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What must be done? The developed world and international institutions must give aid for agriculture top priority. If we do not, poverty, hunger and disease in Africa will get worse. Aid should include support for every technology that can increase production, which must include support for genetic engineering. Everyone concerned with aid for Africa should read a

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wonderful book by Robert Paarlberg, Starved for science: How biotechnology is being kept out of Africa, one of the most important books I have read for years.

No one argues that biotechnology is the only answer. Improvements in traditional plant and animal breeding can make a huge difference; so can marker-assisted selection. There will be other new technology, but genetic engineering has an important role to play as an adjunct to conventional breeding and marker-assisted selection. It should be a major part of the aid programmes of DfID and the United States.

Many myths are part of the anti-GM propaganda. There is not a shred of evidence—after a wealth of experience of over 10 years, with crops now grown on over 112 million hectares in more than 28 countries—that GM crops pose any greater threat to human health than conventionally grown crops. This has been confirmed by every national academy of sciences, the WHO, the FAO and the European Commission. Yet the NGOs continue to warn African Governments that GMOs are toxic. There is no evidence that GM crops are more damaging to the environment; in fact, they decrease the need for fertiliser and chemicals. Pest-resistant transgenic crops need less spraying with pesticides, and herbicide-tolerant crops on balance need less spraying with herbicides.

Herbicide-tolerant crops can also remove the need to plough. Ploughing disturbs wildlife in the earth, causes soil run-off, uses energy and releases harmful greenhouse gases. Most GM crops increase yields and require less land. In any number of ways they are good for the environment. It is claimed that they benefit only multinationals, not small-scale farmers. On the contrary, many GM crops are well suited to the needs of small-scale farmers. They provide a technology packaged in a seed. They do not need large-scale cultivation, more fertiliser and more irrigation, unlike the green revolution, which saved hundreds of millions of lives. There are more than 10 million small-scale cotton farmers, mainly in China and India, but also in parts of South Africa, which is the one part of Africa where GM crops have been allowed. They have greatly increased their income and improved their health because cultivating pest-resistant GM cotton means that they have to buy and use fewer pesticides and spray less often.

In any case, multinational companies are not found in sub-Saharan Africa. A poll by the Pew foundation some years ago shows that people there wish they were, because they make agriculture more productive and raise living standards. It is perfectly true that promoting GM crops suitable for the developing world is not profitable for big companies. It is a tragedy that public investment in agriculture generally, and in biotechnology in particular, has declined in Europe and elsewhere. The best hope for GM crops in Africa now probably lies with the Gates Foundation. Another encouraging development is that about half of total world R&D in transgenic crops is now done in China, which is developing crops for the third world. That is not done by multinationals but in China.

The only staple GM crop now grown in Africa is transgenic white maize, in South Africa. However, the Gates Foundation is investing millions of pounds in

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several transgenic staple crops such as potatoes, sweet potatoes, cassava, millet, sorghum, rice and maize. If introduced, they could boost the low productivity of most African farmers. The problem is that commercial trials of all these crops are held up by political opposition from Governments who are advised by NGOs. NGOs’ influence in Africa is huge. Governments depend on them, partly, I readily acknowledge, because of the good work they do in providing education and healthcare.

One of the most important contributions of transgenic technology is likely to be in drought resistance. Drought-resistant GM crops are now being developed in many countries, including the United States, China, Egypt, Australia and others. Given the likely spread of desertification in Africa, no region stands to benefit more from this application of GM technology.

I hope that I have demonstrated the validity of my two main propositions: first, that in dealing with the food crisis in Africa, we must restore aid for agriculture to the top of the aid agenda; and, secondly, that this must include the best agricultural science, not consisting solely of, but certainly including, biotechnology. I hope that, in the light of the overwhelming evidence now available, NGOs will abandon their dogmatic opposition to GMOs. I hope that I can then renew my support for Greenpeace and Friends of the Earth as campaigners for a better environment whom I strongly backed in their early days. I will back them provided they campaign in support of science and with due respect for the best available evidence. I beg to move for Papers.

11.54 am

Lord Grantchester: My Lords, I congratulate the noble Lord, Lord Taverne, on securing this debate on the topical subject of food prices. As he so eloquently told us, the first aspect to note is that this is a worldwide phenomenon from which the UK is not immune. Even though only a small percentage of food is traded internationally, commodity markets are global. I shall concentrate my remarks on the effects in the western world. I declare my interests as a dairy farmer in Cheshire, as a director of the co-operative Dairy Farmers of Britain and as a member of both the NFU and the CLA.

