The rapid transition of livestock farming is taking place in an institutional vacuum. Background documents for Part I of the report were prepared by Klaas Dietze (FAO); Jeroen Dijkman (FAO) and Keith Sones (Keith Sones Associates); Klaus Frohberg (University of Bonn); Jørgen Henriksen (Henriksen Advice, Copenhagen); Brian Perry (University of Oxford) and Keith Sones (Keith Sones Associates); Robert Pym (University of Queensland); Prakash Shetty (University of Southampton); Farzad Taheripour, Thomas W.
LIVESTOCK IN THE BALANCE
Livestock in the balance
Livestock contributes 40 percent to the global value of agricultural production and supports the livelihoods and food security of nearly a billion people. Due to the increasing geographical concentration of livestock farming, the manure production of animals often exceeds the absorption capacity of the local area.
Livestock sector change
There is therefore an urgent need to improve the resource use efficiency of livestock production and to reduce the negative environmental externalities produced by the sector. In many parts of the world, the transformation of the livestock sector is taking place in the absence of strong governance, leading to market failures related to the use of natural resources and public health.
Structure of the report and key messages
Change in the livestock sector
Consumption trends and drivers 1
Brazil has also experienced a rapid expansion in the consumption of livestock products – meat consumption per capita. In general, in developed countries, the increase in per capita consumption of livestock products has been much more modest.
Production trends and drivers
Note: The totals for developing countries and the world include some countries that are not included in the regional aggregates. Note: The totals for developing countries and the world include some countries that are not included in the regional aggregates.
Trade trends and drivers
As a result, technological innovations in the livestock sector have been relatively less accessible and useful to smallholder farmers. Box 2 shows how all these various technological advances contributed to increased production in the commercial poultry industry.
Outlook for consumption, production and trade
Most of the increase is expected to occur in developing countries, with meat consumption growing by 28 percent, compared to 10 percent at most in developed and OECD countries. The demand for oilseed meal is expected to grow at an annual rate of 3.8 percent in the non-OECD countries and 0.7 percent in the OECD countries.
Livestock sector diversity
They contribute about 17 percent of the global beef and veal supply, about the same share of the sheep and goat meat supply and 7 percent of the global milk supply as their main outputs. Globally, about 48 percent of global beef production, 53 percent of milk production and 33 percent of sheep meat production TABLE 7.
Transformation of livestock systems
The resulting interdependence between firms in the animal food supply chain creates significant pressure for coordination beyond that provided by cash market transactions. The importance of traditionally important livestock functions, such as the provision of traction energy and manure, acting as assets and insurance, and the performance of socio-cultural functions, is decreasing.
Challenges from continued livestock sector growth
When livestock production was based on locally available feed resources, such as natural pasture and crop residues, the distribution of ruminants was almost entirely determined by the availability of such resources. As a result of such processes, livestock production became more geographically clustered, with production units and.
Key messages of the chapter
Livestock, food security and poverty reduction
The livestock sector is one of the fastest growing segments of the agricultural economy, especially in developing countries. The expansion of such trends across the entire livestock sector will have major implications for poverty reduction and food security.
Livestock and livelihoods
Percentage of rural households owning livestock, share of income from livestock and number of livestock per household, by country. 2 The number of livestock is calculated using the tropical livestock unit (TLU), which is equivalent to a 250 kg animal.
Livestock and food security
The fourth dimension of food security – utilization – is particularly important in the case of livestock and food of animal origin. In the European Union (EU), the cost of obesity to society is estimated at approximately 1 percent of GDP (WHO, 2006).
Livestock sector transformation and the poor
Sometimes these dietary shifts occur so quickly that both forms of malnutrition coexist in the same population. Pacific Island countries, which have the highest rates of obesity in the world (International Obesity Taskforce, 2009), have taken drastic measures to address diet-related health concerns.
Livestock and poverty alleviation
In many developing countries, growth in the livestock sector actually leads to growth in GDP (see Box 8). Growth in demand will continue to be a major factor driving development in the livestock sector in the future.
Competitiveness and the livestock sector
This implies that a vision of the livestock sector as driven primarily by exogenous factors may mislead policy development. Analysis of the overall benefits of smallholder contract farming has thus shown mixed results.
Livestock policies for sector transition
Livestock and the environment
Livestock production systems and ecosystems
The strongest impact is being felt in those countries that are actively pursuing efforts to increase the use of biofuels (eg the United States of America and European Union countries), as well as those countries that are closely linked to the economy global agriculture. Of these, 1,491 are classified as “at risk.”1 The true figure is likely to be even higher, as population data is not available for 36 percent of breeds.
Livestock and climate change
Feed production causes emissions in the categories of agriculture, forestry (with land use change), transport and energy. In non-pastoral systems characterized by animal confinement (often in climate-controlled buildings), the direct impacts of climate change can be expected to be limited and mostly indirect.
Improving natural-resource use by livestock production
They can be spent on specific types of farming that are important for protecting or improving the environment or improving the quality and marketing of agricultural products. The rural development regulation for the period 2007–2013 offers further opportunities to strengthen the contribution of the CAP to the improvement of the environment.
Dealing with climate change and livestock
Livestock and human and animal health
This chapter reviews some of the major problems and controversies surrounding animal health and food safety issues and discusses alternatives for controlling livestock diseases and mitigating their effects. This includes increased local capacity, improved cooperation between national and international animal health and food safety authorities (including greater transparency about the occurrence of animal diseases) and investment in technologies to reduce risk.
