome in June this year. We will be watching for what decisions come out of this meeting, which will be discussing the challenges faced by the food and agricultural sectors from climate change and bioenergy. An interview with the agriculture head on the subject of food security and rising food prices can be viewed here.