Derek Headey, Robel Alemu, Will Martin, David Stifel, and
Sofia Vielma
POLICY SEMINAR
Food Markets and Nutrition in the Developing World: Results from ARENA II
MAR 18, 2019 - 12:15 PM TO 01:45 PM EDT
VIP High Class Call Girls Amravati Anushka 8250192130 Independent Escort Serv...
Food Markets and Nutrition in the Developing World: Results from ARENA II
1. FOOD MARKETS & NUTRITION
IN THE DEVELOPING WORLD
Results from ARENA II
With support from The Bill and Melinda Gates Foundation and the CGIAR Research Program
on “Agriculture for Nutrition and Health” (A4NH)
2. Why are we here today?
• Justified interest in leveraging agri-food systems for nutrition
• Bad diets #1 risk factor in the global burden of disease
• Why do agri-food systems play a special role?
• Incomes & aggregate spending on food
• Safety of foods
• Availability of foods (especially rural areas)
• Affordability of foods (especially perishable foods)
• Most previous research focuses on farmers eating what they grow
• But surveys show that poor rural people heavily rely on markets
• Especially true for nutrient-dense non-staples
3. Research questions
Major research objective of ARENA-II is to understand the linkages
between markets, diets and nutrition outcomes
Ultimate policy objective: improve diets & child feeding practices
We pose four questions:
1. How affordable/available are nutritious foods & nutritious diets?
2. Why does food affordability & availability vary so much?
3. Are consumption patterns driven by affordability & availability?
4. What can we do to improve affordability of nutritious foods?
• Agriculture for own-consumption?
• Diversify local or national food production?
• Fix (multiple) value chains?
• International trade?
4. Who is going to answer these questions?
Robel
Alemu
Steve
Block
Will
Masters
John
Hoddinot
David
Stifel
Kalle
Hirvonen
Channing
Arndt
Kwaw
Andam
Sofia
Delano
Andy
Jones
David
Laborde
Will
Martin
Faaiqa Hartley
Dietary determinists (penny pinchers) The Market Fundamentalists
Dairy dudes Fish Folks
Eggonomists
Yan
Bai
5. How are we going to diagnose markets?
Demographic
Health Surveys
• 60 countries
• Data on diets
for 300K kids
aged 6-23m
Economic &
Agricultural Surveys
• PSNP Nutrition
Survey Ethiopia
• Household survey
linked to detailed
market survey
• Prices, availability,
size, frequency
and infrastructure
of rural markets
• Ghana Living
Standards Survey
Consumer Price
Surveys
• International
Comparison
Program (ICP)
• 180 countries
• 2011 survey
• Price of hundreds
of different foods
• Standardized!
• Cost of non-staple
calories relative to
staple calories
Economywide
Simulation Models
• Ghana CGE model
links households
& macroeconomy
• Conduct policy
experiments
• Allows spillovers
• Distributional
implications
The studies today exploit the entire ARENA toolkit ….
6. Some common threads…
• These studies forensically diagnose markets in developing countries,
mostly by looking at prices and supply-side constraints
• They build on some key findings from ARENA-I:
1. Animal-sourced foods (ASFs) strongly linked to child growth:
nutrient-density means they’re ideal for small stomachs
2. In LDCs, perishable nutritious foods are very expensive
sources of calories relative to starchy staples
3. Markets are important, but some markets work very badly,
particularly in rural areas: e.g. dairy in Ethiopia & Bangladesh
7. Calorie price ratios (CPRs):
ASF relative to starchy staple calories
7.7
8.8
7.7
11.7
12.6
15.1
22.6
0.0 10.0 20.0 30.0
HICs
ECA
LAC
MENA
E. Asia
S. Asia
SS Africa
Eggs
14.1
18.3
15.1
12.9
8.8
25.1
13.8
0.0 10.0 20.0 30.0
HICs
ECA
LAC
MENA
E. Asia
S. Asia
SS Africa
Fish
5.5
5.9
5.7
9.6
13.0
8.4
23.6
0.0 10.0 20.0 30.0
HICs
ECA
LAC
MENA
E. Asia
S. Asia
SS Africa
Fresh cow's milk
9.8
7.4
7.3
10.9
9.3
17.5
17.2
0.0 10.0 20.0 30.0
HICs
ECA
LAC
MENA
E. Asia
S. Asia
SS Africa
Poultry meat
Many of these studies seek to
Understand why these pricing
patterns exist, and what can
be done to change them
8. Study 1
Eggs before chickens?
