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The world food price The world food price situation and its situation and its
implications for actionimplications for action
Joachim von BraunJoachim von BraunInternational Food Policy Research InstituteInternational Food Policy Research Institute
Seminar at IFADSeminar at IFAD Rome February 19, 2008Rome February 19, 2008
Joachim von Braun, IFPRI, February 2008
Overview Overview
1.1. The new world food equationThe new world food equation
2.2. Energy - biofuels - food securityEnergy - biofuels - food security
3.3. Climate change - biomass – agriculture Climate change - biomass – agriculture
4.4. Pro-poor policy and program actionsPro-poor policy and program actions
Joachim von Braun, IFPRI, February 2008
Cereal Price - Index 1905 - 2000Cereal Price - Index 1905 - 2000 (All proces = 100 in 1960)(All proces = 100 in 1960)
0
50
100
150
200
250
300
1905 1915 1925 1935 1945 1955 1965 1975 1985 1995 2005
Wheat Mai ze Ri ce
Joachim von Braun, IFPRI, February 2008
Surge in cereal and oil pricesSurge in cereal and oil prices
0
100
200
300
400
Jan-
00
Jul-0
0
Jan-
01
Jul-0
1
Jan-
02
Jul-0
2
Jan-
03
Jul-0
3
Jan-
04
Jul-0
4
Jan-
05
Jul-0
5
Jan-
06
Jul-0
6
Jan-
07
Jul-0
7
0
20
40
60
80
100Corn
Wheat
Rice
Oil (right scale)
Source: Data from FAO 2007 and IMF 2007Source: Data from FAO 2007 and IMF 2007.
Commodity prices (US$/ton)Commodity prices (US$/ton)
New trend?
New trend?
Joachim von Braun, IFPRI, February 2008
Changing supply, demand and price for Changing supply, demand and price for cereals 2000 - 2006cereals 2000 - 2006
100
D2000
S2000
D2006
S2006
153
P
2,070 million tons
2000=100
1,917 Q
Source: Based on data from FAO 2003, 2005-07.Source: Based on data from FAO 2003, 2005-07.
Joachim von Braun, IFPRI, February 2008
Changes in food and agriculture equationChanges in food and agriculture equation
ProductionProduction DemandDemand
Trade and processingTrade and processing
Joachim von Braun, IFPRI, February 2008
ProductionProduction DemandDemandIncome growthIncome growth
Poverty and inequalityPoverty and inequality
Consumer behaviorConsumer behavior
BioenergyBioenergy
Biomass (COBiomass (CO22))
……and Policiesand Policies
Trade and processingTrade and processing
Changes in food and agriculture equationChanges in food and agriculture equation
Joachim von Braun, IFPRI, February 2008
ProductionProductionLand Land
WaterWater
Inputs Inputs
WorkforceWorkforce
Climate changeClimate change
Agrarian structureAgrarian structure
TechnologyTechnology
……and Policiesand Policies
DemandDemandIncome growthIncome growth
Poverty and inequalityPoverty and inequality
Consumer behaviorConsumer behavior
BioenergyBioenergy
Biomass (COBiomass (CO22))
……and Policiesand Policies
Trade and processingTrade and processing
Changes in food and agriculture equationChanges in food and agriculture equation
Joachim von Braun, IFPRI, February 2008
DemandDemandIncome growthIncome growth
Poverty and inequalityPoverty and inequality
Consumer behaviorConsumer behavior
BioenergyBioenergy
Biomass (COBiomass (CO22))
……and Policiesand Policies
Trade and processingTrade and processing-Information & Standards-Supermarkets -Bioenergy & Biomass
…and Policies
ProductionProductionLand Land
WaterWater
Inputs Inputs
WorkforceWorkforce
Climate changeClimate change
Agrarian structureAgrarian structure
TechnologyTechnology
……and Policiesand Policies
Changes in food and agriculture equationChanges in food and agriculture equation
Joachim von Braun, IFPRI, February 2008
Drivers of change: Income growthDrivers of change: Income growth
Growth (2004-06 per annum)Growth (2004-06 per annum)- 9% in Asia9% in Asia- 6% in Africa6% in Africa- 2% in industrialized countries2% in industrialized countries
India: 2000 – 2025India: 2000 – 2025
- - Meat 176% Meat 176%
- Milk and vegetables 70%Milk and vegetables 70%- Grain 27%Grain 27%
Sources: IMF 2007; Kumar, et al. 2007.Sources: IMF 2007; Kumar, et al. 2007.
