Food Marketing System Research Articles

Can Agricultural Traders be Trusted? Evidence from Coffee in Ethiopia

Summary Traditional food marketing systems in developing countries are often not trusted. In consequence, policy makers frequently try to regulate them and modern marketing arrangements are increasingly emerging to address some of their presumed deficiencies. However, it is unclear how trustworthy these markets actually are. The purpose of this study is to look at these issues in the case of coffee marketing in Ethiopia. Coffee markets in Ethiopia present an interesting case study due to the high price and quality differentiation linked to a number of both easily and not so easily observable characteristics. Moreover, modern marketing practices, such as modern retail, branding and packaging, are becoming increasingly common in Ethiopia’s urban coffee markets. When we define and examine trustworthiness in the Addis Ababa coffee market as a function of weights and quality, we find that traditional traders are relatively trustworthy on observable quality characteristics and weights. However, there is a consistent pattern of over-representation of not so easily verifiable quality characteristics. We further find that modern marketing outlets or formats, including modern domestic retail and branded packaged products, deliver higher quality at a higher price, but are not more trustworthy than traditional marketing arrangements in terms of these dimensions of trade transactions.

The Squander Sequence: Understanding Food Waste at Each Stage of the Consumer Decision-Making Process

Food waste presents a complex global problem that involves multiple actors and institutions within the aggregate food marketing system. Food waste occurs across food production and distribution, as well as at the hands of the consumer. In this research, the authors focus on waste that occurs across what is termed the “squander sequence,” which describes waste that occurs from consumer behaviors at the preacquisition, acquisition, consumption, and disposition stages. The authors set forth a behavioral theory–based agenda to explain food waste in the squander sequence with the ultimate goals of encouraging future research to uncover the psychological underpinnings of consumer-level food waste and of deriving transformative consumer solutions to this substantive issue.

Projected demand and supply for various foods in West Africa: Implications for investments and food policy

This paper (a) summarizes recent evidence of changes in dietary patterns in the 15 ECOWAS countries of West Africa over the past 30years and the forces driving those changes (In this paper, the term “West Africa” refers to the 15 countries that are members of the Economic Community of West African States (ECOWAS): Benin, Burkina Faso, Cape Verde, Côte d’Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo); (b) uses expenditure-elasticity estimates derived from budget-consumption studies in 8 of these countries (Burkina Faso, Côte d’Ivoire, Ghana, Mali, Niger, Nigeria, Senegal, and Togo) and hypotheses about alternative income growth trajectories to develop scenarios about the evolution of demand for various foods over the period 2010–2040; (c) compares the projected demand growth with projection of production growth in key commodities to identify potential or increasing demand–supply gaps; and (d) derives implications for needed investments and policies regarding different commodities and components of the West African agrifood system, including identifying gaps in the current African Union-led Comprehensive Africa Agriculture Development (CAADP) programs. The analysis shows that in absolute terms, production shortfalls relative to demand for starchy staples (particularly rice and wheat) will continue to pose a major challenge for ECOWAS countries. In relative terms, however, imbalances between domestic production and demand will increase more quickly for foods with high income-elasticities of demand, such as meat, dairy products, seafood, fruits and vegetables and vegetable oils. Urban demand will grow two to four times faster than rural demand, depending on the commodity, putting increased pressure on already stressed urban food marketing systems. Substantial variations in supply–demand gaps across countries suggest that more fluid regional trade could help individual countries cope with these challenges. The findings also suggest that the focus of food policies in West Africa, historically on starchy staples (particularly cereals) needs to broaden to include a range of higher-value products for which demand is likely to increase very rapidly in the near future.

Obesity as a Socially Defined Disease: Philosophical Considerations and Implications for Policy and Care.

