Energy, Agriculture and Food Security · Energy, Agriculture and Food Security Prabhu Pingali Deputy Director, Agriculture Development Talk to the National Academies Round Table on

Energy, Agriculture and Food Security

Prabhu PingaliDeputy Director, Agriculture Development

Talk to the National Academies Round Table on Science and Technology for Sustainability. Views expressed are personal.

September 24, 2009

© 2009 Bill & Melinda Gates Foundation |

Energy, Agriculture and Food Security

Energy , agriculture & food security are linked by the followingtrends:

Intensification and the structural transformation of the agriculture sector

Rising urban middle class demand for food diversity, convenience and quality – supermarkets & food imports

Declining importance of biomass as fuel

Potential expansion of bio-fuel production

2


Trends in Food and Oil Prices

Source: Data from WB 2008Source: Data from WB 20083


Intensification & the structural transformation of the agriculture

Rising population densities and improved market access leads to the intensification of smallholder agriculture systems– rising energy requirements per hectare

Declining share of agriculture in GDP is associated with rising opportunity cost of labor and mechanization and fertilizer use

Demand for post harvest processing, storage and quality rise with economic development

4

India irrigated area by type of irrigation (000 ha)Source: Ministry of Agriculture, http://agricoop.nic.in/statistics/sump2.htm

5

http://agricoop.nic.in/statistics/sump2.htm

Trend of fertilizer and oil price since 1970

Source: World Bank 2008 6

Rice to fertilizer price ratio trend (1970-2008)

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World Price of Rice under Baseline and a 3-Fold Fertilizer Price Increase Scenario

Source: IFPRI/IMPACT Model Projections 8


From Traditional to Modernizing to Industrialized Food Systems

Consumption: • Traditional – Rising caloric intake, diversification• Modernizing – Diet diversification, shift to processed foods• Industrialized – Higher value & processed foods

Retail:• Traditional – Small scale, wet markets• Modernizing – Spread of supermarkets (limited for FFV)• Industrialized – Widespread supermarkets

Processing:• Traditional – Limited processing sector• Modernizing – Employment and value addition from processing• Industrialized – Large processing sector, domestic and export

Wholesale:• Traditional – Trad. wholesale, retailers bypass traditional system (exports)• Modernizing – Trad. and specialized wholesalers, some retailer bypassing• Industrialized – Specialized wholesalers, private distribution centers

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Dietary transition in Asia: an overview

Reduced consumption of rice

Increased consumption of wheat and wheat based products

Rise in high protein and energy dense diets

Increased consumption of temperate zone products

Rising popularity of convenience food and beverages

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Rising GDP per capita is associated with a larger share of supermarkets in food retail

0%

20%

40%

60%

80%

100%

0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000

GDP per Capita, PPP, 2002

Shar

e of

Sup

erm

arke

ts in

Foo

d R

etai

l

Source: data from Traill (2006) and World Bank World Development Indicators (2006) 11


Global expansion of transnational supermarkets, 1980-2001

Source: UK food group 12


Reliance on biomass for energyFuel wood, manure and other combustible residues are the most significant source of energy in many developing countries—over 90 percent of total primary energy supply for DR Congo, Tanzania, and Ethiopia (IEA 2005)

The gender dimensions are clear:The collection biomass major time burden for womenBurning firewood indoors factor in female and infant mortality

Courtesy of Mark Rosegrant (IFPRI) 13


Hunger and use of biomass as energy

Increasing time poverty

Courtesy of Mark Rosegrant (IFPRI) 14


The biofuels boom

05

10152025303540

1975 1980 1985 1990 1995 2000 2005

Bill

ion

liter

s

Source: Worldwatch Institute 2006Source: Worldwatch Institute 2006

EthanolEthanol > 90% of biofuel production; > 90% of biofuel production; Brazil and US are 90% of the ethanol Brazil and US are 90% of the ethanol marketmarket

0

1

2

3

4

1991 1993 1995 1997 1999 2001 2003 2005B

illio

n lit

ers

Biodiesel:Biodiesel: EU accounts for 90% EU accounts for 90% of productionof production

World ethanol and bioWorld ethanol and bio--diesel production, 1975diesel production, 1975--20052005

2007

Biofuel Impacts on Prices?Source Estimate Commodity Time period

World Bank (April 2008)

75 % global food index January 2002 – February 2008

IMF (2008?) 70 %40 %

cornsoybeans

??

IFPRI (May 2008) 39 %21-22 %

corn rice & wheat

2000 – 20072000 – 2007

OECD-FAO (May 2008)

42 %34 %24 %

coarse grainsvegetable oilswheat

2008 – 20172008 – 20172008 – 2017

Collins (June 2008) 25-60 %23-35 %

cornUS retail food

2006 – 20082006 – 2008

Glauber (June 2008) 23-31 %10 %4-5 %

commoditiesglobal food indexUS retail food

April 2007 – April 2008April 2007 – April 2008January – April 2008

CEA (May 2008) 35 %3 %

cornglobal food index

March 2007 – March 2008March 2007 – March 2008

Source: FAO 2008Source: FAO 2008


Changes in world prices of feedstock crops and Changes in world prices of feedstock crops and sugar by 2020 under two scenarios compared to sugar by 2020 under two scenarios compared to

the baseline levels (%) the baseline levels (%)

Source: IFPRI IMPACT projectionsSource: IFPRI IMPACT projections

0

10

20

30

40

50

60

70

80

Cassava Maize Oil seeds Sugar Wheat

Pric

e C

hang

es (%

)

Biofuel expansion Drastic biofuel expansion

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Energy, Agriculture & Food Security: the way forward

Continue focusing on staple crop productivity growth reduces the food-fuel trade-offSeek technology & policy options for enhancing input use efficiencyExploit opportunities for reducing non-renewable energy use (example. Conservation tillage)Invest in novel (de-centralized) renewable energy technologies– small scale solar systems; bio-fuel from biomassIdentify options for energy savings across the value-chain from the farm to the supermarket.

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Thank You

© 2009 Bill & Melinda Gates Foundation. All Rights Reserved. Bill & Melinda Gates Foundation is a registered trademark in the United States and other countries.

Energy, Agriculture and Food Security · Energy, Agriculture and Food Security Prabhu Pingali Deputy Director, Agriculture Development Talk to the National Academies Round Table on

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