Joachim von Braun, IFPRI, February 2008
Consumption: 2005/1990 ratios of per Consumption: 2005/1990 ratios of per capita consumptioncapita consumption
India China Brazil Nigeria
Cereals 1.0 0.8 1.2 1.0
Meat 1.2 2.4 1.7 1.0
Milk 1.2 3.0 1.2 1.3
Fish 1.2 2.3 0.9 0.8
Fruits 1.3 3.5 0.8 1.1
Vegetables 1.3 2.9 1.3 1.3
Source: Data from FAO 2007.Source: Data from FAO 2007.
Future grain consumption is driven by Future grain consumption is driven by income growth, population growth, and feed income growth, population growth, and feed
for meat and dairy productionfor meat and dairy production
Joachim von Braun, IFPRI, February 2008
The world eats more than it produces: The world eats more than it produces: cereal stocks declinecereal stocks decline
0
100
200
300
400
500
600
700
2000 2001 2002 2003 2004 2005 2006 2007*
Source: Data from FAO 2003, 2005-07.Source: Data from FAO 2003, 2005-07. * Forecast.* Forecast.
Million tonsMillion tons
Total stocksTotal stocks
ChinaChina
Joachim von Braun, IFPRI, February 2008
World cereal production: not growing enoughWorld cereal production: not growing enough
0
300
600
900
1,200
1999 2000 2001 2002 2003 2004 2005 2006 2007*
800
1,200
1,600
2,000
Wheat Coarse grains Rice Total (right)
Source: Data from FAO 2003, 2005-07.Source: Data from FAO 2003, 2005-07.* Forecast.* Forecast.
Million tonsTotal
Million tons
Joachim von Braun, IFPRI, February 2008
Disruptions in production (2004-06)Disruptions in production (2004-06)
However, coarse grain outputHowever, coarse grain output 12% in China12% in China and rice output and rice output 9% in India.9% in India.
WheatWheat Coarse grainsCoarse grains
USUS 16%16% 12%12%
EUEU 14%14% 16%16%
AustraliaAustralia 52%52% 33%33%
Source: Data from FAO 2006 and Source: Data from FAO 2006 and 2007.2007.
Joachim von Braun, IFPRI, February 2008
““corporatecorporate”” world food system world food system
Sales of top 10 companies (billion $US)Sales of top 10 companies (billion $US)
Source: Planet Retail 2007, Morning Star 2007, company financial reports.Source: Planet Retail 2007, Morning Star 2007, company financial reports.
20042004 20062006
Agricultural input industry
Food processors and traders
Food retailers
1,0914094077736337
Joachim von Braun, IFPRI, February 2008
What price for food in the future?What price for food in the future?
Projections have underestimated price Projections have underestimated price increases.increases.
FAPRI: FAPRI:
Wheat and corn to Wheat and corn to by 2 and 4% by 2016by 2 and 4% by 2016
OECD-FAO: OECD-FAO:
Wheat and coarse grain to Wheat and coarse grain to by 20 and 34% by 2016 by 20 and 34% by 2016
Projections need to accommodate the new complex Projections need to accommodate the new complex nature of the world food equation; past trends do no nature of the world food equation; past trends do no longer inform about futurelonger inform about future
Joachim von Braun, IFPRI, February 2008
IFPRIIFPRI’’s modeling of cereals price changes s modeling of cereals price changes (2000-05 and 2006-15(2000-05 and 2006-15))
Source: M. Rosegrant (prelim. results with IMPACT-Source: M. Rosegrant (prelim. results with IMPACT-WATER) .WATER) .
0
100
200
300
2000 2005 2010 2015
Rice Wheat MaizeOilseeds Soybean
US$/ton US$/ton
Joachim von Braun, IFPRI, February 2008
US$ and EURO prices and US$ and EURO prices and …… so what? so what?