Obesity has generated significant worries amongst health policy makers and has obtained increased attention in health care. Obesity is unanimously defined as a disease in the health care and health policyliterature. However, there are pragmatic and not principled reasons for this. This warrants an analysis of obesity according to standard conceptions of disease in the literature of philosophy of medicine. According to theories and definitions of disease referring to (abnormal functioning of) internal processes, obesity is not a disease. Obesity undoubtedly can result in disease, making it a risk factor for disease, but not a disease per se. According to several social conceptions of disease, however, obesity clearly is a disease. Obesity can conflict with aesthetic, moral, or other social norms. Making obesity a "social disease" may very well be a wise health policy, assuring and improving population health, especially if we address the social determinants of obesity, such as the food supply and marketing system. However, applyingbiomedical solutions to social problems may also have severe side effects. It can result in medicalization and enhance stigmatization and discrimination of persons based on appearance or behavior. Approaching social problems with biomedical means may also serve commercial and professionals' interests more than the health and welfare of individuals; it may make quick fix medical solutions halt more sustainable structural solutions. This urges health insurers, health care professionals, and health policy makers to be cautious. Especially if we want to help and respect persons that we classify and treat as obese.

Trends in e-commerce for the food marketing system.

Abstract E-commerce has emerged as a viable option for connecting agribusinesses and consumers within the food marketing system. The purpose of this review is to assess the current status and impact of e-commerce in the food marketing system. The review comprises issues related to adoption and use of computers and the internet by agribusinesses and the economic impact of e-commerce for these businesses. The review also covers aspects related to the importance of consumers' e-commerce food purchases, the factors affecting its usage and some new developments in the use of e-commerce to market food products using social media and mobile marketing. Regarding the adoption and use of e-commerce by agribusinesses, we find heterogeneous rates of adoption, use and impact across sectors and countries. For example, in the USA even though 67% of farms had access to the internet in 2013, only 14% reported conducting marketing activities over the internet. On the other hand, US Census data show that in 2012 the e-commerce value of food product manufacturing shipments accounted for more than 50% of their total value. Data from the USA and UK, two of the most advanced e-commerce markets in the world, indicate that food internet sales account for less than 4% of total sales. We conclude that while e-commerce has influenced the food marketing system, its impact does not appear to have been as dramatic and swift as had been expected. More research is needed in order to better understand the ways in which e-commerce affects agribusinesses and consumers. The review also identifies a paucity of e-commerce related statistical data.

Cost of Hospitalization for Foodborne Diarrhea: A Case Study from Vietnam.

Vietnam is undergoing a rapid social and economic developments resulting in speedy urbanization, changes in methods for animal production, food marketing systems, and food consumption habits. These changes will have major impacts on human exposures to food poisoning. The present case study aimed to estimate hospitalization costs of foodborne diarrhea cases in selected health facilities in Vietnam. This is a facility-based cost-of-illness study conducted in seven health facilities in Northern Vietnam. All suspect cases of foodborne diarrhea, as diagnosed by doctors, who admitted to the studied health facilities during June-August, 2013 were selected. Costs associated with hospitalization for foodborne diseases were estimated from societal perspective using retrospective approach. We included direct and indirect costs of hospitalization of foodborne diarrhea cases. During the study period, 87 foodborne diarrhea cases were included. On average, the costs per treatment episode and per hospitalization day for foodborne diarrhea case were US$ 106.9 and US$ 33.6 respectively. Indirect cost (costs of times to patient, their relatives due to the patient's illness) made up the largest share (51.3%). Direct medical costs accounted for 33.8%; direct non-medical costs (patient and their relatives) represented 14.9%. Cost levels and compositions varied by level of health facilities. More attentions should be paid on prevention, control of foodborne diarrhea cases in Vietnam. Ensuring safety of food depends on efforts of everyone involved in food chain continuum, from production, processing, and transport to consumption.

