Domestic policy responses to the food price crisis: The case of Bolivia

In face of the global food crisis of 2007-2008, severe concerns arose about how developing countries would be affected by the extreme short-term fluctuations in international commodity prices. We examine the effects of the crisis on Bolivia, one of the poorest countries of the Americas. We focus on the effectiveness of the domestic policy interventions in preventing spillovers of the development of international food prices to domestic markets. Using a cointegration model, we study price interdependencies of wheat flour, sunflower oil and poultry. The analysis suggests that the policy measures taken had little effect on food security during the food crisis. Throughout the entire period, perfect price transmission between the Bolivian poultry and sunflower oil markets and the respective international reference markets existed. Bolivian prices were determined by international prices and the policy interventions in the markets of these two commodities were not found to have had an effect. The government's large-scale wheat flour imports did not shield Bolivian consumers from the shocks of international prices.

Assessing the impact of agricultural drought on maize prices in Kenya with the approach of the SPOT-VEGETATION NDVI remote sensing

The high cost of maize in Kenya is basically driven by East African regional commodity demand forces and agricultural drought. The production of maize, which is a common staple food in Kenya, is greatly affected by agricultural drought. However, calculations of drought risk and impact on maize production in Kenya is limited by the scarcity of reliable rainfall data. The objective of this study was to apply a novel hyperspectral remote sensing method to modelling temporal fluctuations of maize production and prices in five markets in Kenya. SPOT-VEGETATION NDVI time series were corrected for seasonal effects by computing the standardized NDVI anomalies. The maize residual price time series was further related to the NDVI seasonal anomalies using a multiple linear regression modelling approach. The result shows a moderately strong positive relationship (0.67) between residual price series and global maize prices. Maize prices were high during drought periods (i.e. negative NDVI anomalies) and low during wet seasons (i.e. positive NDVI anomalies). This study concludes that NDVI is a good index for monitoring the evolution of maize prices and food security emergency planning in Kenya. To obtain a very strong correlation for the relationship between the wholesale maize price and the global maize price, future research could consider adding other price-driving factors into the regression models.

Climate change and hunger as the challenges in the global food system

In the last decades, there has been a growing tendency towards international trade and globalisation, particularly leading to a significant increase in flows of agricultural commodities worldwide. From a macroeconomic perspective, the commodity projections are more optimistic than the previous years and the long run tendency shows an increasing demand for feedstock. However, the strong shifts of shocks and fluctuations (in terms of prices and volumes) are a concern to global food security, with the number of hungry people rising to nearly one billion. Agriculture is a main user of natural resources, and it has a strong link with rural societies and the environment. Forecasted impacts from climate change, limited productive endorsements and emerging rivals on crop production, such bio-energy, aggravate the panorama on food scarcity. In this context, it is a great challenge on farming and food systems to reduce global hunger and produce in sustainable ways adequate supplies for food, feed, and non-food uses. The main objective of this work is to question the sustainability of food and agriculture systems. It is particularly interesting to know its role and if it will be able to respond to a growing population with increasing food demand in a world where pressure on land, water and other natural resources are already evident, and, moreover, climate change will also condition and impact the outcome. Furthermore, a deeper focus will be set on developing countries, which are expected to emerge and take a leading role in the international arena. This short paper is structured as follows: Section I, “Introduction”, describes the social situation regarding hunger, Section II, “Global Context”, attempts to summarise the current scenario in the international trading scheme and present the emerging rivals for primary resources, and in Section III, “Climate Change”, presents an overview of possible changes in the sector and future perspectives in the field. Finally, in Section IV, “Conclusion”, the main conclusions are presented.