The Role of Biofuel Policies on Grain and Oilseed Prices

H. de Gorter, D. Drabik, E.M. Kliauga

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract







Based on forecasts of global population growth, food security will remain an important economic development issue over the next several decades. In addition, real food prices have risen in recent years after decades of decline, bringing the issue of food security even further into the public spotlight. However, there is no global food shortage: the problem is one of moving food, often across borders, from surplus production areas to deficit ones at prices that low-income consumers in developing countries can afford. Trade can be an excellent buffer for domestic fluctuations in food supply. World output of a given food commodity is far less variable than output in individual countries so increased trade integration holds considerable potential to stabilize food prices, boost returns to farmers and reduce the prices faced by consumers. Trade liberalization protects national food markets against domestic shocks by allowing more food to be imported in times of shortage and exported in periods of plenty. Historically, however, most countries have chosen to take the opposite approach by restricting imports of food and discouraging exports to keep domestic markets isolated from international shocks. Food commodity markets, therefore, remain highly distorted despite the wave of liberalization that has swept world trade since the 1980s. In addition to examining the determinants of recent food price spikes, Trade Policy and Food Security explores the impact of food prices on economic welfare, and how the effect of price changes on food security and economic welfare in developing countries can be mitigated through appropriate national policies at the border. It highlights the importance of both the extension and continued application of existing WTO disciplines on trade-distorting agricultural trade policies as a key resolution to the collective action problem witnessed during the recent food price spikes, whereby unilateral border policies—especially export controls—simply exacerbated the initial price increases.
Original languageEnglish
Title of host publicationTrade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices
EditorsI. Gillson, A. Fouad
Place of PublicationWashington DC, USA
PublisherWorld Bank Group
Pages37-63
Number of pages298
ISBN (Print)9781464803055
DOIs
Publication statusPublished - 2014

Fingerprint

Food
Oilseeds
Biofuels
Food prices
Food security
Shortage
Economic welfare
Developing countries
Trade policy
Commodity markets
Import
Surplus
Domestic market
Food markets
World trade
Agricultural trade policy
Population growth
Price changes
Trade liberalization
Commodities

Cite this

de Gorter, H., Drabik, D., & Kliauga, E. M. (2014). The Role of Biofuel Policies on Grain and Oilseed Prices. In I. Gillson, & A. Fouad (Eds.), Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices (pp. 37-63). Washington DC, USA: World Bank Group. https://doi.org/10.1596/978-1-4648-0305-5
de Gorter, H. ; Drabik, D. ; Kliauga, E.M. / The Role of Biofuel Policies on Grain and Oilseed Prices. Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices. editor / I. Gillson ; A. Fouad. Washington DC, USA : World Bank Group, 2014. pp. 37-63
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de Gorter, H, Drabik, D & Kliauga, EM 2014, The Role of Biofuel Policies on Grain and Oilseed Prices. in I Gillson & A Fouad (eds), Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices. World Bank Group, Washington DC, USA, pp. 37-63. https://doi.org/10.1596/978-1-4648-0305-5

The Role of Biofuel Policies on Grain and Oilseed Prices. / de Gorter, H.; Drabik, D.; Kliauga, E.M.

Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices. ed. / I. Gillson; A. Fouad. Washington DC, USA : World Bank Group, 2014. p. 37-63.

Research output: Chapter in Book/Report/Conference proceedingChapter

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AU - Drabik, D.

AU - Kliauga, E.M.

N1 - doi werkt niet

PY - 2014

Y1 - 2014

N2 - Based on forecasts of global population growth, food security will remain an important economic development issue over the next several decades. In addition, real food prices have risen in recent years after decades of decline, bringing the issue of food security even further into the public spotlight. However, there is no global food shortage: the problem is one of moving food, often across borders, from surplus production areas to deficit ones at prices that low-income consumers in developing countries can afford. Trade can be an excellent buffer for domestic fluctuations in food supply. World output of a given food commodity is far less variable than output in individual countries so increased trade integration holds considerable potential to stabilize food prices, boost returns to farmers and reduce the prices faced by consumers. Trade liberalization protects national food markets against domestic shocks by allowing more food to be imported in times of shortage and exported in periods of plenty. Historically, however, most countries have chosen to take the opposite approach by restricting imports of food and discouraging exports to keep domestic markets isolated from international shocks. Food commodity markets, therefore, remain highly distorted despite the wave of liberalization that has swept world trade since the 1980s. In addition to examining the determinants of recent food price spikes, Trade Policy and Food Security explores the impact of food prices on economic welfare, and how the effect of price changes on food security and economic welfare in developing countries can be mitigated through appropriate national policies at the border. It highlights the importance of both the extension and continued application of existing WTO disciplines on trade-distorting agricultural trade policies as a key resolution to the collective action problem witnessed during the recent food price spikes, whereby unilateral border policies—especially export controls—simply exacerbated the initial price increases.

AB - Based on forecasts of global population growth, food security will remain an important economic development issue over the next several decades. In addition, real food prices have risen in recent years after decades of decline, bringing the issue of food security even further into the public spotlight. However, there is no global food shortage: the problem is one of moving food, often across borders, from surplus production areas to deficit ones at prices that low-income consumers in developing countries can afford. Trade can be an excellent buffer for domestic fluctuations in food supply. World output of a given food commodity is far less variable than output in individual countries so increased trade integration holds considerable potential to stabilize food prices, boost returns to farmers and reduce the prices faced by consumers. Trade liberalization protects national food markets against domestic shocks by allowing more food to be imported in times of shortage and exported in periods of plenty. Historically, however, most countries have chosen to take the opposite approach by restricting imports of food and discouraging exports to keep domestic markets isolated from international shocks. Food commodity markets, therefore, remain highly distorted despite the wave of liberalization that has swept world trade since the 1980s. In addition to examining the determinants of recent food price spikes, Trade Policy and Food Security explores the impact of food prices on economic welfare, and how the effect of price changes on food security and economic welfare in developing countries can be mitigated through appropriate national policies at the border. It highlights the importance of both the extension and continued application of existing WTO disciplines on trade-distorting agricultural trade policies as a key resolution to the collective action problem witnessed during the recent food price spikes, whereby unilateral border policies—especially export controls—simply exacerbated the initial price increases.

U2 - 10.1596/978-1-4648-0305-5

DO - 10.1596/978-1-4648-0305-5

M3 - Chapter

SN - 9781464803055

SP - 37

EP - 63

BT - Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices

A2 - Gillson, I.

A2 - Fouad, A.

PB - World Bank Group

CY - Washington DC, USA

ER -

de Gorter H, Drabik D, Kliauga EM. The Role of Biofuel Policies on Grain and Oilseed Prices. In Gillson I, Fouad A, editors, Trade Policy and Food Security; Improving Access to Food in Developing Countries in the Wake of High World Prices. Washington DC, USA: World Bank Group. 2014. p. 37-63 https://doi.org/10.1596/978-1-4648-0305-5