Full Speed Ahead for Global Shipping

Jeff Rubin is at it again. The unconventional former world-markets whiz from CIBC has made another one of his wild, out-on-a-limb forecasts. Rubin has made a name for himself making bold and often unsettling predictions that have a knack for proving themselves accurate – or at least as accurate as economic predictions can be. Over the years, he has anticipated fluctuations in the interest rate and Canadian dollar with surprising precision, projected the decline in the Ontario real-estate market, and predicted soaring energy prices in the 2000s. Now, in a new book entitled Why Your World is About to Get a Whole Lot Smaller: Oil and the End of Globalization, Rubin has declared that peak oil will lead to the collapse of global shipping and global industry along with it.

The basic premise of Rubin’s argument is simple. The global supply of oil is tapering off while global demand for oil continues to rise. As a result, oil prices will continue to inch upwards with gathering momentum as oil becomes increasingly scarce. Skyrocketing (triple-digit) oil prices in the upcoming decades will inflate shipping costs to the point that it becomes no-longer viable to produce commodities on one side of the planet then ship them half-way around the globe to consumers. Rubin expects agriculture to be the hardest hit. The collapse of global agriculture has especially worrying concerns for Rubin, and he argues that peak oil presents a tremendous threat to food security for food importing countries. The United States, for example, imported $6 billion worth of food from China last year which, Rubin quips, “brings a whole new meaning to having Chinese food delivered.” Rubin’s inner-futurist leads him to the conclusion that new, decidedly anti-global forms of production will prevail when the scarcity of oil forces humanity to abandon shipping their meals across the globe.

Rubin is no doomsday prophet, however. In fact, he finds hope in the collapse of global shipping and global agriculture. According to Rubin, triple-digit oil prices will provide the disincentive necessary to force consumers to abandon their energy-intensive lifestyles that rely so heavily on the gas-guzzling transoceanic container ships that have become the backbone of the global economy. In his vision of a post-petroleum-dependent world, local food economies will thrive again. He explains that “Not only does replacing foreign food with local food save energy, but in the process it reduces carbon emissions – a double win in an economy that not only has to contend with triple-digit oil prices but that will soon put a price on burning oil as well.” Rubin likes to think he has found the silver lining to an otherwise disturbing global economic collapse.

Part One of my loosely joined series on global food has already detailed how new research continues to disprove Rubin’s assumption that replacing foreign food with local food will save energy and reduce carbon emissions. Rather than repeat all these facts, figures, and explanations, I will briefly summarize the key points. Global shipping is enormously more efficient at moving enormous quantities of food cargo than the small highway trucks and old farm pickups of the local food economy. Even though the distances involved are further, global shipping allows food production to occur in the world’s least energy-intensive locales, and considering production is where the bulk of the energy is expended, our food arrives in our supermarkets with smaller carbon emissions overall. Global agriculture owes its creation to a search for the most economically efficient way to feed humanity’s appetite. The same benefits of a global scale already apply to environmental efficiency as well.

Another important factor Rubin seems to ignore in his local food utopia is the question of how local food would be transported once peak oil has rendered gas prices prohibitively high. Does he expect the horse-and-buggy to make a comeback? Or, perhaps he expects wheelbarrows will conquer the abandoned highways? These antiquated modes of transportation could never provide the transport capacity humanity needs to feed itself. The reality of the situation is that local food economies are just as vulnerable to peak oil, if not more so than their leaner, more efficient global counterparts. There is no silver-lining here.

While Jeff Rubin’s argument that peak oil is desirable can be discounted by this new research, his argument that peak oil will have inevitable and profound impacts on global shipping still stands as a problem that deserves serious attention. Can global shipping continue to thrive in a world of triple-digit oil prices? I submit that it can for two reasons. First, the processes of economics dictate that global shipping is better positioned to absorb input-cost inflation. Second, the processes of innovation dictate, or at the very least suggest that fresh ideas and new technologies will help global shipping use their oil more efficiently and more environmentally.

Hopefully, readers will not be scared away by some economic terminology. Price elasticity of demand is the measurement of how demand for a commodity responds to changes in prices for that commodity. In other words, the likelihood that a shopper will leave the product on the shelf once they discover the price had increased. The peak oil premise is founded upon this economic concept, and the security of transporting food through networks that rely heavily upon oil, a commodity notorious for its price volatility, has increasingly been called into question, and not just by Rubin. The major short-coming with this food security narrative is that different price elasticities exist for different types of oil consumers. A weekend traveller or commuter-of-convenience, for instance, is more likely to drop out of a bidding war for oil than a large institutional transporter that requires oil to fuel an important and necessary economic activity. Sadly, little economic research has been conducted on this question, and it is hard to say how much sooner the weekend traveller or commuter-of-convenience would drop out of the bidding war. One hundred dollars sooner? Fifty dollars sooner? One dollar sooner? Nonetheless, the basic premise remains sound. The North-American car lifestyle will die out long before global shipping does. And once it does, remaining oil supplies can be concentrated on industries we rely upon to feed ourselves while innovation and technological advancement transforms humanity into smarter, less dependant oil users.