December 2000- December 2007 changeDecember 2000- December 2007 change Wheat US$/ton nominal : +244 %Wheat US$/ton “real” : +176 %Wheat EURO/ton : + 139 %
What matters really for the poor?Purchasing power! - How to measure? PPP; Bigmac (urban bias)Egg-onomics: 1US$ buys 6 in US, 7 in Ethiopia, 14 in Bangladesh, 20 in China; Change in the ratio of [poor peoples’ food prizes / unskilled wages] !
Joachim von Braun, IFPRI, February 2008
Looking beneath the $1 a day lineLooking beneath the $1 a day line
PoorPoor
($.75 cents – $1)($.75 cents – $1)
485 million people485 million people
Medial poorMedial poor
($.50 cents – $.75 cents)($.50 cents – $.75 cents)
323 million people323 million people
Ultra poorUltra poor
(less than $.50 cents)(less than $.50 cents)
162 million people162 million peopleSource: Ahmed, et al. 2007.Source: Ahmed, et al. 2007.
Joachim von Braun, IFPRI, February 2008
-31-38
-27
5
29
-45
-30
-15
0
15
30
Developing World East Asia & PacificSouth Asia L America & Caribb.Sub-Saharan Africa
Mill
ion
The growing number of the poorest in SSA The growing number of the poorest in SSA Living below US$.50/day (1990-2004)Living below US$.50/day (1990-2004)
Source: Ahmed et al. 2007.Source: Ahmed et al. 2007.
Joachim von Braun, IFPRI, February 2008
Impact of price increase: the poor are Impact of price increase: the poor are mostly net buyersmostly net buyers
Source: Adapted from World Bank 2007.Source: Adapted from World Bank 2007.
Country- and crop-specific outcomesCountry- and crop-specific outcomes
Staple foods Bolivia2002
Ethiopia2000
Bangladesh2001
Zambia1998
% of total expenditure of all poor% of total expenditure of all poor
Purchases by all poor Purchases by all poor
net buyersnet buyers11.311.3 10.210.2 22.022.0 10.310.3
Sales by all poor Sales by all poor
net sellersnet sellers 1.41.4 2.82.8 4.04.0 2.32.3
Joachim von Braun, IFPRI, February 2008
Overview Overview
1.1. The new world food equation The new world food equation
2.2. Energy - biofuels - food securityEnergy - biofuels - food security
3.3. Climate change - biomass – agriculture Climate change - biomass – agriculture
4.4. Pro-poor policy and program actionsPro-poor policy and program actions
Joachim von Braun, IFPRI, February 2008
050
100150200250300350400450500
1850 1875 1900 1925 1950 1975 2000
EJ/
year
Gas
Oil
Coal
Nuclear
Hydro +
Biomass
History of world primary energy supplyHistory of world primary energy supply
Hydro+ means hydropower plus other renewables besides biomass
Energy supply grew 20-fold between 1850 and 2000. Fossil fuels supplied 80% of the world’s energy in 2000. (Holdren 2007)
Joachim von Braun, IFPRI, February 2008
Source: Global Subsidies Source: Global Subsidies Initiative 2007Initiative 2007
The biofuels boomThe biofuels boom Ethanol production 1975 - 2007 (billion liters)Ethanol production 1975 - 2007 (billion liters)
BiodieselBiodiesel production production 1991 - 2007 (billion liters)1991 - 2007 (billion liters)
EthanolEthanol > 90% of biofuel > 90% of biofuel production; Brazil and US production; Brazil and US dominate the marketdominate the market
Biodiesel:Biodiesel: EU is the largest EU is the largest producer and consumerproducer and consumer
Joachim von Braun, IFPRI, February 2008
CountriesCountries’’ plans for expansionplans for expansion
EthanolEthanol BiodieselBiodiesel
USA: 16%USA: 16% USA:USA: 19% 19%
EU: 45%EU: 45% EU:EU: 37% 37%
Brazil: 8%Brazil: 8% Malaysia: 248%Malaysia: 248%
India: India: 15% 15% Indonesia: 143%Indonesia: 143%
China: China: 3%3% Thailand: Thailand: 70%70%
Source: USDA, 2006; 2007.Source: USDA, 2006; 2007.
