The Economist has an article in this week's issue that makes something of the same point that I was making in my previous post on this subject:
Harvest failure in a country with just 8% of the world’s wheat has produced embargoes and panic buying. What are importers to make of that? For some the answer seems to be obvious: don’t trust markets; grow it yourself; food security begins at home.
This is deeply depressing. Self-sufficiency is inefficient and shallow markets are more volatile than deep ones. And it will get worse. On the current best guesses of scientists, climate change is likely to produce more events like the heatwave in Russia. These will disrupt harvests and make prices more volatile still. And climate change will probably shift patterns of production; some marginal land will become infertile; land now barren will come into production; some countries will import more, others export more. Retreating into self-sufficiency just when production may be reshaped is a starve-thy-neighbour policy.
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