Poultry, poverty and nutrition in
sub-Saharan Africa
9. WHAT’S THE POULTRY PROBLEM?
• Africa in the midst of a “Livestock Revolution”: ASF consumption↑
• But unlike other regions, coastal Africa imports much of its ASFs
• Is this economic problem also a nutritional problem?
-30
-20
-10
0
10
20
30
Eggs Poultry Milk Fish
Change in ASF calories:
Ghana 1993-2013
Domestic
Imports
Poultry meat: heavily imported
• Exploded since mid 1990s
• Imports bans and tariffs
• Africa broilers uncompetitive
Eggs: no blue-ocean imports
• Naturally protected
• Super expensive, no growth
• But HIGHLY NUTRITIOUS!!!
10. Eggs are expensive, so the poor don’t eat them
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
80.0%
90.0%
100.0%
Eggs Fish Meat Dairy
ASFs in the past 24 hours by wealth quintile:
Ghanaian children 12-23 months
Poorest Poorer Middle Richer Richest
Kids most at
risk of stunting
11. Why is African poultry unproductive?
• Poultry is the most commonly owned livestock in Africa
• But almost all low input-low output scavenging systems
Albania
Azerbaijan
Burundi
Benin
Burkina Faso
Bangladesh
Bulgaria
Belize
Brazil
Canada
Cote d'Ivoire
Cameroon
DRC
Comoros
Cyprus
Czech Rep
Denmark
Egypt
SpainEstonia
Ethiopia
FinlandFrance
Gabon
UK
Ghana
Gambia
Greece
Guatemala
Honduras
Croatia
Hungary
Indonesia
India
IrelandIraq
Iceland
Italy
Jordan
Kenya Cambodia
South Korea
Sri Lanka
Lesotho
Lithuania
Luxembourg
Latvia
Morocco
Madagascar
Mexico
Mali
Malta
Myanmar
Montenegro
Mozambique
Mauritania
Malawi
Malaysia
Namibia
Niger
Nigeria
Norway
Peru
Philippines
PolandPortugal
Romania
Rwanda
Senegal
Slovakia
SloveniaSweden
Chad
Togo
Thailand
Tunisia
Tanzania
Uganda Ukraine
USA
Viet Nam
Yemen
South Africa
Zimbabwe
05
101520
Relativeeggprice(ratiotocerealprice)
0 20 40 60 80 100
Share of chickens in intensive systems (%)
Linear fit: coef = -0.08 [CI -0.10-0.07]; R-sq = 0.60
• HUGE economies of scale
from commercialization
• Commercial sectors
mostly cater to urban
areas
• Egg prices very high in
rural areas
• Rural children don’t eat
eggs
F1. Egg prices & share of chickens in intensive systems
Albania
Armenia
Azerbaijan
Bangladesh
Burkina Faso
Benin
Burundi
DRCCongo, Rep.CIV
Cameroon
DR
DR
Egypt
Egypt
Ethiopia
Gabon
Ghana
Guinea
Guyana
Honduras
Honduras
Haiti
Haiti
India
KH5
KM6
Kyrgzstan
LB5
LB6
Lesotho MDG
Mali
Malawi
MZNigeria
Nigeria
Niger
NamibiaNamibia
NepalNepal
Pakistan
Rwanda
Sierre Leone
Sierre Leone
Senegal
SZ
TJ
Timor-Leste
Uganda
Uganda
Yemen ZambiaZambia
ZIM
0
.2.4.6
Eggconsumption(shareofkids)
0 .25 .5 .75 1
Chicken ownership (share of HHs)
Negative link between egg intake & chicken ownership!
