WTO chief urges alternatives to food export curbs

* Export restrictions major factor in food crises

* Food aid should be exempted * For stories on Doha round, click on [ID:nLR352231]

GENEVA, Jan 22 (Reuters) - Export restrictions are a prime cause of current and recent surges in global food prices, and countries should find other ways to secure domestic supplies, the head of the World Trade Organization said on Saturday.

WTO Director-General Pascal Lamy said that only a few years after the 2008 food crisis, rising prices were stoking global inflation and fomenting political unrest in several countries.

Two weeks ago the United Nations Food and Agriculture Organisation (FAO) said its food price index had reached a record high in 2010, exceeding 2008 levels when rising food prices prompted riots in a number of countries. [ID:nLDE7040LX]

Lamy said that one factor this time was bad weather, for instance last year’s drought in Russia and its Black Sea neighbours.

But export restrictions played a major role in food crises, and some people considered them the main cause of the 2008 price rise, he told a conference of agriculture ministers in Berlin. “Export restrictions lead to panic in markets when different actors see prices rising at stellar speed,” Lamy said. For instance there was no fundamental imbalance in the market for rice in 2007-2008 but international trade in the crop fell by seven percent in 2008 from record 2007 levels largely because of export restrictions, he said.

Rising prices for cereals in 2010-2011 have much to do with export restrictions in Russia and Ukraine, imposed after both countries were hit by drought, he said.

Such restrictions hurt importing countries and can prevent the World Food Programme from acquiring the food it needs to help starving people.

Lamy said countries imposing restrictions were driven by the need to prevent their own populations starving, but there were other ways of achieving this goal.

“The answer to that question must reside in more food production globally, more social safety nets, and more food aid and possibly food reserves,” he said.

“I would argue that what we must at least explore is the exemption of humanitarian food aid from export bans.”

WTO rules allow members to curb or ban food exports to ensure their own food supplies, and efforts by Japan in 2008 to make it harder for countries to restrict exports found little support.

But Lamy said the long-running Doha round to free up world trade could help remove other barriers to commerce in food, for instance by reducing rich-world subsidies that have hurt poor countries’ production capacity and banning export subsidies entirely, and bringing down some tariffs.

“Globally, what we would be likely to see as a result of Doha is more food being produced where this can be done more efficiently,” he said.

WTO members have launched a renewed push to conclude the nine-year-old Doha round this year. In agriculture they spent the last week largely looking at technical issues needed to implement a deal, and looking at proposals on subsidies. (Editing by Tim Pearce)