With the increase in demand from China for things like meat, milk and rice, we are seeing food prices skyrocket and even food shortages. It’s funny to think that there can be food shortages when governments in Europe and the U.S. heavily subsidize agriculture. In the past twelve months in Spain, for example, the price of milk has increased 30%. Something like 40% of the total EU budget goes to agriculture — that means that consumers are paying twice (first through taxes and second at the cash register).
Nevertheless, there may be some light at the end of the tunnel. If the wealthy nations don’t react quickly and change their agricultural policies, China may just be the opportunity that developing nations in Africa and Latin America have been waiting for to finally be able to compete in a global market.