Global shipping is at the forefront of this innovation and technological advancement. Bold strides have been taken in this direction, and they have been well documented. A recent BBC article recounts some of these exciting new developments in the world of ship-building. For instance, the world’s largest container ship, the Estelle Maersk, makes use of several innovative design features that increase her efficiency and allow her to travel farther on each fill-up. Internal funnels on her engines capture waste heat to drive power-boosting turbines that reduce fuel consumption by 10%, kind of like the world’s largest supercharged street racer. Additionally, cutting-edge hull design, computerized systems control, and an extra-slippery coat of silicon paint make her one of the sleekest, most efficient ships ever built. All together, these technologies reduces her fuel consumption 25% when combined with new, smart sailing practices. Other innovations for global shipping are in the works, including kites to harness nautical winds, and as new discoveries are made, new technologies will continue keep global shipping on the cutting edge of efficiency.

Jeff Rubin’s book is engaging food for thought, and it raises important questions about the security of our food supply and the future of our global food economy. Sadly, his book fails to recognize the folly of local food economies as a solution to clear and present ecological concerns. Furthermore, it fails to recognize the innovations that have been made in global shipping and the promise they hold that efficient global economies might continue to benefit the residents of our small planet. They say that necessity is the mother of all invention, and the vast appetite of humanity has already required us to invent global agriculture. Now, the fragility of our world is requiring us to invent new ways to fuel our food. Hopefully, these inventions will prevail before our world and our food security comes crashing down around us.

Save the Planet – Buy Global Food! Debunking the food miles myth

Lately, I’ve been hearing a lot about food miles and the environmental benefits of local food. I hear about it from friends and on the radio. I read about in newspapers and on the Internet. Every environmentally conscious consumer, it seems, has fallen for local food and farmers’ markets. And when I tell them that I don’t buy into the local food logic, and that I believe global food is the key to sustainability, I invariably get some kind of suspicious, even dirty look. I watch them wonder: How could anyone deny that local food is our environmental salvation? How could anyone endorse the psychopathic, planet-murdering global food consumer lifestyle?

My reasons are hard to explain, and they rarely withstand the full onslaught of slick, local food slogans. This is probably a case of what my roommate would call “unsexy truths” – it’s nearly impossible to distill my logic into buzzwords and mantra. Local food advocates only need a handful of words to explain how global food economies require longer transportation networks and, as a result, have larger carbon footprints. This argument, the so-called ‘food miles’ concept, seems intuitive. It just makes sense.

The case for global food, on the other hand, needs more than a handful of words. It’s technical and full of complexity – there is no poetry in global food. It does not capture the imagination of the conscientious consumer, and quite often it will dull the passions of concerned citizens. This is unfortunate, for it will either exasperate the listener’s attention span or, worse yet, lead them to the conclusion that it is merely a desperate and sophisticated attempt to confound the no-brainer logic of food miles. To this I say: there are rarely no-brainers in subjects as complex as agronomy, ecology, and economics, and solutions rarely fit inside a greeting card. The truth is not always simple and sexy, but it can be beautiful in its complexity. And this beauty will not let itself be seduced by the lazy mind.

For the last fifteen years, food miles have been the load-bearing pillar of the local food movement’s architecture. The desire to slow the insidious progress of climate change by reducing food transport distances, and thus carbon emissions, have been a driving factor behind the resurgence of farmers’ markets and local food products in supermarkets. In the past few years, however, the utility of food miles as a measure of environmental impact has been increasingly called into question by agricultural and environmental scientists. New research continues to expose fissures in the food miles argument.

Broadly speaking, the food miles concept relies on three assumptions that are increasingly being proven false. First, food miles assumes that the distance travelled by an agricultural commodity is more relevant in assessing environmental impact than the mode of transportation used and the quantity transported. Second, food miles assumes that transportation from producer to retailer is the most significant phase, environmentally speaking, of an agricultural commodity’s lifecycle. Third, food miles assumes that energy efficiency and carbon intensity in production are constant across all geographies, terrains, and climates. This post will walk you through an explanation of how each of these assumptions rarely holds true.

In 2005, the British government’s Department for Environment, Food, and Rural Affairs (DEFRA) conducted a study of the environmental impact of food transportation in the United Kingdom to determine whether food miles would make a useful measurement for the government’s Sustainable Farming and Food Strategy. The results of the study are fascinating, especially the revelation that food miles, when crudely conceptualized, are almost meaningless and that when analyzed closely, the food miles travelled by global food commodities were actually less harmful to the environment than those travelled by local food commodities. How is this possible, you might ask? It certainly seems to run against common sense.

