Food prices and poverty impact briefs
The recent escalation in food, fuel, and fertilizer prices has intensified concerns about economic stability, food security, and poverty in developing countries. These concerns have been further exacerbated by the rise in agricultural commodity prices, particularly staple grains like wheat and maize, that began in mid-2020. Supply chain bottlenecks associated with the Covid-19 outbreak partly fueled this rise, and the invasion of Ukraine by Russia in February 2022 triggered an additional spike in these commodity prices. To assess the downstream impact on poverty, a household income and expenditure model has been utilized. This study includes a series of six briefs that evaluate the poverty impact of higher global prices for staple grains; other countries covered include Burkina Faso, Kenya, Ethiopia, Niger, Nigeria, and Mali.
Our methodology remains consistent across all six country studies. The analysis commences by examining the effect of the surge in international grain prices on the domestic market prices of selected grains in each country. Subsequently, we estimate how these domestic price changes affect the real income of households, based on a nationally representative survey. This takes into account the role of these commodities both in household consumption and as a source of income. Finally, we estimate shifts in headcount poverty—the proportion of the population living below the poverty line—based on the changes in real income for each sampled household. The focus of our study is on maize, wheat, and sorghum, the rationale for which is elaborated in a methodological brief. Detailed summaries of the findings for each country and methodology are readily available for examination.
Poverty impacts of food price increases in Niger
All six studies use a similar approach. First, we examine the effect of the rise in international cereal prices on the real price of key grains in the domestic markets of the country. Second, we estimate the impact of the changes in domestic grain prices on the real income of each household using nationally-representative survey data, taking into account the importance of the commodities in consumption and as a source of income for each household. Finally, we estimate the changes in headcount poverty (the share of people living below the poverty line) based on the changes in real income for each household in the sample. We focus on the prices of maize, wheat, and sorghum for reasons discussed below.
Poverty impacts of food price increases in Kenya
Poverty impacts of food price increases in Burkina Faso
We use the same approach in all six country studies. The analysis starts by exploring the effect of the rise in international grain prices on the real price of selected grains in the domestic markets of the country. Next, we estimate the impact of the changes in domestic grain prices on the real income of each household in a nationally representative survey, taking into account the importance of the commodities in consumption and as a source of income for each household. Finally, changes in headcount poverty (the share of people living below the poverty line) are estimated based on the changes in real income for each household in the sample. We focus on the prices of maize, wheat, and sorghum for reasons discussed below. The methods are described in more detail in a method brief.
Poverty impacts of food price increases in Nigeria
The methodological approach is similar in all six country studies. First, we examine the effect of the increases in international cereal prices on the real price of key grains in the domestic markets of the country. Second, we estimate the impact of the changes in domestic grain prices on the real income of each household using nationally-representative survey data, taking into account the importance of the commodities in consumption and as a source of income for each household. Finally, we estimate the changes in headcount poverty (the share of people living below the poverty line) based on the changes in real income for each household in the sample. We focus on the prices of maize, wheat, and sorghum for reasons discussed below.