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301. Rising Food Prices: Drivers and Implications for Development

Author:
Alex Evans
Publication Date:
04-2008
Content Type:
Policy Brief
Institution:
Chatham House
Abstract:
Global food prices have risen 83 per cent over the last three years. The increases have been driven by high income growth in emerging economies (probably the single most significant factor), use of crops for biofuels, the relative inelasticity of supply, historically low stock levels and some speculative investment. More recently, national concerns over inflation and prices have led some countries to reduce exports and others to try to build up stocks – creating a feedback loop that feeds on itself to drive prices up still further. In the medium to longer term, 'scarcity trends' – climate change, the cost of energy inputs, scarcity of land and water – could limit the supply-side response. In the immediate term, the priority is to increase both the volume and the quality of humanitarian assistance available to poor people, including by moving away from in-kind food aid and towards cash transfers or voucher systems – although it is important to be clear that there are outstanding questions about how these social protection systems will work, and they should not be seen as a panacea. The issue of compensatory financing may also arise for some countries facing balanceof- payments difficulties. In the longer term, the key challenge is to increase the supply of food: the World Bank estimates that demand for food will rise by 50 per cent by 2030, as a result of rising affluence and growing world population. Achieving this challenge will require something close to a revolution, and a massive investment in agriculture in developing countries. If supply fails to keep pace with rising demand, then the question of 'fair shares' is likely to emerge as a significant global issue. Already, the effect of a burgeoning global middle class switching to diets with more meat and dairy products – both relatively inefficient in terms of grain use – has been to reduce the affordability of staple foods for poorer consumers.
Topic:
Agriculture, Economics, Environment, International Trade and Finance, World Bank, and Population

302. Empowering Women Through Livelihoods Orientated Agricultural Service Provision: A Consideration of Evidence from Southern Africa

Author:
A. J. E. Charman
Publication Date:
01-2008
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper considers the impact of livelihoods oriented agricultural service provision for smallholder farmers on gender relationships and food security. The paper contents that the democratization and liberalization of agricultural services towards participatory, bottom-up approaches, from the early 1990s has brought favourable gender gains to women. The paper examines the background to this shift in agricultural service provision. The resulting gender gains, we argue, should be seen in terms of Sen's notion of entitlements. We examine evidence of these gains from developments and cases in Malawi and Zambia and draw supporting evidence from Zimbabwe and South Africa.
Topic:
Agriculture and Gender Issues
Political Geography:
Africa, South Africa, and Zimbabwe

303. Human Need and Corporate Greed - Understanding the Call for a New Green Revolution in Africa

Author:
Sameer Dossani
Publication Date:
08-2008
Content Type:
Working Paper
Institution:
Africa Policy Information Center
Abstract:
In 2005, the Bill and Melinda Gates Foundation and the Rockefeller Foundation announced a plan to “help millions of small-scale farmers lift themselves out of poverty and hunger.” In the years since, those foundations have been joined in their efforts by a number of other organizations and have founded the Alliance for a Green Revolution in Africa (AGRA).
Topic:
Agriculture, Development, Humanitarian Aid, and International Affairs
Political Geography:
Africa

304. Resource Scarcity: Responding to the Security Challenge

Author:
Richard A. Matthew
Publication Date:
04-2008
Content Type:
Working Paper
Institution:
International Peace Institute
Abstract:
For over two centuries, the social effects of natural resource scarcity have been the subject of lively debate. On one side are those who contend that the planet's resource endowment cannot support increased consumption indefinitely. In 1798, for example, Thomas Malthus wrote An Essay on the Principle of Population, in which he argued “that the power of population is indefinitely greater than the power of the earth to produce subsistence for man.” The imbalance between human needs and food availability, Malthus predicted, would lead to famine, disease, and war. Writing 150 years later, Fairfield Osborn (1948: 200-201) reiterated this concern: “When will it be openly recognized that one of the principal causes of the aggressive attitudes of individual nations and of much of the present discord among groups of nations is traceable to diminishing productive lands and to increasing population pressures?” More recently, updated versions of the “scarcity conflict thesis,” developed by scholars such as Paul Ehrlich (1968), Donella Meadows (1972) and Thomas Homer-Dixon (1999), have been influential in both academic and policy circles around the world.
Topic:
Security, Agriculture, Demographics, Globalization, and Peace Studies

305. Fisheries Trade in India: Understanding Potentials and Barriers.

Author:
Meenakshi Rajeev
Publication Date:
08-2008
Content Type:
Working Paper
Institution:
Norwegian Institute of International Affairs
Abstract:
The fisheries sector assumes significance in the Indian economy in several respects. The most important amongst them is the providence of livelihood to many poor households especially located in the coastal areas. These households can generate income from the sector due to the fact that many varieties of marine fishes have been exported from the country including chilled and dried items, fish oil, shrimp and prawns. Thus from the point of view of employment and income generation, international trade has considerable significance as well. It is the trade aspect of the sector that would be the focus of the current paper.
Topic:
Agriculture, Demographics, Economics, and Food
Political Geography:
South Asia and India

