Food prices, led to the increase in international trade protectionism post-2019

Result of Service Make available analyzes on the impact of food inflation on the purchasing power of the population, with the main focus on families with the lowest income. It intends to dismantle the current public policies to combat fome ajudaram (or not) to minimize the effects of inflation and the effects of international trade on food prices and volatility in Brazil

Work Location Brasília

Expected duration 240 Days

Duties and Responsibilities Overcoming food insecurity by 2030 is the first of the United Nation's eight Millennium Development Goals. Globally, significant advances have been made toward the goal in the last two decades. The world had 13% of the population undernourished in 2001, and it increased to 9% in 2017 (Figure 1). This result was mainly driven by China, from 11% malnourished in 2001 to values below 2.5% in 2011. In Brazil, the data on the percentage of malnourished also improved; the country went from values greater than 10% in 2011 to less than 2.5% in 2008 (see Figure 1). However, in the global scenario, there were warning flags due to the non-improvement of the post-2011 index and the still high values for the region of the world that most suffers from the problem, Sub-Saharan Africa. In Brazil, pre-2019 concerns were related to the strong economic downturn in 2015 and 2016 on food security. Such concerns were added to the effects of the Covid-19 Pandemic and the Conflict between Russia and Ukraine on global food chains and, naturally, on food prices in Brazil. This last concern with food prices in Brazil is largely justified by the price indices of the Brazilian Institute of Geography and Statistics (IBGE). After the pandemic, prices in Brazil, measured by the IPCA-IBGE, rose by almost 20% (accumulated between 2020m1 and 2022m5). Inflation is usually felt more by the poorest, especially those with less access to the banking system and less bargaining power due to salary readjustments. This time, the situation is even worse as food prices are rising at an even faster rate. The accumulated between 2020m1 and 2022m4 was more than 30% for food consumed within the household (see Figure 2). Even though there is a discussion of the participation of local determinants for Brazilian food inflation, part of this inflation is imported – that is, global shocks cause it. First, the Covid-19 Pandemic is a negative supply shock with the breakdown of global production chains. Added to this, we have the conflict between Ukraine and Russia, which, by reducing the supply of fossils, generates increases in the prices of fuels and fertilizers (intensive in oil). With these two adverse supply shocks and an inelastic demand for food in the short term, the adjustment takes place via prices. Food inflation is not a phenomenon unique to Brazil. Of the four most consumed kinds of cereal in the world (corn, rice, wheat, and soy), only rice had an increase of less than 60% between 2020m1 and 2022m1. Namely, the increases were 61% (wheat), 62% (soy) and 62% (corn) (International Food Policy Research Institute, 2022). So, the concern to feeding the local population has raised customs barriers to keep both food and inputs cheaper for the local market. As much as the measure seems to be interesting from the point of view of each player, each country, in the aggregate, causes food prices to rise globally. This new scenario for food production raises concerns mainly for the poorest. The POF 2017/2018, for example, indicates that expenditure on food is approximately 8% for families with a total monthly income above R$23,850.00, while 22% for families with an income of less than R$1,908.00. Thus, this consultancy first aims to understand how food inflation has affected the Brazilian population, focusing mainly on families with lower incomes. It is also intended to evaluate how underway public policies, Auxílio Brasil, helped (or not) minimize the effects of food inflation. CONSULTANCY OBJECTIVES The study's general objective to be carried out is to understand how the Brazilian population is being affected by the current food inflation. Answering the following questions: a) What is the profile of the population most affected by food inflation? b) Did this population enter the Hunger Map again? c) Were the public policies applied during the pandemic able to mitigate the effect of food inflation? d) What are the possible long-term effects of this inflation on human capital formation? e) Are there disproportionately affected regions? f) Do rural and urban populations suffer similarly from food inflation? g) Is it possible to think of new ways of fighting hunger? h) Does a world with more customs barriers worsen or improve the Brazilian situation?

Qualifications/special skills Academic Qualifications: Doctorate in one of the following areas: Public Administration or Public Management or Economics. Experience: - Minimum of 5 years of experience in the areas of economics, economic development, econometrics, public policies, agricultural economics, agribusiness, energy economics, social projects and/or related topics - Publications in the consultancy area. Language: Portuguese and English

Additional Information Outputs/ Works Assignment: Product 1 – Literature review on food inflation and the nexus between it and world hunger (report and article). To be submitted 120 days after start date. Product 2 - Mapping of the population on food inflation in Brazil (report and 2 articles). To be submitted 150 days after start Product 3 - Analysis of current public policy tools to combat food inflation in Brazil (report and article). To be submitted 180 days after start Product 4 - Analysis of the effects of international trade on food prices and volatility in Brazil (report and article). To be submitted 210 days after start Product 5 - Analysis of the relationship between international trade, hunger and public policies for the Brazilian population (report and 2 articles). To be submitted 240 days after start

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