Agricultural marketing and food safety in China: a utility perspective

Purpose – The purpose of this paper is to explore Chinese food safety issues by analysing select incidents within he Chinese agricultural marketing system. Design/methodology/approach – A marketing utility framework is utilized to discuss some of the major food safety incidents in China and potential solutions are explored. Findings – The paper finds that food safety issues arise from problems of asymmetric information which leads to the profit seeking behaviour of agents distorting rather than enhancing the creation of one of the four types or marketing utility (time, form, place and possession). Additionally, structural causes found within the Chinese food marketing system have contributed to the food safety problems. Research limitations/implications – This is not an empirical research with numerical data. Originality/value – This study is one of the first to address Chinese food safety problems from an agricultural marketing utility perspective. Key anecdotes are used to support the claims made in this study.

Twenty Years of Country-of-Origin Food Labeling Research

Recent legislation by the United States and European Union governments now mandates the provision of country-of-origin (COO) information at the point of purchase for a variety of meats, fruits, vegetables, and other assorted food products. To better understand the significance of these regulatory changes, two decades of existing COO food labeling research are synthesized, reviewed, and discussed. The implications for two primary sets of actors within aggregate marketing systems, consumers and practitioners, are then discussed from a macromarketing perspective. Based on the reviewed literature, the authors conclude that little generalizable knowledge about COO food labeling effects exists, and further identify a lack of sufficient theoretical application and development as a primary reason. Consequently, the exact impact of mandatory (and voluntary) COO labeling initiatives for consumers and practitioners still remains unclear and highly debatable. Thus, as these initiatives continue to make country-of-origin labeling more commonplace around the world, it is crucial that additional theory-driven research be conducted, especially from a macromarketing perspective, to foster more generalizable knowledge about the complex role of COO information in aggregate food marketing systems.

Can we improve global food security? A socio-economic and political perspective

Ensuring global food security for a growing population remains a major challenge. This is especially true against the background of increasing food prices paired with growing income levels and changing demand patterns in the developing world. At the same time, climate change and the occurrence of more frequent and extreme natural disasters increase the vulnerability of rural farm households, negatively affecting agricultural production. Given the many dimensions of food security, no simple solution can be found. Promoting productivity of farming and increasing the efficiency of the food marketing system are effective measures contributing to rural development in developing countries. Policy reforms in agriculture and beyond help to reduce distortions and change consumers’ awareness with respect to food waste and resource use inefficiencies related to human diets. What is new in this context is the increasing link of agriculture with other sectors such as the energy and the financial markets. This calls for further research as additional pressure is being put on the global food system.

Covert distinction: how hipsters practice food-based resistance strategies in the production of identity

This paper reveals the processes by which food is used to express resistance to the mainstream and perform identity work within the hipster community of consumption. Based on the findings of a qualitative investigation, several resistance strategies involving food emerged: Vegetarian choices; Brand choices and avoidances; and Decommodification practices. We discuss how these strategies are framed by hipsters' discursive distaste for the commercial food marketing system but are, in practice, operationalised as subtle ways to achieve proper representation of their collective identity within the marketplace. Mundane consumption emerges as motor-force in allowing these consumers to surreptitiously maintain distinction and to protect their within-group identity from mainstream co-optation. We conclude by suggesting that the inconspicuous nature of mundane consumables such as food and alcohol products allows for idiosyncratic shared community performances that are covert and difficult for broader social currents to detect and co-opt.

A Macromarketing Perspective on Food Safety Regulation

This article discusses the implementation and diffusion of mandatory and voluntary food safety regulations from a marketing systems perspective, and specifically applies this framework to an analysis of the antecedents and implications of the Danish 2003 ban on trans-fatty acids (TFAs). The analysis is based on reviews of published material and on interviews with food marketers, nutrition experts, and policy makers. It is established that the ban was implemented due to scientific proof of health risks associated with the intake of TFAs but also as a result of aligned interests and efforts of the major stakeholders in the Danish food marketing system. Adding to the literature on diffusion of regulatory initiatives, the analysis shows that the Danish ban on trans-fats had—and still has—an important impact on trans-fat regulation in other European and overseas countries. In the final section, insights from the analysis are used as a starting point for a discussion of how public authorities, food marketers, and macromarketing researchers can apply the marketing systems perspective when designing, managing, and studying future cases of food safety regulation.

