Food Security Challenge or Opportunity

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Food SecurityChallenge or Opportunity?

• RASE President's Seminar
• Siôn Roberts
• EFFP Chief Executive

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Thomas Robert Malthus
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Food SecurityChallenge or Opportunity?The
Evidence
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Food prices up 75 since 2000
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UK Inflation
Food prices in the UK
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Wheat price
1,400
1,200
1,000
800
Cents per bushel
600
400
200
0
07/05/2000
07/01/2002
07/09/2003
07/05/2005
07/01/2007
28/03/2008
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Implied Volatility (annual and monthly)(1997-2007
and Jan 2005 to Oct 2007)
Source FAO
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Food SecurityChallenge or Opportunity?Prelimin
ary Conclusions
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Wheat price
1,400
Supply Issues Productivity Weather Stocks Oil /
water
1,200
Demand Issues Bio-fuels Structure of demand
1,000
800
Cents per bushel
600
400
200
0
07/05/2000
07/01/2002
07/09/2003
07/05/2005
07/01/2007
28/03/2008
10
World population and agricultural production
1961-2005
Source Defra
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Cereals stocksand ratios of major exporters
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Growing Population
Region 2007 2050 Change World 6,671
9,191 38 High Income 1,223 1,245 2 Low
Income 5,448 7,946 46 Africa 965 1,998
107 Asia 4,030 5,266 31 Latin America
572 769 34 North America 339 445
31 Europe 731 664 - 9
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Urbanising Population
Region 1950 2000 2030 World 30 47
60 Africa 15 37 53 Asia 17 38
54 Europe 52 73 81 Lat. America 42 75
84 North America 64 77 85 Oceania 62 74
77
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Refrigerators and Microwaves

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World Food Demand
World food demand could double by 2050 50
increase from population growth 50 increase
from broad-based economic growth in low income
countries
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Wheat price
1,400
Supply Issues Productivity Weather Stocks Oil /
water
Financial Markets
1,200
Demand Issues Bio-fuels Structure of demand
1,000
800
Cents per bushel
600
400
200
0
07/05/2000
07/01/2002
07/09/2003
07/05/2005
07/01/2007
28/03/2008
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New era?
1920s-30s
Farming Depression
Food Basic
Market dynamic Significant levels of imports
into UK
1940s-50s
Agricultural Act
Rationing
Under-supply
1960s-70s
CAP
New products
Increasing domestic production
1980s-90s
Quotas Environment
Cost, variety, convenience
Over-supply
Less security of supply
2000s-10s
Increasingly Hi-tech
Health, ethics, provenance
More market focussed
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Food SecurityChallenge or Opportunity?Implicat
ions
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Security of supply

• Macro level
• Global
• EU
• UK

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UK Self-sufficiency
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Imports of food into UK by country of source
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Origins of food consumed in the UK 2006
Source Defra
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Security of supply

• Macro level
• Global
• EU
• UK
• Micro level
• Individual businesses

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Implications

• Challenge
• balancing supply and demand
• Solutions?
• RD
• investment in infrastructure
• increasing efficiency and reducing waste

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Implications

• Challenge
• dealing with uncertainty and volatility
• Solutions?
• Use the good times wisely
• Hedging instruments
• Food chain partnerships

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Growth of food chain partnerships
Value
Trading relationship
Long term partnership
Time
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Challenge or opportunity?

• to approach food security issue with fresh
  thinking
• not just about self sufficiency but government
  working with industry to tackle big challenges
• for efficient producers to expand
• progress Doha trade round and removal of
  production controls
• to develop new long term collaborative
  relationships
• between farming and food industry