Technology, Trade and Production: Whose Agenda Is South Africa Following?

By Stephen Greenberg · 19 Aug 2009

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Picture: Curte Carnemark/World Bank
Picture: Curte Carnemark/World Bank

An important question facing humanity at present is how to ensure enough food is produced so that everyone has enough. There is a distribution issue that is unresolved in a capitalist system: the market distributes, and those without the resources to participate in the market are excluded. This produces the reality of obesity in some countries side by side with starvation in others, and surplus production that goes to waste or is fed to animals, side by side with food deficits in other places. This requires urgent resolution. 

There is also a production issue: the global population is rising rapidly, but the land available for production is finite. As long as there are more people, we will need to produce more food, although realising a more balanced distribution of existing food (and the production of more appropriate food) is likely to be able to solve a large part of this problem. 

But if the world does need to produce more food, there are two main possible responses to this - extensification or intensification of production. We can either move onto land currently not occupied by agriculture. But this will confront other land use requirements, not least the need for ecological sustainability. Agriculture is currently encroaching onto forest land in a way that is exacerbating the climate crisis. Moving onto land that is not arable (e.g. deserts) will require some new technologies. As it stands, agriculture is creating deserts rather than absorbing them. The alternative is intensification of production on existing land, i.e. increasing yields without destroying the natural resource base in the process.

The response from those in control of the global economy is twofold: more technology and more open markets. It’s more of the same one-size-fits-all mentality. Trade negotiations aim to force new technologies onto all populations, regardless of whether they want them or need them. They also aim to force all countries to open their borders to products from other countries, whether they want to or need to.

Both technology and trade have their place. But a useful rule of thumb is to ask to what extent these proposed solutions bring control over resources and decisions about how to use resources closer to practitioners. It is clear that current technologies such as genetic modification and precision farming based on computerised calculations of inputs are leading to the gradual deskilling of farmers. Farmers with access to financial resources receive a package of inputs and a precise set of instructions about how to apply them. Farmers without access to financial resources receive limited or no support whatsoever, and are forced to compete with the first category even in their own backyards. Concentrated control of the entire input supply system by a handful of multinationals - Monsanto, Syngenta, Dow, BASF, Du Pont/Pioneer Hi-Bred and Bayer - is encroaching on the sovereignty of both large-scale commercial farmers and small-scale farmers. The input industry is driving the restructuring of the production node in favour of its own profitability.

Local markets are far more significant than export markets across the world. Most food is produced for domestic consumption. It is only once the domestic market is satisfied that surpluses are exported. This is the case for most food commodities, although some countries produce high-value added crops for export even when the local population does not share in the crop. According to the Food and Agriculture Organisation of the United Nations, only 23% of wheat production is traded globally, even though wheat is one of the most traded agricultural commodities. For rice and sugar, less than 5% of the total crop is globally traded.

Not only is production mainly used for local consumption, but exports are dominated by a small handful of large-scale traders. The top 5 exporters in the world market for maize control 95% of the market. For soyabeans the figure is 98%. For wheat the figure is over 80%, and for rice, other cereals and sugar the figure is between two-thirds and three-quarters of the market.

This suggests two things. First, production for local consumption is not against the mainstream, but is the norm. It is the constant push for export production, even at the expense of production for local markets that does not fit the reality. Second, opening agricultural production to the flow of global commodities also opens the country to greater volatility in prices. If the margin of production that is a surplus for export is fairly slim, then failure of production in just one of the dominant producer countries can have sharp effects on the price. It just takes drought in one year for prices to rise sharply. 

The South African wheat sector is a perfect case in point. South Africa has the climate to produce a large proportion of domestic requirements, at a price that enables farmers to earn a living from it. But opening the economy to the international wheat market has caused a decline of the wheat sector so that South Africa is increasingly hostage to the fluctuations of supply and demand on the world level. A vicious circle ensues, since local wheat breeders do not have enough of a market to improve cultivars, so the quality of local germplasm declines, causing a further decline in the sector. This is only necessary on the basis of an abstraction called 'comparative advantage' which says that at a global level, those who can produce wheat cheapest should do so, and others should produce something else.

Are we afraid of change? No. The question is: what kind of change? Is it in the public interest for farmers to have less and less control over their fields and decisions in the name of greater production of agricultural commodities, with production decisions increasingly being made in the laboratories and boardrooms of multinational corporations who are driven by profit? Or can we envisage a different kind of change, where agricultural production is distributed more equitably, on the basis of need rather than profit, and where the technology that is selected gives greater, not less, control to production processes for farmers and peasants? Can we imagine diversifying the production base so that the 75% of all food producers globally who do not produce for export markets are empowered to use their creativity and knowledge to produce for local needs first, without fear of having to compete with a technological machine that imposes tastes, products and competition even where they might not be appropriate? 

Are we afraid of technology and competition? No. But is technology a tool that is being harnessed to improve the lives of people in an integrated way - materially, socially, spiritually - or are decisions increasingly being taken on the basis of where technology is pushing us? Is technology driving us, or are we driving technology? It doesn’t help that the ‘owners’ of the technology are interested, first and foremost, in profiting from that ownership. How do we democratise technology so that the products of R&D are made available to everyone who needs them, so that control over how those technologies are used is based on their most effective use and is not constrained by claims of ownership? These are questions we need to answer.

Dr. Greenberg is a freelance researcher with an interest in food systems, land, agriculture and rural development.

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hughlaue Verified user
23 Aug

SA Agenda

Thanks Stephen, a good synopsis of the huge problems we face. The root is, of course, greed and fear, best manifest in our consumerist lifestyle. The scary reality of climate change and limits to growth has not penetrated world consciousness yet. Denialists of all kinds, whether just mis-informed or actively mis-informing are wriggling like worms on a hook. Saw Deborah Gracias film on the evil GMO story. Really depressing but with rays of light in what we can be doing. Ultimately it's the shareholders in these corporations that are driving their agendas. For the best blog on climate change see Interesting post on the "tragedy of the commons" a month or so ago. The discussion is now active around their post on geo-engineering.

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