Lecture 14: Understanding (shocks in) the global agri-food system

Question 1

Why do countries trade food?

Answer 1

• Based on comparative advantage: e.g. Belize grows bananas more efficiently, Belgium grows apples.
• Specialization and trade improve total consumption.
• Even if one is better at both, trading is still beneficial due to opportunity costs.
• Trade increases net welfare even if some lose (compensation possible).

Question 2

How does trade affect food security?

Answer 2

Positive effects:
* Increases availability and access.
* Can stabilize food supply (buffer against local shocks).
Negative effects:
* Affects dietary quality (e.g. more processed/junk food).
* Creates dependency on global supply chains → exposure to external shocks.

Question 3

Environment impact: impact of trade on emissions
How does trade affect the environment?

Answer 3

• Transport = small share of food GHG (EU: ~6%).
• Food type matters more (animal products have highest impact).
• Trade can reduce land use pressure → lower emissions and better biodiversity (“land sparing”).
• Efficient producers export → others reduce local production.

Question 4

Environment impact: impact of trade on emissions
Is food trade fair?

Answer 4

• Virtual water trade: water embedded in traded goods.
• Often flows from water-scarce to richer countries.
• Biodiversity footprint: Exporting countries (e.g. Indonesia, Madagascar) bear biodiversity loss.
• Trade can lead to local degradation even if it improves global efficiency.
• There are real trade-offs between food, biodiversity, and climate.

Question 5

Shocks: What are they and how vulnerable is the system?

Answer 5

What are shocks to the global agri-food system?
* Natural: droughts, floods, pests, climate change.
* Political: war, bans, authoritarian regimes.
* Economic: market shocks, volatility.
* Example: UK imports cauliflower from Spain → exposed to Spanish floods.

Shocks have spatial and temporal dimensions:
* Daily/monthly monitoring (short-term)
* Scenario modeling (long-term)

Question 6

Shocks in the short term

Answer 6

Remote sensing (e.g. satellite data) shows:
* Which crops are cultivated at what location?
* At which stage is each crop?
* Is this as expected?
Meteorology + status check
* What is the current status of production?
* What is forecasted for the upcoming weeks/months?
* What would be the impact for the crop?
Trade
* What is the current trade pattern?
* How will this affect food security?

National exposure: mapping import dependencies (e.g. Australia relies 94% on Argentina for a crop)
MARS: EU’s crop yield system using EO + agrometeorology
DCPI & DDPI models:
* Combine satellite data, meteorology, OSINT
* Predict displacement, conflict from climate shocks (e.g. drought-driven migration)

Question 7

Shocks in the long-term future
Can trade help with climate adaptation?

Answer 7

Shocks in the long-term future
Shift in Production Probability Frontier
→ Shift in Opportunity Costs
= Shifting Comparative Advantages
Can trade help with climate adaptation?
* Yes: Compensates for falling yields via imports
* Yes: Allows flexible sourcing as climate shifts productivity zones
* No: Creates dependence, vulnerability to global disruptions
* Arab Maghreb Union: mainly imports rice → less affected by local climate change, but highly vulnerable to external shocks (e.g. yield drop in Southeast Asia).
* Egypt: grows and exports rice → more affected by local climate change; less impacted by external shocks, but global price increases may lead to higher local prices due to more exports.
Economic shocks

Question 8

Externalities

Answer 8

Urbanisation in Africa = structural transformation
* Agricultural Employment → Non-Agricultural Employment
* Shift away from traditional dietary patterns
* More processed foods + convenient foods
Long-term continental effects: RCP vs SSP
* In long-term socioeconomic changes do dictate everything
* Depend on economic change, population change, …
* Lower yield will not change production -> more land will be used
Climate change vs socioeconomic changes
* Socioeconomic will be main drivers
* But these are continental effects on African change
* CC will still have impact (local) but at larger scale this will be masker (scale at which policy makers look at)