Some neglected issues in food demand analysis: retail-level demand, health information and product quality

Food demand analysis is dominated by the econometric estimation of demand systems based on aggregate market data and steady progress has been made in analytical techniques. Yet some issues have been neglected in food demand analysis which are crucial for understanding recent consumption trends in industrialised countries. Three of these issues are dealt with here: analysis of food demand at the retail level; influence of health information on food demand; and importance of product quality for food demand. It is shown that answers to important questions in these areas can be given when large and unconventional data sets are used.     

Brexit and Tariff Rate Quotas on EU Imports: A Complex Problem

Tariff rate quotas (TRQ s) are a means by which non‐EU suppliers of agri‐food products can be given preferential access to EU markets within a regulated framework of quotas at tariff rates below the Most Favoured Nation rates bound in the GATT . TRQ s are common in governing trade in the meat and dairy sectors of the EU , although they apply to a wide range of other agricultural commodity and processed agri‐food products. Brexit poses a complex set of problems regarding TRQ s in terms of how the respective parties should divide up jointly undertaken commitments within the WTO , since TRQ s have been negotiated by the Commission on behalf of all EU Member States. Whilst individual quota allocations can be allocated to specific third country suppliers, individual Member States receive no specific allocation of the global product TRQ either in total, or from any named preferential supplier. The article outlines the nature of TRQ s in the meat and dairy sectors of the EU , and how a simple partitioning of existing quotas between the EU ‐27 and the UK is unlikely to resolve the complex issue of access rights of third countries to both markets. Possible solutions are explored, including the potential need for reciprocal EU ‐27–UK TRQ s post Brexit.     

Does Food Safety Information Impact U.S. Meat Demand?

A theoretical model of consumer response to publicized food safety information on meat demand is developed with an empirical application to U.S. meat consumption. Evidence is found for the existence of pre-committed levels of consumption, seasonal factors, time trends, and contemporaneous own- and cross-commodity food safety concerns. The average demand response to food safety concerns is small, especially in comparison to price effects, and to previous estimates of health related issues. This small average effect masks periods of significantly larger responses corresponding with prominent food safety events, but these larger impacts are short-lived with no apparent food safety lagged effects on demand.     

Critical issues suggested by trends in food,population, and the environment to the year 2020

This article reviews the emerging trends in global food supply and demand up to 2020, and discusses policy challenges and obstacles to meeting this demand. Data were obtained from the International Food Policy Research Institute's International Model for Policy Analysis of Commodities and Trade (Rosegrant et al.). The country-specific data pertains to 37 countries and regions and 17 food commodities and prices in the world market. Cereal prices are expected to decline by about 11% by 2020; meat prices may decline by 6%. After 2010, cereal prices are expected to dramatically decline. Cereal demand will change with changes in income and urbanization. Maize and coarse grains will be replaced by wheat and rice. Life style changes may lead to a switch from rice to wheat. Growth in food consumption in developed countries will slow. A projected 82% of growth in global cereal consumption and almost 90% of increased global meat demand will occur in developing countries during 1993-2020. Asia alone will account for 48% of increased cereal consumption and 61% of increased meat consumption. 88% of food production growth will occur in developing countries through increased yields and 94% in developed countries. World trade in cereals will increase from an estimated 185 million metric tons annually to 328 million during 1993-2020. Food security for the poor and child malnutrition will remain unimproved. Yield growth is affected by agricultural research, fertilizer and energy use, land degradation, water scarcity, and bad policy. Water scarcity is the most limiting on yield growth. Malnutrition problems present multiple challenges.     

China's changing diet and its impacts on greenhouse gas emissions: an index decomposition analysis

With increasing awareness of agriculture's contribution to global greenhouse gases (GHGs) and China's position as the world's top GHG emitter, there is heightened attention to the embodied emissions in China's food consumption. China's diet has shifted to include more fruit, vegetables, meat and dairy. Not surprisingly, GHG emissions from food consumption have also increased substantially. This analysis links China's food consumption with the emissions of food production industries in China and its trade partners to determine the effects of dietary change on GHGs since 1989. We utilise high‐resolution food production and emissions data to perform a logarithmic mean Divisia index decomposition to attribute changes in GHG emissions to the scale, supply structure, demand structure and efficiency effects resulting from Chinese dietary changes over a 20‐year period. This study finds that while countries supplying food to China contribute little to China's food‐related GHGs, demands for meat and dairy play a much larger role, driving up emissions. The overall scale of increased consumption of all food further propels growth in GHG emissions. Results indicate, however, that while food consumption in China more than doubles between 1989 and 2009 improvements in technological efficiency limit the rate of increase.     

