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The increasing costs of Animal Source Foods in Ethiopia: Evidence and Implications PRELIMINARY!

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The increasing costs of Animal Source Foods in Ethiopia: Evidence and Implications PRELIMINARY!

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The increasing costs of Animal Source Foods in Ethiopia: Evidence and Implications PRELIMINARY!

  1. 1. Photo Credit Goes Here The increasing costs of Animal Source Foods in Ethiopia: Evidence and Implications PRELIMINARY! Fantu Bachewe, Bart Minten & Feiruz Yimer
  2. 2. I. INTRODUCTION • Strong desire to improve nutritional outcomes • Increasing diet diversity crucial • Within diet diversity, increasing attention to Animal Source Foods • ASF have more accessible crucial vitamins and minerals and contains bio-active factors • Beneficial for child growth and brain development of children; bone development
  3. 3. I. INTRODUCTION • In Ethiopia, also evidence on links of ASF and nutrition • However, consumption of ASF is low • Several factors advanced: 1/ High prices 2/ Shortage of ASF 3/ Lack of awareness • Look at patterns and trends of ASF prices
  4. 4. II. BACKGROUND • Livestock largest livestock population in Africa • CSA: 56 million cattle; 58 million shoats; 57 million poultry (do not include pastoralists)
  5. 5. II. BACKGROUND • 13.4% of food consumption towards ASF: Of these, - 42 percent dairy - 40 percent beef - 12 percent sheep/goats • ASF economically superior: - richest: 18% of food budget - poorest: 7% of budget
  6. 6. II. BACKGROUND • International trade 0 5 10 15 20 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 MillionUSD Imports Dairy Meat 0 200 400 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 MillionUSD Exports Live animals Meat Raw hides and skins
  7. 7. II. BACKGROUND • International trade – imports of inputs used in livestock products 0 1 2 3 4 5 6 MillionsUSD animal feed veterinary vaccines
  8. 8. III. DATA • Consumer price survey CSA • 116 retail markets • Prices on livestock: cattle (heifer, cow, bull, oxen); shoats; poultry • Prices on ASF: beef, camel meat, milk (different types), eggs, dairy products • Deflate prices with CPI • Period January 2007 – December 2016
  9. 9. III. DATA • Consumer price survey CSA
  10. 10. III. DATA Number of observations Mean Livestock Heifer (2-4 years) 10,905 2,074.3 Cow (4 years and above) 10,898 3,117.4 Bull (2 - 4 years) 11,142 2,607.4 Ox (4 years and above) 11,479 5,029.1 Sheep (10 - 15 kgs) 12,260 460.9 Goat (10 - 15 kgs) 12,158 425.0 Hen (indigenous) 12,593 44.7 Cock (indigenous) 12,676 66.7
  11. 11. III. DATA Number of Animal Source Food (ASF) Unit observations Mean Beef kg 11,697 71.0 Camel meat kg 1,018 63.1 Cow milk unpasteurized liter 11,102 9.5 Cow milk pasteurized liter 2,392 18.8 Camel milk liter 1,438 11.8 Goat milk liter 469 11.7 Powdermilk 450 gr 7,853 99.8 Yoghurt liter 8,884 15.8 Cheese kg 5,997 23.8 Butter kg 11,694 98.1 Egg dozen 12,837 20.3
  12. 12. IV. SEASONAL AND SPATIAL PATTERNS • Supply factors • Demand factors
  13. 13. IV. SEASONAL AND SPATIAL PATTERNS 0.90 0.95 1.00 1.05 1.10 1.15 J F M A M J J A S O N D Price seasonality sheep ox hen
  14. 14. IV. SEASONAL AND SPATIAL PATTERNS 0.90 0.95 1.00 1.05 1.10 1.15 J F M A M J J A S O N D Price seasonality beef cow milk cheese butter egg
