Cold spell disaster for food/beverages

by FS

(January 18, Colombo, Sri Lanka Guardian) The current cold spell and a possible change in weather patterns across the year is disastrous for food and beverage companies in Sri Lanka while food production is also expected to fall which could lead to shortages or result in more imports.

However at the risk of being called a ‘doomsday’ forecaster, there is also concern – coming from the President himself – of a shortage of food production across the globe which would impact on prices.

According to one news report, at a meeting of the government’s Food Protection and Cost of Living Committee, President Mahinda Rajapaksa had ordered the preparation of a ‘strategic plan’ to face an impending food crisis as there were signs that the world is to confront a food shortage by next April. The report also stated that at the meeting it was revealed that Sri Lanka could lose 15% - 20% of its food production due to nagging rain.

Tea production has also been affected with some estates in the low and mid-country region reporting the emergence of the ‘blister blight’ disease in which the tea bush is affected due to frost and severe cold. Temperatures on Thursday fell to a record low of less than 18C in Colombo, for the first time in 60 years, while in places like Nuwara Eliya it was near freezing at 8C. The cold wave is so bad that, according to government officials, five people died of the cold in Batticaloa.

Damp conditions and no sunlight is good for quality tea production particularly at this time of the year but on the long term it could ‘stress’ the tea bush to a difficult state, say tea industry officials. January to March is generally the quality season but in recent years (not only this year), the weather has been erratic which has been attributed to global warming and the El Nino phenomenon.

On the flip side, tea and coffee could find more drinkers which then results in increased demand and better prices because soft drinks like the colas and fizzy types or iced drinks are generally consumed during warmer times.

According to experts, a global food crisis – now precipitated by flooding in many areas in Australia which is the world’s largest commodities producer – will impact on prices and demand and hurt countries like Sri Lanka. “Huge challenges lie ahead for our policy planners,” one local expert said.

Oil prices are also rising and reaching the $100 per barrel level which is putting pressure on food demand as consumers turn to bio fuels (produced with corn and other food) for their needs. More food moving towards the production of biofuels would mean ess for consumption as food and see higher prices as the supply side is lower. Food consumption is also rising and if one is to add the growing demand for food in India and China, the world’s largest economies, then Planet Earth has a major crisis on its hands!

The last time fuel prices rose in around 2007-8, increasing production of biofuels saw a similar hike in food prices amidst a shortage. That was the time Sri Lankan authorities dabbled in the now controversial oil hedging and burnt its fingers with a poor, hedging formula that was destined to fail.
Sri Lanka is dependent on large wheat and sugar imports and even though the government is promoting more rice consumption than wheat, such a promotion would be affected by the impact of floods on rice output at least for the first quarter of this year.

The government has a huge task on its hands in terms of helping over a million people being rendered homeless by the floods which, according to some reports, is the worst disaster since the 2004 tsunami.
Thus with a natural disaster on its hands and huge financial resources required to help the affected, the government needs all the help it can get without bias, rancour or those seeking political mileage. Now is the time for civil society and the private sector to step in. While many companies have already pitched in with relief assistance, others too should volunteer support.

Though many NGOs involved in humanitarian work are already providing a lot of assistance in areas like Batticaloa, a current tussle between the government and NGOs has thrown a lot of NGO relief work off gear and led to a sharp fall in humanitarian aid in recent months for the needy. Given the kind of support that the government needs in this gigantic exercise of helping a million people (5% of the population), there is a strong case for the authorities to ease its restrictions and garner the support of the NGO community too, towards a national crisis.