* More investments needed to increase food
production-Piebalgs
* France proposes agricultural stockpiles to tame food
prices
(Adds background on French proposal, comments on biofuels)
MILAN, Oct 1 (Reuters) - Building strategic agricultural
stocks to curb market volatility, as proposed by France, would
not be the most effective way to tame food prices, EU
Development Commissioner Andris Piebalgs said on Monday.
He said what was needed instead was an increase in food
production in the world's poorest countries, which remain
vulnerable to the threat of a new food crisis despite the recent
easing in grain prices from record highs hit this summer.
Last month, French President Francois Hollande launched a
global campaign to win support for creating strategic stockpiles
of food commodities after a year of drought renewed fears of a
new crisis in agricultural supplies.
Paris has also called an emergency meeting of G20 farm
ministers for mid-October to discuss ways to curb price
volatility.
"I believe it is one of the instruments but it is not the
most effective," Piebalgs told Reuters in an interview on the
sidelines of an international cooperation conference in Milan
when asked about the French stockpiles proposal.
"The answer to food insecurity is sufficient food production
in the world's poorest regions," he said, adding that increasing
investments in agriculture was the best way to keep a lid on
prices.
"Resilience in farming, access to water, fighting against
climate change, crops, access to the markets - it's a lot of
elements, one element does not help sufficiently," he said.
The worst drought in more than 50 years in the United States
has sent corn and soybean prices to record highs over the summer
and, coupled with drought in Russia and other Black Sea
exporting countries, raised fears of a global food crisis like
the one that led to rioting in poor countries in 2008.
Food prices have fallen back in the past few weeks but
Piebalgs said there was no room for complacency.
"Globally, food prices are now not a matter of concern in
the short term but there are problems in the Sahel, continuing
problems in the Horn of Africa and other regions," he said, also
mentioning Haiti. "The situation remains very vulnerable."
France first raised the issue of reserves last year as it
chaired the Group of 20 leading economies. But the final deal
limited promises to food aid stocks in countries that might most
need them, a measure that is yet to be implemented.
It is unclear whether Hollande will be more successful this
time round in convincing the United States or his European peers
to rebuild public grain stockpiles that were liquidated decades
ago. Or, as in the case of China, to use existing government
stockpiles more collaboratively to address global issues.
The French proposal, which was backed by the U.N.'s Food and
Agriculture Organisation, did not specify how and where the food
stockpiles would be developed.
Analysts have been sceptical about the idea of reserves on a
global scale because they are costly to run, particularly as
grain has a shorter storage life than commodities like oil.
Piebalgs said he hoped European moves to cap the use of
food-based biofuels would be followed elsewhere, and said there
was a growing consensus, even in the United States, which is a
major biofuels producer, that food crops should first and
foremost feed people.
"We believe that biofuels should be produced from food
residues after crops have been used for providing foodstuff,
then the remains can be tranformed for second- and
third-generation biofuels," he said.
The EU Commission announced a major shift in biofuel policy
last month, saying it plans to limit crop-based biofuels to 5
percent of transport fuel..
(additional reporting by Sara Rossi and Paris bureau; Editing
by Anthony Barker)
