Think Piece

Agricultural Trade and Food Security: Some Thoughts about a Continuous Debate

December 2013
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Current WTO trade negotiations are being held at a time of higher prices for agricultural products (compared to the 1980s and the 1990s), stronger links between energy and agriculture (with some food and feed crops being diverted for the production of biofuels), and disruptive climate change (with more frequent extreme events, such as droughts and floods). Previous agricultural trade negotiations were conducted when global prices were lower. They focused on policies that artificially expanded supply in some countries, or reduced demand in other countries through protection. Now there seems to be more interest in policies that may artificially restrict supply to other countries or expand demand in some countries. Producers were the focus of previous trade concerns; now consumer concerns seem to have come to the fore. But policy instruments and approaches to the negotiations do not seem to have changed much. There are, just as when prices were lower, again strong suggestions for higher levels of protection and inefficient and inequitable subsidies as a way to combat high prices. Several trade measures contributed to the price spike in recent years and therefore there have been discussions about the need to consider tightening current trade disciplines, particularly on the export side. Although some of the proposals are sound, if another spike occurs, the protracted WTO process may not be enough to restrain governments of exporting countries that need to react to complaints from their citizens about the price of food. When such emergencies arise, multilateral interventions based on financial aid or physical stocks would prove useful. In terms of food policies, the old dilemma between supporting high prices to help with availability of food, and pushing for lower prices to contribute to access from poor consumers continues to be present. The only way out that dilemma is based on policies that improve profits for producers through greater productivity and efficiency while expanding supply at affordable prices for consumers. In that regard, it must be remembered that adequate trade policies and WTO disciplines can contribute to food security, but they are just a component of what must be a multidimensional approach.

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