Gardebroek, C.

NARCIS 

Agricultural Economics and Rural Policy

Wageningen Yield 

32 | Food for all | Dining with Planet Earth
1 Dining with Planet Earth
Agricultural 
economics and 
rural policy
Soaring food prices frequently dominate the world news.  
High prices are often associated with increasing hunger and  
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and security varies with time and place, however.
Food prices are determined by supply and demand. Supply and demand, however, hardly react to price 
changes, both are price inelastic.Conversely, small 
shifts in demand or supply lead to substantial changes 
in market prices. As demand increases – through 
population growth and higher disposable incomes – 
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Reversed process
Food production has grown faster than global food 
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ward trend in food prices up to 2000. However, since 
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(2.3 percent per year) will remain ahead of the world's 
population (1.0%) until 2021. Other drivers of demand 
growth, such as increases in wealth and demand for 
biofuels and livestock feed, are therefore important 
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for every country and individual. When the prices of 
maize, wheat and rice rose sharply in 2008, there were 
worldwide protests, leaving several dead and wounded 
in places such as Cameroon. In Haiti, Egypt, Mauritania 
and Mozambique, demonstrations against high food 
prices led to looting and clashes with the police. 
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food warehouses. High food prices caused hunger and 
poverty in these low-income countries. 
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of the developed world, where the amount that people 
spend on food is relatively low. In the Netherlands, 
Wheat Maize Rice+14% +11% ???
?????-30%
-49%
-23%
+90%
+52%
Wageningen UR | 33
Changes in the price of food crops 
at various locations around the world between July 2011 and July 2012.
Source: FAO and GIEWS, 2012
Average price change
El Salvador
Sudan
Mozambique
MalawiNicaragua
34 | Food for all | Dining with Planet Earth
Growth food prices
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World Bank both regularly publish statistics, 
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prices of a number of commonly traded food 
crops. Both institutions report for 2012 that 
food prices are about as high as they were  
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reported record prices for maize and soya 
this summer of 2012.
50
40
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Source: USDA, 2011 
250
200
150
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2000 2001 2002 2003 2004 2005 2006 ???? 2008 2009 2010 2011 2012
Source: FAO
Food Price Index
an indication of relative international world food prices.  
2002-2004 = 100
Percentage of income spent on food
Wageningen UR | 35
about 14 percent of our total household budget is 
earmarked for food. Moreover, the cost of primary 
foods – grain, sugar, etc. – only partly determines  
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transporta tion, processing and trading costs are  
all important components of the consumer price.  
All of these elements dampen the impact of prices  
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food banks in Western countries is largely the result of 
other problems, such as a loss of jobs and income,  
high housing costs and debt.
Consuming less
In developing countries, poor households spend  
a large part of their income on largely unprocessed 
food. People thus respond to higher food prices by 
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base their diet increasingly on staple crops like grain 
and sugar. (Food) poverty in these countries varies 
geographically. Local conditions – harvest, stockpiling, 
policies – determine the food prices, which are not 
always in line with the world market and prices. 
Research of Koos Gardebroek, associate professor  
of agricultural economics and rural policy, shows that, 
even within a region, prices may react differently to 
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major commercial centres, the greater the impact of 
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fall less rapidly. However, it can also cause the price 
shock to be that much greater.
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was established in research by the FAO. While the  
price of rice, maize and wheat on the world market 
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between 2011 and 2012, the price of rice increased  
by 90 percent in Malawi and fell by 23 percent in 
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in Sudan and 30 percent cheaper in El Salvador.  
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in Malawi, while its price fell by 49 percent in 
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the prevention of hunger appeared limited, partly 
because local prices barely changed in China, India  
and Indonesia.
Price effect biofuels
In addition to supply, demand is also relevant.  
In this regard economists do not just look at the 
current situation in the food market. Although the 
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– i.e., the trader and the farmer agreeing on a price 
before the harvest, giving the farmer security and the 
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impact on food prices as well. A minor part of the 
increase in demand is currently driven by biofuels. 
Food crops such as maize and sugar are used for the 
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crops being converted into energy is relatively small, 
however). Since this market is growing – due among 
other things to compulsory requirements by  
govern ments in Europe, the US and Brazil – it creates 
an upward pressure on prices.
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food prices, as they encourage farmers to increase  
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higher yields, they can invest in fertiliser and other 
inputs to increase production. It also becomes more 
attractive to use fallow land. In the long term, high 
food prices can lead to increased spending on R&D in 
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In the Netherlands, about 14 percent of our  
total household budget is earmarked for food
36 | Food for all | Dining with Planet Earth
Biobased economy: getting more out of biomass 
Agriculture and nature management are increasingly
linked to other economic sectors through the  
development of the biobased economy. Deploying green 
raw materials (biomass) as components in chemical 
products and in energy production opens a whole  
new world of possibilities for the use of biomass and 
the gradual replacement of fossil fuels (coal, oil,  
natural gas). But how do we guarantee food safety  
in such a biobased economy?
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start with plant production of biomass in agriculture, 
horti culture and forestry, and with the organic waste 
released during agricultural production and nature 
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materials can be processed into components for food, 
feed and biobased products (chemicals, materials and 
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approach is that it makes use of as much of the plant 
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material always be available as green manure in order 
to maintain the quality of the soil.
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con - verted into a wide range of products. New  
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(molecular) structures of biomass in the best possible 
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as chemical building blocks for semi-manufactured and  
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broken down to the simplest small molecules, which 
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however, the functional groups remain intact, which 
saves energy and power consumption across the 
production process.
Wageningen UR provides an important contribution  
to the development of the biobased economy in an 
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cooperates with knowledge users, work on new  
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technologies together with industry. We also generate 
knowledge for use by policymakers and support the 
public debate with factual information. Our knowledge 
users are both governments and international
companies in the chemical industry, materials 
production & processing, electricity & fuel production, 
and the agricultural, food and horticulture sectors.
Within the Biobased Economy research programme of 
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the various biomass sources, conversion processes  
and chain development to the various applications. 
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and applied at a local, regional, national and global 
scale. Wageningen UR charts the opportunities and 
barriers on each level and develops the technological 
knowledge required to achieve new biobased value 
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opportunities and restrictions, are relevant to 
technology, logistics, process-related product 
development and the economy, as well as in the  
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always play an important role and there is a  
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Optimised cooperation
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cooperation between the production of food, feed, 
biobased chemicals, materials, biofuels and energy.  
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focused on innovation and market implementation. 
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crops and soil quality are relevant within this R&D 
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knowledge: Economic feasibility and development  
of business cases, competing claims, changes in land 
use, and environmental issues such as the development 
of sustainability indicators, related greenhouse gas 
emissions and risk assessment for new biobased chains.
In terms of food production, economic development 
constitutes an important issue. While food and feed 
have a high value in the sustainable biobased value 
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of biomass in the best possible way
Biofuel production
Lignocellulose-rich crops, such as the fast growing miscanthus, 
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CO2
energy
materials
chemicals
fuel
energy
Wageningen UR?????
chain, there is also a large and growing market for 
other biobased applications. It is necessary to ensure 
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producers is to realise a level of production of a 
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current and future food needs. At the same time,  
the sector faces the challenge of optimising the 
production of biomass to allow the greening of the 
fossil fuel economy. Wageningen UR supports this 
process, among other things as a co-developer of 
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non-edible components and residues are processed  
into quality products in chemicals, materials and  
energy production.
Biobased economy
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economy in which food, feed, 
chemicals, materials, transport 
fuels, electricity and heat are 
produced economically and 
sustainably from green resources: 
resources that are renewable. 


Agricultural Economics and Rural Policy

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