urgent actions needed to address emerging food security challenges

Urgent Actions Needed to Address Emerging Food Security Challenges

Shenggen FanDirector General

International Food Policy Research Institute

International Workshop on “Climate Change, Price Volatility, and Food Security: Perspectives from Southeast Asia”

Jakarta, April 20, 2011

Shenggen Fan, April 2011

Key messages

Global food insecurity persists, including in Southeast Asia

Food price volatility, biofuel expansion, and climate change are major emerging food security challenges

Urgent actions are needed to address these challenges

Emerging economies have a key role to play in enhancing global food security


Many are still hungry despite progress

Source: Data from FAO 2011 Source: United Nations 2010

Number of undernourished persons

1990-

1992

1995-

1997

2000-

2002

2005-

2007

2008 2009 201060

80

100

120

600

800

1,000

1,200Southeast AsiaWorld


Global food price hikes and volatility

Global hikes since June 2010• Maize: 90%• Wheat: 82%

Volatility due to• Natural disasters• Panic purchases• Trade restrictions, etc.

High domestic food inflation (yoy)

• China: 11% (Feb. 2011)

• India: 11% (Feb. 2011)

• Indonesia: 14% (Mar. 2011)Source: Data from FAO 2011

Mar-0

5

Sep-05

Mar-0

6

Sep-06

Mar-0

7

Sep-07

Mar-0

8

Sep-08

Mar-0

9

Sep-09

Mar-1

0

Sep-10

Mar-1

10

200

400

600

800

Maize

Wheat

Rice

US

$/m

etr

ic t

on


Domestic prices are also rising rapidly

Source: FAO 2011


High and volatile food prices affect food security, but outcomes vary

Source: Headey 2011

Self-reported food insecurity in select countries

China

India

Indonesia

Brazil

Pakista

n

Bangladesh

Nigeria

Mexic

o

Vietn

am

0

10

20

30

40

50

60

2005/06 2007/08 2008/09

Pre

va

len

ce

of

se

lf-r

ep

ort

ed

fo

od

in-

se

cu

rity

(%

)


Rising energy prices influence food security

Rising energy prices cause food prices to increase, rather than the reverse (Heady and Fan 2010)

Rising energy prices make biofuels more profitable, rather than agricultural production more expensive (Abbott, Hurt, and Tyner 2008)

Jan-05Jan-06

Jan-07Jan-08

Jan-09Jan-10

Jan-110

20

40

60

80

100

120

140Average crude oil price

US

$/b

arr

el

Source: Data from IMF 2011


Years to repay carbon debt for

9 scenarios of biofuel production (Fargione et al. 2008)

Biofuels raise food security and environmental concerns

Crop-based biofuels: compete with food availability and push up food prices increase CO2 emissions through conversion of e.g.

rainforests and grasslands


Climate change adds to pressure on food systems

Increased intensity and rate of natural disasters e.g. droughts and floods

Large yield losses and production cuts

Climate change impact on production: Irrigated rice, 2050

SE Asia total production = -17%Source: IFPRI 2011


Natural disasters undermine food security

# of persons affected, 2009

Source: The OFDA/CRED International Disaster Database 2011

Negative impacts on the poor and hungry through:

crop and asset losses

agric. and non-agric. infrastructure damages

farm and non-farm income declines

higher expenditure costs, etc.

Disaster risk management should be integrated ex ante into food security strategies (Haen 2008)


Urgent actions needed to address emerging food security challenges

1Promote effective policies and technology investments to minimize food-fuel competition

2 Provide social protection, esp. productive safety nets

3 Support transparent, fair, and open global trade

4 Establish global emergency physical grain reserve

5 Promote policies and investments to promote agric. growth

6 Invest in climate change agric. adaptation and mitigation

7Establish an international working group to monitor world food situation and catalyze action


0

5

10

15

20

25

30

35

40

0

20

40

60

80

100Transportation & CommunicationSocial ProtectionDefenseHealthEducationAgriculture

2005$int, bill 2005$int, bill

Invest in agriculture and smallholder productivity

Source: Data from IFPRI SPEED database

Improve access to quality seeds, fertilizer, financial and extension services, crop insurance, new technologies, rural infrastructure


Bangladesh Vulnerable Group Development program

Increased per capita food consumption by 45-66 kcal per taka transfer (Ahmed et al. 2009)

Ethiopia Productive Safety Nets Program (PSNP)

With access to both safety nets and agric. support, beneficiaries are more food secure and productive (Gilligan, Hoddinott, and Taffesse 2009)

Nigeria Fadama II Development Project

Increased the value of individual productive assets by about 50% (Nkonya et al. 2008)

Promote productive social safety nets


Emerging economies have a key role to play in enhancing food security (1)

Brazil China India In-done-

sia

0

10

20

30

MaizeRiceWheat

Share of global crop production, 2007 (%)

Source: Data from IMF 2011Note: Projections after 2009

Share of world GDP, PPP (%)

Source: Data from FAO 2011

0

4

8

12

16

20Brazil

China

India

Indonesia


Emerging economies have a key role to play in enhancing food security (2)

South-South trade: Expanding

South-South FDI: ~1/3 of all FDI to developing countries

Emerging economies: promote technologies more

suitable for developing countries

provide buffer during crises

provide platform for mutual learning0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

Brazil

China

India

Indonesia

Agriculture and food exports to developing countries (US$ bil.)

Source: Data from UNCTAD 2011