EDITORIAL: Food export curbs

A rising number of countries are responding to skyrocketing international grain prices by imposing bans or strict quotas on the export of domestically produced cereals. Alarmed, the government has made an emergency call to establish international rules on food export restrictions in ongoing multilateral trade talks under the World Trade Organization.

More than a dozen countries have already imposed restrictions on grain exports. Among food exporters, Russia has slapped export duties on wheat and other crops, while Argentina has effectively halted exports of corn and wheat. As for the Asian staple, rice, Vietnam and India, the second- and third-largest exporters of the grain, have both moved to ban their export.

These export restrictions can be seen as desperate self-defense efforts by countries where grain exports are ballooning due to rising food prices and posing a serious threat to many residents.

The recent surge in grain prices and the resultant food shortages have triggered riots in many poor countries in Asia, Africa and Central America. The international community's immediate priority should be to expand food aid to these battered countries.

At the same time, though, steps must be taken to rein in the global rush to pass curbs on exports and keep the world on a course toward freer trade.

Stable food supplies are crucial for the well-being of mankind. Possible disruptions in food imports because of unilateral cuts by exporters inevitably make food-importing nations very uneasy about depending on supplies from beyond their borders.

That is especially true of countries like Japan, "the world's largest food importer."

Rampant export restrictions could give food importers a good excuse for protecting domestic farmers and thereby cause global food trade to contract. That would deliver a heavy blow over the long term to the many developing countries that depend on food exports to bring in hard currency.

Free trade is the crucial foundation for the economic well-being of both exporters and importers.

Realistically, prohibiting all forms of export restrictions is probably not possible. But it is desirable that such restrictions be treated strictly as emergency relief measures that must be ended as soon as possible once the emergency situation improves.

New rules should be established to require food-exporting countries to provide importers with an advance explanation of the reasons for instituting any export curb. In addition, a system should be created to enable the WTO to settle disputes over export restrictions between food exporters and importers.

In 1972, a U.S. embargo on soybean exports set off sharp price increases for soybeans and other feed grains, generating concerns about a full-blown global food crisis.

In the ensuing years, however, increasing agricultural output led to a chronic global glut of farm products. Amid this global oversupply of food, the scrapping of restrictions on farm imports has remained high on the agenda of world trade talks since then.

Policymakers around the world have paid little attention to the issue of export restrictions.

Now, with international grain markets seeing soaring prices, the trend may indicate the onset of a new global food shortage. Several factors have contributed to this shift. The world's population, which is already huge, continues its rapid growth, while demand for feed is climbing in both China and India, both seeing heady expansion of their economies.

In addition, rising demand for foodstuffs used to produce biofuels is competing with world demand for food at an alarming rate.

The situation clearly requires that Japan ramp up domestic agricultural production. The government must start considering a radical departure from its traditional policy of limiting rice production to maintain higher prices and protect domestic growers.

The government should redirect its policies to prevent the proliferation of export restrictions, while also enhancing the competitiveness and productivity of domestic agriculture.

--The Asahi Shimbun, May 13(IHT/Asahi: May 14,2008)