12. But commercial poultry also uncompetitive!
Feed ingredient costs in Ghana compared with
international prices, 2016 (US$/ton)
Ghana feed mills prices International FOB price Ghana premium (%)
Yellow maize 268.79 159.9 68.10%
Fishmeal 1128.79 1566 -27.92%
Soybean 500.00 382.04 30.88%
Wheat bran 103.41 NA NA
Total feed costa
380.16 328.948 15.57%
• Feed costs are 60-70% of the broiler and layer production costs
• Feed costs are 15.57% higher than international costs
• Problem inputs are maize and soybeans
13. Main results (CGE economywide model)
Feed improvement:
• Egg prices 9% ↓
• Egg consumption↑
• Total household
consumption↑ 0%
5%
10%
15%
20%
Q1 Q2 Q3 Q4 Q5 Q1 Q2 Q3 Q4 Q5 Q1 Q2 Q3 Q4 Q5
Rural farm Rural non-farm Urban
Growth in household egg consumption
• We model two alternative policy paths to 2025:
1. Import ban (Nigerian approach)
2. Feed improvement (maize productivity growth)
• Import ban useless: no poverty or nutrition benefits
14. Key Takeaways
1. More economywide research for growth, poverty & nutrition:
1. Understand competitiveness issues
2. Understand growth-poverty-nutrition tradeoffs & macro spillovers
2. Understand & address high cost of feed
1. A cross-cutting constraint for poultry meat, eggs, fish?
2. Can Africa raise area and productivity of maize & soybeans
3. Behavioral change on eggs
1. Major improvement in maize yields only reduces egg price by ~10%
2. Baseline egg consumption low, though rises with income
3. National egg campaigns; targeted efforts for poorer parents
16. What’s the problem?
• Dairy products highly effective delivering nutrients
• High amino acid scores & insulin-like growth factor
• Dense in calories, fat and calcium and micronutrients
• Tasty, palatable and familiar to young children
• But low levels of dairy consumption
• Great variability across countries
• Low consumption in most of Africa and much of Asia
• High prices in these regions
• Why is dairy so expensive?
• Dairy powder is tradable (why don’t prices equalize across countries?)
• Countries can import dairy powder
• Consumers or factories can reconstitute it
17. How do we analyze the problem?
• ICP calorie price ratios to compare relative dairy prices
• Cross-country regressions to explain child dairy consumption:
income, prices, parental education, refrigeration, water quality
• Differences b/w farmgate & consumer prices (processing margins),
and consumer prices & international prices (trade margins)
• Reform options: Differences by type of dairy country:
• Dairy strategies for high potential producers?
• Dairy strategies for low potential producers?
18. Influences on dairy consumption?
Children
taking dairy
Low
Incomes?
High prices? Piped water?
% $ PPP CPRs %
Central Africa 15.7 1,670 21.9 26.8
West Africa 25.0 3,766 21.4 19.6
Southern Africa 18.0 1,814 9.5 27.2
Eastern Africa 34.4 1,685 23.3 28.9
South-East Asia 19.2 3,725 12.8 11.0
South Asia 52.7 4,357 8.5 34.6
M East & N. Africa 70.9 8,139 7.9 74.2
E. Europe & C. Asia 67.1 9,587 6.1 71.7
Latin America 58.2 12,451 5.6 68.7
19. Child dairy consumption:
Double log regressions from 58 DHS countries
(1) (2)
GDP per capita 0.473*** 0.241**
Fresh milk price -0.435*** -0.334***
Cattle ownership 0.063
9+ yrs maternal educ. -0.071
Health access 0.023
Piped water 0.175*
Refrigerator 0.188**
Obs 58 58
R-squared 0.636 0.721
Price differences explain
~20% of difference
between high & low
dairy countries
Piped water &
refrigeration significant
even after controlling
for GDP per capita
Income, prices and implicit prices matter…
20. Child dairy consumption & dairy prices
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSASSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SSA
SAS
SAS
SAS
SAS
EAPEAP
MNA
MNA
MNA
LAC
LAC
LAC
LAC
LAC
LAC
LAC
ECA
ECA
ECA
ECA
ECA
0
20406080
100
0 10 20 30 40
Dairy calorie price ratio (relative to starchy staples)
