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How will higher meat demand affect food prices?

By Caroline Scott-Thomas+

08-Jan-2014
Last updated on 08-Jan-2014 at 14:21 GMT

Increased demand for animal protein will push up meat prices – but not necessarily grain prices, claims a new report from UK think tank the Overseas Development Institute (ODI).

The report claims that future diets may matter more for public health than for agriculture, and strong public policy could prevent high grain prices as well as poor dietary outcomes in the coming decades, despite increased demand for meat and dairy.

According to modelling of different scenarios by the International Food Policy Research Institute (IFPRI), varying the projected future levels of meat consumption would have barely any effect on staple grain prices and only a small effect on how much feed grain would be needed. However, it did predict that increased meat consumption would have a strong effect on meat prices.

The ODI report’s authors acknowledge that total meat consumption is unlikely to fall to 2030, but they suggest a ‘business as usual’ worst case scenario – in which demand for feed grain increases 77% – is unlikely.

Effective public health policy?

Partly, this is because high income countries are likely to cut their meat consumption, they say, as are Brazil and China, for reasons quite separate from affordability.

“In other words, these scenarios assume strong and effective public policy, beyond what may seem feasible in the near future,” the researchers wrote.

“…This implies that lower meat consumption does not matter quite so much from an agricultural point of view, nor from our original concern – the cost of staple foods. But that does not mean that meat consumption, and the consumption of dairy and some fish, does not have public importance. It means, in fact, that the more important public concerns probably lie with better health.”

That said, they do expect meat consumption to increase, with an appreciable effect on the proportion of coarse grain used globally for feed, from 42% in 2012 to 56% by 2050.

Tapering consumption

But the report’s authors point out that meat consumption does not rise endlessly in tandem with income. Meat consumption in the UK, for example, has only risen marginally in the past 50 years, and the ODI says this pattern is expected in other countries too – but it depends on the nation’s food culture.

“It is expected that increases in meat consumption will taper as incomes rise, a pattern that is already evident for China, as shown by the almost straight line of rising meat consumption against logarithmic increases in income. For Brazil, however, it seems that the tapering is less pronounced,” it said.

“…Diets and their influences are more varied than some may imagine. Yes, the combined forces of economic growth, rising incomes, urbanisation and globalisation are powerful, but we should not underestimate the extent of local variation.”

Public policy paradox

Finally, they point out a “paradox of public policy” in which there is little appetite among the public and politicians for policy that could affect future diets in high-income countries – but a strong public health case to find population-wide ways to reduce calories, fat, salt and sugar.

“At some point in the future there may well be international debate over meat consumption and what fair shares of meat can be produced at relatively low cost and within the limits of environmental sustainability and greenhouse-gas emissions. Policy may be able to proceed incrementally, both in ambition and instrument, using combinations to get the best effect.”

The full report is available to download here (pdf).

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