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The world is closer to a major famine today than it has been in decades.  In the current era, there have been smaller cases of famine in the world such as Niger in ‘05 and again in 2010.  The western African region is exposed to drought-based famines on a fairly regular basis.

The changing weather patterns from El Nino to La Nina in the Pacific, however, have been the primary driver for this round as rain patterns change due to a cooling or heating of the mid Pacific.

The rains occurring in normally dry Australia and droughts in locations like China were, in the past, linked to a La Nina phase.  We have moved from a El Nino 2010 into a La Nina 2011.  The current La Nina is a deep one with no sign of it ready to end yet.

China has documented history of over 1,800 famines (nearly 1 per year) over the past 2000 years.  The four famines of 1810, 1811, 1846 & 1849 are reported to have killed no fewer than 45 million people in China over a 39-year period.

The largest famine in modern times was the Chinese famine of 1958 – 1961, during the “Great Leap Forward” period in China.  The death total is estimated to have been between 36 to 45 million people with an estimated additional 30 million canceled or delayed births.

The use of modern technology and fertilizers, along with growing scales of economy has helped to lower the risk of a global famine. The world has not faced a real significant famine event in decades.

This brings us to today. The fires of last summer in Russian wheat fields significantly lowered the total harvest for the Russian market.  Russia, a net exporter of wheat has found itself needing to import grain for next year’s planting season.  Today, Russia has an export ban in place for most grains.

The rains of November and December have flooded large parts of Australia, and those who were able to harvest their wheat, watched it rot in silos during the floods.

The drought in China’s Northern Province is currently the worst it has been in the last century. Beijing is at 88 days and counting since rain.  The change in weather pattern, to a wet one is not expected soon.

Experts say that if the drought continues over coming weeks with no effective measures to combat it, the winter wheat crop, which accounts for more than 90 percent of the country’s wheat harvest, could be hurt significantly.

GuoTiancai, deputy chief of the agriculture ministry’s wheat experts group, said the dry weather had not hurt the winter crop for now, as earlier irrigation was providing enough moisture.

“But as the temperature warms up in spring and wheat grows faster, any measures which are not in place during the period could cause big losses to the final yield … immeasurable losses.”

In Shandong, there are locations that have not experienced a drop of rain in the last four months.  The district is 86% below average since October.  This drought has caused the local governments to use fire trucks to deliver water to 240,000 people and over 100,000 livestock.

The shift in weather patterns has sent freezing rain and snow to the south, normally the warmer areas of the nation.

“It is of great significance for the people’s basic lives and the social and economic development to combat the current drought and ensure agricultural production,” Wen said.

Beijing Water Authority states that Beijing has been in a drought for the last 12 years.  The estimated loss of rainfall would add up to about 20 billion cubic meters (or 200 billion cubic feet) of water.

Sea ice off China’s east coast is starting to hamper shipping, as smaller boats and ships are kept in port, and larger ships wait off shore for a break in the ice.  The drought on shore having impacted 17% of the winter wheat crop already.  90% of the nations wheat supply is grown in the winter, making this springs rains extremely important.

The planet has been increasing its population exponentially, while the area under cultivation has been stable to dropping over the longer term as productive increases allowed a greater concentration of food production by a smaller and smaller number of workers.  This process has seen productive land turned into housing tracks in the California food basket.

The British Government’s Chief Scientific Adviser John Beddington believes the system is failing now.  He is also Professor of Applied Population Biology at Imperial College, London.

‘Firstly, it is unsustainable, with resources being used faster than they can be naturally replenished,’ he said.

‘Secondly a billion people are going hungry with another billion people suffering from “hidden hunger”, whilst a billion people are over-consuming.’

The USDA releases a World Agricultural Supply and Demand Estimate.  The latest edition was released January 12th.  It is a great resource for following the world food storage estimates.  After the fire in Russia last summer, the rains in Australia, and now the drought in China, wheat buyers have ran out of sources of wheat in volume.

WHEAT: U.S. wheat ending stocks for 2010/11 are projected 40 million bushels lower this month as a reduction in expected feed and residual use is more than offset by higher projected exports. Feed and residual use is projected 10 million bushels lower as December 1 stocks, reported in the January Grain Stocks, indicate lower-than-expected disappearance during September-November. Exports are projected 50 million bushels higher reflecting the pace of sales and shipments to date and reduced competition with lower foreign supplies of milling quality wheat. At the projected 1.3 billion bushels, exports would be the highest since 1992/93…

The worldwide supply of wheat is estimated to climb in 2011, as nations around the world focus on rebuilding their reserves.  The full impact of the floods in Australia are not known yet, as most of their crop was out of the field, but was in silo’s at this stage.

The last estimate lowered Australian production due to the flooding.

…More than offsetting these increases are reductions for Kazakhstan and Australia. Kazakhstan production is lowered 1.3 million tons based on the latest government reports. Australia production is lowered 0.5 million tons as heavy late-December rains and flooding further increased crop losses in Queensland.

The global rain patterns are expected to stay in a La Nina phase for a few more months exacerbating the water drought in China.  If the rains do not return in the spring, China will have to find new sources of wheat to purchase for its population by this fall.

The world has enough food for its population currently, but after the fires in Russia last summer, the flooding in Australia this winter, and now the on going drought in China is starting to drain the worlds reserves.  If the crops of 2011 are sub par or worse damaged due to weather related conditions, the planet could be looking at a real famine issue in 2012.

Links of interest to the story

Confessions of a Macro Contrarian