In many SSA countries
prices are far too high
for the average parent
21. Price differences across different dairy types
NIGERIA ETHIOPIA KENYA INDIA VIETNAM
Dairy potential Low High High High Low
Child dairy (%) 27.5% 33.5% 55.4% 54.5% 64.0%
Calorie Price Ratios
Non-perishable (tradable) milk
Powdered milk 13.4 42.4 15.8 18.8 14.2
Perishable (non-tradable) pasteurized milk
Milk, full fat 16.9 15.1 12.6 11.3 11.3
Unpasteurized milk
Cow's milk NA NA NA 9.4 NA
Buffalo milk NA NA NA 6.9 NA
Relatively cheap
80% imported
Informal milk markets still important
22. Irrational dairy trade strategies?
Low
income
Lower
Middle
Upper
middle
High
income
Global
Milk protection (%) 24.7 13.2 56.6 12.2 29.8
Dairy
potential
Milk import share
(%)
Milk protection
Milk
Margins
Rwanda Good 2.3 -42.2 162.6
Kenya Good 1.0 -54.0 137
Senegal Medium 53.2 35.6 104
Chad Medium 3.5 98.2 34.8
Gambia Low 108.5 24.0 86.6
Cote d'Ivoire Low 86.0 -87.7 231.1
Dairy is a significantly protected sector … on average
Good dairy potential ≠ Protection & Poor potential = Protection
23. Key takeaways
Huge scope to raise dairy consumption, and large nutritional benefits
Policy options
1. Raising incomes important
2. Improve access to safe water and refrigeration
3. Nutritional knowledge, especially in countries with poor dairy traditions:
• Experiences of dairy transformation exemplars: Thailand, Vietnam
• School feeding programs, promotion campaigns, behavioral change
4. Reduce relative prices of “fresh milk”
• Successful strategies need to be tailored to comparative advantage
• High potential: raise productivity, solve value chain issues (e.g. India)
• Low potential: Use imports for domestic reconstitution (e.g. Thailand)
• Further research needed, particularly on dairy success stories
24. The Importance of Fish for Child
Nutrition in Sub-Saharan Africa
Study 3
25. What’s the problem?
• The fish problem is very different to the egg, meat & dairy problems
• MANY, MANY children in Africa (and) Asia consume fish!
• Fish problem: we know little about something that happens a lot:
1. How widespread is fish consumption in Africa?
2. How affordable is fish in Africa?
3. How do fish markets work, particularly trade?
4. Is there scope to improve production & consumption?
• And then some questions we still need to answer:
1. Do children actually consume significant amounts of fish?
2. What types of fish are consumed?
3. What are the nutritional properties of different fish species
and preparation methods?
• How can Africa better leverage the potential of fish for nutrition?
26. How do we analyze this problem?
• DHS: Child fish consumption patterns
• FAO: national food balance sheets and trade
• International Comparison Program: price data on fish
• Fish markets in Africa: literature review
• Nutrient content of fish: FAO, West African sources
But major knowledge/data gaps:
• Surveys do a poor job of recording species & preparation methods
• Very few fish value chain or trade studies in Africa
• Very few individual dietary intake surveys in Africa
27. Nutrient profile of 35 fish products
Energy
(kcal)
Protein
(g)
Fat
(g)
Calcium
(mg)
Iron (mg) Zinc (mg)
Vitamin A
(ug RE)
Median 103 18.6 3 28 0.8 0.6 11
Min 68 10.6 0.5 9 0.1 0.2 0
Max 368 79.8 13 1700 3.1 5.2 49
25th centile 84 17.1 1.2 17 0.5 0.4 6
75th centile 119 19.7 5.1 51 1.1 1 18
Major takeaways:
• Calorie- and protein-dense
• Fatty acids: Omega-3s mostly in fatty saltwater fish
• Calcium: Huge variation in species and preparation; potentially
very high when eaten with bones, and dried
• Iron, zinc: Good amounts
• Vitamin A: large variation, but often high
• BUT … dried fish eaten in very small quantities = small nutrients!