As a farmer, I am acutely aware of whose food prices we are talking about—food pricing at both ends of the supply chain. Historically, the retail price of food has been held through a combination of efficiencies and deflation down the supply chain and especially at the farm. The farm-gate price as a percentage of the retail price has been falling consistently over many years. A farmers’ co-operative’s prime function is to sell its members’ supplies at the highest price possible and to push prices up for its suppliers’ prosperity. In the dairy sector, that has been extremely difficult, with spare capacity in the processing sector failing to react quickly enough to consolidation in the retail sector.

The Bank of England’s monetary panel’s ability to meet the Government’s inflation target has certainly been made easier by the actions of the grocery trade. Many a debate in your Lordships’ House has felt the pain suffered by the farming community. In the milk

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sector, supermarkets are able to take advantage and have built their margins to 40 per cent or more. Moreover, the recent price rises at both ends of the supply chain do not mean that the farm end of the chain is now sustainable. Much consolidation is still required. The price of oil is intrinsically linked to food prices. The chill chain, packaging, transport and fertilisers are all heavily dependent on oil. Despite the massive rises in farm-gate prices since spring 2007, supplies of milk are down 6 per cent year on year. Farming confidence is extremely fragile. The supermarkets have responded by reducing price rises through a reduction of their margins to 20 per cent and are looking to enter into long-term relationships to secure their supplies. Any future price wars are likely to be at the expense of their own margins.

What does that mean for the future? Has food been too cheap, and is it merely rebasing? What does it mean for government policy? To return to the global situation, the price rises have been for a combination of reasons. While supplies declined through some poor harvests, demand has increased, especially in China and the developing world. Alternative biofuels have been developed to compete for land use. Energy prices have rocketed. In addition, some exporting countries have responded by export bans, and the turbulent situation has been exacerbated by commodity speculators.

Food policy has evolved alongside those changes. In the 1970s and 1980s, farmers were encouraged to produce. The policy was food from our own resources. With the resulting food mountains at taxpayers’ expense, policy evolved towards addressing the environmental consequences of changes in the production methods that brought about those food surpluses. Notions of sustainability argued for a balance between the economic, social and environmental aspects of policy. Can they be made compatible? Is there a trade-off? Who pays for public goods? Payment on the basis of income forgone in production methods had unintended consequences, as the measure was often against continuing downward movement on prices and hindered a more integrated approach.

Policy has evolved again towards an understanding of the multifunctionality of the countryside. To the three aspects of sustainability—economic, social and environmental—have been added animal welfare, price and climate change. The debate has become more complicated; the trade-off between so many outcomes to policy has resulted in a lot of mixed messages, which has become confusing to the public. The era of cheap, safe and plentiful has drawn to a close. Issues such as waste, recycling, the effect on third-world economies, climate change and renewable energy mean that food and supply policies need to be reassessed. This country’s strategic approach within the context of a European policy needs re-evaluation. No doubt many aspects of present policy will remain, but it must be recognised that we need a more global approach, and a more co-operative approach will become necessary.

How far does the situation call for more of the same—for example, areas of more intensive agriculture and the acceptance and application of more scientific advances, such as genetic modification? Do we need a continuation of the present liberalisation of trade policies without protectionism and taxpayer support?

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It is interesting to note that the response of many in the developing world is to implement export bans, as they see price rises as continuing to undermine their domestic development. Security of supply must not be confused with self-sufficiency.

I argue that government policy must concentrate on joining up policies on climate change, land and water. Models which show the trade-offs between those outcomes need to be developed. The role and responsibilities of Government need to be readdressed. What should be the focus of any UK research and who should pay for it and what it delivers? I argue that it needs to refocus on production systems that reduce the need for water and energy. Transitional research needs to inform the debate.

We need to show some urgency in our debate. On a global scale the BRIC countries—Brazil, Russia, India and China—are exerting huge economic influences, with growth more than 10 per cent per annum. Their strategies must be acknowledged. On the domestic front, the persistence of economic pressure means that there is a developing skills shortage at the farm gate. Pillar 1 support is still critical to farm profits, while resources are transferred to Pillar 2. There is a need to link the two, underpinning land use. Supply chain contracts need to become less volatile to secure profits through longer-term contracts and more co-operative relationships which are understood by the competition authorities and to the benefit of consumers.