Economic and human-health threats related to livestock disease
Many of these differences are explained by the changing production and marketing systems, the persistence of industrial and traditional systems and the resulting imbalances in national animal health and food safety systems. Such countries generally have less robust animal health and food safety systems; they often focus their limited resources on the problems of the small portion of the livestock sector engaged in international trade, while ignoring the needs of poorer livestock farmers.
Disease control and risk management
Conclusions: balancing society’s objectives for livestock
The sector is consuming a large portion of the world's resources and contributing to a significant portion of global GHG emissions. In economic terms, the positive and negative externalities long generated by the livestock sector must be internalized so that producers and consumers pay the real price of the impacts of livestock production on natural resources and the environment.
Balancing the needs of different smallholders
Animal health systems must help reduce the growing risk of human pandemics from diseases originating in animals and should better deal with the endemic diseases that continually undermine the livelihoods of the poor. Rich and poor producers face different risks and incentives in the area of livestock health.
Balancing opportunities against risks
When and where small-scale livestock farmers face rising opportunity costs for their labor, they naturally leave the industry and move to more rewarding employment elsewhere. Concerns arise when competitive forces push people out of the industry before the wider economy can create alternative employment opportunities.
Balancing food security and nutrition
This is a natural part of the development of the agricultural sector and can be considered a sign of progress. Broader rural development policies can promote a dynamic economy that offers attractive alternatives for livestock farmers who cannot compete in this sector.
Balancing the trade-offs among systems, species, goals and impacts
Balancing objectives in different societies
In later stages of development, policy emphasis is likely to shift to other objectives, such as: providing food for growing, especially urban, populations; In advanced economies, in which livestock production represents a small part of the overall economy, societal concerns are likely to focus heavily on human health, food security and the environment.
The way forward: towards an agenda for action for the livestock
There is a clear need to focus international attention on the livestock sector and the challenges it faces. The development of an agenda for action in the livestock sector, supported by governments, international institutions, multilateral and bilateral donors and civil society stakeholders, is a crucial first step towards a livestock sector characterized by: better governance; clearer focus on problems and issues; a more inclusive development process; levels of investment commensurate with the importance of the sector and the challenges it faces; and improved international cooperation.
Key messages of the report
Wider rural development strategies aimed at creating off-farm employment for women, men and youth can facilitate their transition from the livestock sector. The governance of the livestock sector needs to be strengthened to ensure that its development is environmentally sustainable.
WORLD FOOD AND AGRICULTURE IN REVIEW
This is a period of grave concern about the fate of the world's hundreds of millions of poor and hungry people. Will resumed growth of the world economy lead to a renewed phase of rising food prices.
TRENDS IN GLOBAL FOOD SECURITY 7
Those most affected by the crisis of high food prices – landless rural households, female-headed households and the urban poor (FAO, 2008c) – are in a particularly precarious situation. Both rural and urban areas are being affected by a reduction in multiple sources of income, including remittances.
In addition, these prices have been relatively most affected during the recession due to their strong reliance on income sensitivities. The main causes of food price declines have been widely attributed to faltering consumer/import demand during global recession and credit-constrained conditions, as well as lower demand for biofuel feedstocks as a result of lower energy prices.
DOMESTIC FOOD PRICES IN DEVELOPING COUNTRIES
An example is leather and leather used in durable consumables such as cars, demand for which has fallen drastically since the start of the global recession. There remains great uncertainty as to how these factors will evolve in the near term and affect the future of agricultural markets.
MEDIUM-TERM PROSPECTS FOR INTERNATIONAL AGRICULTURAL
However, supply-side indicators have also made an important contribution to price declines, especially given the significant response to crop supply in 2008, and to lower input prices, particularly for transport.
AGRICULTURAL PRODUCTION
In about 80 percent of the countries covered by the database, last nominal domestic price quotations3 were higher than 12 months earlier. For wheat and wheat products, 71 percent of the surveyed countries show prices that are higher than 12 months ago.
AGRICULTURAL TRADE
Agricultural commodity prices fell sharply with the onset of the global recession in the second half of 2008. Brazil's net food surplus has grown almost fourfold since 2000 and is expected to grow another 50 percent in the next ten years.
POLICY RESPONSES TO HIGHER FOOD PRICES AND THEIR IMPACT
Second, some policy measures may simply be ineffective, if not counterproductive, in addressing the central problem – the impact of high food prices on poor consumers. Note: Index of real exports using 1999-2001 reference prices for weighted exports by commodity, measures changes in exports in constant US dollars.
Trade-related measures
It concludes by presenting a simple scenario analysis based on the OECD-FAO Aglink-Cosimo model to assess the nature and extent of the impact of these measures on agricultural markets. However, the size of the price reduction tends to be less pronounced than for export bans and taxes, as the extent of the reduction is limited by the size of the existing duty or tax.
Production policies
However, targeting is not as effective as it might be in the case of targeted safety net programs. Kazakhstan's government planned to inject USD 3 million into the agricultural sector to help farmers withstand the impact of the global credit crisis.
Consumption policies
Stock policies
IMPACT OF POLICY RESPONSES ON GLOBAL MARKETS
Production policy measures, relatively minor in the case of rice markets, are not expected to have. In the case of wheat, border measures are estimated to be much less important than for rice.
CONCLUSIONS
The most distortive policies in the case of rice were border policies implemented in 2007 and 2008. However, in the case of policies that were only in place for short periods, this procedure may have had the effect of underestimating the size of the short-term effects by spreading them over two years.
STATISTICAL ANNEX
The totals for developing countries and the world include some countries that are not included in the regional aggregates. The totals for developing countries and the world include some countries that are not included in the regional aggregates.
AGRICULTURE
