Food Aid Projections for the Decade of the 1990s (1988) / Chapter Skim
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From page 9... ...
arranged for an NRC-appointed pane} and a group of experts to convene for two days of discussions concerning projections of needs for food aid in the decade 1990-2000. The objective of the meeting was to examine the projections of food commodity trade and, either directly or by deduction, food aid needs of developing countries, relying upon work of six principal groups engaged in food commodity analysis the United Nations Food and Agriculture Organization (FAO)
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From page 10... ...
METHODOLOGY . Projecting food commodity trade and aid has consistently been attempted since the Second World War, thanks, in part, to the creation of the FAO, and the expansion of trade and development concerns in industrial countries.
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However, these general equilibrium models are so complex that none currently exists that is agreed to be especially useful In projecting food aid needs. The International Institute for Applied Systems Analysis QUASAR, in Laxenburg, Austria, a center for international cooperation in developing this type of modeling, among other types of research, has creates} one basic world food model.
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From page 12... ...
policies in detail in their models because of their importance to world food trade and aid. The IFPRI effort, which does project food aid needs, is based on the aggregate importation of food by developing countries, translated into cereal equivalents.*
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The import gap of demand exceeding domestic supply should get wider by 2000. An interesting implication is that high growth, stimulated through resource transfer to developing countries from industrial countries, has a greater economic impact than freer trade resulting from removal of restrictions on commodity trade.
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1::::::::::: :: 1-:-:-:. .: :-, p-:-:-:-:-:-::: .~:-:-:-:L EXPORTS IMPORTS IMPORTS EXPORTS IMPORTS IMPORTS DCS LDCs CPEs DCs LDCs CPEs FIGURE 1 Projected 1995 Net Trade.
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Food import gaps cannot always be filled commercially because of countries' foreign exchange shortages; food aid fills this unfilled gap. There is no such thing as food aid "needs" per se, however.
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Out of 12 MMT of food aid in 1987, 10 MMT went to low income food deficit countries, an allocation trend to be welcomed. The definition of a nutritionally "minimal level of intake" was established by the Fifth World Food Survey of 1985, based on the distribution of food energy intake measured through recent household consumption surveys.
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PRESENTATION OF WORLD BANK FIGURES Ronald Duncan, International Commodity Markets Division Dr. Duncan indicated that World Bank figures are not for food aid, but projections of _ 1 ~ · te · ~ ~ ~ ~ ~ .
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From page 18... ...
dollar, and it is the same countries with foreign exchange shortages whose currencies are likely to depreciate, causing the costs of imported commodities to rise. The region under the greatest pressure, in terms of potential reductions in per capita consumption of commodities, is Africa, followed by the Middle East and Latin America, excluding Argentina.
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Gulf Port Real Prices FAPRI Model 0.29 0.23 O 0.21 0.19 0.17 0.15 0.13 0.11 1~ j L\ . _\\ ~ J i ~ I ~ ~ ~ / I I HI I \ / ~ I / t1 ~ ~ ma/ 1 1 I/ 1 71/72 76/77 81/82 86/87 YEAR FIGURE 4 World Cereal Levels: Stocks-to-Use Ratio FAPRI Model 19 96/97 / The at / / \\ / 1 \ \ I \ \ I \ 1 \ 1 \ 1 \ 11 \ 1 l l Feed Grains 1 1 91/91 96/97
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70 A o E IL z o 65 60 55 50 40 35 Domestic Use Production _ _— 76/77 78/79 80/81 82/83 84/85 86/87 88/89 90/91 92/93 94/95 96/97 YEAR FIGURE 5 Africa and Middle East Wheat 65 60 z o E A o FIGURE 6 Africa and Middle East Coarse Grains 55 50 45 40 35 30 / x\' Domestic Use Production _— _ _ _ _ _ _ 251 1 1 1 1 1 1 1 1 1 1 76/77 78/79 80/81 82/83 84/85 86/87 88/89 90/91 92/93 94/95 96/97 YEAR expected to keep pace with population growth rate. Although imports are increasing in all developing regions, they are insufficient to offset the slower rates of growth in production.
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as well as agriculture and industry if the growing import gap projected is to be avoided. Only through Tong-term sustainable growth will food security problems be solved.
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Foreign exchange will be a major factor affecting future growth of commercial imports. In 69 countries, food imports use 10 percent or more of available foreign exchange.
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, Reference Run 1980 2000 Argentina Brazil Mexico Egypt Kenya Nigeria India Indonesia Pakistan Thailand Turkey 1 12 3 3 3 1 6 25 o 219 156 21 0 9 6 8 1 Note: The low year-2000 figures for Egypt and Indonesia derive from a continuation of the trend of high percent per capita per annum economic growth. (See the text of Frohberg's paper for the explanation.)
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From page 24... ...
