Food Security Under Stress

Food Security under Stress Joachim von Braun International Food Policy Research Institute IICA-OAS Food Security Conference Washington DC, October 1, 2009

Overview
Poverty, food insecurity, new complex risks – now and emerging
Agenda for research, investment, and action

Rising number of hungry people in the developing world Data source: FAO 2006, 2008, 2009 . (in million) >1 bil. WFS target

Hunger “serious” in parts of the region Source: von Grebmer et al., IFPRI 2008 . 2008 Global Hunger Index (GHI)

Sub-national poverty ca. 2005 ($2/day) Prevalence Number Source: Stan Wood et al. (IFPRI) 2009.

High inequality in LAC Source: POVCAL, based on household surveys .

Food riots a mass phenomenon when prices spike Source: J. von Braun based on news reports. Price are data from FAO 2009. Price spike

Distributional impacts of the food crisis Source: M. Torero (IFPRI) 2009. Guatemala Honduras Nicaragua Peru Poverty (%) Rural Urban Rural Urban Rural Urban Rural Urban Deepening 64.1 43.7 67.8 23.4 58.0 22.8 70.6 39.8 Exit 0.1 0.0 0.2 0.0 0.7 0.1 0.0 0.0 Entry 2.2 2.3 1.3 1.8 2.3 3.0 2.3 1.8 Change 2.1 2.3 1.1 1.8 1.5 2.9 2.3 1.7

Calorie consumption – Honduras Before (blue) and after (red) of the increase in prices Households with 0 -2 years old kids National level

Increased speculation in food markets, and link to energy price Source: Chicago Board of Trade 2009. Grain and oilseed futures and options - Ave. daily volume And closure of commodity exchanges (India, China, etc.)

The financial crisis and the recession complicates food security
Less capital available today and in the future for the agriculture
More debt specially for small holders which had already invested in the expansion of their production
Shift of attention of policies for agriculture and reduction of public investment
Reduction of employment and wages of low skill workers
Reduction of remittances

Food system now also affected by financial volatility and recession Source: Data from IMF 2009; Ratha, Mohapatra, and Silwal. 2009; UNCTAD 2009, and World Bank 2009.

Climate change, agriculture and food security

Climate induced percentage change in production in 2050: Rainfed maize Source: M. Rosegrant (IFPRI) 2009. Global production: -16%

Climate change impact: Global food prices Source: M. Rosegrant (IFPRI) 2009.

Agriculture must be on the 2009 Copenhagen agenda, but how?
Investment: agriculture-related investments, as part of a Global Climate Change Fund
Incentives: phase in incentives first to reduce emissions and support technological change
Information: Establish comprehensive information and monitoring services of land use and soils for verification purposes

In sum: Risk patterns and emerging change
Risk of high and volatile food prices
Financial and economic shocks driving volatility further
Climate change accelerating volatility
Political volatilities and fragile states with increasingly reduced capacity to address risks

Overview
Poverty, food insecurity, new complex risks – now and emerging
Agenda for research, investment, and action

Agenda: A new pro-poor risk prevention, reduction, and management strategy
Promote agriculture growth with technology and institutional innovations to prevent risks
Innovate in insurance systems
Facilitate open trade and reduce market volatility
Expand social protection and child nutrition action

Actions for agric. productivity enhancement that serves food security
Access to inputs (e.g. quality seeds, fertilizer, feed, veterinary drugs)
Access to services, extension
Investment in rural infrastructure (rural roads, electrification, water and irrigation)
Agricultural research and innovation: triple the investment incl. the CGIAR by 2020

Innovate in insurance systems
Develop new insurance products (e.g. index-based weather insurance)
Explore new delivery channels (e.g. NGOs, community support networks)
Invest in information and technology (e.g. geographic information databases)
Provide smart insurance subsidies for the poor

Calm markets and facilitate open trade
Keep trade open even at times of global and regional food shortage
Establish grain reserves policy at global level as a risk management tool to prevent spikes
shared physical reserves, and
virtual reserve (a new institution at global level )

Invest in social protection and child nutrition action
Protective actions e.g.:
Cash transfers
Employment-based food security programs
Preventive actions e.g.:
School feeding (new insights)
Early childhood nutrition programs
Focus on children, women, and poorest

IFPRI LAC research strategy for
Target countries and regions with high food insecurity levels and prevalence of undernourishment
Analyze the range of problems of poor people, both in urban and rural areas
Agricultural productivity opportunities and sustainability
Trade and investment opportunities
In partnership with regional and national organizations

Food Security Under Stress

by Joachim von Braun

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