306. Sugar in Kisumu,kenya

Publication Date:
11-2008
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
An investor, seeking to financially benefit from producing sugar as a commodity in Kisumu, Kenya, needs to consider the entire investment environment before making a decision. Since Kenya is a net importer of sugar, domestic demand cannot be satisfied by domestic production, which creates a potential opportunity for an investor looking to bridge the gap. As a result, an opportunity may exist for an investor who wants to play a significant role in the future of the industry. Sugar, produced as a commodity within Kisumu, may have the ability to compete on a global scale if time, investment, and governmental support align.
Topic:
Agriculture, Development, Globalization, Markets, and Foreign Direct Investment
Political Geography:
Kenya and Africa

307. Does Digital Divide or Provide? The Impact of Cell Phones on Grain Markets in Niger

Author:
Jenny C. Aker
Publication Date:
10-2008
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
Due partly to costly information, price dispersion across markets is common in developed and developing countries. Between 2001 and 2006, cell phone service was phased in throughout Niger, providing an alternative and cheaper search technology to grain traders and other market actors. Weconstruct a novel theoretical model of sequential search, in which traders engage in optimal search for the maximum sales price, net transport costs. The model predicts that cell phones will increase traders' reservation sales prices and the number of markets over which they search, leading to a reduction in price dispersion across markets. To test the predictions of the theoretical model, we use a unique market and trader dataset from Niger that combines data on prices, transport costs, rainfall and grain production with cell phone access and trader behavior. We first exploit the quasi-experimental nature of cell phone coverage to estimate the impact of the introduction of information technology on market performance. The results provide evidence that cell phones reduce grain price dispersion across markets by a minimum of 6.4 percent and reduce intra-annual price variation by 12 percent. Cell phones have a greater impact on price dispersion for market pairs that are farther away, and for those with lower road quality. This effect becomes larger as a higher percentage of markets have cell phone coverage. We provide empirical evidence in support of specific mechanisms that partially explain the impact of cell phones on market performance. Robustness checks suggest that the results are not driven by selection on unobservables, nor are they solely a result of general equilibrium effects. Calculations of the four-firm concentration index suggest that the grain market structure is competitive, so the observed reductions in price dispersion are not due to greater market collusion. The primary mechanism by which cell phones affect market-level outcomes appears to be a reduction in search costs, as grain traders operating in markets with cell phone coverage search over a greater number of markets and sell in more markets. The results suggest that cell phones improved consumer and trader welfare in Niger.
Topic:
Agriculture, International Trade and Finance, Markets, and Science and Technology
Political Geography:
Africa and Nigeria

308. Thought for Food: The Challenges of Coping with Soaring Food Prices

Author:
Nora Lustig
Publication Date:
11-2008
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
World food commodities prices increased 130 percent from January 2002 to July 2008. Individual agricultural commodities show even more pronounced increases: corn, wheat, rice and soybeans rose by 190, 162, 318 and 246 percent, respectively. Since July, food commodities prices began to fall. While this decline comes as a relief, prices are likely to stay high in the foreseeable future. Available evidence suggests that the decline in living standards of net consumers caused by higher food prices outweighs the benefits accruing to poor net sellers in the majority of countries that have been analyzed so far. The time to implement measures to help the poor net consumers cope with higher food prices is now. However, too many developing countries lack the instruments, administrative capacity and fiscal space to implement safety nets fast enough and in the required scale. This is one of the most pressing policy challenges that we face. For the poor who are net sellers, governments should seize the opportunity to convert the short-run windfall into longer-term gains. Multilateral financial institutions can play a key role in providing financial resources to countries facing negative terms of trade shocks, technical assistance in the design of safety nets and resources to add fiscal space to countries to fund safety net programs. International organizations can also help countries design the appropriate macroeconomic policy response. This will call for greater flexibility in the menu of policy options traditionally deployed by the Bretton Woods institutions.
Topic:
Security, Agriculture, International Political Economy, International Trade and Finance, Markets, and Poverty

309. Rainfall Shocks, Markets, and Food Crises: Evidence from the Sahel

Author:
Jenny C. Aker
Publication Date:
12-2008
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
How do markets respond to extreme rainfall in West Africa? This paper examines the effect of weather on grain market performance in Niger, a country increasingly affected by drought and severe food crises over the past two decades. Using a dataset that combines information on rainfall, agricultural production, prices and transaction costs, I exploit rainfall variation to estimate the impact of drought on grain market performance between 1997 and 2006. Time series tests suggest that grain markets in Niger respond to supply shocks and that markets are more integrated during drought years. Exploiting the exogeneity of extreme rainfall in a difference-in-differences framework supports these findings: drought reduces grain price dispersion across markets. This impact is stronger as a higher percentage of markets are affected by drought, as was the case in 2004/2005, the year of a severe food crisis. The results suggest that early warning systems in West Africa should focus on the spatial impact of drought at the sub-regional level, as well as monitor prices in key forecasting markets during the harvest period.
Topic:
Agriculture, International Political Economy, and Markets
Political Geography:
Africa and Nigeria

310. An Accounting Method-Based Cost-Benefit Analysis of Conformity to Certified Organic Standards for Spices in Tanzania

Author:
Evelyne Lazaro and Adam Akyoo
Publication Date:
12-2008
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
Certified organic farming has emerged as a market channel providing participating African small-holders with access to high value markets in the EU. The benefits may include not only a guaranteed produce market, but also premium prices, and higher net revenues. Where training in organic farming techniques is provided there may be also benefits in terms of increased yield. The major cost challenges are those for certification, although in many cases donor support to exporters is available to cover these.
Topic:
Agriculture and Markets
Political Geography:
Africa and Tanzania