AnnualAnnual growth in biofuel production…2010/12 growth in biofuel production…2010/12
Joachim von Braun, IFPRI, February 2008
Political forces Political forces of biofuelsof biofuels
Energy security
Environment/ Climate
Agriculture
Actual welfare Actual welfare effectseffects
Biofuels will hardly contribute to energy securityBiofuels will hardly contribute to energy securityThe share of biofuels in road transport: ca. 3-4% in The share of biofuels in road transport: ca. 3-4% in 20302030
Agriculture
Environment/ Climate
Energysecurity
Joachim von Braun, IFPRI, February 2008
Biofuels: fundamental change in world Biofuels: fundamental change in world food price determination food price determination
Energy prices always affected agricultural Energy prices always affected agricultural prices through prices through inputsinputs, i.e. P of fertilizer, , i.e. P of fertilizer, pesticides, irrigation, transport pesticides, irrigation, transport
Now, energy prices also affect agricultural Now, energy prices also affect agricultural outputoutput prices strongly via opportunity costs prices strongly via opportunity costs
Large and elastic energy demand creates Large and elastic energy demand creates price price floors and price bandsfloors and price bands for agricultural for agricultural commoditiescommodities
Source: Schmidhuber 2007.Source: Schmidhuber 2007.
Joachim von Braun, IFPRI, February 2008
Corn breakeven price for ethanol at crude Corn breakeven price for ethanol at crude oil price of $60/barrel (and subsidies)oil price of $60/barrel (and subsidies)
Source: Hurt, Tyner, Doering 2006.Source: Hurt, Tyner, Doering 2006.
Joachim von Braun, IFPRI, February 2008
22ndnd generation?? generation?? Reducing the food-fuel competitionReducing the food-fuel competition
• Second-generation technologies shall:Second-generation technologies shall:- utilize waste biomass utilize waste biomass - use less land (and water?) resources use less land (and water?) resources
22ndnd generation technologies will generation technologies will notnot overcome overcome the food-fuel competition unless they are very the food-fuel competition unless they are very smart (e.g. joint product technology like smart (e.g. joint product technology like sweet sorghum, or salt water algae)sweet sorghum, or salt water algae)
Joachim von Braun, IFPRI, February 2008
Land conversion: Payback period for biofuel Land conversion: Payback period for biofuel carbon debt (years)carbon debt (years)
0
100
200
300
400
Palm biodiesel Soybeanbiodiesel
Corn ethanol Palm biodiesel Sugarcaneethanol
Indonesia/Malaysia
BrazilBrazil USUS BrazilBrazilIndonesia/Indonesia/MalaysiaMalaysia
Peatland rainforest
Tropical rainforest
Central grassland
Cerrado wooded
Tropical rainforest
423
319
93 86
17
Source: Fargione et al. 2008.Source: Fargione et al. 2008.
Joachim von Braun, IFPRI, February 2008
IFPRI IMPACT-Model: IFPRI IMPACT-Model: Biofuel scenarios by 2020Biofuel scenarios by 2020
Scenario Biofuel expansionPrice changes
(% by 2020)
11 Actual plans & assumed Actual plans & assumed
expansionsexpansions
corn: +26corn: +26 sugar: +12sugar: +12 oilseeds: +18oilseeds: +18
22 Doubling of Scenario 1 Doubling of Scenario 1
expansionexpansion
corn: +72corn: +72 sugar: +27sugar: +27oilseeds: +44oilseeds: +44
Source: IFPRI IMPACT–model projections; Rosegrant et.al.. Source: IFPRI IMPACT–model projections; Rosegrant et.al..
Joachim von Braun, IFPRI, February 2008
Change in agricultural value added, 2020, Change in agricultural value added, 2020, biofuel expansion compared with baseline (%)biofuel expansion compared with baseline (%)
Source: IFPRI IMPACT ProjectionsSource: IFPRI IMPACT Projections
Country/Country/RegionRegion Crops Livestock Total
Brazil 9.3 -7.0 6.6
China 5.0 -3.8 2.8
India 5.5 -1.8 4.1
USA 9.2 -7.4 3.7
SSA 4.2 -0.8 3.4
EAP 5.7 -3.7 3.5
ECA 4.5 -6.1 1.3
MENA 3.5 -4.2 1.8
Joachim von Braun, IFPRI, February 2008
IFPRI IMPACT Model:IFPRI IMPACT Model:Calorie consumption changes in 2020 compared to baseline (%)Calorie consumption changes in 2020 compared to baseline (%)
Source: IMPACT-WATER.Source: IMPACT-WATER.
