Whole World Botanicals

World Wide Food Crisis is Also Affecting Peru

Elena reports that Peru has not escaped the worldwide food crisis which has sharply raised the prices of food staples such as corn, wheat, and rice in the last three months. One of the reasons for this sudden and exaggerated rise in food prices is the increasing use of food plants for biofuel, which has meant taking millions of acres out of food production and into energy production, thus reducing the available supply of food. Another contributing factor to this food crisis is the unprecedented number and severity of natural disasters-part of our climate change crisis, including droughts and floods which have ruined crops and reduced the available food supply.

The third factor which you won't see discussed on network TV

But there is a third factor, which may well be the most decisive one and it has been building for decade. With the signing of free trade agreements between developed countries, such as the U.S. and developing (or third world) countries, U.S. wheat and corn, heavily subsidized by the U.S. government has been allowed to enter the poor countries and compete with the small farmers who grow wheat, corn, and rice locally, essentially putting them out of business by "dumping" - selling their products below the cost of production - made possible by government subsidies. Much of the worldwide food supply is now in the hands of mega million dollar corporations which trade on the stock exchange. This food is treated like any other commodity and can be purchased on the futures market and become an important part of the hedge fund portfolio of large investors. Since local small farmers have been put out of business by these (foreign) corporations, allowed to enter the country by the free trade agreement, the people of many developing countries are largely dependent on imported food. Corporatized food, like corporate oil, doesn't have to respond to the market forces of supply and demand. It can store its grains for long periods of time, waiting for buyers to purchase it at its inflated price. These seemingly impersonal and morally neutral business transactions are creating desperate populations who cannot afford to buy the barest food necessities for their families.

More than 1,000 women, run food kitchens for the poor, where Peruvians can buy breakfast or lunch for less than a dollar, protested outside Peru's Congress in April banging empty pots and pans to demand the government increase their food subsidies by 30%. Last month (May), Alan Garcia, President of Peru, after cutting taxes on imported food, began sending in the army at night to hand out free bags of food in the poorest neighborhoods of Lima, the capital. This was both a humanitarian gesture and political common sense since the global food crisis has raised concerns about political instability in many countries. Government subsidized eating halls in Peru are being flooded with hundreds of thousands of people per day. According to Reuters, 42% of the Peruvian population, or 12 million people, live in poverty. [Information taken from Reuters News Service]

In April (last month) there were street demonstrations in Lima, Peru, shown on CNN TV to protest the high food prices and the Peruvian government has begun to buy up food staples and distribute them at night to the poorest urban dwellers with the help of the Peruvian army.

Whole World Botanicals' Suppliers Relationship with the Food Crisis

Although this desperate situation in Peru and throughout the underdeveloped world (we barely feel it in the U.S. but Costco and Sam's Club has begun to ration the purchase of rice) will not be solved without basic structural readjustments in trading relationships between countries, it affects our botanical partners in the high Andes and in the Amazon rainforest less than most Peruvians. The high Andes and the rainforest regions do not presently have huge corporate style farms and our botanical suppliers, like peasant farmers all over the world, support their families through a combination of subsistence farming (they grow their own food), growing or collecting a cash crop - such as maca or camu - camu or cat's claw bark - practicing a part-time trade like carpentry, and craft production, whether it be alpaca sweaters and blankets, jewelry made from tropical seeds or wood carvings. Although they are poor and undereducated, our botanical suppliers have enough to eat. Also both the maca growers and the camu-camu collectors eat primarily native Peruvian foods which are much more perishable than wheat and rice (including potatoes, rainforest roots, tropical fruits, etc) and are not attractive to the international commodities speculators. True they are now paying inflated prices for oil and sugar but they are still able to basically feed themselves.