Technical Report UK’s Global Food Security programme, 2015. Paper abstract bibtex
There is inherent systemic risk in the global food production system. Over the last century there have been several food production shocks that have seen 10% of individual grains lost in a single year. These production shocks often, but not always, lead to policy responses. A physical shock can often be the trigger for a much larger market shock especially when there are other issues that increase the size of the shock, such as export restrictions, re-stocking (demand increase) of low stocks, biofuel policy/growth and a devalued US dollar. Individual grain prices have more than doubled in a relatively short space of time during some of the past shocks. While governments around the world are implementing strategic responses to better manage food production, in particular following food shocks in the past decade, these responses have not (yet) created a resilient food system. Developing a better understanding of potential responses is important if the worst impact of future production shocks are to be avoided. There are two main agents whose responses determine the short term impact of these shocks – the market and governments. Other actors include farmers, private sector, consumers and relief agencies. As the main traded grains; wheat, maize and soybean production shocks are key drivers of overall food price shocks. However, a production shock in rice can more easily deliver a global price shock because it is thinly traded. Therefore, we wish to capture potential market and government responses to food production shocks in wheat, maize, soybean and rice. This report is a summary of data analysis, literature review and expert interviews and lists those potential responses. We categorise possible short term responses as either price and export responses or import responses. In addition we include various amplifying factors that over the medium term could make these short term responses more or less likely to occur or will alter the impact on market dynamics, prices and the availability of food.