UK government report says climate change creats 'shocks' to food industry

14/08/2015 - 07:53:17Back to Business Home

Food production “shocks” that push up prices and can spark unrest, migration and even terrorism are set to become more common with climate change, experts have warned.

The global food system, already under pressure from rising demand from a growing, increasingly wealthy population, is vulnerable to sudden shocks from extreme weather such as drought or floods, a UK Government-commissioned report said.

Such extreme weather events are becoming more frequent as global temperatures rise, making “rare” food production shocks more common in the coming decades, the study by a UK and US taskforce of academics, industry and policy experts warned.

Preliminary analysis suggests the risk of a once-in-a-century food production shock, in which harvests of key crops such as wheat, maize, rice and soy bean could fall by around 5% to 7%, could become three times as likely by 2040.

More extreme reductions in production, which would be expected to occur once in 200 years today, could be the norm by the end of the century under the worst case scenarios.

Even small weather-related production shocks, coupled with policies by countries such as imposing export bans in the face of crop reductions or requiring increase use of biofuels, can cause significant price spikes, the report said.

The world recently experienced such price spikes in 2007/8 and again in 2010/2011, when heat waves hit wheat production in Russia and it imposed export bans, with other countries following suit.

There was a significant rise in global food prices, providing a spark in North Africa and the Middle East region, the world’s biggest importer of wheat, for the Arab Spring and the following unrest that is still rife, experts said.

Professor Tim Benton, of the UK Global Food Security Programme and one of the report’s lead authors, said the report showed the risk of weather-related shocks were increasing and the size of shocks was increasing.

“The food system is increasingly under pressure, because demand is growing and our ability to supply it is much more constrained.

“On top of that, we have climate change affecting where we can grow things, so we’ve got the impacts of climate change.”

Climate change was not just about average temperatures providing conditions for growing crops, but increased variability in weather, he said.

“The incidence of extreme weather is adding a layer of difficulty because it happens suddenly within a year, it’s more difficult to adjust slowly than you would do to other major drivers like demand increases.

“If we are coping with demand increases by sustainable intensification and then suddenly we have a catastrophic year and we lose a big chunk of the world’s calories, everybody will feel it.”

The UK, which imports around 40% of food, was less directly exposed to production shocks, as more consumption of processed food meant the price of basic commodities was not so significant and the country was richer.

But lead author Rob Bailey, from Chatham House, said: “Countries like the UK and the US are still very much exposed to the indirect consequences of these kind of events.

“If there’s instability in the Middle East and North Africa region, that’s really where the UK’s vulnerability and exposure lies.”

Consequences for the UK could include increased migration and risk of terrorism, prompted by food price rises alongside other factors, he said.

Prof Benton said: “In a way, what we’re living with with Isis today comes out of a spark that came from food price rises.”

Efforts were needed to improve the functioning of international markets, bolster national resilience to market shocks and to develop agriculture so it was more resilient to a changing climate, the report said.

Lead author Dr Aled Jones, of Anglia Ruskin University, warned there would be a cost to building resilience that would ultimately be footed by consumers.

“We will need investment in our food system going forward and that will cost money, that means more cost of food or prioritisation through tax or government spending,” he said.