Radiation Leak in Japan and Global Food Crisis

Countries around the globe are imposing bans on Japanese food imports when radioactive steam leaked from a disaster-struck nuclear plant. As of March 25, 2011, the official death toll for the March 11 monstrous earthquake had exceeded 10,000.  Water supplies are close to reaching a crisis with hundreds of thousands of people were housed in Tokyo’s evacuation shelters. Damage to the Fukushima nuclear plant attributed to plate movements triggering the quake and tsunami fuelled global anxiety. Increasing number of countries are joining the list of banning food imports from Japan. United States (US), Hong Kong (HK), France have already restricted the imports of Japanese food products. Russia and Canada halted food imports from four perfectures – Fukushima, Gunma, Ibaraki and Tochigi, which are in the vicinity of the stricken Fukushima Daiichi plant.

On March 24, 2011, Singapore was reported to have detected low radiation levels in four vegetable samples that were imported from Japan. It was discovered that parsley, rapeseed, mustard and perilla were found to be tainted with radiation levels, but the levels were not life-threatening. Contaminated vegetables discovered in Singapore originated from Tochigi, Ibaraki, Chiba and Ehime. Australia and Singapore have banned agricultural produce from Fukushima, Gunma, Ibaraki and Tochigi. With  Singapore’s discovery of contaminated samples from Chiba, HK included Chiba in its suspension list. Singapore also suspended imports of chocolates, milk products and other foodstuffs from the four prefectures, Chiba and Ehime.

Food safety concerns are now an additional dimension of the emergency. Amid the fears of nuclear contamination, the Japanese government have informed its people not to consume 11 types of green leafy vegetables that are grown in Fukushima. The Ibaraki prefectures also sees the halting of the shipments of milk and parsley. Radiation fears are likely to affect domestic demand as most of the agricultural produce are consumed domestically. Food exports in Japan is also expected to see a slump.

Problems were compounded with the detection of radioactive iodine in the drinking water being more than twice the level that was safe for infants. Release of the news by the Tokyo government led to the frenzy among people to sweep bottled water in shops and vending machines. The Tokyo government has also started distributing three 550 ml of bottles to each infant. Japan’s government has stopped shipments of untreated milk and other vegetables from Fukushima and 3 adjoining prefectures. Radiation monitoring has also been levelled up in 6 other prefectures, covering an area bordering Tokyo.   Results of the measurements of radioactivity in foods are also present and announced publicly to reassure the public that foods that they consume do not carry radiation contamination at the unsafe level. 

It was detected on March 25, 2011 that there were more contaminated vegetables as radiation above the legal limit had been detected in Japanese mustard spinach and komatsuna which are cultivated in Tokyo. This discovery followed after tap waters in several territories including Tokyo was discovered to contain radiation levels that was unsafe for infants to consume. Worldwide concerns on Japanese food imports were heightened with the detection of the high radiation levels in agricultural produce of Tokyo. With higher radioactivity being detected in the Pacific Ocean in the vicinity of Fukushima’s nuclear plant, fears concerning the safety of fish and seaweed were stoked as they form the main staples of the Japanese.

 

References:

• The Straits Times (March 26,2011). ‘High levels of radiation in veg grown in Tokyo’.
• The Straits Times (March 25, 2011). ‘Traces of radiation found on samples of veggies’.
• The Straits Times (March 25, 2011). ‘Panic buying of bottled water hits Tokyo’.
• http://news.smh.com.au/breaking-news-world/global-food-scare-widens-from-japan-quake-20110325-1c8rs.html
• http://www.news24.com/World/News/Japan-irradiated-food-scare-now-global-20110324
• https://lh6.googleusercontent.com/-94lItUDyOyc/TYC5lco4ZaI/AAAAAAAABKA/0EEhtuNsnso/s1600/radiation+map+japan.PNG

Population Growth and Food Trends

With the issue of escalating population size confronting many Asian nations, food crisis is increasingly imminent in Asia. With Asia's population growing by around 56 million annually, domestic demand for rice is expected to top 770 million tonnes by the year 2025.The establishment of a futures market for rice could facilitate in the stabilisation of prices and enhance food security within Asia as 65% of the people who live in this region are living in hunger. A futures market refers to one where the participants would buy and sell contracts for financial instruments and commodities to guard themselves against long term price fluctuations.

