We may not always think about it, but the origin of trade is found in ecology and not in economy. The merchant was an ecological plumber moving supplies from an area of surplus to one of shortage, greasing the cogs of ecology as well as human society. Trade made it possible for human beings to establish themselves even where some basic resource was absent. One tribe had access to a resource that the other was missing. In some places flint or obsidian was abundant, and in other places hunters had no access to those stones for making spears and arrows. In other areas there was no salt, which was important for preserving meat and curing skins. In some rare cases this situation might have led to war, but more often it led to peaceful exchange.
The role of trade in ecological adaptation has, in some cases, meant that communities have been able to specialize in forms of production that are very well adapted to their ecological context. Through trade with the plains, the peasants of the Alps could shift entirely to pasturing livestock thus avoiding the need to plow fragile mountain slopes while their Mediterranean colleagues occupied themselves with viticulture and olives. In this way, trade in agricultural produce, even staple food such as grain, promoted sustainability, long before the term was coined.[i]
But how is it today? I will explore the status and implications of global food trade in (I believe) four posts. This first one gives an overview of
Global food production increased with over 50% between 1986 and 2009. Meanwhile the trade in food for direct human consumption has increased from 15% of total production in 1986 to 23% in 2009, thus about one fourth of food production is traded. Half of the net exports 2010 were originating from just ﬁve countries, USA (17%), Brazil (9.9%), Argentina (8.5%), Indonesia (5.9%) and France (5.9%).[ii] At the global level, land for export production grew rapidly by about 100 million hectares between 1986 and 2009, while land supplying crops for direct domestic use remained virtually unchanged.[iii] Production of commercial agricultural commodities for domestic and foreign markets is increasingly driving land clearing in tropical regions. Henders et al (2015) show that in the period 2000–2011, the production of beef, soybeans, palm oil, and wood products in Argentina, Bolivia, Brazil, Paraguay, Indonesia, Malaysia, and Papua New Guinea was responsible for 40% of total tropical deforestation.[iv] At the same time large tracts of land is left idle or used for development in the advanced economies.[v]
Rich countries are increasingly using land in other regions for their food production. The UK is currently importing over 50% of its food and feed, and 70% of the associated cropland is located abroad. Between 1986 and 2009 the global cropland footprint associated with the UK food and feed supply increased by 2022 kha (+23%).[vi] Of course, you have to afford food in order to buy it in international markets; the average per capita GDP in countries that achieve sufficient food supply by imports was approximately tenfold compared to countries with insufficient food supply and production.[vii]
Mostly, international trade flow from high-yield to low-yield regions: For that reason, one can argue that trade lowered global cropland demand by almost 90 million hectares according to a study by Thomas Kastner, Karl-Heinz Erb and Helmut Haberl (2014). However, area-efﬁciency gains through trade do not imply that international trade reduces total global land demand. For instance, if trade reduces price levels, consumption of agricultural products will increase, especially for products with elastic demand.[viii] Clearly this is what has happened with the rapid increase of trade in poultry meat, palm oil and soybean meal.
Trade fills an important role for moving produce from areas with excess to areas with deficit. In 1965 insufficient domestic production normally meant insufficient food supply, but in recent years the deficit has been increasingly compensated by rising food imports.[ix] There are, however, many meachnisms in trade which leads countries not to produce food even if they could do so. Europe has let almost 100 million hectares of farm land revert to forest or lying idle, while European farmers buy protein rich feedstuffs from developing countries and European food industries buy palm oil from Malaysia and Indonesia. Europe could produce those within its own territory.[x]
Many assume that exports goes from countries with relatively more efficient production than importing nations, including land use, water use, and nutrient use. However, Macdonald et al (2015) suggest that higher resource endowments in some major exporting countries may facilitate land- or water-intensive exports despite lower efficiency. Research on embodied water trade demonstrates many examples in which trade occurs despite relative disadvantages.[xi] In many countries agricultural production and trade patterns are driven by other factors than availability or water and land resources. In some cases scarcity of resources can even be intensified by the production of agricultural products for export. There are some countries which rely on food imports due to land and water constraints on domestic food production, but many countries import a lot without having particular resource constraints. For example, in Mexico, per capita freshwater and land resources are still quite abundant despite the rapid population growth. Yet, in recent years it has become a high net importer of food, with over 1800 kcal/capita/day imported in 2005. [xii] Partly this is because Mexico imports high calorie commodities such as maize, soybeans and wheat and export high-value vegetables. Despite this, Mexico is a net importer also calculated in values; see graph.
