Food Security Policy Toward Inclusive and Sustainable Food

Food Security Policy: Toward Inclusive and Sustainable Food System Transformation Theme 2: Rural and Agrifood Systems in Transforming Economies Midstream: Impact of transformation in oilseed sector on policies and investments in Southern Africa Ferdi Meyer University of Pretoria

Presentation overview • FSP-IL training in PE modelling at Re. NAPRI institutes • Impact of transformation in oilseed sector on policies and investments in Southern Africa • Overview of imports of agricultural products into SSA. • Vegetable oil imports into Malawi and Zambia • Alternative future scenarios – implication for area, yields etc. • Implications for policy interventions and public investments

PE model training at Re. NAPRI institutes • 2015 - Sokoine • 2016 - CEPPAG • 2017 - CARD • 2018 – collaboration on task 5

Thousands Imports of agricultural products into SSA 90 80 70 60 50 40 30 20 10 0 2007 2008 2009 2010 2011 2012 2013 2014 Un-processed perishable Un-processed non-perishable Low processed non-perishable High processed non-perishable 2015 2016

Soybean production & prices Production Prices USD per tonne 350 300 250 200 1000 800 600 150 400 100 200 50 Malawi 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 Zambia 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 0 0 2005 Thousand tonnes 400 Zambia Price Malawi Price World (CIF Rotterdam)

Surplus of beans and meal…. but oil imports Malawi Thousands 250 200 150 50 40 30 20 10 0 50 -10 0 -20 -30 Soybeans Soybean meal Soybean Oil 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 -50 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Thousands Zambia Soybeans Soybean meal Soybean Oil

120 100 Malawi 80 60 Zambia 40 20 0% 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Thousand tonnes Vegetable oil imports Zambia Malawi 20% 40% 60% 80% Palm oil and its fractions Soybean oil and its fractions Sunflower, Safflower or cottonseed oil and its fraction Other vegetable oils 100%

Alternative future scenario: import substitution 2017 Actual Baseline 2025 Scenario vs. Baseline Absolute change % change Thousand hectares Soybean Area 232 257 461 Percentage 204 Tonnes per hectare Soybean Yield 1. 52 1. 89 2. 24 79% Percentage 0. 34 Thousand tonnes 18% Percentage Soybean Production Soybeans Processed 351 268 488 363 1031 545 668 112% 184% Soybean Oil Production Soybean Oilcake Production 38 199 51 269 144 763 94 494 184% Soybean Oilcake exports 129 22 516 494 2258%

Other markets: Sunflower market in Tanzania 4500 4000 Dom Cons Prod adjusted Prod Min Ag TAN price Net trade 800 700 3000 500 2000 400 1500 300 1000 200 500 100 2026 2025 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 -500 2006 0 0 US $/ton 600 2005 Thousand tons 3500 • Rapid growth in Tanzanian sunflower market • Official statistics overestimate crop by approx. 30% • SME processors approx. 65% of market…. but low tech crushing • Palm oil imports highly competitive • Value chain upgrade: Policy intervention on imports plus investment in solvent extraction

Implications: Policy & Public Investment • Number of African countries have entered “consolidation phase” for selected commodities – value chain upgrades required • Sustainable additional development of these value chains depends on: a) Advanced efficiency of regional trade in surplus products b) Simultaneous development of secondary industries • Traditional producer-led approach not sufficient to capture implications of transforming food systems. • Market-led approach: Broader context of market dynamics to shape policies and direct targeted public investments • Local independent think-tanks critical for market-led approach – continuous engagement with local stakeholders • Foresighting – anticipating trends and potential future scenarios & combination of tools required