Household food consumption in Turkey

This paper analyses Turkish household food consumption, usingdata from the 2003 Turkish Household Expenditure Survey. A completedemand system is estimated taking into account demographic differencesand zero consumption. The highest expenditure elasticity isfound for the meat and meat products group, suggesting thatits demand will grow faster than the demand for other productsas the economy develops and income increases. Demand is moreprice-responsive for fats and oils and non-alcoholic beveragesthan all other food products. Regional and seasonal differencesand socio-demographic factors are as important as the conventionaleconomic variables in explaining observed differences in thehousehold's food consumption patterns in Turkey.     

Testing for pre‐committed quantities of Australian meat demand

Pre‐committed consumption represents the portion of demand that is determined by non‐price and non‐income factors. This study uses quarterly data to estimate a Generalised Almost Ideal Demand System (GAIDS) to test for the existence of pre‐committed meat consumption in Australia. Two specifications are estimated to evaluate the impact of seasonal and time trend factors on pre‐committed demand. Evidence is found for the existence of pre‐committed chicken consumption when jointly estimated with seasonal and time trend factors. Results support improved demand modelling of Australian meat consumption using the GAIDS and provide insights into how Australian meat demand is affected by price, expenditures, pre‐committed consumption, seasonality, and trends.     

Explaining the Decline in UK Agricultural Productivity Growth

This paper reports the results of a study of total factor productivity (TFP) growth in UK agriculture, from 1953‐2000. It shows that prior to 1984 TFP grew at 1.68% per annum and after that date at only 0.26%. International comparisons show that the UK has fallen far behind the leading EU countries. Yield growth declined even more and only labour productivity continues to grow rapidly. In part, the result is due to better data that incorporates more quality adjustment, but the real decline can be explained mainly by cuts in R&D, less patents, less growth in farm size and the demise of public extension. There are other negative factors, which have not been quantified, including asset fixity, convergence and ozone pollution, and a background argument that recent growth rates cannot be sustained.     

Vertical Coordination in the Swine Industry: A Multi-Country Study

Pork constitutes about 45 percent of the world's total meat consumption. Recent trends indicate that pork consumption is likely to increase in future as well. The international pork industry is undergoing a structural and organizational change as a result of changes in the method of pork production and processing technology. This paper identifies a variety of pressures that are leading to these changes. One of the most important factors is the change in consumer demand patterns. Consumers now demand more specific product characteristics. In case of pork, the specificity of the product includes color and texture of the meat, origin of the meat, labeling information pertaining to nutritional contents, drug and chemical residues, and production methods used. In order to meet all these specific demands and to further reduce production costs, various stages of pork production have started to coordinate in many countries. The extent of vertical coordination varies both within and among the countries. This paper identifies the types of linkages and the methods of transaction(s) used between various stages of pork production in Canada, the Netherlands and the U.S. The paper also identifies the upcoming pressures for change and illustrates the analytical framework developed to compare coordination mechanisms that exist between stages of pork production in the three countries. The paper concludes that industrialization, globalization, and changes in consumer demand and preferences are resulting into massive structural and operational changes in the international pork industry.     

Meat and milk self-sufficiency in Asia: forecast trends and implications

Recent structural changes in dietary patterns in Asia resulting from economic development are placing increasing pressure on the existing production systems in the region-particularly those systems producing ruminant meat, non-ruminant meat and milk. This has significant policy implications for the countries in the region in terms of self-sufficiency goals in these commodities and the associated inter-and intra-regional trade opportunities in the future. Forecasts of ruminant meat, non-ruminant meat and milk production and consumption for selected Asian countries between the years 2000 and 2010 revealed the following: China, Pakistan and Viet Nam are likely to be self-sufficient with respect to ruminant meat; Malaysia is likely to continue to be a net importer of ruminant meat; India and Malaysia will be more than self-sufficient with respect to non-runvinant meat with the converse being true for Pakistan; and India, Laos and Pakistan will be self-sufficient with respect to milk production with the possibility of Indonesia, Thailand and Cambodia becoming self-sufficient if the current trends continue. Structural changes in the early 1980s generally resulted in higher average annual growth rates of production-particularly in non-ruminant meat production. Thus forecasts of ruminant meat production and consumption by 2000 using the medium-term average annual growth rates for production present a more favourable outcome in terms of self-sufficiency for countries such as Bangladesh, the Philippines and Viet Nam but a less favourable outcome for countries such as Indonesia, Malaysia, Laos and India. Similar forecasts for non-ruminant meat indicated an improvement in the long-term non-ruminant self-sufficiency estimates for most cases-particularly for Bangladesh, China and Cambodia. Intensification and commercialisation of meat production systems have increased meat self-sufficiency in a number of countries but often at the expense of grain self-sufficiency. Given these trends, the impact of trade liberalisation measures on livestock production in the region and inter-and intra-regional trade of livestock commodities and grain is likely to be significant.     