30. Household wealth quintiles
Predictedrecentchildfishconsumption
90% CI
kernel-weighted local polynomial smoothing
Relationship between wealth & child fish consumption
varies by country: sometimes declines with wealth
PANEL A: FISH CONSUMPTION AND HOUSEHOLD WEALTH:
COUNTRIES WHERE FISH IS COMMON
Where fish is common its
consumption can decline with wealth
PANEL B: FISH CONSUMPTION AND HOUSEHOLD WEALTH:
COUNTRIES WHERE FISH IS RARE
Predictedrecentchildfishconsumption
Household wealth quintiles
90% CI
kernel-weighted local polynomial smoothing
Where fish is rare
(typically expensive),
consumption rises steeply
with income
31. Africa is becoming more import-dependent
Africa, 46%
South-Eastern
Asia, 18%
Eastern Africa,
23%
Central Africa,
40%
Western Africa,
64%
0%
10%
20%
30%
40%
50%
60%
70%
1990 1995 2000 2005 2010
SHARE OF IMPORTS IN DOMESTIC SUPPLY QUANTITY,
1990-2013
32. FORMAL VS INFORMAL TRADE ROUTES IN WESTERN AFRICA
FORMAL
Formal trade growing, but informal trade is also
very important
Source: AU-IBAR, 2018
INFORMAL
33. Takeaways
Policy goals
• Improve fish supply:
• Huge potential for more trade in fresh fish, trade
facilitation to reduce informality
• Significant potential for growth in African aquaculture?
• Improve fish demand:
• Combat perception of fish as in inferior good
Research needs:
• Improvement measurement in surveys, national
accounts, price surveys: know little about kids!!!
• Assess contribution to diet and nutrition outcomes
• Improve evidence base for nutrition-sensitive fish
development strategies: micro and macro issues
35. Do rural markets deliver nutritious foods?
Source: Sibhatu & Qaim (2017)
• Diets & nutrition outcomes
are very poor in rural areas
• Improving diets of children
quality not just quantity
• How to improve dietary
diversity in rural areas?
• Change what people grow?
• Maybe, but …
• Markets are the main
source of non-staple foods
What’s the problem?
36. Why does the problem exist?
• Many nutritious foods are highly perishable
• Poor infrastructure can result in thin/missing markets
• Quality of market: Are nutritious foods…
• Available?
• Affordable?
• Safe?
37. How do we understand the problem?
• Combine HH survey data with market
survey data for poor areas of Ethiopia
• Relate child (6-36 months) dietary
diversity to market quality…
•Availability: No. of food groups available
•Affordability: Calorie Price Ratios
i.e. How expensive is it for a parent to
feed a child eggs instead of maize?
38. Main Results
Food Groups Consumed by kids 6-36m
1.0 = Average number of non-
staple food groups consumed
6% = Percent of children who
consumed 4+ food groups
0 20 40 60 80 100
Other fruit & veg
VitA-rich fruit & veg
Eggs
Flesh foods
Dairy
Legumes & nuts
Starchy staples
Percent of Children
39. Main Results
LOTS of missing markets:
• Dairy only in ~1/2
• Flesh foods in ~1/3rd
• 44% of markets sell <4 foods
We estimate that going from 3
to 6 food groups sold results in
only … 0.24 more food groups
Why such a weak linkage?
0 20 40 60 80 100
Other fruit
Other veg
VitA-rich fruit & veg (oth)
Dark green leafy veg
Eggs
Flesh foods
Dairy
Nuts
Legumes
Percent of Markets with Food Group
Available
March August
40. Main Results
Affordability=major constraint
ASFs are SUPER expensive in
poor rural areas!!!
Price effects on diet are small:
Doubling the mean CPR
results in only… 0.15 fewer
food groups consumed
Why? Very poor households,
and prices are relatively high
in all markets0 5 10 15 20 25 30 35 40
Other fruit
Other veg
VitA-rich fruit & veg (oth)
Dark green leafy veg
Eggs
Flesh foods
Dairy
Nuts
Legumes
Calorie Price Ratios -
Affordability
March August
41. Bottomline
• Very poor rural households rely heavily on (imperfect) markets
• Availability of nutritious foods is quite limited, especially dairy
• Affordability of nutritious foods is extremely low
• Poor households living in poor food systems
• What’s the policy agenda for improving rural markets?
• Value chains? Infrastructure? Basic productivity? Demand?
42. Where are nutritious diets most expensive?
Evidence using ICP prices for 744 foods from
164 countries
Study 5
43. What’s the problem?
A “complete nutrition” diet may be unaffordable for the poor
• Health outcomes depend on overall diets not just specific foods
• Must meet all requirements to stay healthy
• Poorest of the poor focus on warding off hunger: i.e. calories
• But complete nutrition means meeting lots of dietary requirements
We pose three questions
1. What is the least costly way an individual in a given food
environment can achieve “complete nutrition”?
