Feeding and Fueling the World to 2030 and Beyond: Land Use Change from a Food Security Perspective
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Feeding and Fueling the World to 2030 and Beyond: Land Use Change from a Food Security Perspective

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International Development Seminar Series ...

International Development Seminar Series
November 9-10, 2009
Lausanne, Switzerland

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  • 1. Feeding and Fueling the World to 2030 and Beyond Land Use Change from a Food Security Perspective Siwa Msangi Environment and Production Technology Division, IFPRI International Development Seminar Series 9-10 November 2009, Royal Savoy Hotel, Lausanne, Switzerland
  • 2. Page Page
    • Overview of future food needs at global level
    • The link between agricultural productivity and land use
    Overview Land use change w/in context of food & agriculture
    • Country case studies which show linkage to poverty
    Country-level perspective on biofuels & well-being
    • Impact pathways that are relevant for food security
    • Implications for gov’t policy and local biofuel operators
    The micro-level aspects of food security Summary and conclusions
  • 3. Page Page
    • Diet change driven by increasing income and urbanization is inevitable
    • While cereal demand for food will decrease on a per capita basis – the need for feed will increase it in some regions (LAC/NAE)
    • Fast growth in meat consumption – especially Asia
    • Demand for grain and oils for biofuels will only increase the pressure on food markets and prices
    Increasing Food Demand to 2030 and beyond Socio-economic and demographic growth imply that food demand for cereal, meat and other products will increase rapidly to 2030 and beyond
  • 4. Ag. Growth: Extensification vs. Intensification
    • There are two ‘margins’ along which expansion or substitutions can take place – either more extensive displacement of the agricultural landscape or more intensive use of inputs
    • There might be constraints to one of these which means production growth has to rely more the other – such as land availability in Asia vs. Africa
    • Either of these options have implications for the environment – loss of natural cover or forested area versus increased load of pesticides, fertilizer and water consumption
  • 5. Page Page Where will new production come from? The needed increase in production, to meet demand can come from additional yield on existing land or achieving a sufficient level of production on new land = change in production = change in yield on harvested area previously cultivated = average yield on additional land going into prod’n
  • 6. Where is the land for agriculture? Page Source: Fields et al , 2007 Global Land Areas from HYDE-3 LU data
  • 7. Page Page
    • While there has been steady growth in production and yield in agriculture – the rate of increase has remained stagnant or decreased
    • The decreased attention paid to agriculture in past years has contributed to its falling share in national spending
    • Consequently, agricultural research dedicated to productivity enhancement of staple crops has declined over the years despite the fact studies have shown that roughly 70 percent of food needs will be met through yield enhancements (FAO, 2006)
    Maintaining the engine of crop yield growth Agricultural yield growth as a longer-term driver
  • 8. Observed and Future Trends in Agricultural Productivity
    • Past observed trends in agricultural productivity (global average across all crops) and required future trends in productivity increase under increasing pressures on land and water use (diet change, 200 EJ bioenergy demand in 2050, climate change, reduced trade) [Baseline: 9 billion people in 2055, constant current diets, no climate change, progressing globalization and increasing trade]
    Page Source: Lotze-Campen and Popp 2009
  • 9. Additional yield growth in cereals to offset malnutrition impacts of US biofuels target Page Global Cereal Yield Growth Malnourished children (0-5) Additional (annual average) yield growth in cereals: 1% in developing world 0.5% in developed world In other words…. Going from: 1.3%  1.8% Avg annual yield growth, globally
  • 10. Crop productivity and land use: MiniCAM model, Pacific Northwest National Laboratory
    • Crop area increases from 10% to 40% of arable land;
    Page Source: Wise et al. 2008
  • 11. Yield growth as a key driver of LUC
    • Need to get more food while relying on less expansion in land than before – need to move along the ‘intensive’ margin
    • The rate at which yield can grow has enormous consequences for future land use change
    • Some agronomists fear that we’re already approaching the yield ‘ceiling’ in key regions for some major crops that we will need to rely on
    • Yield growth ends up being a key factor to the competitiveness and human well-being outcomes of biofuels at the country level (as we will see next….)
  • 12. Country-level perspective on linkage b/w biofuels, growth and poverty Page
  • 13. Example: Mozambique
    • Example from recent work done on Mozambique (University of Copenhagen, IFPRI and others)
    • A food-insecure country that is scaling up export-oriented biofuels production
    • Some key trade-offs to consider – since Mozambique is land rich but labor scarce
    • Study considered 5 scenarios (baseline included) – that look at ethanol from plantation-based sugarcane and biodiesel from Jatropha (based on out-grower scheme)
    • Also with technology spillovers to food sector
  • 14.
    • Combining sugar and jatropha scenarios causes…
    • +0.7% GDP growth rate
      • +2.4% agriculture
      • +1.5% manufacturing
    • Biofuels = 5% of GDP by 2015
      • Mainly at the expense of export crops
    • -5.9% national poverty rate
      • -6.4% rural
      • -4.9% urban
    Combined Mozambique scenario results Source: Arndt et al. 2008 Distribution of reduced GDP shares
  • 15. Mozambique: Agricultural land use Land allocated to export crops declines fastest… … but most displaced land comes from food crops Source: Arndt et al. 2008 Land displaced by biofuels (total = 415 000 hectares)
  • 16. Example: Tanzania
    • A case study country (among 3) for the FAO BioEnergy & Food Security (BEFS) project
    • TZ is a food-insecure country that also wants to scale up biofuels production for both domestic use and export
    • Key crops for ethanol: sugarcane and cassava
    • Key crops for biodiesel: jatropha and palm oil
    • BEFS considered 2 scenarios (+baseline) – one which projects 49 Ml ethanol (10%) and 55 Ml biodiesel (5%) by 2017 – and another which reaches 800 Ml ethanol and 695 Ml biodiesel, based on land requests (314 kha)
    • Under #2 – biofuels prodn exceeds domestic demand
