The Grain Drain

Ahh, Elevenses on a working day.

Perhaps I should awake that little bit earlier and prepare a delicious and nutritious packed lunch, you know the one, yes, the one that everyone else seems to have. Woulda-coulda-shoulda and all that.

So instead I find myself out on the road seeking out a village shop.

I have every intention to purchase locally produced foods along the lines of a traditional ploughman's lunch but fall prey to a factory sealed plastic packaged sandwich, extra large but outrageously good value packet of mass manufactured savoury snacks, a very low chocolate content chocolate bar and a can of chemically charged carbonated pop. I use food in this instance for its comfort factor more so than to provide energy and motivation to see me through to at least tea-time.

Like a secretive squirrel I take my acquisitions in the car to a quiet spot to eat but as always with processed foodstuffs the actual feeling of satisfaction falls well short of the anticipation of the mobile feast.

Parked up in a field gateway and gazing out over an idyllic rural scene I often feel a pang of sadness that I did not pursue a career in agriculture.

At the age of 15 when it was time to make important choices about the forthcoming structure of education I was seriously thinking about being a Farm Manager. This set me apart from my schoolmates who were checking out a livelihood in the law, science, military and the fledgling but rapidly developing computer and information technology sectors.

I could see no  major obstacles in my way to being outstanding in my own field. I had however overlooked four important facts. 1) I was not the son of a farmer 2) I did not know any farmers 3) I had never worked on a farm 4) I had always lived in a town.

The British have a very idealised image of agriculture and always appear shocked and affronted when reminded that it in fact a massive industrial operation. Take the recent outcry and controversy surrounding the discovery of dodgy substances in our favourite supermarket bought meat products.

Farming is a very sophisticated business being not only industrialised but also politicised. The confidence in and stability of Governments relies upon the uninterrupted supply of our foodstuffs ranging from daily staples to luxury items. The ruling classes have seen the consequences of food shortages and famines on their status throughout history from the ancient world, in biblical times, the French Revolution and periodic riots and unrest in society. Even in todays supposedly efficient supply chain business I defy anyone not to have a small panic attack upon finding an empty or sparsely stocked shelf in their local Tesco or Asda. If the retail giants cannot ensure their own supply then what hope would we have in keeping our cupboards stocked in any crisis or scare.

The rapid increase in world population and pressures on crop yields from diminishing land availabilty and climate change is expected to transform the prospects and fortunes of our farmers for the first time in centuries. In the last few decades no-one has really wanted to be a farmer because of the economic instability of prices and of course, the bloody hard work that is involved. Sons of farming families have had to seek permanent employment beyond the farm to make anything like a decent living. The suicide rate amongst the agricultural population is one of the highest to illustrate the stress and anxiety associated with the industry. Statistic produced are interesting, for example the average ages of farmers in the United States, Japan and Australia are currently 58,66 and again 58 years respectively.

Investors and Speculators have already appreciated that investment in the world's food supply, given the extrapolated factors, represents one of greatest opportunities for wealth since the discovery of oil, gas and the availability of stocks and shares in technological innovations now indispensable to everyday life.

I had first hand experience of one of the main aspects of this commodity trading during one of my elevenses stops at a small rural petrol station/shop. Standing at the checkout I overheard a conversation between a local farmer and another customer, a known acquaintance. He was celebrating in having sold his next three years crop produce. In the stroke of a pen on a Futures Contract the farmer had eradicated the curse of uncertainty and price fluctuations and for once could plan and budget ahead at least for the next 36 plus months.

It sounded simple and fair to me.

That was until I realised that only 3% of the world's futures contracts are physically delivered with the 97% changing hands for cash. Traders and Brokers have latched on to the world's food supply as their next big punt and gamble after the boom and bust of the same sort of plundering foray into the world's money markets and global energy resources.

The derivatives have arrived. The wealthiest speculators are betting on the fundamental requirements of human existence. Control of the world's food resources, now and for the forseeable future, is in the hands of those whose prime motivation is to make money and lots of it.

Take Grain. It is a readily traded commodity because it is uniform unit size. In the United States 78% of grain production is for the feeding of livestock, in Europe around 50% and in the rest of the world 38%. This appears to be a wicked and wasteful use of a valuable staple intended to fatten up cattle to keep our steaks and burgers in the shop window.

Grain is regarded as a safe bet by the speculators but is it a moral thing to gamble on such a precious resource?

The agricultural stocks and inventories of world agriculture are currently at their lowest ever levels because we have consumed more than we have produced and inevitably the reserves have to be tapped to make up the shortfall. This brings about price fluctuations and the potential for even greater fiscal gains by those controlling the market.

Farmers may be content with some certainty in their incomes from future selling their crops but have never been in as much peril of losing control of their industry. This should be most concerning and worrying for us but we seem to be stumbling along oblivious to the implications and threats to the fundamental role of food in our existence, our health, social welfare and political stability.