2. How expensive is the cost of this nutritious diet relative to the cost
of just meeting calorie requirements in a “survival diet”?
3. How does the cost of complete nutrition compare to actual food
expenditures?
44. How do we address this problem?
Focus on 21 essential nutrients (Dietary Reference Intakes (DRIs))
• Representative woman, 19-30 with median requirements
• Use acceptable macronutrient distribution ranges (AMDRs)
• Micronutrients above estimated average requirements
(EARs), below upper limits (ULs) for healthy life
Use ICP food prices and USDA nutrient composition
• International Comparison Project (ICP) prices
• We include 744 foods (mean of 194 items per country)
• Match each food USDA standard reference data
• Least-cost diets estimated with linear programming
45. In poorer countries all food prices are relatively high,
compared to earnings and non-food prices
Price levels relative to all HH expenditure
Why does this problem exist?
46. • Relative prices determine which foods enter least cost diet
Food systems cause systematic variation in prices
Foods in least-cost diets by country income level
Fruits, nuts, veg,
legumes used
MORE in poor
countries
Dairy used less
in poor countries
47. Nutritious diets (CONA) cost >50% of the $1.90 poverty line and
twice as expensive as least-cost energy diet (COCA)
$1.90/day
$0.85/day
Nutritious diets are expensive for the poor
48. CoNA=current spending
Nutritious diets are expensive for the poor
In poor countries, the
nutritious diet often exceeds
average food expenditure
In richer countries, CoNA is
usually below 50% of spending
49. Key messages
Global analysis reveals global patterns
• Foods in general are expensive in poor countries
• Substitution to lower-cost source of each nutrient helps reduce diet
costs, but scope for adjustment is limited
• Even the lowest-cost nutritious diet is often unaffordable
• Vegetal foods enter more often in poorer countries: ASFs costly!
• Diets cheaper in countries with more electricity & less remoteness
Policy uses
• Think strategically about:
• low cost diets & recommended diets
• affordable foods that “complete” the diet: demand promotion
• nutrient-dense foods currently unaffordable: supply promotion
Pinstrup-Andersen commentary on Lancet 2013 Nutrition series; landscape, “food systems”
Wordy?; key words
Wordy?; key words
DHS: Consistent survey instruments, unlike GDD
Bit wordy
-people defend calories: all the action is on diversity
What's the problem?
Fish is widely consumed in many poor countries: most common ASF in most African countries.
Fish constitute a large proportion of the animal-source foods (ASFs) consumed by low-income populations in SSA, Asia and the Pacific
Many species of fish offer dense, bioavailable source of high-quality protein, omega-3 fatty acids, and limiting micronutrients (e.g., vitamin A, vitamin B12, Fe, Ca, Zn)
What's the problem?
Fish is widely consumed in many poor countries: most common ASF in most African countries.
Fish constitute a large proportion of the animal-source foods (ASFs) consumed by low-income populations in SSA, Asia and the Pacific
Many species of fish offer dense, bioavailable source of high-quality protein, omega-3 fatty acids, and limiting micronutrients (e.g., vitamin A, vitamin B12, Fe, Ca, Zn)
What's the problem?
Fish is widely consumed in many poor countries: most common ASF in most African countries.
High consumption of fish reported among children aged 6-23 months old.
But is fish really having an impact on child nutrition? Is it consumed in the right quantities and the right way?
Figure 3. Kernel-weighted local polynomial smoothing of predicted recent child fish consumption by household wealth quintile among countries of Sub-Saharan Africa wherein 20% or more of children recently consumed fish or shellfish (Panel A), and less than 20% of children recently consumed fish or shellfish (Panel B), respectively.
Why does this problem exist? Access to dried/smoked fish is relatively good, but fresh fish not so much. Africa highly reliant on imports. Graph/map: African fish imports as share of total consumption
Alternatively, I could add 4-6 graphs of specific countries in Africa, rather than compare 2 different regions.
Main result: Africa has huge fish potential, but we suspect main government fail to realize and actively exploit this potential. Remarkably few studies on fish value chains and trade, and neglect by agricultural and development economics.
note: high participation of women in trade. (esp. informal)