World Food Board Proposal

MAC/WFY

Page-24

0230_553559_07_cha03

194570. Early Attempts: FAO's Pioneering Work

and social problems were to be solved. But they could not act together without
adequate international machinery. Provision had been made for joint consultation
but not for putting the results of such consultation into effect.

Against this background, it was recommended that a `WFB' should be estab-

lished with the necessary authority and funds to tackle the long-term problems
of world food security. The proposed WFB, which would act through commodity
committees, might be established as a new international agency or FAO's consti-
tution might be altered to enable it to set up the WFB. There were drawbacks to
having a multiplicity of international agencies acting in the same field. If FAO
could establish the proposed WFB, it could be appointed by the FAO Conference,
which, it was hoped, ultimately would include representatives of all countries,
including those of the Soviet Union. But as the actions of the WFB would involve
broad problems of world economics and finance, it would be necessary to include
representatives of other international organizations such as the IBRD, ECOSOC
and the proposed ITO.

According to Boyd Orr's proposal, the WFB would have four functions:

· stabilization of prices of agricultural commodities on the world markets,

including provision of the necessary funds for stabilizing operations;

· establishment of a world food reserve adequate for any emergency that might

arise through crop failure in any part of the world;

· provision of funds for financing the disposal of surplus agricultural products

on special terms to countries that needed them; and

· co-operation with organizations concerned with international credits for indus-

trial and agricultural development, and with trade and commodity policy, in
order that their common ends might be more quickly and effectively achieved
(FAO, 1946b).

For agricultural price stabilization, the WFB, operating through its commodity

committees, would have power to hold stocks of each of the important commod-
ities, in line with principles previously put forward by the League of Nations and
other bodies. The WFB would undertake the investigations necessary to determine
what world prices would call forth the quantities that could be marketed. It would
announce a minimum and maximum price and would undertake to buy into
its stocks when the world price falls below the declared minimum price and sell
from its stocks when the world price exceeds the maximum. It was recognized
that care would be needed to commence operations at the correct moment and
to choose an appropriate world price. The WFB would need a revolving fund to
operate such a plan. For safety, the normal stocks held by the WFB would represent
six to twelve months' trade, the amounts varying with different commodities. In
determining the contributions made to the fund, the relative benefits derived from
the stabilizing operations by exporting and importing, developed and developing,
countries, would need to be carefully weighed.

Since the WFB would normally be buying at its minimum and selling at its

maximum price, it was considered that the Board would earn enough to cover the

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Useful links	World Food Board Proposal MAC/WFY Page-24 0230_553559_07_cha03 24 194570. Early Attempts: FAO's Pioneering Work and social problems were to be solved. But they could not act together without adequate international machinery. Provision had been made for joint consultation but not for putting the results of such consultation into effect. Against this background, it was recommended that a `WFB' should be estab- lished with the necessary authority and funds to tackle the long-term problems of world food security. The proposed WFB, which would act through commodity committees, might be established as a new international agency or FAO's consti- tution might be altered to enable it to set up the WFB. There were drawbacks to having a multiplicity of international agencies acting in the same field. If FAO could establish the proposed WFB, it could be appointed by the FAO Conference, which, it was hoped, ultimately would include representatives of all countries, including those of the Soviet Union. But as the actions of the WFB would involve broad problems of world economics and finance, it would be necessary to include representatives of other international organizations such as the IBRD, ECOSOC and the proposed ITO. According to Boyd Orr's proposal, the WFB would have four functions: · stabilization of prices of agricultural commodities on the world markets, including provision of the necessary funds for stabilizing operations; · establishment of a world food reserve adequate for any emergency that might arise through crop failure in any part of the world; · provision of funds for financing the disposal of surplus agricultural products on special terms to countries that needed them; and · co-operation with organizations concerned with international credits for indus- trial and agricultural development, and with trade and commodity policy, in order that their common ends might be more quickly and effectively achieved (FAO, 1946b). For agricultural price stabilization, the WFB, operating through its commodity committees, would have power to hold stocks of each of the important commod- ities, in line with principles previously put forward by the League of Nations and other bodies. The WFB would undertake the investigations necessary to determine what world prices would call forth the quantities that could be marketed. It would announce a minimum and maximum price and would undertake to buy into its stocks when the world price falls below the declared minimum price and sell from its stocks when the world price exceeds the maximum. It was recognized that care would be needed to commence operations at the correct moment and to choose an appropriate world price. The WFB would need a revolving fund to operate such a plan. For safety, the normal stocks held by the WFB would represent six to twelve months' trade, the amounts varying with different commodities. In determining the contributions made to the fund, the relative benefits derived from the stabilizing operations by exporting and importing, developed and developing, countries, would need to be carefully weighed. Since the WFB would normally be buying at its minimum and selling at its maximum price, it was considered that the Board would earn enough to cover the back to top Next page
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