Vertical coordination, access to capital, and producer loyalty in the Polish dairy sector

AbstractNumerous studies have shown that processing and retail industries have actively assisted farmers in joining the modern food marketing systems. Data from the Polish dairy sector show that assistance is provided not only for the traditional‐channel farmers wishing to modernize, but also for farmers already included in the modern marketing channel. Two explanations can be provided to account for this phenomenon. One, even modern‐channel farmers may lack sufficient funds to maintain required quality/quantity on their own. Two, it may be the case that even after undertaking necessary adjustments, modern‐channel farmers are more likely to quit their relationship with a processor and turn elsewhere, in which case assistance is provided to prevent them from defecting. Using farm‐level data, we investigate the impact of supply chain modernization on farmers’ access to credit and their loyalty toward processors. Our results do not provide compelling evidence to support either hypothesis, suggesting at most a partial explanation for the existence of vertical linkages between processors and modern‐channel farmers in Poland.

The Challenge Facing Translation of Basic Science into Clinical and Community Settings to Improve Health Outcomes

Scientific research on human health must include deliberate efforts to translate the findings of basic biomedical research to the delivery of effective treatment and prevention services in real-world settings. When research is examined from bench to bedside, and bedside to community, it is clear that those working at different points along this continuum often have radically different frameworks that guide their research. Molecular researchers, guided by reductionist assumptions, devise experiments to isolate and explore single causal pathways. This approach has been extremely productive in revealing the molecular workings of the human body, has led to many new drugs and therapies, and holds the promise of making personalized medicine a reality. However, single causal elements often can have different effects when placed in the larger functioning system. Clinical scientists are trained to think at the level of whole organ systems and the interaction between different organ systems, whereas epidemiologists and social scientists assess the effect of contextual, environmental, and social factors. Figure 1 shows a model that integrates the behavioral health and life sciences; the model is intended to facilitate effective, efficient translation of scientific discoveries to improve population health. The center of the model shows the biobehavioral individual in the present moment. A temporal dimension runs left to right on the x-axis, and considers the past to future—from antecedents to behaviors to consequences. Last, a consideration of micro- to macrolevel systems is considered on the y-axis. The health and behavior of the individual in the present moment is influenced by a nexus of causal factors emanating from biological microsystems and environmental macrosystems. This multilevel, complex systems model can be applied to understanding the childhood obesity epidemic, as an example. American children consume a diet that is energy dense and nutrient poor. Over the past three decades, changes in food production, marketing, and distribution systems have created a price structure in which fresh fruits and vegetables have become relatively more expensive than nutrient-poor foods such as soda and fatty snacks. Additionally, portion sizes have increased and more food is consumed outside of the home. This Western diet stimulates the autonomic nervous system, increases oxidative stress, and alters our metabolic response to food, eventually leading to inflammation, insulin resistance, and increased risk for coronary artery disease, hypertension, type 2 diabetes, and cancer. Figure 1 Dietary changes leading to increased childhood obesity may be driven by changes in climate that promote or restrict agricultural crops such as fruits and vegetables; government policies; and concentration of food production, distribution, and marketing in the hands of large corporations. At the same time, economic recession and loss of middle-class buying power force people to shop for the least expensive foods. Simultaneously, changes in food consumption may alter neurobiological parameters that enhance craving for foods that are energy dense but nutrient poor. Emotional distress leads people to use food as a coping strategy, a behavior that is easily transmitted to children. Using the framework illustrated by Figure 1 encourages scientists to find new ways to collaborate by addressing how microlevel systems interact with macrolevel systems. For example, an integrated scientific team could consist of microbiologists and geneticists working with economists, public health scientists, and community partners and finally with farmers and grocery stores. The childhood obesity epidemic will not be slowed, let alone conquered, by individual researchers examining single causal pathways. Although the public health benefits could be significant, challenges exist. First, there must be equitable rewards for each collaborating entity. While the scientist is motivated by discovery, the farmer might be motivated by economic viability. How can the work be aligned to achieve both ends? Second, a common language must be forged. Third, designing multilevel, multisystems approaches, as suggested by Huang et al. (2009), requires a clear conceptualization of the end goal and often begins by examining macrolevel interventions connected to microlevel understanding of disease processes. Last, these approaches take time and long-term investment of collaborators. Often this need for time is at odds with grant-funding expectations and the process of tenure in academia. Using this framework to conduct intervention research involves a) framing a set of research questions using multilevel thinking, b) assembling a team with multidisciplinary expertise, c) identifying causal pathways that can be used to develop intervention strategies, d) integrating multiple intervention strategies, and e) using a broad-based measurement model to evaluate process and outcome. We hope this framework steers scientists away from the search for the single “magic bullet” and toward creating evidence for effective solutions to complex problems such as the childhood obesity epidemic.

