OECDFAO AglinkCO'SI'MO' Projection System

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OECD-FAO Aglink-CO.SI.MO.Projection System
Favignana, 28-29 September 2009

• by Stefania VannucciniFishery Statistician
  (Commodities)FAO Fisheries and Aquaculture
  Information and Statistics Service

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AGLINK MODEL

• OECD
• Dynamic, partial equilibrium supply-demand model
• Yearly basis since early 1990s
• Medium-term projections
• Agricultural key commodities
• Assumptions
• Coverage
• Close collaboration with member countries
• Influence of agricultural policy

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CO.SI.MO MODEL

• FAO World Food Model
• FAO COmmodity SImulation MOdel
• Yearly basis since 2004
• Updating Cycle
• Coverage
• Commodities
• Macro economic assumptions
• Parameters

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OECD-FAO Projection Work

• Joint outlook preparation between OECD and FAO
• Started in 2004
• Annual process
• Expansion of OECD Aglink model to developing
  countries
• Utilize global expertise

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Aglink CO.SI.MO.

• Partial Equilibrium Model
• Projection systems to examine future potential
  impacts
• Policy impacts
• Economic scenarios
• Link to food security indicators

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Aglink CO.SI.MO.Key factors of assumptions

• World markets for agricultural commodities are
  competitive
• Domestically produced and traded commodities as
  perfect substitutes by buyers and sellers.
• Importers do not distinguish commodities by
  country of origin as it is not a spatial model
• Non agricultural markets, including fish, are
  treaded exogenously to the model

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Aglink CO.SI.MO.

• About 15 000 equations
• 40 individual countries
• 19 regions
• About 40 commodities
• About 26 000 variables
• 17 world clearing prices
• Simulation of market determination of equilibrium
  prices

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AGLINK-CO.SI.MO. COMMODITIES
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AGLINK COUNTRIES
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CO.SI.MO. COUNTRIES
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Data Requirements

• Projections based on a calendar year (exc. crops)
• Annual time series for
• prices (usually export prices)
• supply (area, yield, animal numbers...)
• demand (food, feed, crush...)
• trade (exports, imports)
• policy variables (tariffs, CAP...)
• macroeconomic data (GDP, GDPD, private
  consumption expenditure deflator, exchange rates,
  Brent crude oil price)
• Commodity Production Cost Index

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PARAMETERS/DATA

• World Food Model, FAPRI, USDA, OECD, expert
  estimates, literature
• Source of data
• Databases trade and market division FAO (EST)
• FAOSTAT, national data, prices
• OECD, EU Commission, USDA, national sources
  (politics)
• COMTRADE (USDA), IDB and CTS (WTO), TRAINS
  (UNTAD), WITS (WB/UNCTAD), AMAD
• IMF
• UN population
• Reuters
• OECD questionnaires

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Projections and elasticities

• Functional relationships linking supply and
  demand to prices are, in most cases, linear in
  the logarithms of the variables
• Equation coefficients are partial elasticities
• Source of elasticities
• Global market projectionsBaselines

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Scenarios

• The baseline provide a benchmark for alternative
  scenarios
• Scenarios try to address questions such as
• What are the likely impacts of market stocks?
• What are the likely impacts of domestic policy
  changes?
• What are the likely impacts of multilateral
  policy changes?

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OECD-FAO Agricultural Outlook

• Country views are the starting point
• AGLINK CO.SI.MO is used to get a consistent and
  coherent picture
• Model outcomes adjusted through expert opinions
• Final reviews in OECD commodity working groups
• The datasets are available at
  www.agri-outlook.org

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OECD-FAO Agricultural Outlook

• Yearly
• Preparation November-April
• Projections and related market analysis for
  some fifteen agricultural products over a ten
  year horizon
• The result is a plausible set of conditional
  projections
• It shows how these markets are influenced by
  economic developments and government policies and
  highlights some of the risks and uncertainties
  that may influence market outcomes

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Adding fish to the AGLINK-COSIMO

• Inclusion of fish in the AGLINK CO.SI.MO. model
  and in the FAO Agricultural Outlook
• Species
• Elements
• Capture-Aquaculture for supply
• Price index