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September 23rd, 2011
06:32 PM ET

Should the U.S. emulate the Biblical Joseph and store grain?

Dave Schechter
CNN Senior National Editor

Back in 1895, Katharine Lee Bates was teaching English at a college in Colorado when she wrote this first stanza of a poem that became the lyrics for the song “America the Beautiful”:

O beautiful for spacious skies,
For amber waves of grain,
For purple mountain majesties
Above the fruited plain!

Reading about global food issues, most notably rising prices paid by consumers around the world, prompts this probably overheated question: Might America wake one day and discover that those “amber waves of grain” and the bounty of its “fruited plain” no longer is enough to feed its citizens?

American farmers were forecast this spring to plant more than 92 million acres of corn, 75 million acres of soybeans and 58 million acres of wheat. Every bushel that survives to be harvested this fall will be coveted. The United States accounts for more than half of the world’s grain exports; by comparison, a higher percentage than Saudi Arabia’s share of global oil exports.

South Korea, which imports 70 percent of its grain supply, already buys large amounts of from the United States. A desire to ensure the imports it needs has moved the government in Seoul to create a mechanism that could bypass a competitive marketplace. By 2020, South Korea hopes to import 4 million metric tons of corn and wheat annually, some 30 percent of its import needs, contracting directly with the source.

Lester Brown, founder of the WorldWatch Institute, earlier this year wrote about this development, as part of a larger piece titled "The New Geopolitics of Food." “As the Koreans acquire their own grain elevators, they may well sign multiyear delivery contracts with farmers, agreeing to buy specified quantities of wheat, corn, or soybeans at a fixed price,” Brown wrote in Foreign Policy.

Surely, Brown observed, “Other importers will not stand idly by as South Korea tries to tie up a portion of the U.S. grain harvest even before it gets to market.” If the South Koreans do this, he said, the Chinese, the Indians and others will follow, paying top dollar and removing significant quantities of American grain from the marketplace. Brown also pointed out that such more affluent countries as Saudi Arabia, South Korea and China increasingly are leasing or buying land outside of their borders, notably in Africa, on which to grow food for their domestic consumption.

Brown previously had suggested that, given China's role as an engine in the world economy,   the United States might find it difficult to restrict grain exports should the People’s Republic want to make particularly large purchases.

In his Foreign Policy article, Brown posited that Americans could wake up some day and discover that there no longer is enough grain available to meet the demand in this country for food, feed and fuel (such as corn used in the production of ethanol, by itself a major subject of debate in the world of global agriculture).

“This is happening just as China may be on the verge of entering the U.S. market as a potentially massive importer of grain. With China's 1.4 billion increasingly affluent consumers starting to compete with U.S. consumers for the U.S. grain harvest, cheap food, seen by many as an American birthright, may be coming to an end,” Brown wrote.

TIME magazine noted this trend in a piece outlooking “A Future of Price Spikes.” “With demand steadily rising, the world is closer to disaster because the food safety net has shrunk. In the late 1990s, we had enough corn stashed in reserve to meet world demand for about four months; now we have enough for only about 12/3. From more than four months' supply of wheat in storage, we have gone down to just over three (and in recent years, reserves have fallen even further),” TIME reported.

As to that comparison of U.S. grain exports with Saudi Arabian oil exports: Given the implications of demand outstripping supply, the question has been raised in recent years whether the U.S. government should maintain a strategic grain reserve, akin to the Strategic Petroleum Reserve used to cushion severe shocks to oil supplies.

Therein lies the Biblical story of Joseph, who interpreted the Pharoah’s dream about seven fat cows and seven lean cows to mean that seven years of plenty in Egypt would be followed by seven years of famine, for which Joseph recommended that the Pharoah save a portion of the harvest in the good years to feed the people in the years to follow.