Global pressure means food prices are unlikely to fall back to the relative levels of the past. I look forward to the policy debates initiated by the Government into land use, food policy and food security. Continuing support of the UK farming industry is vital. It must continue to be evidence based, scientifically sound and demonstrably seen to be benefiting the consumer. I remain confident that a new policy framework will emerge.

12.01 pm

The Earl of Selborne: My Lords, the whole House will be grateful to the noble Lord, Lord Taverne, for the compelling way in which he introduced the debate. I want to follow him and speak about the global context, particularly the implications for sub-Saharan Africa, of high world food prices. I must declare an interest as a farmer and as the chair of an intergovernmental programme of research, Living with Environmental Change, which is funded by all the research councils and by a number of departments and agencies. Of course, food security is very much part of the environmental change we are addressing.

These high prices amount to a wake-up call, as the noble Lord, Lord Taverne, has told us so compellingly. We are facing a stark inability to feed the world. We are already failing to feed more than 800 million people, who are persistently hungry. We are seeing a failure to invest adequately in agricultural infrastructure, particularly in developing countries with a food deficit. The millennium goal to eradicate extreme poverty and hunger by 2015 is looking increasingly like just a dream.

In the medium to long term, leaving aside for the moment the short term, we need to deal with emergency food supplies. The immediate requirement is to meet

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the stark requirements for food, which we can project forward, as we have already heard from the noble Lord, Lord Taverne. Think about it: if there are to be 2.5 billion extra people by 2030, as we are assured there will be, and if you allow for increased consumption because of increased ability, in India, China and elsewhere, to purchase food, and therefore an increased standard of living, and if you allow a margin for climate change and increased urbanisation, which means that fewer people will be involved in food production so we will have to feed more people in cities—forget about biofuels for the moment as they are almost an irrelevance—there will be a need to double or even treble food production. That is no easy consideration. We have to plan now, or probably should have planned yesterday, how to make global agriculture much more productive. The conference in Rome last month identified, as have previous conferences, the need and called for more aid, more research and much else besides. One has to ask what fundamental change we have to make to policies in order to do any better than we have done over the past decade or two.

I shall concentrate on water requirements. In order to produce extra food—double or treble the amount—water will have to be used more efficiently and more water will have to be found. One litre of water will produce one calorie, roughly. With 2.5 billion more people and all the extra margins I have allowed for, we will need another 2,000 cubic kilometres of fresh water to feed the population. That means we will have to do a lot of research on the efficient use of water and spend an awful lot on infrastructure: water storage, water harvesting, large-scale reservoirs, small village ponds and, above all, efficient irrigation systems that do not waste water. At the moment, there is evaporation and loss and most of the water does not end up where it should: on the crop.

There are already solutions. There are good systems. The Israelis, the Indians and many others have demonstrated low technology solutions, but they have to be rolled out. There has to be technology transfer and somebody has to invest. There has to be water regulation that works. In sub-Saharan Africa, not necessarily in other parts of the world, we are seeing a failure to invest in basic water infrastructure. I agree with the noble Lord, Lord Taverne, that GM crops may well have a contribution to make, but even drought-resistant GM crops need water. Every plant needs water, and until the basic water requirement is sorted out, we will always be fighting a losing battle.

If we and all western economies are to be persuaded, as we should be, to invest more heavily in agriculture and global food production, we must give priority to water. The great advantage about water storage and systems is that we can see where the money has gone. There is something tangible. We know that so much of the aid in the past has been frittered away. That is not to say that we should not also support grain storage, transport, roads, fertilisers, animal health, markets and much else, but if an international agency or a national government is going to prioritise and wants to make the most effective long-term contribution to meet these almost insuperable problems, it should concentrate on addressing hunger and poverty through

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water. Globally, 70 per cent of the water we extract ends up irrigating crops. That is what we do with water, although it is often not used very efficiently.

It is not true to say that all developing economies are failing to invest adequately in their agriculture. Countries such as China and Thailand in south-east Asia and Mexico in North America have some impressive improvements in yield. They have done that by investing in agriculture, including in water storage. They have not kept up with demand because demand is increasing faster, so the problem is becoming very difficult. Nevertheless if we look at the graph of yields, which starts from a very low base compared with what we are used to in developed economies, particularly those in the northern hemisphere, they are catching up in terms of yields because they are using appropriate technologies and agriculture systems and, above all, they are harnessing appropriate agricultural research and technology.

