FOOD SECURITY, FOOD PRICES AND CLIMATE VARIABILITY - Food Security, Food Prices and Climate Variability - page 15

degradation of environmental conditions due to changes in land use, ecosystem functioning and
climate. Remote sensing assessments of agriculture and food production help to identify which
fields are under cultivation in any one year (Husak et al ., 2008), drought conditions (Atzberger,
2013; Eklundh and Olsson, 2003; Jeyaseelan, 2003), fields being irrigated (Thenkabail et al .,
2005), land degradation in drylands (Evans and Geerken, 2004), and other longer-term trends
that result from anthropogenic activities (Turner et al ., 2003). These observations form the basis
of food security assessment and are fundamental to our understanding of the impact of weather
and climate change impact on food systems (Vermeulen et al ., 2012).
Linking food prices and food security
Using models that link environmental variability as measured by satellite remote sensing to
food price dynamics, quantitative assessment of the likely impact of environmental change on
food prices can be explored. It is possible to identify in a predictive way exogenous shocks to
local food price dynamics. Modeling results described here show that local food price changes
can be predicted in 87 out of the 179 locations where there were at least five years of monthly
food price observations. Of the 87 locations, 59 were significantly influenced by domestic
weather shocks as measured with satellite remote sensing between 2008 and 2012. The
modeling framework shows the vulnerability of these small, local food markets to production
shocks due to the weather, and the urgent need for investments to increase efficiency and
reduce transaction costs in local markets (Zant, 2013), modernization of food production to
boost yields in good years (Hansen et al ., 2011) and increased participation by farmers in
markets to ensure supply.
The price of food in local markets is a critical indicator of food security and offers a better
early warning of food scarcity. Without a clear understanding of current and projected market
conditions, food security analyses will be incomplete and inadequate. If rainfall in a particular
area is likely to be poor and food production negatively affected, using knowledge of market
networks can help identify the geographic areas with and without access to alternative sup-
plies and thus more precisely define the most affected areas. Those most affected could be
situated outside the drought-affected region because of trade patterns. Focusing on just the
immediate area could seriously underestimate the number of food insecure households and
completely overlook areas that are potentially in need of assistance. Using a model that links
weather shocks to local food price changes has the potential to provide immediate and useful
information currently not available to early warning organizations.
Seasonality in the price of food is a critical source of information about the vulnerability of
a region to climate variability. The seasonal increase in food prices in many isolated, small
markets is due to the lack of storage capacity and to limited access of rural producers to export
channels (Becquey et al ., 2012; Hillbruner and Egan, 2008; Brown et al ., 2009). Access to
food from regional and international markets when prices are high is extremely limited in
these areas due to the limited purchasing power of the region and high transaction costs
(Brown et al ., 2012). Thus pre-harvest grain prices are significantly greater than post-harvest
grain prices in many markets. This seasonality of food prices is used in this research to indicate
a poorly functioning market, and to indicate that growing conditions will likely be more
important for food price determination in that market than elsewhere.
Markets and the price of food shed light on two aspects of food security: whether there is
food available in a region and the ability of people to access that food. Food supplies can be