At one time, the U.S. government did maintain physical reserves of grain, but today opts instead to hold cash reserves should it need to buy grain in the event of a crisis. Joseph W. Glauber, chief economist of the Agriculture Department, told CNN that removing grain from the marketplace for a strategic reserve or for other policy purposes raises issues of government intervention in the marketplace. As an example, Glauber cited a short-lived embargo on U.S. soybean exports in the early 1970s, one part of a larger Nixon administration anti-inflation strategy. The embargo’s “unintended consequences,” as Glauber termed them, included Brazil and Argentina expanding soybean production to take advantage of import demands the U.S. could not fill and the European Union “embarked on a ‘self-sufficiency’ policy for oilseed production.”

The National Family Farm Coalition, which bills itself as a “North American organization that serves as a national link for grassroots organizations working on family farm issues,” believes a strategic grain reserve is needed to prevent livestock feed costs from escalating beyond a reasonable price, “preserve our national security” by making sure there is sufficient grain for use by Americans and make sure farmers can cope with boom-and-bust cycles in the prices they receive.

China, the world’s most populous nation and the world’s largest wheat producer, maintains a national reserve, because “Food security is national security in China,” Jim Harkness wrote in a piece for the Institute for Policy Studies, the implication being that perhaps it is less of a national security priority in the United States. Harkness added, “Although China maintains vast reserves of grain, and other foods as well like pork and edible oils, the United States and most other countries have abandoned this wise approach,” Harkness, president of the Institute for Agriculture and Trade Policy, added.

In the years to come, the demands and diet of a growing global population – expected to reach 7 billion in late October – may well test the reassurance that Marri Carrow, communications manager for the U.S. Grains Council, offered CNN: “The U.S. farmer has an amazing ability to plant enough coarse grains to meet both domestic and international demand.”

Filed under: CNN Newsroom
soundoff (21 Responses)
  1. John from Erie, Pa

    America should take care of it's own first. If there is excess then sell to others. Profits should never come before feeding our own.

    September 24, 2011 at 10:32 am |
  2. Leo

    Hey Dave, nice article, but the religious symbolism was superfluous. Completely unnecessary. The increasing demand for food due to increasing population, the climate destabilization, the floods and droughts, the food shortages... this is science, not myth. And the idea of creating a stockpile, like any sort of cache of supplies kept in case of an emergency, is common sense in any culture, not just Judeo-Christian ones.

    Or... was the Biblical symbolism put there as a way to talk sense into the people who won't do anything unless "God said it in the Bible"? *sigh*

    September 26, 2011 at 4:47 pm |
  3. Jeff

    Ease up there Chief Leo. Out of that entire article, there was one paragraph, which referenced a biblical story, and yet that is what you keyed in on? Sure, let's not concern ourselves with whether we need to stockpile or not. Let's not be concerned with what could happen if we start allowing futures of our grain product be sold off. No no, let's instead focus on one paragraph and get all hurt.

    September 29, 2011 at 8:51 am |
  4. Ron Cook

    As one who has had a front row seat to grain storage issues, as a grain warehouse examiner during the grain storage glut of the 1980’s, there are wise and unwise ways of creating a grain reserve.
    Everyone must remember that storing grain is not like storing sand. Grain is a living breathing organism and it will not store indefinably. Millions of bushels of grain were lost to spoilage in the ’80’s because the grain just sat; even the best management and care will not keep it forever.
    The best method would be owning grain stored in public warehouses and take warehouse receipts for that grain. Only a low percentage of grain should be owned in any one warehouse to insure that the warehouse is able to rotate its stocks and thus maintain quality. Yes there would be an ongoing storage charge to pay, but even government owned storage costs money and the risk of not rotating the inventory is very high.

    October 27, 2011 at 10:43 am |
  5. Eric

    No. Yes. Confused? No, the U.S. government does not need to tax the 1/5 of all the grain produced in the U.S. However,....YES the PEOPLE of the U.S. should plant grains, fruits, and vegetables, raise animals, and store as much as possible on their on properties.

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