Global Food Security Challenges and Opportunities

Global Food Security Challenges and Opportunities

Shenggen FanDirector General

International Food Policy Research Institute

University of Nebraska-Lincoln’s Interdisciplinary Research Initiative in Food, Water, and Energy Resources Policy Event, Nebraska, April 13, 2011

Shenggen Fan, April 2011

Key messages

Food security challenges remain large

A development agenda with greater support for food security is needed

The role of policy research is crucial


Food security challenges remain large


The goal of halving hunger is off-track

Source: Fan 2010

Number of hungry people, 1990-2015

946

584


Challenges to global food security

Food price volatility

Energy/Biofuels

Population growth and demographic changes

Land and water constraints

Climate change


Food price hikes and volatility

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

High domestic food inflation• China: 10% (Jan. 2011, y-o-y)

• India: 11% (Feb. 2011, y-o-y)

• Driven by non-staples

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

Source: 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-11

0

200

400

600

800

MaizeWheatRice

US$

/met

ric to

n


High and volatile food prices increase food insecurity

Source: Headey 2011

Senega

l

Cameroo

n

Ghana

Nigeria

Kenya

Malawi

Ugand

a

Zambia

0

10

20

30

40

50

60

70

802006/2007 2007/2008* 2008/2009*

% o

f hou

seho

lds

repo

rting

pro

blem

s in

af

ford

ing

food

in la

st 1

2 m

onth

sSelf-reported food insecurity in Sub-Saharan Africa


Rapidly growing population and demographic change

World population reaches 9 billion by 2050

All growth to come from urban areas

Most growth to come from developing countries

Source: FAO 2009.

Larger and more urban population will demand more and better food


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-05

Jan-06Jan-07

Jan-08Jan-09

Jan-10Jan-11

0

20

40

60

80

100

120

140Average crude oil price

US$

/bar

rel

Source: Data from IMF 2011


Biofuel boom

Biofuel production to more than double from 2007-09 to 2019 (OECD-FAO 2010)

Biofuel demand to grow four-fold between 2008 and 2035 (IEA 2010)

Biofuels support to rise • 2009: $20 bn• From 2010 to 2020: $45 bn• From 2011 to 2035: $65 bn

World ethanol and biodiesel production

0

5,000

10,000

15,000

20,000

25,000

0

1,000

2,000

3,000

4,000

5,000

6,000EthanolBiodiesel

Bill

ion

gallo

ns

Bill

ion

gallo

ns

Source: Data from Earth Policy Institute 2011


1995/1996

1997/1998

1999/2000

2001/2002

2003/2004

2005/2006

2007/2008

2009/20100

5000

10000

15000

20000

25000

30000

35000

40000 Biofuels maizeNon-biofuels maize

Estim

ated

are

as h

arve

sted

to m

aize

(M

il-lio

n ha

)19

9519

9719

9920

0120

0320

0520

0720

090

100

200

300

400

0

10

20

30

40Maize productionShare of maize used for ethanol

Mill

ion

tons

(%)

Food-fuel competition(e.g. U.S. maize)

Source: Data from Earth Policy Institute 2011 Source: Data from USDA 2011; Headey 2011


Biofuels will impact food security(2020, compared to baseline)

Source: Rosegrant et al. 2008

Changes in number of malnourished children (‘000s)Changes in calorie availability (%)

Pric

e ch

ange

s (%

)


Growing land constraints

Source: Ahamed et al 2006

Global extent of soils with low nutrient capital reserves

Arable land per capita (ha in use per person)

Source: Bruinsma 2009


Severe water constraints

Source: Veolia Water and IFPRI 2011

With “business as usual,” high water stress by 2050 puts at risk:

→ 52% of global population

→ 49% of global grain production

→ 45% of global GDP


Climate change will push up food prices

World food price increases under various scenarios, 2010–2050(% change from 2010)

Source: Nelson et al. 2010


A development agenda with greater support for food security is needed


Address food price volatility

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

Support transparent, fair, and open global trade to enhance efficiency of global agricultural markets

Create global, physical, shared grain reserve to address food price crises

Establish 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


Promote safety nets that increase productive capacity

Ethiopia’s Productive Safety Nets Program (PSNP) Improved daily/capita caloric acquisition in last 7 days

by 10%

Enhanced food security in 2004-06 by 0.36 months

Rise in credit use by 12% points

Increased use of fertilizer by 11% points

Increased use of improved seeds by 5% pointsSource: Gilligan, Hoddinott, and Taffesse 2009