-9 -6 -3 0
EAP
ECA
LAC
MENA
S Asia
SSA
N America
Biofuel expansion Drastic biofuel expansion
Joachim von Braun, IFPRI, February 2008
Price-effects for BangladeshPrice-effects for Bangladesh five-person five-person household living on one dollar-a-day per personhousehold living on one dollar-a-day per person
Spend…their $5Spend…their $5
$3.00$3.00 on foodon food
$.50 on household energy $.50 on household energy
$1.50 on$1.50 on nonfoodsnonfoods
A 50% increase in food and energy prices requires A 50% increase in food and energy prices requires them tothem to cut $1.75 cut $1.75 of their expendituresof their expenditures
Cuts will be made most in food expenditures: Cuts will be made most in food expenditures: Reduced diet quality, and Reduced diet quality, and Increased micronutrient malnutritionIncreased micronutrient malnutrition
Joachim von Braun, IFPRI, February 2008
Overview Overview
1.1. The new world food equation The new world food equation
2.2. Energy - biofuels - food securityEnergy - biofuels - food security
3.3. Climate change - biomass – agriculture Climate change - biomass – agriculture
4.4. Pro-poor policy and program actionsPro-poor policy and program actions
Joachim von Braun, IFPRI, February 2008
Impacts and Vulnerability to Impacts and Vulnerability to Climate Change & VariabilityClimate Change & Variability
• Rich countries emit majority of GHG Rich countries emit majority of GHG
• Poor countries are more vulnerablePoor countries are more vulnerable
- Geography (hotter, less rain, more variation)Geography (hotter, less rain, more variation)
- Greater dependence on agriculture and natural Greater dependence on agriculture and natural resourcesresources
- Limited infrastructureLimited infrastructure
- Low income, poverty and malnutritionLow income, poverty and malnutrition
- Thus, lower adaptive capacity (also including Thus, lower adaptive capacity (also including inadequate complementary services, like health inadequate complementary services, like health and education)and education)
Joachim von Braun, IFPRI, February 2008
Climate change will reduce production growth in Climate change will reduce production growth in many of the poorest countries and regions many of the poorest countries and regions
Percent change in agricultural production due to climate change, 2080 Percent change in agricultural production due to climate change, 2080
This will have further price increasing effectsThis will have further price increasing effects
Source: Cline 2007Source: Cline 2007
Joachim von Braun, IFPRI, February 2008
Much Adaptation is Extension of Much Adaptation is Extension of Good Development PolicyGood Development Policy
• Promoting growth and diversificationPromoting growth and diversification
• Investing in research and development, Investing in research and development, education and healtheducation and health
• Creating markets in water and Creating markets in water and environmental servicesenvironmental services
• Improving international trade systemImproving international trade system
• Enhancing resilience to disasters and Enhancing resilience to disasters and improving disaster managementimproving disaster management
• Promoting risk-sharing, including social Promoting risk-sharing, including social safety nets, weather insurancesafety nets, weather insurance
Joachim von Braun, IFPRI, February 2008
Effective Adaptation StrategiesEffective Adaptation Strategies
• Requires Requires judicious selection of measures within a policy judicious selection of measures within a policy
context context and and strategic development framework strategic development framework
• Must go beyond good development policy to explicitly target Must go beyond good development policy to explicitly target
the impacts of climate change, particularly on the poorthe impacts of climate change, particularly on the poor
• Market signals Market signals
- essential factor in determining the necessary essential factor in determining the necessary
responses to a changing environmentresponses to a changing environment
- but involves potentially expensive time lags and but involves potentially expensive time lags and
overlooks equity overlooks equity
Climate change adaptation must therefore be proactive, not Climate change adaptation must therefore be proactive, not
merely reactivemerely reactive
Joachim von Braun, IFPRI, February 2008
Critical Step toward mitigation: Post-Kyoto Critical Step toward mitigation: Post-Kyoto International Climate Change RegimeInternational Climate Change Regime
