The Humanitarian impact of World Trade on Farmers


Farmers in Ireland and across Europe are operating high-cost systems but when the food comes to market it is under-priced. How is this so?

The Humanitarian impact of World Trade on Farmers

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Farmers in Ireland and across Europe are operating high-cost systems but when the food comes to market it is under-priced. How is this so?

Farmers in Ireland and across Europe are operating high-cost systems but when the food comes to market it is under-priced. How is this so? One of the main reasons is that international free trade agreements have opened up global markets and forced farmers across the world to compete with one another. This results in massive inequity, as both standards and costs of production vary greatly from place to place. But the market has no way of differentiating between Irish, grass-fed dairy products and those made with milk produced by Dutch herds that are kept indoors all year. And this is just a blip when you consider the difference between other food products from different parts of the world.

Take for example a typical Indian smallholder, Sachidanand Rai. He has 5 acres on which he used to grow rice and wheat. Consider his costs in labour and inputs, of producing three acres of wheat, ploughing with an ox and weeding by hand. Rai's wheat ends up in a silo being traded against the wheat grown by a typical US farmer with 5,000 acres. Rai managed to diversify his holding by growing medicinal plants, because there was no way he could survive on the income from 5 acres of wheat and rice. Yet over half the world's food is currently produced by smallholders like Rai. They cannot all find alternative enterprises and many are becoming indebted and losing their holdings as a result.

Ireland

Ireland's farmers have had to scale up to compete. In the 1840s, the average tenancy here was between 6-15 acres. Under the post-independence land commission 30 acre holdings were commonly distributed. In 2000, the average farm size was 77 acres and in 2016 this had risen to 81 acres. With trends only increasing, we seem to be heading for a New Zealand style future in which small farmers are a rarity. Only EU supports have prevented a total reconfiguration of Irish agriculture.

While some might argue that we have too much regulation and bureaucracy, the hard cash we receive in return has propped up Irish rural communities and sheltered us from the realities abroad. Subsidies are an integral pillar of European farming. They are keeping our countryside alive by making it possible for small farmers to continue producing highly traceable, high-quality food. Europe currently takes a hit by diverting money into farming, propping up European farmers for the sake of having higher standards of production. But this cannot continue indefinitely and it can have negative impacts for farmers in other countries, when our food products are sold on their markets for less than the cost of production.

We need to be planning for the day when income supports come to an end. In fact, with the rise of anti-EU nationalism and right-wing reactionary leaders like Marion Le Pen and Geert Wilders, this day could come sooner and more suddenly than many would have predicted. The EU is still reeling from Brexit. A Le Pen victory in this year's French general election could spell the end of the whole experiment and a return to closed borders. This would be a disaster for Ireland as our current farming model is not sustainable economically. Our government alone, as Britain will soon realise, would find it impossible to maintain the current budget of $54bn in supports.

Root problems

The global commodities market is reducing the value of food products by allowing those produced with lower standards to set the benchmark. For example, under international free trade agreements Brazilian beef cattle, stuffed with hormones and grazed on land generated by clearing forests, constitute the EU's largest source of beef imports, 130,684 tonnes per carcass weight (pcw) in 2016.

Brazilian beef exports have rocketed since the 1990s, €1.28m tonnes pcw in 2015. Most of this expansion, over 80%, is due to land reclamation in the Amazon. Since 1978 over 289,000 square miles of the Amazon rain forest have been destroyed across 8 countries. Most of this destruction was in Brazil for beef and soya production. Between 24 and 25 million hectares of soya is grown in Brazil alone. It constitutes the bulk of Europe's protein imports for animal feeds and is also used in many food products.

For years Brazilian governments turned a blind eye to deforestation because the new export industries it generated are worth billions of dollars to the economy. But as the enormous scale of the problem became apparent, stricter implementation of forest protection has resulted in a decline in forest destruction there. Nevertheless, illegal deforestation is still a major problem in Brazil, with powerful land barons controlling large areas too remote to police, while other countries in the region are only now ramping up their enterprises. Bolivia, Colombia and Peru are seeing increased rates of deforestation for the same economic reasons.

The control of markets by multinationals has led to a fall in international standards, according to the human rights organisation Global Exchange. 30 companies now control a third of the world's processed food. The way in which these companies operate in developing nations has been criticised for their tendency to encourage countries to neglect their own food security and long-term environmental interests. The market demands a steady supply of certain produce, like soya from Brazil or palm oil in Indonesia.

Palm oil is a key ingredient of many processed foods and products. In fact it is almost ubiquitous and you will only understand this, if you try some time to avoid it. Almost every processed food ingredients-list will contain palm oil in some form or another. Palm plantations have been blamed for increased deforestation around the tropics.

Indonesia alone is estimated to have contributed up to 9% of worldwide greenhouse gas emissions between 2000 and 2010, through destruction of its peaty rain forests, to make room for palm oil plantations. According to the Union of Concerned Scientists, the burning of wetland forests can also be linked with respiratory illnesses. A haze of smoke has spread across Southeast Asia in recent years because once a forest fire is ignited, the underlying peat can smoulder uncontrollably for months at a time. Up to 100,000 deaths from particulate matter exposure are now attributed to landscape fires in Southeast Asia each year.

These are only some of the issues that accompany international trade in food and commodities. There's nothing most of us can do about it except to aim for higher standards of our own. The desire to rise above the lowest-common-denominator and pay for standards, has set the EU apart. Although it is far from a perfect model and in some respects, still no more than an aspiration, it is better than nothing at all.

At present most global trade is carried on without consideration of social or environmental impacts, but citizens are better informed now and demand for sustainably produced food is increasing all the time. It is hoped that this direct consumer-driven imperative, coupled with the imminent threat of climate change, will lead new agreements to foster increased accountability and will result in more equity across the world. The return of an isolationist US and new divisions within the EU threaten to scupper this hope, but we shall see how it all pans out.

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