Three quarters of the global food trade is with crops which are grown both in the exporting and importing countries, i.e. only a quarter of the trade is with crops which could not be grown in the importing country, e.g. coffee imports to Europe and United States.[xiii] Sometimes very similar products are exchanged between countries, e.g. bottled lager beer can be both imported and exported from the same country. Sometimes there are some differences in quality between the imported and the exported goods. For example, the United States imports land-intensive pasture-grazed beef from Australia but simultaneously exports predominantly grain-fed beef to other countries.[xiv] Sweden both import and export wheat, normally it imports lower quality and imports higher quality. In many cases it is just the price which determines if a product will be traded or not.
[i] This introduction is extracted from my book Global Eating Disorder, which discuss food trade extensively. The data in this post are however even more recent and was nbot part of the research for the book.
[ii] D’Odorico, P., J. A. Carr, F. Laio, L. Ridolﬁ, and S. Vandoni (2014), Feeding humanity through global food trade, Earth’s Future, 2, 458–469, doi:10.1002/2014EF000250.
[iii] Thomas Kastner, Karl-Heinz Erb nd Helmut Haberl 2014 Rapid growth in agricultural trade: effects on global area efﬁciency and the role of management, Environ. Res. Lett. 9 (2014) 034015 (10pp)
[iv] Sabine Henders et al 2015, Trading forests: land-use change and carbon emissions embodied in production and exports of forest-risk commodities, Environ. Res. Lett. 10 (2015)
[v] Rundgren, G 2014, Global Eating Disorder.
[vi] de Ruiter H, Macdiarmid JI, Matthews RB, Kastner T, Smith P. 2016 Global cropland and greenhouse gas impacts of UK food supply are increasingly located overseas. J. R. Soc. Interface 13: 20151001. http://dx.doi.org/10.1098/rsif.2015.1001
[vii] Porkka M, Kummu M, Siebert S, Varis O (2013) From Food Insufficiency towards Trade Dependency: A Historical Analysis of Global Food Availability. PLoS ONE 8(12): e82714. doi:10.1371/journal.pone.0082714
[viii] Thomas Kastner, Karl-Heinz Erb nd Helmut Haberl 2014 Rapid growth in agricultural trade: effects on global area efﬁciency and the role of management, Environ. Res. Lett. 9 (2014) 034015 (10pp)
[ix] Porkka M, Kummu M, Siebert S, Varis O (2013) From Food Insufficiency towards Trade Dependency: A Historical Analysis of Global Food Availability. PLoS ONE 8(12): e82714. doi:10.1371/journal.pone.0082714
[x] Rundgren, G 2014, Global Eating Disorder.
[xi] Graham K. Macdonald et al 2015, Rethinking Agricultural Trade Relationships in an Era of Globalization http://bioscience.oxfordjournals.org
[xii] Porkka M, Kummu M, Siebert S, Varis O (2013) From Food Insufficiency towards Trade Dependency: A Historical Analysis of Global Food Availability. PLoS ONE 8(12): e82714. doi:10.1371/journal.pone.0082714
[xiii] Thomas Kastner, Karl-Heinz Erb nd Helmut Haberl 2014 Rapid growth in agricultural trade: effects on global area efﬁciency and the role of management, Environ. Res. Lett. 9 (2014) 034015 (10pp)
[xiv] Graham K. Macdonald et al 2015, Rethinking Agricultural Trade Relationships in an Era of Globalization http://bioscience.oxfordjournals.org