• Emissions targets, rates of convergence, and Emissions targets, rates of convergence, and rates of growth in developing-country emissionsrates of growth in developing-country emissions
• Level of emission allowances for developing Level of emission allowances for developing countriescountries
• Level of caps by sector and industryLevel of caps by sector and industry• Sector-specific mitigation optionsSector-specific mitigation options• Incentives for international carbon tradeIncentives for international carbon trade• Transparency and complexity of administrationTransparency and complexity of administration
All influence the regime’s impacts on economic All influence the regime’s impacts on economic growth, agriculture, food security, and poverty growth, agriculture, food security, and poverty in developing countriesin developing countries
Joachim von Braun, IFPRI, February 2008
Sources of GHG EmissionsSources of GHG Emissions
Sources: World Resources Institute 2007; World Development Report 2008Sources: World Resources Institute 2007; World Development Report 2008
0
10
20
30
40
50
60
70
Energy Deforestation Agriculture(excluding land
use change)
Industrialprocesses
Waste
% t
ota
l of
GH
G e
mis
sio
ns
Developed Countries Developing Countries
60%
18%14%
4% 4%
Joachim von Braun, IFPRI, February 2008
Pro-Poor Climate Mitigation PolicyPro-Poor Climate Mitigation Policy
• Climate change policy can generate income Climate change policy can generate income for small farmers and investment flows for for small farmers and investment flows for rural communitiesrural communities
• Requires effective integration Requires effective integration
from global governance of carbon trading,from global governance of carbon trading,
to sectoral and micro-level design of to sectoral and micro-level design of markets and contracts, andmarkets and contracts, and
investment in community managementinvestment in community management
Joachim von Braun, IFPRI, February 2008
Estimated Potential Emission Savings Estimated Potential Emission Savings and Costs by Sector and Costs by Sector
SectorSector 2050 Annual 2050 Annual Emissions Emissions
SavingsSavings (GtCO (GtCO22))
Average Annual Average Annual Cost($/tCOCost($/tCO22))
~2025-2050~2025-2050
Deforestation Deforestation 3.5-5.03.5-5.0 2-42-4
Afforestation and ReforestationAfforestation and Reforestation 1.0-2.01.0-2.0 5-155-15
Land management practicesLand management practices 1.0-2.01.0-2.0 20-2720-27
Agriculture (methane & nitrous Agriculture (methane & nitrous oxide)oxide)
1.01.0 2727
BioenergyBioenergy 2.0-3.02.0-3.0 2525
Waste and fugitive emissions,Waste and fugitive emissions,
industrial processesindustrial processes
4.14.1 3-53-5
Fossil fuel related, excludingFossil fuel related, excluding
bioenergybioenergy
40.040.0 22-3322-33
Source: Adapted from various estimates, Stern Review, pp. 244-63 by Source: Adapted from various estimates, Stern Review, pp. 244-63 by RosegrantRosegrant
Joachim von Braun, IFPRI, February 2008
So far minimal carbon trades in So far minimal carbon trades in agriculture in developing countriesagriculture in developing countries
• Only 3-4% of carbon trading is sourced Only 3-4% of carbon trading is sourced
from agriculture, land use, land use from agriculture, land use, land use
change, agroforestry and forestrychange, agroforestry and forestry
• Only 3% of carbon trading is sourced Only 3% of carbon trading is sourced
from Africafrom Africa
Joachim von Braun, IFPRI, February 2008
IFAD IFAD –– IFPRI proposed 3 objectives of IFPRI proposed 3 objectives of research and outreach cooperationresearch and outreach cooperation
1.1. Identifying and disseminating policy options Identifying and disseminating policy options enabling the enabling the rural poor to benefit from climate change mitigation and rural poor to benefit from climate change mitigation and carbon marketscarbon markets
2.2. Identifying and disseminating policy options to enable Identifying and disseminating policy options to enable the rural poor including women farmers and communities the rural poor including women farmers and communities to to access agricultural markets on better termsaccess agricultural markets on better terms
3.3. Strengthening country program Strengthening country program capacity to address capacity to address policy issues in agricultural and rural developmentpolicy issues in agricultural and rural development by by
sharing policy knowledge and innovationsharing policy knowledge and innovation
Joachim von Braun, IFPRI, February 2008
IFAD IFAD –– IFPRI proposed Program Outputs IFPRI proposed Program Outputs
