Food price shocks and food consumption Workshop on

Transcript:Food price shocks and food consumption Workshop on:
Food price shocks and food consumption Workshop on the cost of food and food price inflation Brussels, 3 October 2024 Céline Bonnet, Toulouse School of Economics, INRAE - National Research Institute for Agriculture, Food and Environment, France 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 1 European context: food price shock 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 2 Global price increase in 20 years: +75% The 2008 great recession : financial crisis Increase in food price, stronger relative price-income increase Covid-19 pandemic (2020-2022): disruption in global supply chains Significant food price increase Ukraine War (2022-2023): Russian and Ukraine are major exporters (wheat, maize, sunflower oil), increase in the price of energy (gas and electricity), uncertain financial markets Significant food price increase Food expenditures 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 3 Degree of vulnerability to unexpected food price changes depends on the share of food expenditures in households’ total budget Spike in food prices are likely to disproportionately affect lower income countries and lower income households Heterogenous price shocks within EU 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 4 Countries with high share of food expenditure Countries with low share of food expenditure What happens to food consumption patterns when food prices change? 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 5 Decrease in Food consumption Most sensitive to changes in prices in low-income countries or low-income households Change in consumption behaviour: Smoothing and adjusting consumption Spending more time shopping and finding lower prices Increase their use of discounts or coupons Switch to generic products Switch to low-price retailers What are the implications for food quality consumption? Descriptive analysis of the link between price and food consumption from 2002 to 2019: Food consumption: Food quantities in kgs Food qualities: Nutrient Profile Model (Food Standard Agency score) 03/10/2024 Presentation for the Committee on Agriculture and Rural Developmnet 6 French case study Heterogeneous quality of food consumption Nutrient Profile Model according to the social status and a health status 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 7 French case study Unhealthy Healthy Increase of nutritional inequalities of price shocks? 03/10/2024 Presentation for the Committee on Agriculture and Rural Development 8 Price increases exacerbate nutritional inequalities between poor and rich French households Similar or lower quantity responses when larger shocks Smoothing consumption Large price shocks lead