Mycotoxins: analytical challenges.

Mycotoxins are natural secondary fungal metabolites produced on agricultural commodities. Mould and mycotoxin contamination may occur before harvesting, between harvesting and drying, and during storage. FAO has estimated that approximately 25% of the world’s crops are contaminated by molds and affected by mycotoxins, and the estimated loss extends to billions of dollars. Since fungi have a widespread distribution in the environment, mycotoxins are considered to be one of the most important contaminants in foodstuffs and feedstuffs. More than 500 different mycotoxins are known, but only a few present considerable food safety hazards. Aspergillus, Fusarium, and Penicilliumare the natural fungal flora associated with foods. The most important mycotoxins are aflatoxins, ochratoxin A, zearalenone, deoxynivalenol, fumonisins, and patulin. The common occurrence of mycotoxins in foodstuffs and feedstuffs poses a threat to the humans and animals health. Mycotoxins have acute toxic, mutagenic, carcinogenic, teratogenic, estrogenic, and immunotoxic effects in humans and animals. Despite occurrence of mycotoxin contamination of agricultural products in the developed countries, mycotoxin exposure have greatly been reduced in these populations due to the presence of a legislatively regulated food processing and marketing system and the application of different strategies. However, in the developingcountries, much of the population relies on subsistence farming or on unregulated local markets. Therefore, regulatory limits for major mycotoxin classes and selected individual mycotoxins have been established in many countries to protect the consumer from the harmful effects of these toxins. The requirement to apply these regulatory limits has prompted development of analytical methods for the identification and quantification of mycotoxins in different foodstuffs and feedstuffs. The techniques used for detecting known mycotoxins are quite advanced and range from methods for directly detecting the toxins themselves, to methods for indirectly detecting the toxins. Modern technologies used for the detection of mycotoxins include mass spectrometry-based assays, ambient ionization mass spectrometry, electrochemical immunoassays, piezoelectric sensors, enzyme inhibition assays, biosensor arrays, and fluorescence polarization immunoassays. However, it is impossible to use one single method for analysis of mycotoxins due to the variety of chemical structures. Therefore, many analytical methods have been developed and validated. The demand for a fast, simultaneous and accurate determination of multiple mycotoxins, along with the heterogeneity of food matrices, creates extreme challenges for routine analysis. For simultaneous identification and determination of multiple mycotoxins, highly sophisticated multianalyte methods based on liquid chromatography coupled with multiple-stage mass spectrometry have been developed. Rapid analytical techniques such as infrared spectroscopy, fluorescence polarisation immunoassay, and optical biosensors, could be useful alternatives for screening and cost-effective quantitative determination of mycotoxins in the future. Rapid tests such as ELISAs, dipstick assays and lateral flow devices will continue to play a major role in routine analysis and for on-line applications. Molecularly imprinted polymers, evanescent wave technology, and microarray technology are among other emerging technologies for mycotoxin analysis. Although enormous progress has been achieved in mycotoxin analysis, there are still major challenges in this regard. Food is not necessarily safe, just because of the ruling out of the presenceof well-known mycotoxins. They might still be there in conjugated form, including masked or bound mycotoxins. Sampling is the largest source of variability associated with the mycotoxin analysis and the most crucial step in obtaining reliable results. In conclusion, although methods used for the detection of mycotoxins are quite advanced, the need remains for the exploration of novel detection technologies, for comprehensive validation of such technologies and for methods with increased throughput. Emphasis should also be laid towards the development of newer low-cost instruments for mycotoxin detection, which are reliable, portable, and easy to handle at field levels. Hassan Yazdanpanah is currently working as an associate professor of Toxicology, at the Department of Pharmacology and Toxicology, School of Pharmacy, ShaheedBeheshti University of Medical Sciences, Tehran, Iran. He could be reached at the following e-mail address: Hassan.yazdanpanah@gmail.com