However, the irrigated area in Africa is very small and the proportion of arable land compared with other regions around the world is desperately small. In Ethiopia, a desperately poor country, water storage per capita is 38 cubic metres. The other extreme—and it is an extreme case—is Australia, which has 5,000 cubic metres per capita. If we want to resolve the problems of Ethiopia and so many other sub-Saharan countries, we will have to provide water storage, harvest water efficiently, reuse it and much else besides.

I agree with the noble Lord, Lord Taverne, that much relevant research is going on around the world, including into GMs, although, as he acknowledged, biotechnology in itself is not necessarily the sole solution. Crop protection, animal health, and plant and animal genetics all have relevant applications which have been used very successfully in the West.

Much as the common agricultural policy is disliked around the world and by our Government, sometimes for good reason because of its protectionist aspects, it must be credited with having achieved what was its primary goal: to ensure that we were efficient producers of food using a smaller labour force. Again, there is criticism that sometimes the impact on the environment from leakages to soil, air and water was unacceptably high. Nevertheless, those are the issues that we continue to address, as well as protecting biodiversity.

That should be the objective of all agriculture around the world. We do not necessarily transfer the same technologies as we use in this country—they would be inappropriate for some parts of the world—but without doubt, the basic plant science, the sort of work that we are so good at in this country in plant genetics, molecular biology and much else will very soon have application in those countries. One of our roles, which is not actually very expensive, is to look to our science base, which, I have to say, has been whittled down considerably since I chaired what was then called the Agriculture and Food Research Council in the 1980s—that was 25 years ago—now subsumed into the Biotechnology and Biological Sciences Research Council. Nevertheless, we still have a science base which is extremely important. We punch well above our weight and there are already applications around the world with a very low added cost to transfer those technologies.

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If you want to reduce your dependence on fossil fuels and your carbon emissions, reduced tillages have a very appropriate application. Mixed cropping will sometimes give you advantages on crop protection that you will not get from a monoculture. Those are systems that are being researched in this country and elsewhere around the world. We must concentrate on research and on providing investment in agricultural infrastructure. I have concentrated very much on water, but I repeat that we must invest in many other aspects of agriculture. Those economies around the world where people fail to understand that no civilisation can exist without ensuring that it has an agricultural base will face a crisis. We have a wake-up call now. Why on earth do so few countries and so few international agencies recognise that if we do not invest now in the agricultural infrastructure of sub-Saharan Africa and other countries, the problems will be very much worse?

12.12 pm

Lord Bilimoria: My Lords, according to the World Health Organisation, overweight people now outnumber the malnourished. That is not a boast; it is an indictment. One billion people in the developed world are overweight; 300 million are obese. In sharp contrast, we heard the noble Lord, Lord Taverne, saying that more than 800 million people in the developing world are chronically malnourished. For them, this global food crisis will serve only to deepen the extreme hardship in their lives. Indeed, the only reason that recent events have been elevated into a food crisis is that, for the first time in living memory, they have spread from the developing world to the developed world.

For two decades, we in the developed world grew accustomed to our cup quite literally overflowing. From 1975 to 2005, food prices fell by 75 per cent in real terms. During those years of plenty, when it became cheaper for some of our farmers to feed flocks of sheep with bread from supermarkets than with traditional grain, the international community's commitment to agriculture in the developing world waned. According to the OECD, funding for agricultural projects fell as a percentage of total international aid from 19 per cent in 1979 to just 5 per cent in 2006. World Bank lending for agricultural projects also fell from 30 per cent of all lending to just 12 per cent last year. The implications of those neglectful decisions are only now becoming apparent.

We all know that in the past year global food prices have risen extortionately—overall, by an average of 60 per cent. Over the past two years the price of wheat has doubled. The price of rice in Asia—a crop that sustains billions of people—has more than doubled in two months from $460 a tonne in March to more than $1,000 a tonne in May. According to the head of the World Food Programme, since January 2008 an extra 100 million people who previously were independent are now dependent on food aid. The UN Secretary-General, Ban Ki-Moon, has said that such a situation has the potential to,

All nations are vulnerable. We in Britain may be safe from the evils of hunger and starvation. We may even escape this crisis without witnessing the rioting

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that has erupted in other nations. But we are by no means immune. Any nation which exports less food than it imports should take note of the tortilla riots in Mexico, the pasta strikes in Italy and the tomato boycotts in Argentina. Any nation whose self-sufficiency to feed itself has fallen, as ours has, from 75 per cent 20 years ago to 60 per cent today, should be concerned about the food export restrictions adopted by countries such as China, Russia and India. Any nation committed to international development should concern itself deeply with the warnings of hunger in Nepal, the Philippines and Africa.

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