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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
Shenggen Fan, April 2011
Food security challenges remain large
Shenggen Fan, April 2011
The goal of halving hunger is off-track
Source: Fan 2010
Number of hungry people, 1990-2015
946
584
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Challenges to global food security
Food price volatility
Energy/Biofuels
Population growth and demographic changes
Land and water constraints
Climate change
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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
Shenggen Fan, April 2011
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
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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
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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
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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
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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
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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 (%
)
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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
Shenggen Fan, April 2011
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
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Climate change will push up food prices
World food price increases under various scenarios, 2010–2050(% change from 2010)
Source: Nelson et al. 2010
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A development agenda with greater support for food security is needed
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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
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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
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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
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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
Shenggen Fan, April 2011
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
Source: Veolia Water and IFPRI 2011
Shenggen Fan, April 2011
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)
Source: Veolia Water and IFPRI 2011
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
The role of policy research is crucial
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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
Shenggen Fan, April 2011
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