Climate change may cause ‘massive’ food disruptions
By Luzi Ann Javier and Susan Li, with assistance from Chanyaporn Chanjaroen in London and Anand Menon in Singapore. Editors: Matthew Oakley, Jarrett Banks
February 15, 2011, 6:00 AM EST Feb. 15 (Bloomberg) — Global food supplies will face “massive disruptions” from climate change, Olam International Ltd. predicted, as Agrocorp International Pte. said corn will gain to a record, stoking food inflation and increasing hunger. “The fact is that climate around the world is changing and that will cause massive disruptions,” Sunny Verghese, chief executive officer at Olam, among the world’s three biggest suppliers of rice and cotton, said in a Bloomberg Television interview today. “We’re friendly to wheat, corn and soybeans and bearish on rice.” Shrinking global food supplies helped push the United Nations Food & Agriculture Organization’s World Food Price Index to a record for a second month in January. As food becomes less available and more expensive, “hoarding becomes widespread,” Abdolreza Abbassian, a senior economist at FAO, said Feb. 9, predicting prices of wheat and other grains are more likely to rise than decline in the next six months. Corn futures surged 90 percent in the past year, while wheat jumped 80 percent and soybeans advanced 49 percent as the worst drought in at least half a century in Russia, flooding in Australia, excessive rainfall in Canada, and drier conditions in parts of Europe slashed harvests. Corn may be the best-performing agricultural commodity, surging to a record in the first half, while wheat will advance as increased government purchases help “inflame” the market, said Vijay Iyengar, managing director of Agrocorp International, who’s traded agricultural commodities since 1986. Global warming may help lift the prices of corn, wheat and rice by at least two-thirds by 2050, a study by the International Food Policy Research Institute showed in December. “There is an increasing likelihood of a food crisis globally due to climate change,” South Korean President Lee Myung Bak told his secretaries on Feb. 7, according to a statement. Last year was the warmest on record, together with 2005 and 1998, the Geneva-based World Meteorological Organization said. …