-3.0 Reduced Meat Consumption in IMEs -1.4 " Green" Scenario of Reduced Use of Fertilizer and Pesticides in OECD Countries Drought in the North Drought in the South +9.0 +8.6 +8.2 TABLE 6 Alternative Aid Scenarios for All LDCs (Millions of People Hungry, Percentage Change) Reference Run A-Capa A-Bopb 1990 2000 1990 2000 1990 2000 All LDCs 470 400 -13 -32 -24 -32 Poorest LDCs 345 305 -15 -40 -29 -40 b Aid added to capital investment.
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LDCs must not focus only on primary agricultural products; they must diversify. If there is a productive tendency to increase the value added to primary products, there may not be such a decline in their commodity prices, since less will be available for export.
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Though there may be production surprises as prices increase, these are unlikely to be a major factor in commodity trade in the 1990s. DEMOGRAPHIC CONSIDERATIONS COMMENTARY Robert Chen, Alan Shawn Feinstein World Hunger Program Dr.
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, the need for primary agricultural products doubles, rising significantly above what is presently produced in the world. This increase due to dietary composition is much larger than the potential differences in projected demand due to different population growth projections.
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Food aid must influence nutrition or health. It is not a question of total food quantity per se, nor average supply and demand per se, but rather how food prices are deterrr~ined and why incomes of populations at risk are insufficient to afford them.
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Q ~ ~ N\~< \ ._ ° ~ s ° ~ ° ~ ~ z z z m m m :~: ~ ~ ~ ~ ~ ~ t ~ ~ t t ~ ~ ~ o CO o C~ o o CM o N o CO o CM CM o CM o O O O o C~ o cn o 00 o r~ o o C~ o U: ._ s~ U: U: o ._ :o a)
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From page 31... ...
The total food deficit is estimated at 15 MMT/year (current FAO figures) , which at 50 percent substitution is equivalent to 30 MMT/year cereal equivalent as food aid entitlement to the poor.
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G ~ ~ G — 0 in 0 ~ I I I t ~ me, I I .
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From page 33... ...
Wheat yields may be increased through increased yield stability, dependent on multigenic resistance factors. Substitutions of wheat for rice will be difficult in Asian countries; wheatiands are drier and more difficult to manage, so the potential for increasing wheat production is poor except through increased application of irrigation.
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Priority for future stabilization of food production through food aid is likely to be in Asia rather than Africa, because of greater man/land ratio and much higher numbers of hungry people. CLIMATIC IMPACT CONTEXT Norman J
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Improvements in seasonal forecasts are much more difficult because of the absence of real understanding about global climatic systems, and their extraordinary complexity. One recent improvement was the discovery of connections between global phenomena such as the E]
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for a doubling of atmospheric carbon dioxide concentration for June, July, and August simulated by the global climatic models of GFDL (left) , GISS (center)
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for a doubling of atmospheric carbon dioxide concentration for June, July, and August simulated by the global climatic models of GFDL (left) , GISS (center)
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From page 38... ...
This is more important in determining the commodity composition of demand than any other factor; the latter is a prime determinant of the demand for imported wheat and rice there has been a shift in commodity consumption in West Africa since the 1960s, according to FAO figures, where rice and wheat consumption rose by 16 kg per head while sorghum fell by 23 kg per head; 3. IMP structural adjustment policies are working in Africa, but the debt situation is grim and demand on foreign exchange for debt servicing is a major constraint on growth; this will tend to reduce the ability to import food commercially; 4.
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From page 39... ...
In the ensuing discussion, the dilemma was underlined in which African countries typically base food security policies on increasing food prices. Governments cannot bank on a long-term downward trend in prices, yet this is what has happened over the past 39
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From page 40... ...
Since actual food aid allocations are made in a highly political environment which is largely divorced from "need criteria", and since most t50 percent or more] food aid in fact ~ , replaces commercial imports (even though by international convention it is supposed to be "in addition" to commercial food trade)
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From page 41... ...
In 1988, 10 percent of industrial country commodity exports to LDCs are food aid; if this level is maintained to 2000, the Bank estimate of food aid will thus be 23 MMT. IlASA/:B[S Estimate Projection of the mode} to 2000 shows 165 MMT net imports annually by LDCs (excluding China)
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From page 42... ...
For the Tow-income food deficit countries, based on requests and percentage of food aid in imports 1984-86 (with very little for feed) , food aid needs are 19 MMT minimum and 38 MMT maximum.
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Food aid projections are not good at including exogenous shocks.Negative exogenous shocks include: . Climatic effects - increased variability increased UV affecting photosynthesis change in ozone layer volcanism, and "volcanic winter" effect occurrence of worst weather events together in the eastern and western or northern and southern hemispheres.
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Dr. Andersen suggested that the most useful references include the FAO Fifth World Food Survey (1985)
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From page 45... ...
1985. "The Fifth World Food Survey." Rome.
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From page 46... ...
1988. Prevalence of Malnutrition and Dietary Deficiencies as they Relate to Health and Performance Problems (Paper Prepared for the 1988 World Food Conference, Des Moines, Iowa, June 5-9, 1988.
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