In fact, it is not too difficult to explain these findings. Put simply, the fuel efficiency and cargo capacity of different modes of transportation matters a whole lot more than the actual distance travelled. A container ship, for instance, can move one tonne of food over one kilometer with less harmful emissions than a light ground vehicle (DEFRA’s fancy terminology for a pickup truck). Global food economies have the most efficient modes of transportation (container ships, freight trains, and heavy highway trucks) as their backbone while local food economies rely exclusively on the less-efficient pickup trucks, minivans, and automobiles. In one startling example, the DEFRA report demonstrates that a British consumer driving 10 kilometers to purchase green beans from Kenya actually expends more carbon per-bean than during the transport of these beans by airplane from Kenya. Had these beans been delivered to the retailer from a local producer by pickup truck, the carbon expended would likely have been even greater.

Sure, a local food advocate might say, these behemoths of global transportation might be more efficient per-tonne per-kilometer, but overall they contribute more harmful emissions because of the sheer volumes they carry and vast distances they travel. They might have marginally smaller carbon footprints per-capita, but in absolute terms the carbon footprint of global transportation far exceeds the carbon footprint of local transportation. The problem with this line of reasoning is that it forgets that humanity’s total appetite will remain constant, if not grow thanks to raising levels of prosperity in the developing world. Reducing the importance of global modes of transportation would only increase the prevalence of less-efficient local modes of transportation. If we could wave a magic wand and replace the existing global food economy with local equivalents, it would eliminate the enormous carbon footprint of global food transportation. Unfortunately, it would produce an even large carbon footprint resulting from a veritable army of farmers in pickup trucks (many of which aren’t the most environmentally friendly vehicles). This argument has recently been made by David Owen in his new book Green Metropolis.

These findings certainly cast doubt on the relevance of food miles and the sustainability of local food overall, but ultimately they will likely become little more than a footnote in the rapidly growing anti-localization literature. Their relative unimportance results from the same factors that disprove the second food miles assumption, that transportation is the most impactful phase, environmentally speaking, of an agricultural commodity’s lifecycle. Recent studies criticizing food miles all point out that transportation accounts for a very small percentage of an agricultural commodity’s total carbon footprint. A 2007 study by Carnegie Mellon University in Pittsburgh, for instance, found that over the entire lifecycle of the average agricultural commodity consumed in the United States, only 11% of green house gas emissions occurred during transportation. Furthermore, the stage of transport most derided by local food advocates, where commodities are delivered from producer to retailer across vast distances, accounted for only 4% of emissions. Clearly, the second assumption upon which food miles rests (that transportation is the most impactful phase, environmentally speaking, of an agricultural commodity’s lifecycle) does not hold true.

The real culprit is production itself, the stage of the commodity’s lifecycle that occurs before it even leaves the farm. The Carnegie Mellon study found that 83% of emissions occurred during the production phase, highlighting the importance of energy efficient and low-carbon intensity agricultural production. This is where the food miles concept makes another oversight. It fails to consider that longer transport distances are generally a beneficial trade-off for more efficient and less intensive production. Several studies have addressed this question in great detail, and their findings are very illuminating. These studies all point out that local variations in geography, terrain, and climate have profound impacts on the efficiency and intensity of agricultural production. A 2008 study from the University of Toronto found that strawberry farms in hot and sunny California produce, on average, 17 times more strawberries than their equivalents in Ontario. A similar study done by the Cranfield University in the United Kingdom found that 12,000 cut roses produced in Kenya’s favourable climate generated 6,000kg of carbon dioxide while their Dutch competitors required 35,000kg for the same quantity. The DEFRA study (mentioned above) found that British farmers generated 2,394kg of carbon dioxide during the production of a tonne of tomatoes while their Spanish counterparts generated only 630kg. Another study conducted by the Lincoln University in Christchurch, New Zealand came to similar conclusions regarding lamb, apples, dairy products, and onions. For example, the study found that 2,849kg of carbon dioxide are generated during the production one tonne of lamb in the United Kingdom while only 688kg of carbon dioxide are generated during the production of one tonne of lamb on New Zealand’s clover-studded slopes and the subsequent transport of the meat 18,000km to the UK by boat.

This is, essentially, the logic behind global agriculture and the reason that food miles are little better than a “marketing fad” (to quote Pierre Desrochers, author of the University of Toronto study). The distance travelled by an agricultural commodity is not more relevant in assessing environmental impact than the mode of transportation used and the quantity transported. Transportation from producer to retailer is not the most significant phase, environmentally speaking, of an agricultural commodity’s lifecycle. Energy efficiency and carbon intensity are not constant across all geographies, terrains, and climates.

That being said, do not get the impression that I am categorically against local food production. There are some cases where the local agricultural commodity will prove to be the most environmental. A Spaniard should eat Spanish tomatoes. A New Zealander should eat New Zealand lamb. A Californian should eat California strawberries. The important issue here, and this is one place where I can agree with local food advocates, is that consumers put more thought into the provenance of their food. It is one economic activity that is universal to all human beings, and conscientious consumption holds incredible power to remodel the world in which we live. We should all ensure that our consumption patterns will contribute to a sustainable future. Just don’t take for granted that local food is always the answer and that food miles really mean anything.