The Internet is buzzing over the decision by Sam's Club and a few Costco outlets to limit bulk rice purchases to customers. Rice rationing in the United States! How long before food riots in San Francisco?
How the World Works has been accused by some readers of peddling a relentless supply of doom of late, but when the price of the staple food of half the planet's population triples in less than five months, governments get nervous. It's a big story, and unlike in the case of corn (biofuels) or wheat (bad weather) there is no easy villain to blame. World rice production is up, but demand is up more. Production gains are not keeping up with population growth and increased consumption.
With that in mind, here's a rice-related item that's gotten a little less coverage than possible rice hoarding in the world's richest country. According to a report in Monrovia, Liberia's The News, the chief executive officer of China's China-Africa Development Fund pledged 5 billion dollars of investment in African agriculture over the next 50 years -- including, specifically, rice production. (Thanks to China Digital Times for the link.)
Mr. Chi Jianxin, at a head of a Chinese delegation, is in the country to explore investment opportunities in the agricultural sector.
Chi said his company has the financial capacity and expertise to develop and stabilize the food situation in Liberia "particularly in rice production and other cash crops."
During an acquaintance visit with Liberia's Agriculture Minister Chris Toe, the Chinese delegation summed up its exploratory visit in averring that an increased investment in the agricultural sector would provide more food as well as jobs for thousands of Liberians
The announcement isn't going to move the price of rice this year, or next, but it's a pretty clear indicator of which way the world has to go if global food production is to be boosted to match world demand while keeping prices affordable. The developed world, (and in this case, we'll include China in that category, with its $1.68 trillion dollars worth of currency reserves) must find ways to invest in Africa, where there is labor, and land, and a desperate need for inputs, both financial and physical. How about it -- Africa: breadbasket of the world, instead of basket case?