• A set of policy options enabling the rural poor to A set of policy options enabling the rural poor to engage in and engage in and benefit from climate change mitigation benefit from climate change mitigation and carbon marketsand carbon markets
• A set of policy options and institutional A set of policy options and institutional arrangements) to enable the arrangements) to enable the rural poor to access rural poor to access agricultural markets on better termsagricultural markets on better terms
• A set of tools and methods to improve A set of tools and methods to improve impact impact assessment and scaling up in projects assessment and scaling up in projects in pro-poor in pro-poor market accessmarket access
• A A business model to implement carbon offset business model to implement carbon offset projectsprojects that are beneficial to the poor that are beneficial to the poor
Joachim von Braun, IFPRI, February 2008
Overview Overview
1.1. The new world food equation The new world food equation
2.2. Energy - biofuels - food securityEnergy - biofuels - food security
3.3. Climate change - biomass – agriculture Climate change - biomass – agriculture
4.4. Pro-poor policy and program actionsPro-poor policy and program actions
Joachim von Braun, IFPRI, February 2008
What policy response What policy response notnot to choose to to choose to deal with the high prices?deal with the high prices?
Not:Not:• Export stops (starving your neighbor)Export stops (starving your neighbor)• Food subsidies for vocal middle classFood subsidies for vocal middle class• Slow change in outdated production control Slow change in outdated production control
policiespolicies• Continued public underinvestment in Continued public underinvestment in
agriculture productivity increasesagriculture productivity increases• Exclusion of agriculture from climate change Exclusion of agriculture from climate change
mitigation strategiesmitigation strategies
Joachim von Braun, IFPRI, February 2008
Biofuels: policy implicationsBiofuels: policy implications
Global trade regime with transparent biofuel Global trade regime with transparent biofuel standardsstandards
Criteria to internalize Criteria to internalize allall + & - effects of biofuels + & - effects of biofuels
1.1. Slow down on biofuels with current technology Slow down on biofuels with current technology now ! (because of environment and the poor) now ! (because of environment and the poor)
2.2. Accelerate agriculture productivity investments Accelerate agriculture productivity investments and R&D broadly and in biofuels!and R&D broadly and in biofuels!
Source: IEA 2004, Henniges 2005.Source: IEA 2004, Henniges 2005.
Joachim von Braun, IFPRI, February 2008
Investing in Climate Change for the Poor Investing in Climate Change for the Poor
• Climate change policy can create new value-Climate change policy can create new value-
added for pro-poor investmentadded for pro-poor investment
• Increases profitability of environmentally Increases profitability of environmentally
sustainable practicessustainable practices
• Employ advanced ICT to streamline Employ advanced ICT to streamline
measurement and enforcement of offsets, measurement and enforcement of offsets,
financial flows, and carbon credits for investors financial flows, and carbon credits for investors
• Enhance global financial facilities and Enhance global financial facilities and
governance to increase and manage funding governance to increase and manage funding
flows for both mitigation and adaptationflows for both mitigation and adaptation
Joachim von Braun, IFPRI, February 2008
Pro-poor policy actions to adapt and Pro-poor policy actions to adapt and mitigate food price problemmitigate food price problem
1. Developed countries1. Developed countries- Eliminate agricultural Eliminate agricultural trade trade barriers, barriers, - expand / re-visit aid priorities for expand / re-visit aid priorities for agriculture and agriculture and
rural servicesrural services, incl. social protection, incl. social protection
2. Developing countries 2. Developing countries - Increase investment in agriculture, rural infrastructure Increase investment in agriculture, rural infrastructure
and market access for small farmers and market access for small farmers - Expand Expand social protectionsocial protection (rural and urban) for the (rural and urban) for the
poorestpoorest
3. Science and Technology (CGIAR and NARS)3. Science and Technology (CGIAR and NARS)- Facilitate production response by agriculture science- Facilitate production response by agriculture science-
and technology-based solutions (China, India, Africa)and technology-based solutions (China, India, Africa)