1. Global Food Security and its importance for the UK/Scotland Kate Bailey Cardiff Business School

2. Global Factors World population growth (and increasing per capita calorie intake) Climate change and extreme weather, carbon price GDP growth in Asia and China, nutrition transition Energy costs Rising agricultural input costs Freight costs Level of biofuel subsidies and production Futures trading, speculation WTO, environment/open trade tensions, unilateral food tariffs, Level of food stocks Supply response – change in plantings Government policy in general, including sustainability policy Environmental policy: Loss/protection of biodiversity, reduced nitrogen, carbon pricing Agricultural policy: EU/UK, end of set- aside, CAP reform New agricultural production technology (e.g. GM) Macroeconomic conditions, capital availability, R&D expenditure, lag in innovation application Water availability Competition for land use, land use issues Animal and plant disease

3. 7 fundamentals Population growth Nutrition Transition Energy Land Water Labour Climate change

4. 4 Food in Crisis (5 years) 1 Just a Blip (5 years) 3 Into a New Era (10 years) 2 Food Inflation (10 years) Steady transformation System structure unchanged Food prices stay high Crisis mode discontinuity High food prices trigger a strong supply response by farmers. The weather is favourable. Global anxieties recede and the oil price falls. The reduced oil price undercuts the incentive for bio-fuel production, which drops, reducing the competition with food supply and freeing up production capacity. Food moves into overproduction and prices fall to below the long run trendline as financial speculators change tack. New diseases spread and water shortages bite. Geopolitical disruptions drive energy prices to record levels. Significant input cost pressure drives food prices higher. Grain stocks are run down in an effort to avoid high prices. Extreme weather events reduce harvests well below expectations. Stocks are exhausted, and prices skyrocket. Nations control prices and ban exports. Civil disturbances and wars spread. Serious famines occur in many poor regions. Demand for food grows with population and slightly outpaces supply, as Asian meat consumption grows and weather losses mount. High energy prices support the push for bio-fuels and raise fertiliser prices. The push for increased supply encourages investment in new production technology. Productivity improves but input costs and food prices remain high. High food prices fuel inflation and contribute to economic recession woes. Oil supply tightens as peak oil arrives. Climate change is stark and weather-related crop losses mount. International carbon pricing is agreed and environmental regulations get tougher, restricting energy use and synthetic inputs. Under these conditions, fundamental long term supply constraints become apparent. The problems of the existing agricultural paradigm are accepted and production gradually shifts to an eco-technological approach. System structure changed Food prices trend down Food prices skyrocket Chatham House Project Global Food Scenarios

5. Range of impacts Global influences are combining to create a new generational experience EU/UK are not immune A food crisis cannot be ruled out Both shocks or systemic risks could trigger a crisis event Higher baseline of costs – end of the era of cheap food Tightening in global demand and supply will drive higher prices Higher energy and input costs Food, energy, transport cost burden higher in Scotland Inclusion of external costs (carbon, water etc) Higher prices have potential to create health and equity issues Particular concern for Scotland

6. Range of impacts Increased global competition could pressure some aspects of supply Higher prices/crisis likely to trigger further protectionist behaviours Food’s increasing prominence as a strategic asset may see increased by-passing of world trade system UK/Scotland has key global dependencies include the supply of fruit, phosphates, soya Sustainability issues are creating an ecological dimension to food security Availability and usage of basic resources – land, water, skills – creating new uncertainties Longer term ability of the system to function could come under question Food will increasingly need to be considered as a strategic issue

7. The New Dynamic Environmental and social impacts of agriculture and food production can no longer be ignored New definitions of risk as global shocks and the availability of basic resources create more uncertainty Businesses will need to operate around a higher price norm, reflecting true social and ecological costs Consumers expectations of cheap, unlimited food will be challenged Resilience Competitiveness Sustainability Managing Consumer expectations Four key system elements