The risk of food crisis led to International Rice Research Institute (IRRI) to lower the risk by increasing the amount of rice reserves, especially in large Asian countries that are enthusiastic in maintaining more stable food pricing. This would be critical after the global food crisis that struck between 2007 and 2008 which saw the rapid depletion of global rice buffer stocks. Furthermore, the major rice producers such as Thailand were concerned about domestic supply squeezes and imposed export curbs, hence further straining global availability of rice supplies.

The recent bad weather conditions such as the storms that struck the Philippines in late 2009, severe monsoons in India and torrential downpour and massive flooding in China since June 2010 put the focus back onto food security of the staples in the Asian region. The world’s biggest importer of rice – The Philippines had been badly affected by the dry season during the El Nino period in 2010, putting greater pressure on food supplies as substantial production losses were incurred due to the bad weather conditions.

To aggravate matters, rice plots in Asia are diminishing due to the immense pressure brought about by industrialisation and urbanisation. For instance, China’s rice cultivation lands fell from 37 million ha in 1976 to 31 million ha in 1996. Problems such as waterlogging, soil salinisation and other forms of degradation associated with intensive rice cropping led to declines in Asia’s total irrigated lands. Across nations within Asia, a trend of the ‘greying’ of Asia’s rice farming populace is also observed. The average age of farmers is increasing in almost every country, in parallel with its rate of industrialization. In Korea, the number of rice farmers fell by two-thirds between 1965 and 1995. Urbanization and industrialization will further reduce the labour force, push up farm wages, increase farm size, and increase pressure for mechanization.

As IRRI is aware that it would be a challenge to maintain a large rice reserve with the high cost of maintenance, they see the potential of establishing a futures market in Singapore to promote greater stability and transparency in the rice market. However, the extent of success would depend on the presence of a regulatory framework that protects legal contracts. Traders would also require access to a modern, well capitalised financial market to facilitate purchases and sales. making Singapore a conducive site for locating such operations and transactions. Despite the plausible benefits that a futures market entails, it is important to note that there are also notorious arenas for financial speculation which could also lead to upward spiralling of rice prices.

 

References:

• McIndoe, A. The Straits Times (September 29, 2010). ‘Singapore rice futures market may help region’.
• www.prb.org
• http://www.fao.org/ag/magazine/9809/spot1.htm
• http://news.bbc.co.uk/2/hi/south_asia/7324596.stm

Bad Weather Conditions and Agricultural Output

Russia had been plagued by the worst droughts in at least 50 years and led to the withering of million of acres of wheat, causing the government to introduce the ban on all exports of grains. With Russia being the world’s third largest producer of wheat, the ban in exports led to the hike in wheat prices across the globe. The move by the Russian government was seen as necessary to prevent a domestic escalation of food prices.

  The shortage in global wheat production is further aggravated by bad weather conditions in other parts of the world. For instance, dry weather in Kazakhstan, the Ukraine and the European Union, and flooding in Canada have damaged crops and caused a 91% surge in wheat prices in Chicago since June 9, 2010.

Prices are now at their highest since August 2008, where the spike in food prices was a contributing factor to the food riots from Haiti to Egypt. The United Nations food price is 22% lower than the record set in June 2008 but it is estimated that the current pricing is 13% higher, relative to that in 2009.

Hence, pricing of agricultural output are often subjected to constant checks so as to avoid and ameliorate the impacts of inflation on the prices of food. Food pricing is crucial as it influences the affordability of food to the people. Situations of high food pricing could lead to negative repercussions such as malnutrition, food shortages and starvation.