Of Floods and Food Bowls

This post is occasioned by the last couple of weeks of discussion of the impact of the floods  in Queensland, Australia on the supplying of fruit and vegetables to at least the Eastern States of the country if not, as most commentators imply, all of Australia.

The hyperbole of the descriptions of the flood - 'biblical' (what, 40 days of torrent and the whole world drowned?), 'epic' (what, something out of Cecil B de Mille?) is now sloppily being used to create a food supply and price crisis that a closer reading of the stories gives the lie to, or at least calls into question.

What do I mean by this? First the disclaimer - these are not the thoughts of an economist nor food producer nor agronomist, so I am open to being told to go eat hay (or something even less palatable). But here goes...

On, January 24th, two weeks plus post the ceasing of the rain and the water began receding, the front page lead headline in the Sydney Morning Herald (herein affectionately known as the SMH)  was 'Floods empty the food bowl', bylined to Kirsty Needham.  Two main points are highlighted above the headline - 'Supermarkets stock damaged produce', and 'Swan [the Australian Government's Treasurer} warns of price rises'. Now, if I was a sloppy reader, or indeed an average reader trying not to upset my morning coffee as I tried to turn the pages of the broadsheet format of the Herald or to upset my fellow passengers in the train or bus by poking them with my elbows as I attempted the same, I might get no further and might already be planning how to raid my local Harris Farm Market outlet or that uber-deli that's just opened a healthy walk away.


The first two paragraphs of the article, the ones that the sub-editor will want to make sure carry the main points of the story so no-one needs to read further to get the message the paper wants to put out, are as follows:


'Big supermarkets are contemplating the mass import of fruit and vegetables - and are already stocking shelves with damaged produce from local growers desperate for cash after the floods.

In what looms as a dilemma, Coles and Woolworths (hereunder dubbed the Big 2) are weighing up whether to support Australian producers  -and sell their water-damaged crops - or favour imports and keep prices down.'


Okay, so what the journo really means by 'Big supermarkets' is just the biggest two that control somewhere near half of the fresh produce market nationally, and who have every reason to fan the flames of a food crisis. They are also of course the ones that create and support the kind of regional mono-cropping that inevitably causes economic hardship for the farmers when a disaster such as a flood destroys a potential harvest or postpones planting. Now what's immediately interesting to me is that we have heard/read nothing from the likes of Harris Farm Market, IGA, or Aldi, all of whom are locked in competition with the Big 2, and I for one have to ask why.

This is where my residual pinko conspiracy meter starts ticking. It turns out that food prices were rising even before the floods, as Peter Martin, also writing in the SMH, notes ('Food prices were soaring even before the floods', SMH, January 26, p2). Fruit prices had risen 15% and vegetable prices 11%  in the last quarter of 2010. The article goes on to quote Michael Blythe, an economist with the Commonwealth Bank, on the reasons for this.

Firstly, 'Rapid income growth in emerging economies is lifting the demand for food. Economic history shows that the largest increase in food consumption typically occurs as income levels rise from low levels. Most of any rise in income goes on food, either more of it or better quality'. Now this fits with articles I've been reading over the past weeks about the rising food costs in India and China, and the shift in consumption patterns there two. In both cases, it is the increasing wealthy middle class that is pushing up prices and is shifting food consumption to a more Western pattern, typically a more expensive one.

Secondly, 'The other driver is the expansion of biofuels which will absorb more agricultural production over time.' This also fits with what I have been reading hidden away in the World News pages in little paragraphs here and there.

And here's an interesting figure that you won't read in the oh-woe-will-be-the-impact-of-flood-on-food-prices, again from Blythe. 'The Food and Agriculture Organisation believes global food prices have climbed 46% over the past four years. Australia is not immune.'

Now, this all makes me feel like what we are being subjected to by the Big 2, and what is being unwittingly (I hope) supported by Government is a smokescreen for the inevitable on-going rise in the price of fruit and vegetables because of these much larger shifts in production, distribution and demand that are the result of years of bad public policy in support of bad private policy that show no signs of being halted. It's easier to blame catastrophic events than to blame catastrophic human errors.

So let's drill a tad deeper.  What exactly is the impact of the flooding - on what produce, how long would it take to recover etc etc? The way the stories have been reading, and the way the Big 2 talk up the situation, it wouldn't be out of order for the likes of the average home buyer to think that what we are facing is something akin to a famine, with basic food items, the cereals on which most of the human world ultimately depends for survival, have been wiped out, and the simplest of go withs, a little carbo from some root vegetable, a little green stuff from something brassica, had also gone the way of the dodo. But what exactly are we to expect shortages in from this so-critical foodbowl that was turned into something more like a fishbowl and is now probably more like what's left in the fishbowl when you've been on hols and forgotten to get someone to top up the water.

In the article cited above, Martin identifies what fruit and vegetables will be affected: '60 per cent of Australia's beetroot is produced in flood affected areas, as well as 60 per cent of sweet potatoes and zucchini, madarines and spring onions'. Oh, and Queensland bananas.

Now, I don't know about you, but this does not look like a list of necessities for survival the large scale destruction of which could certainly lead to producers thereof hiking prices of what remains - nothing like a flood or famine for cashing in if you are lucky enough not to have been flooded or famined. Seriously, I'm not seeing in this list anything that most of us would be able to do without until such time as the Queensland farmers were able to re-plant and re-harvest. Mind you, there's still someone out there producing the other 40 per cent of these crops should I really be desperate for them, and if I am then I am happy to say I ought to be happy to afford whatever price they charge to feed my cravings.

The limited scope of what's being bewailed may be one reason why Colin Gray, the chief executive of the NSW Chamber of Fruit and Vegetable Industries, and a director at the Sydney Markets, is quoted in the SMH on 26th January a saying that there is no significant shortage of fruit and vegetables, that it is unlikely that there will be a need to import anything, and that shoppers ought to ignore reports about shortages and huge price rises ('Ugliness is in the eye of the fruit buyer' Amy McNeilage, SMH, January 26, 2011).

I've just come back from a visit to the mid-North coast of New South Wales, the Great Lakes area of Forster/Tuncurry. One of my better meals there was at a cafe/restaurant that is delivering haute monde food. When going through the menu with me, one of the co-owners pointed out that some dishes could not be served as described in the menu because of the Queensland floods. These dishes were ones that were described as having kipfler potatoes, baby spinach or peaches. She was apologetic that for the night they would have to substitute plain old potato potatoes, rocket and nectarines. Did it make a difference to the dish. Perhaps to the chef who created it. To me, the diner, the integrity of the dish didn't seem to have been compromised in any of the cases. 

Now, they could have chosen to be purist and sought out these ingredients, perhaps paid a motzah for them, and passed on the cost for that night on to me the diner.  That they didn't shows the kind of good sense I think most of us would show faced with a shortage of some particular fruit or vegetable - we would substitute or go with out.

I will not be dragooned into supporting artificially inflated prices across the board as a result of supply problems for produce that I can perfectly well live without, short or long term. I will not collude with profiteering, and from what I can see that's what the Big 2 are building an argument for. I will continue to argue for food policies that work toward food justice and security. I urge you to do the same.