Dec 2, 2014 - 1500. 1989. 1993. 1997. 2001. 2005. 2009. 2013. Consumer Oriented. Bulk. Intermediate ... Growth, and good
Trade and food security Jared Greenville, Senior Agricultural Policy Analyst, OECD Global Forum on Agriculture Paris, 2 December 2014
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Outline of the presentation 1. 2. 3.
The role that trade has played in food security Future challenges Long term Implications for food security
www.oecd.org/tad Trade and Agriculture Directorate Organisation for Economic Co-operation and Development (OECD)
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Trade is important in global food supply Proportion of global grain and oilseed production traded globally Corn
Soybean
Rice
Wheat
Trade volumes for most ag. products have increased
10% or less for Rice and Corn
Fluctuating around 20% for Wheat
Highest and rising for soybean
45 40 35 30 25 20 15 10 5 0 1960/61 1966/67 1972/73 1978/79 1984/85 1990/91 1996/97 2002/03 2008/09 2014/15 Source: USDA data
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And in food supply diversity Growth in value of agricultural trade by broad groupings (100=1989 nominal USD value) 1500
All groups have seen strong growth in nominal values
Growth in consumer oriented products fastest – greater diversity of product offerings
Growth in bulk (grains and other raw) slowest
1300 1100 900 700
500 300
100 1989
1993
1997 Consumer Oriented
Source: USDA data
2001
2005 Bulk
Intermediate
2009
2013
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Accessibility and real food prices: the long and short FAO Real Food Price Index 1961-2014 Base 2004-06
180
160
140
120
100
80
60 1961
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
Source: FAOSTAT www.oecd.org/tad Trade and Agriculture Directorate Organisation for Economic Co-operation and Development (OECD)
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Food share of total merchandise import costs falling Share of agricultural imports in total merchandise imports (nominal per cent) World
LDCs
LIFDCs
NFIDCs
Agricultural products cost share in total merchandise imports have been falling
Pattern consistent across most country groups
Recent price changes have moderated trends
30 25 20 15 10 5 0 1961 Source: FAO STAT
1971
1981
1991
2001
2011
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Increased reliance on world markets for some 1961-2011 USD billions
LDCs
LIFDCs
NFIDCs
SIDSs
,20
A shift for some to greater reliance on world food markets
Trade increasing in importance for food security
,10 ,0 -,10 -,20 -,30 -,40 -,50 1961
1966
1971
1976
1981
1986
1991
1996
2001
2006
2011
Source: FAOSTAT www.oecd.org/tad Trade and Agriculture Directorate Organisation for Economic Co-operation and Development (OECD)
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Changes in net food trade status and progress on food security
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Future challenges for food security Two main factors Demography and prosperity Rising demand Further changes in relative demands Productivity and technological change in agriculture Climate change Altered production patterns Increased variability
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Trade will be important for food security in the long term The stabilising and balancing role of trade will become more important More frequent shocks due to climate change Permanent shifts in comparative advantage Trade openness can help secure supplies from wider set of suppliers Prosperity increasing the level and diversity of demand Trade openness facilitates participation in GVCs
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Trade will be important for food security in the long term Ultimately trade is important for growth Greater participation in global and regional markets increases opportunity for growth Growth, and good domestic policy setting provide best opportunity to reduce poverty – the most important driver of improved food security
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But questions remain Positives Increased international trade Moderating but sustained higher prices: second round effects But risks Damaging impacts of some trade polices ( for example, export restrictions/taxes/subsidies) Current lack of safety nets/hedge products to provide policy alternatives Other domestic policy settings can be counter-productive (stockholding generated by market price support)
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Discussion points for the forum How can trade policy rules be crafted to help improve global food security? What are the priority areas that need attention with respect to current trading rules? How can the trade distorting impacts of domestic policies such as stockholding be minimised while also providing countries or regions with flexibility to hold stocks to manage transitory food security risks?
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