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THE LIVESTOCK REVOLUTION: Making livestock value chains work better for the poor
Alejandro Acosta Livestock Policy Officer FAO
Global Agenda for Sustainable Livestock Development Cali, October 2014
BY 2050…..
The global population
will reach 9.6 billion
In developing countries GDP will
grow at 5.5%
The demand for livestock products will grow
Meat consumption will
increase by 77% Dairy consumption will
increase by 81%
This phenomenon has been known as: THE LIVESTOCK REVOLUTION
In many developing countries households are Producers and Consumers of livestock products
Close to
1 billion of the poorest depend upon livestock
…… and spend
30% of their income to purchase livestock products
In many developing countries households are Producers and Consumers of livestock products
But…..ensuring Efficient Value Chains is a fundamental precondition
The livestock revolution is an unique opportunity to accelerate the rate of poverty reduction and inequality
Price is the main instrument by which different actors of the value chain are linked.
Therefore, an adequate
transmission of prices
is fundamental to increase the level of
efficiency
US consumers and producers whole milk price index
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PPI CPI
Price is the main instrument by which different actors of the value chain are linked.
However, in many countries the transmission of prices in livestock value chains is inefficient
Panama consumers and producers whole milk price index
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t-20
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PPI CPI
However, in many countries the transmission of prices in livestock value chains is inefficient
Panama consumers and producers whole milk price index
0.5
1
1.5
2
2.5
3
Jan
-200
0
May-200
0
Sep
t-20
00
Jan
-200
1
May-200
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t-20
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May-200
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Sep
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May-200
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May-200
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May-200
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May-200
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Sep
t-20
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-201
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May-201
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Jan
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May-201
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Jan
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May-201
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Sep
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May-201
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Sep
t-20
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PPI CPI
However, in many countries the transmission of prices in livestock value chains is inefficient
Vertical Transmission of Milk Prices: Are Small Dairy Producers Efficiently Integrated into Markets?
An increase of 1.83 % Consumer 17% per month 13% per month Producer An increase of 1% `
Welfare Policy Implications
P*
QD QS*
S
P
Q
WL P
D
Producers and consumers are not benefiting from price changes as much as they would under a more efficient market scenario.
Conclusion
If price signals are not transmitted efficiently to producers and consumers, the livestock revolution might not yield the expected results to reduce poverty and inequality.
Recommendation
Stakeholders trying to increase the contribution of the livestock sector to poverty reduction and inequality should pay close attention to measures aimed at increasing the efficiency level of livestock value chains.
Making livestock markets work better for the poor: THE LIVESTOCK REVOLUTION
Thank you