An Analysis of Household Beef Consumption of Japanese Expatriates in U.S.:

This paper uses a novel approach to investigate how food consumption in Japan may change as Japanese consumers become more westernised in their tastes and preferences for food. It is widely believed that as food prices in Japan fall to international levels and as Japanese consumers become more westernised in their taste and preferences for food, their meat consumption patterns, in particular, will approach those of western countries. The approach undertaken in this paper involves a comprehensive survey of Japanese expatriates in Los Angeles, California, regarding their food consumption habits. The findings are interesting as they shed some light on the changing nature of food consumption of accultured Japanese faced with competitive food prices. The results indicate that although household meat consumption of Japanese expatriates have changed, it remains debatable, however, that their food consumption habits will approach those of western consumers in the foreseeable future. The findings have important implications for food marketeers in Japan and elsewhere, particularly as further liberalisation of food import in that country gains momentum.     

中国水产品出口贸易流量与潜力分析——基于引力模型的研究

中国作为世界上最大的水产品生产国,近30年水产品出口一直保持增长,在全球水产品市场中的比重大幅度增加,同时面临着与其他国家同业间的竞争。本文运用拓展的引力模型对1999年～2007年中国水产品出口相关的面板数据进行了实证检验,并对主要出口市场水产品贸易潜力进行了测算与分析。研究表明,引力模型只能对中国水产品出口贸易流量和潜力起到部分的解释作用,虽然中国水产品出口对欧美日等市场呈现出所谓的“过度贸易”,对泰国、印度尼西亚等表现为“贸易不足”,但这一总体趋势不会有太大改变。另外,进出口市场之间的产品竞争程度、进口市场的消费习惯也是进出口贸易可能的影响因素。     

Brexit,Trade Agreements and CAP Reform

Although a number of reforms have significantly changed the Common Agricultural Policy (CAP ) over the past two decades, a defining characteristic of the policy is its prohibitively high import tariffs on a number of key commodities as tariff cuts have not formed part of CAP reform. These high tariffs, whilst protecting EU producers, complicate the EU 's attempts to negotiate Free Trade Area (FTA ) agreements around the world, and will likewise be problematic for agri‐food trade with a post‐Brexit UK , particularly over the politically sensitive border between the EU ‐27 and the UK on the island of Ireland. An open border could be more easily secured if the UK 's tariff barriers on CAP products matched those of the EU ‐27. This, however, implies either that the UK will have to abandon its plans to pursue ‘free‐trade’ policies with other countries around the world, or that the EU ‐27 needs to complete its reform of the CAP by unilaterally reducing its tariff barriers. It seems highly unlikely that the challenges posed by Brexit would prompt the EU to unilaterally reduce its excessively high CAP tariffs.     

新一轮国际粮食价格上涨：原因及对中国市场的影响

[目的]随着中国粮食进口不断增加,国内外市场联系越来越紧密。2020年下半年以来,国际市场粮食价格快速上涨,对国内粮食市场产生一定影响,分析国际市场价格上涨的原因和影响对确保国内粮食供应稳定、保障国家粮食安全具有重要意义。[方法]文章分析了2019年以来小麦、大米、玉米、大豆4种粮食产品的国内外价格走势,从供需状况、贸易政策、气候变化等因素分析国际市场价格波动的原因,并探讨了国际价格对国内价格的影响。[结果]当前全球主要粮食品种供应充足,库存仍处于较高水平,此轮国际粮食价格上涨主要是受到美国等发达国家宽松的货币政策以及疫情后全球消费逐步回暖的影响;但国际市场价格上涨对中国市场的影响总体有限,国内小麦、大米、玉米价格上涨的主因是国内消费回暖和生猪产能恢复带动的饲用需求快速增长,油用大豆受国际市场的影响较大。[结论]为稳定国内粮食市场,避免国际市场的冲击,中国要进一步提升粮食综合生产能力,强化科技支撑,加强粮食储备管理,健全政策支持体系,并引导居民建立科学的消费观念。     

European Agriculture after Brexit: Does Anyone Benefit from the Divorce?