Promote land productivity improvements Create awareness of sustainable land management (SLM)

practices

Provide technical support for often knowledge-intensive SLM practices

Support generation of innovative SLM practices (e.g. fertilizer micro dosing and packaging, biomass transfer, manure management)

Invest in water storage or distribution to improve irrigation efficiency

Increase finance of irrigation investments, esp. for small farmers Source: Nkonya et al. 2011, forthcoming


Sustainable land management (SLM) practices have win–win outcomes

SLM practices: (evidence from Kenya, Niger, Nigeria, and Uganda)

• control soil erosion • increase soil carbon stock• increase crop yields• reduce climate-induced production risks • enhance agricultural productivity and incomes

Examples of SLM practices: irrigation, agroforestry, fertilizers, mulching, crop residues, improved fallow, compost

Source: Kato et al. 2010; Nkonya et al. 2011, forthcoming


Promote water productivity improvements

Higher levels of water reuse by all users of water

Improvements and evolution of water technology

Water and wastewater infrastructure improvements

Extension of services to rural and urban poor populations

Greater energy efficiency with increased use of renewable energy



Sustainable water management has high pay-offs

Compared to “business as usual,” it can de-risk:

>1 bn people

~$17 trillion of GDP

>20% of children likely to suffer from malnutrition(with higher investments in rural water supply and sanitation and female secondary education)



Invest in climate change adaptation and mitigation esp. through agriculture

Adaptation: e.g. • improved land management• adjustment of planting dates • introduction of new crop varieties

Mitigation: e.g. • improved energy efficiency and crop yields• land management techniques to increase carbon storage

Source: IPCC 2007; Nelson et al. 2009

At least additional US$7 billion agricultural productivity investments are needed annually to offset adverse effects on

human well-being


The role of policy research is crucial


Changing global policy landscape

Emerging issues and new actors• High and volatile prices, increasing natural resource

stresses, climate change, demographic shifts etc.• Emerging economies, private sector, philanthropic

organizations etc.

Emphasis on country-driven and -owned development strategies

Increased demand for policy research


Role of policy research

Policy research evolves beyond technology e.g. to macroeconomics, trade, energy, and social protection

Contribution of policy research to poverty and hunger reduction• Direct: Increases investment in food security,

agriculture, and rural development and improves resource allocation

• Indirect: Creates enabling environment for agricultural technology innovation and adoption in developing countries


Impacts of policy researchVietnam rice marketing and policy research

• Influenced timing of changes in rice policies• Generated benefits worth US$45-91 million

Bangladesh food-for-education program research• Improved targeting and strengthened capacity• Generated benefits of about US$248 million

Evaluation of Mexico’s PROGRESA• Guided program investments and implementation

Public investment research• Contributed to public investment strategies in many Asian

and African countries


Sector

Ghana Uganda Tanzania Ethiopia China India Thailand

Returns to agriculture or rural income(local currency/local currency spending)

Agriculture 16.8 12.4 12.5 0.14 6.8 13.5 12.6Education -0.2 7.2 9.0 0.56 2.2 1.4 2.1

Health 1.3 0.9 n.e. -0.03 n.e. 0.8 n.e.

Roads 8.8 2.7 9.1 4.22 1.7 5.3 0.9

Ranking in returns to poverty reduction

Agriculture n.e. 1 2 n.e. 2 2 1

Education n.e. 3 1 n.e. 1 3 3

Health n.e. 4 n.e. n.e. n.e. 4 n.e.

Roads n.e. 2 3 n.e. 3 1 2

Policy research insights for resource allocation

Source: Fan, Mogues, and Benin 2009 Note: “n.e.” indicates not estimated


Examples of policy research needs (1) Assessing the impacts of high and volatile food prices

on poor people (use of household surveys)

Identifying strategic investments in pro-poor agricultural technology development and adoption

Understanding the impacts of biofuels and climate change on agriculture and food security

Identifying more effective strategies to promote sustainable land management for poverty reduction


Examples of policy research needs (2) Understanding the impacts of global change drivers on

current and future availability and accessibility of water resources

Identifying research-based options to address growing water scarcity and water quality challenges

Identifying strategies to build the capacity of small farmers and the rural poor to adapt to climate change

Understanding the linkages between climate change and gender

Documents

Global Food Security Challenges and Opportunities