Consumer Risks and New Food Systems in Urban China

Informed by sociocultural theories of risk, this research explores the responses of urban consumers to the globalization and liberalization of food marketing systems in China. Based on food shopping observations and focus groups in four major cities, the study investigates how consumers identify and navigate risk in a rapidly changing marketplace. The findings suggest that, while consumers have legitimate worries related to the safety of their food supply in the marketizing economy, the newly diverse food retail and product options also provide new strategies to actively manage risk. The findings substantiate the importance of geographical, political, and historical contexts for understanding how consumers interpret risks in the face of transitional marketing systems.

Real and perceived risks for mycotoxin contamination in foods and feeds: challenges for food safety control.

Mycotoxins are toxic compounds, produced by the secondary metabolism of toxigenic moulds in the Aspergillus, Alternaria, Claviceps, Fusarium, Penicillium and Stachybotrys genera occurring in food and feed commodities both pre- and post-harvest. Adverse human health effects from the consumption of mycotoxins have occurred for many centuries. When ingested, mycotoxins may cause a mycotoxicosis which can result in an acute or chronic disease episode. Chronic conditions have a much greater impact, numerically, on human health in general, and induce diverse and powerful toxic effects in test systems: some are carcinogenic, mutagenic, teratogenic, estrogenic, hemorrhagic, immunotoxic, nephrotoxic, hepatotoxic, dermotoxic and neurotoxic. Although mycotoxin contamination of agricultural products still occurs in the developed world, the application of modern agricultural practices and the presence of a legislatively regulated food processing and marketing system have greatly reduced mycotoxin exposure in these populations. However, in developing countries, where climatic and crop storage conditions are frequently conducive to fungal growth and mycotoxin production, much of the population relies on subsistence farming or on unregulated local markets. Therefore both producers and governmental control authorities are directing their efforts toward the implementation of a correct and reliable evaluation of the real status of contamination of a lot of food commodity and, consequently, of the impact of mycotoxins on human and animal health.

A speculative bubble in commodity futures prices? Cross‐sectional evidence

AbstractRecent accusations against speculators in general and long‐only commodity index funds in particular include: increasing market volatility, distorting historical price relationships, and fueling a rapid increase and decrease in the level of commodity prices. Some researchers have argued that these market participants—through their impact on market prices—may have inadvertently prevented the efficient distribution of food aid to deserving groups. Certainly, this result—if substantiated—would counter the classical argument that speculators make prices more efficient and thus improve the economic efficiency of the food marketing system. Given the very important policy implications, it is crucial to develop a more thorough understanding of long‐only index funds and their potential market impact. Here, we review the criticisms (and rebuttals) levied against (and for) commodity index funds in recent U.S. Congressional testimonies. Then, additional empirical evidence is added regarding cross‐sectional market returns and the relative levels of long‐only index fund participation in 12 commodity futures markets. The empirical results provide scant evidence that long‐only index funds impact returns across commodity futures markets.

