ICN2-Trends in Food Supply and Impacts on Food Consumption

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Trends in Food Supply and Impacts on Food Consumption
by WB Traill, University of Reading

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ICN2-Trends in Food Supply and Impacts on Food Consumption

  1. 1. Trends in Food Supply and Impacts on Food Consumption WB Traill, University of Reading Paper co-authors: M Mazzocchi, B Shankar, D Hallam PREPARATORY TECHNICAL MEETING FAO Headquarters, Rome, Italy 13-15 November 2013
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  3. 3. Outline •How diets have changed since 1992 •Supply system drivers of change •Some policy implications 3
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  6. 6. Sales growth rates selected food categories 6
  7. 7. Overweight and Underweight prevalence 7
  8. 8. 8 TRENDING FACTORS AGRICULTURAL & TRADE POLICIES Consumer policies Producer support policies Trade polices Food prices Food availability Food preferences Population growth Intakes Dietary quality Globalisation Urbanisation Energy prices (biofuels, oil price volatility) Technical progress (agricultural productivity, progress in processing / preserving foods) Other socio-demographic trends Prevalence of undernutrition Prevalence of overnutrition Income effects Food consumption Market organization Incomes
  9. 9. Today’s focus: Consumption implications of supply chain modernisation 9
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  14. 14. Income growth 14 GDP per capita, PPP (constant 2005 international $) Country grouping 1992 2010 Yearly growth Low income 738 1127 2.4% Middle income 3048 5998 3.8% High income 24866 33119 1.6% European Union 20664 27555 1.6% OECD members 22931 30112 1.5% Sub-Saharan Africa 1535 2041 1.6% World 6797 9889 2.1%
  15. 15. Urbanisation 15
  16. 16. Female labour force participation OECD Growth 1992-2010 =20% (48m) Low income countries + 58% Middle income countries +46%
  17. 17. Globalisation 17
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  19. 19. Foreign Direct Investment 19 Source WIR.
  20. 20. Trade and Investment policies •Uruguay Round Agreement on Agriculture (URAA) (1994) and World Trade Organisation (1995) •200 plus regional agreements registered with WTO •SPS and TBT measures of WTO/Codex •Trade-Related Investment Measures (TRIMS) 20
  21. 21. RETAILERS Asian food retail market clusters Discriminating Shopper Markets Multi-Format Modern Growth Markets Big and Basic Markets Source: Food Retail Formats in Asia
  22. 22. Implications of supply chain modernisation On supply chain organisation Tight vertical control Private standards Centralised purchasing, warehousing and distribution Product differentiation and sophisticated marketing On supply chain actors Opportunities and threats to domestic farmers, processors, distributors and retailers On consumers? Have the observed changes caused consumption shifts or responded to them? Much less well understood! 23
  23. 23. Hypotheses of why food system changes have an ‘additional’ impact on consumption 1. They lower the price of processed foods relative to traditional staples and fresh F&V. 2. They make more foods available (e.g. chilled foods such as dairy products, processed meats, product variety, snack foods, fast foods, soft drinks) 3. They enhance food safety and quality (enforcement of standards) which promotes consumer confidence in the foods supermarkets sell 4. They employ sophisticated marketing, often targeted at children, to encourage a preference for western foods Implications: diets are more diverse, deliver cheaper energy, enhanced micronutrient availability, but processed/fast foods are often energy dense with higher levels of salt, saturated and trans fats. NB. In general consumers derive pleasure from these developments! 24
  24. 24. Some policy implications: Harness the good, avoid the bad •Continued liberalisation of markets (trade, investment, institutions) will contribute to supply chain modernisation and the benefits (and costs) this can bring •Modern supply chains offer opportunities for delivery of micronutrients through dietary diversity and fortification •Governments should work with industry to promote reformulation (reduced salt, saturated and trans fats, sugar) •Take early steps to minimise/reverse trends in over-nutrition— information and market intervention measures.
  25. 25. Thank you for your attention!

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