"We won't see food prices going back down to former levels," EU Development Commissioner Louis Michel told a Strasbourg audience of MEPs convened to discuss the global food crisis.
The "huge rise" in food prices is a threat to global stability, according to Michel, who announced an increase in EU spending on food aid to developing countries.
But Michel also stressed that solving the crisis is "far beyond the EU's ability", pointing to structural problems in world agricultural markets and, in particular, a lack of purchasing power in poorer countries.
Empty bellies
Global average food prices have risen by 83% in the past three years, according to the World Bank, which notes a particularly sharp increase in the past six months. While EU citizens have to dig deeper into their pockets to meet rising costs, in many poor nations - where hundreds of millions of families and individuals live on less than one euro per day - the increase means the difference between poverty and starvation.
Josette Sheeran, executive director of the UN's World Food Programme (WFP), has compared the crisis to the 2004 Asian tsunami, and is calling for "large-scale, high-level action by the global community, focused on emergency and longer-term solutions".
The crisis has also raised concerns that the UN's objective of halving global poverty by 2015, the so-called Millenium Development Goals, will not be met.
'Hedge foods'
Growing demand for previously unaffordable meat and other 'luxury' foods in rapidly developing nations like China, India and Brasil is frequently cited as one of the main drivers of higher prices.
But during their debate, a number of MEPs also pointed to increased food commodities speculation and profiteering in the wake of the recent melt-down of global financial markets. The implication, according to a number of Socialist MEPs in particular, is that players on the financial markets have scrambled to find new profits, and are deliberately driving down food supplies while pushing demand in order to boost the price of food commodities.
Calls for greater regulation of financial markets have raised red flags in Brussels, where the EU's Trade Commissioner Peter Mandelson recently warned against using the crisis as an excuse for greater agricultural protectionism (EurActiv 21/04/08).
Bashing biofuels
There are growing concerns that a greater shift from food production towards biomass-for-biofuels production will further aggravate food shortages and price concerns.
Italy's outgoing prime minister, Romano Prodi, most recently addressed the issue at the International Energy Forum in Rome on 22 April. Competition between food and fuels is creating a conflict that could result in "disastrous social conflicts and dubious environmental results," he said.
The office of Gordon Brown, the UK prime minister, also promised on 22 April to "push for a change" in the EU's biofuels policy if a UK government review finds that the policy is counter-productive in terms of food prices and environmental sustainability.
Brussels meanwhile continues to defend its biofuels proposals.
"Biofuels have become a scapegoat for recent commodity price increases that have other causes – poor harvests worldwide and growing food demand generated by increased standards of living in China and India," EU Energy Commissioner Andris Piebalgs wrote in a blog post on 28 March.
A number of MEPs have also cautioned against 'throwing out the baby with the bath water', arguing that biofuels have only a marginal impact on food price hikes and that structural changes to world food markets, as well as greater agricultural output from Africa, would largely cancel out the food price impact of biofuels production.
The GMO solution?
While most MEPs agreed during their debate that greater agricultural productivity is needed to address the crisis, views differed sharply about the benefits of using biotechnology and genetically modified (GM) crops in order to boost harvests in the EU and in developing states.
There is also speculation that the extent of the price hikes may push EU consumers towards a generally more favourable view of GM crops. EU citizens "hearts may be on the left, but their pockets are on the right," said MEP Neil Parish, chairman of the Parliament's agriculture committee, the International Herald Tribune reported.
But a collection of EU consumer, family farm and environmental groups remain opposed to GM crops. In a statement issued to MEPs as part of the debate, the groups argue that "there is little evidence to suggest that weakening the GMO regime in Europe will address [the crisis]. Price increases have occurred all over the world – even in the US which has the most permissive system of GM approvals".