  15. 15. IV. SEASONAL AND SPATIAL PATTERNS 0 200 400 600 800 1000 Jan-07 Mar-08 May-09 Jul-10 Sep-11 Nov-12 Jan-14 Mar-15 May-16 2011Birr Sheep Shewa Addis 0 2000 4000 6000 8000 10000 Jan-07 Mar-08 May-09 Jul-10 Sep-11 Nov-12 Jan-14 Mar-15 May-16 2011Birr Oxen Shewa Addis
  16. 16. IV. SEASONAL AND SPATIAL PATTERNS 0 5 10 15 20 25 30 Jan-07 Mar-08 May-09 Jul-10 Sep-11 Nov-12 Jan-14 Mar-15 May-16 2011Birr/dozen Eggs Shewa Addis 0 5 10 15 Jan-07 Mar-08 May-09 Jul-10 Sep-11 Nov-12 Jan-14 Mar-15 May-16 2011Birr/lt Milk Shewa Addis
  17. 17. V. PRICE EVOLUTION OVER TIME 0 10 20 30 40 50 Heifer (2-4 years) Cow (4 years and above) Bull (2 - 4 years) Ox (4 years and above) Sheep (10 - 15 kgs) Goat (10 - 15 kgs) Hen (indigenous) Cock (indigenous) Changes of real prices in 2016 compared to 2007 (%) 2016
  18. 18. V. PRICE EVOLUTION OVER TIME 0 5 10 15 20 25 30 35 40 Beef Cow milk unpasteurized Cow milk pasteurized Powder milk Yoghurt Cheese Butter Egg Changes of prices in 2016 compared to 2007 (%)
  19. 19. V. PRICE EVOLUTION OVER TIME [76.8 86.3) [66.1 76.8) [57.1 66.1) <57.1 No data 2007 2016 Beef
  20. 20. V. PRICE EVOLUTION OVER TIME >=11 [9.6 11) [8.6 9.6) [7.4 8.6) <7.4 No data 2007 2016 Cow milk (unpasteurized)
  21. 21. V. PRICE EVOLUTION OVER TIME >=22.4 [20.3 22.4) [18.3 20.3) [15.2 18.3) <15.2 No data 2007 2016 Eggs
  22. 22. V. PRICE EVOLUTION OVER TIME
  23. 23. V. PRICE EVOLUTION OVER TIME
  24. 24. V. PRICE EVOLUTION OVER TIME
  25. 25. V. PRICE EVOLUTION OVER TIME 0 10 20 30 40 50 Heifer (2-4 years) Cow (4 years and above) Bull (2 - 4 years) Ox (4 years and above) Sheep (10 - 15 kgs) Goat (10 - 15 kgs) Hen (indigenous) Cock (indigenous) Changes in terms of trade (wrt cereals) in 2016 compared to 2007 (%)
  26. 26. V. PRICE EVOLUTION OVER TIME 0 10 20 30 40 50 Beef Cow milk unpasteurized Cow milk pasteurized Powder milk Yoghurt Cheese Butter Egg Changes in terms of trade (wrt cereals) in 2016 compared to 2007 (%)
  27. 27. V. PRICE EVOLUTION OVER TIME -60.0 -40.0 -20.0 0.0 20.0 40.0 60.0 80.0 Grains, roots and tubers Legumes and nuts Dairy products (milk, yogurt, cheese) Eggs Flesh foods and others/small animal… Vitamin A dark green leafy vegetables Other Vitamin A rich vegetables and… Other fruits and vegetables Oils and fats Sugar and honey Changes of prices in 2016 compared to 2006 (%)
  28. 28. V. CONCLUSIONS • Consumption of ASF major nutritional impacts • However, only minority of people consume • An important factor is prices • Several patterns in prices: - Price seasonality linked to demand - Spatial patterns - High prices (per cal./kg 10 times higher than cereals)
  29. 29. V. CONCLUSIONS • Prices rapidly increasing • Important as high price elasticities in Ethiopia (beef: -0.73; dairy products: -0.67); • Noted price increases in last decade would have led to a 25% reduction in beef and dairy products consumption (ceteris paribus)!
  30. 30. V. CONCLUSIONS • Implications: Ethiopia successful in cereals sector; less so in other sectors; more attention needed in these other sectors • Further research - Causes of price increases: 1/ Supply issues in the face of rapid increasing demand 2/ Costs increases in livestock rearing (wages, land, feed) 3/ International prices

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