The UK exited the EU on 31 January 2020, with a transition period agreed as part of the Withdrawal Agreement. During this transition period the UK and the EU will decide on their future trading relationship. No matter what form this relationship takes, there will be disturbances to agri‐food markets. This study analyses four different scenarios with increasing barriers to trade, ranging from a very close relationship similar to the European Economic Area to a distant relationship in which the UK and EU trade on Most Favoured Nation terms, using the EU focused global agricultural sector model CAPRI. In the UK, food prices will increase in all scenarios, making consumers in the UK the biggest losers. Only in a free trade agreement scenario does the UK show an unambiguous positive net welfare gain in just the agri‐food sector. In the case of the European Economic Area scenario, which assumes continued access to the single market, the net welfare impact would depend on the size of the UK’s continued contribution to the EU. In the EU, declining food prices would benefit consumers but the sum of the loss in farmers’ incomes and the UK’s EU CAP contribution would be much greater than the consumer’s gain. These impacts in agricultural markets under different future trade arrangements will also be influenced by the UK’s agricultural policy changes in direct payments as well as by possible further UK trade liberalisation after the end of the transition period.     

Demand for fish in Asia: a cross‐country analysis*

Fish demand patterns in nine Asian countries were investigated using a multistage budgeting framework allowing a disaggregated approach to analysing fish consumption. This paper highlights the heterogeneity of fisheries products in terms of species, sources and cultural responses of consumers, factors that are important in fish demand under the Asian setting. Specifically, fish demand by income groups were compared to determine how the low‐ and high‐income households respond to price and income changes. Results showed that the estimated price and income elasticities of all fish types included in the study were relatively more elastic among the poorer households.     

Demand for animal‐derived food in selected Asian countries: A system‐wide analysis

Food consumption patterns in Asia show a trend away from staples toward high protein food derived from animal and dairy products, fruit and vegetables, fats and oils. Such changes in food consumption patterns are due to rising incomes, urbanization, globalization, and modernization of marketing infrastructure. In this article, we analyze the demand for the animal‐derived food group comprising meat (chicken, beef, pork, and mutton), eggs and fish, and derive income and price elasticities in seven Asian countries using the system‐wide approach. Demand homogeneity and Slutsky symmetry properties were tested and found to be compatible with the data. Our findings reveal that animal‐derived food as a group is a necessity (except in Taiwan) and its demand is price inelastic (except in Taiwan and Sri Lanka). The implied unconditional demand elasticities reveal that, in all countries (except beef in Japan and Taiwan), chicken, beef, pork, mutton, eggs and fish (except in Taiwan) are all necessities and the demand for all types of animal‐derived food in all seven countries are mostly price inelastic. The cross‐price elasticity estimates are mostly found to be positive, meaning that there is a higher degree of substitutability between chicken, beef, pork, mutton, eggs, and fish.     

消费者需求受食品质量与安全影响的讨论分析

近年来,国内经济发展迅速,人们生活水平也得到很大提升,使得人们越来越重视安全,而食品是人们生活中的基本物质保障,是人们生活的必需品,所以食品的质量与安全问题是当下最热门的话题之一。当前消费者的需求会受食品质量与安全的影响,频发的食品质量与安全问题让人们愈发重视食品质量与安全,消费者的需求渐渐发生变化。基于此,本文展开了关于食品质量与安全对消费者需求的影响的研究。     

A Microeconometric Analysis of the U.S. Meat Demand

Price and expenditure elasticities and estimates of the effect of household demographic variables on U.S. meat demand are estimated using the newly released 1987–88 USDA household food consumption survey data. The USDA survey for the first time included variables reflecting respondents' concerns for health and diet information. A hybrid demand system, which combines a modified generalized addilog system and a level version Rotterdam demand system, is developed as the analytical framework. The micro econometric analysis takes into consideration the consumer selection problem, the missing-price problem, and the aggregation and quality variation problem. The most significant household characteristic and socio-economic variables are region, ethnic background, household size, urbanization, food planner, received health information, female household head employment status and proportion of food expenditure on away-from-home consumption. The results support the speculation of other time-series meat demand studies claiming both health concerns and convenience are the reasons for changes in consumer preference in favor of poultry and fish and in disfavor of red meat.     

Who Will Feed China in the 21st Century? Income Growth and Food Demand and Supply in China

This study uses resource‐based measures to explore the evolution of China's demand and supply for food. China's dietary shift from plant to animal‐based foods, induced by its income growth, is likely to impose considerable pressure on agricultural resources. China's demand for food on this measure appears consistent with global trends, while China is an out‐performer on the supply side, producing much more food than its income level and land endowment would predict. China's current per capita income is in a range where consumption growth is high and in excess of production growth, but the gap between supply and demand is likely to diminish as population and per capita consumption growth decelerate. Continuing agricultural productivity growth and sustainable resource management will be important influences on the growth of China's future net import demand for food.