  • 17. Key results for Tanzania
    • Biofuel production accelerates economic growth and reduces poverty
    • No food-fuel trade-off appears in the medium term
      • The exchange rate appreciates as biofuel exports increases (or fuel imports decrease) – which puts traditional export commodities at a competitive disadvantage
      • The relatively large export sector for Tanzania allows the biofuels-driven land & labor displacement to take place without hurting food production much
    • Engaging small-holders has a poverty-reducing effect
      • Small-holder cassava is more cost competitive at current yields
      • Increasing yields makes outgrower sugarcane feasible as well
  • 18. Connections to household food security Page
  • 19. Micro-level connections to biofuels
    • We have looked at the macro-level implications – but we worry about micro-level effects
    • The macro-level prices for food and energy products affects hhold –level decisions/outcomes
    • Food security hinges around issues of availability, access, utilization and stability
    • Access (e.g. purchasing power) and utilization (e.g. quality) have strong micro-components which are important – maybe more than availability
    • Distributional implications become important when considering price effects at household level
  • 20. Poverty impacts of food prices
    • Ivanic and Martin (World Bank) did a study of 9 developing countries to tease out the difference in impacts from food price increases
    • The results varied country-to-country depending on food commodity in question
      • Bolivia : wheat strongest effect (maize the least)
      • Vietnam : largest impact in rice (price incr. cuts poverty)
      • Malawi & Zambia : incr. in maize price incr poverty
      • Pakistan : incr. in rice/dairy/wheat prices lowers poverty in rural areas – but raises it in urban areas
      • Cambodia : rice price incr. raises poverty in rural/urban, while incr in beef prices lowers rural poverty
  • 21. Impact pathways of food security Page Retail food prices Income Price transmission World Price Changes Household-level decisions & outcomes Macro-scale market conditions National commodity prices Off-Farm income sources Own cons’n Nutrition, health & well-being Marketed surplus Markets ( marketing policy) Processing & marketing Producer decisions Consumer decisions Food purchases (subsidies & policy)
  • 22. Food security impacts through prices
    • The impact pathways that go from biofuels-driven indirect land use change and food security – depend mostly on prices
    • There are winners and losers from price changes, depending on whether they are producers or consumers – and net buyers or sellers of the good
    • The magnitude of shocks along these pathways depend upon degree of price transmissions and policies that affect costs & margins along marketing chain and the final prices seen by hhold
    • The household can adjust along several dimensions
  • 23. Key dimensions of household choices Page Preferences & market conditions market opportunities Could be biofuel-related Expenditure Trade-off market opportunities Income Savings ( mkt return ) food non-food farm non-farm cash crop food crop agric. non-agric. own production marketed food allocation Labor/resource allocation diversification
  • 24. Protecting food security at hhold-level
    • Policy can have an influence on food security outcomes through maintaining the household’s access to food – especially under shocks
    • This can come through directly increasing the household’s purchasing power through income transfers or providing subsidized/free food to supplement the little that the hhold can buy directly
    • Land use policy enters in when the productive land assets (or access to commons) of hholds is at risk of being taken away by commercial interests
    • Increasing on-farm yields of hholds has big impact
  • 25. What can operators do to protect food security at project-level?
    • Allowing farmers to use (through borrowing or hire) machinery for their own on-farm production
    • Offer safety-nets or a ‘menu’ of contracts to outgrowers that targets those hholds most likely to fall into food insecurity (combination of pay & food)
    • Exercise caution in dealing with land that may be deemed ‘marginal’ or ‘unproductive’ but which might be important for livelihoods [gov’t plays role here]
    • Many communities want social services too (schooling facilities, water access) – the operator cannot replace the gov’t role, of course, but workers might feel more loyalty if they perceive goodwill
  • 26. Concluding Thoughts Page
  • 27. Page Page
    • Global orchestration is needed for those policies which require coordination on international level (trade and climate policy, enactment of regulation & law) – establishing certain strategic funds & response systems
    • National-level action to protect vulnerable areas and people, and to continue making necessary investments in agriculture and national infrastructure
    • Local-level monitoring, interventions, enforcement of regulations and implementation of best practices
    Global-to-local dimensions of food security Action needed both at the global, national and local levels – with coordination between all of them
  • 28. Page
    • Future food security is tied as much to changes in consumption as it is to production and land availability
    • More food production involves tradeoffs with environmental & ecosystem quality – LUC is a key part
    • Changes in both land use and food security operate through market mechanisms that produce ‘spillovers’ – but need different policy instruments to deal with them
    • Food insecurity occurs at household level and interventions need to happen there – operators can play a role in trying to mitigate this at the project-level
    • But the heavy-lifting needs to happen at gov’t policy level
    Food security and iLUC
  • 29. Thank You! Page
  • 30. Extra slides Page
  • 31. Regional per cap variation stands out …. especially meat Page Per capita Cereal Demand to 2050 Per capita Meat Demand to 2050
  • 32. Page Page Outlook for cereal production Total Cereal Production to 2050 Per Capita Cereal Production to 2050 Continue to depend on key regions to deliver...
  • 33. A varied pattern of child malnutrition IMPACT model projections Prevalence of pre-School Child Malnutrition in Asia and Africa (% of population aged 0 to 5) Total Levels of pre-School Child Malnutrition in Developing World (millions of children aged 0 to 5)
  • 34. Mozambique example: poverty Biofuels investments reduce poverty (raises returns to land and labor) Jatropha out-grower scheme is more pro-poor (absolute and relative def.) Urban households benefit from processing and indirect jobs (raises semi-skilled wages) (Arndt et al., 2008)