Impact of mycotoxins on human health in developing countries

Adverse human health effects from the consumption of mycotoxins have occurred for many centuries. Although mycotoxin contamination of agricultural products still occurs in the developed world, the application of modern agricultural practices and the presence of a legislatively regulated food processing and marketing system have greatly reduced mycotoxin exposure in these populations. At the mycotoxin contamination levels generally found in food products traded in these market economies, adverse human health effects have largely been overcome. However, in the developing world, where climatic and crop storage conditions are frequently conducive to fungal growth and mycotoxin production, much of the population relies on subsistence farming or on unregulated local markets. The extent to which mycotoxins affect human health is difficult to investigate in countries whose health systems lack capacity and in which resources are limited. Aflatoxin B1, the toxin on which major resources have been expended, has long been linked to liver cancer, yet its other effects, such as immune suppression and growth faltering previously observed in veterinary studies, are only now being investigated and characterized in human populations. The extent to which factors such as immune suppression contribute to the overall burden of infectious disease is difficult to quantify, but is undoubtedly significant. Thus, food safety remains an important opportunity for addressing current health problems in developing countries.

Food Safety in Southeast Asia: Challenges Facing the Region

The paper tackles the issue of food safety, which is generally defined as the assurance that food will not cause harm to the consumer when it is prepared and/or eaten according to its intended use. Echoing the recognition by the Food and Agriculture Organization (FAO) in 1996 that food safety is an element of food security, the paper discusses the importance of the food trade in the economies of many countries, as reflected in the health, economic and political consequences that arise when the food safety system of a country fails. It focuses on the Southeast Asian experience—their food marketing system, the current food safety situation, as well as the complexities brought about by the concern for food safety. Highlighted are the challenges in establishing and strengthening the key components of a food control system to ensure safety along the whole food chain continuum, the relationship between Codex standards and related texts, as well as the enormous responsibility faced by Southeast Asian countries in meeting the obligations of the World Trade Organization. Finally, several recommendations are outlined, stressing the importance of carrying out a needs assessment, participating more actively in Codex work, and taking advantage of the existing collaborative initiatives undertaken, including those in ASEAN, and the various technical assistance available for capacity-building in food safety.

Food Security in Indonesia: Current Challenges and the Long-Run Outlook

In the long run-- over the past four decades--improvements in food security in Indonesia have generally been driven by pro-poor economic growth and a successful Green Revolution, led by high-yielding rice varieties, massive investments in rural infrastructure, including irrigation, and ready availability of fertilizer. In the short run, food security in the country has been intimately connected to rice prices. After more than two decades of stabilizing domestic rice prices around the long-run trend of prices in the world market, Indonesia emerged from the devastating financial crisis in 1998 with domestic rice prices much higher than world prices and much higher than long-run trends of real prices in rupiahs. Although the current political rhetoric pushing for even higher prices uses food security as the rationale (i.e., they will cause greater self-sufficiency in rice), in fact few productivity gains are now available to rice farmers, so their gains will be consumers' loses. High rice prices have a major impact on the number of individuals living below the poverty line and on the quality of their diet. The paper reviews research on the impact of rice prices on the poor, on real wages in rural and urban areas, and on the broader macroeconomic consequences for investments in labor-intensive manufacturing. Discussion then focuses on how political and economic circumstances have changed since price stabilization, implemented by the national food agency (Bulog), balanced the needs of producers and consumers as Indonesia's approach to food security. The most important current challenge for the country's future food security is re-starting rapid, pro-poor growth. An additional challenge on the horizon is the supermarket revolution, which is rapidly changing the basic structure of Indonesia's food marketing system. Within a decade well over half of Indonesia's rice is likely to be sold in supermarkets, thus transferring to the private sector a supply-management role that had historically been a public sector activity.