Energy Scarcity, Food Supply Chain Transformation, and Poverty Reduction in the Emerging Economies: the Case of Brazil, China, and India

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Rational. Three existing knowledge gaps motivate this study. First, there has been little research on linking energy, transformation, and poverty reduction in the developing countries. Second, there has been little research analyzing energy costs in the various segments of the food supply chains, differentiating over products, tracing both patterns in energy intensity by segment as well as the impacts of these costs on net incomes of actors. Third, there has been little empirical research empirically linking energy policy and public energy system investments with energy costs and performance in food supply chains in developing countries.Objectives. 1) to develop an integrated conceptual framework for modeling the relations among three interrelated factors, transformed versus traditional food supply chains; energy costs from electricity and fuel; and net incomes of supply chain participants and food prices; 2) to apply the framework to analyze horticulture and dairy supply chains in China, India, and Brazil, to assess how energy costs are generated and affect behavior in the segments of the supply chain and what the implications of these are for food costs to consumers and incomes to producers; and 3) to formulate policy pathways for moving towards more optimal energy use practices that contribute to supply chain development and reduction of poverty. Key Research Questions. What determines the patterns and formation of energy costs along the supply chains? How do these energy costs affect the transformation of the value chains? How do energy costs and access constraints condition small-scale actors' participation in transformed food value chains? How do energy costs in those chains impinge on the welfare of the poor? What are the patterns of energy use indicators of the value chains? Via what innovations do supply chain actors cope with energy costs and seek energy efficiency? How do technology changes used to improve access to transformed value chains translate into energy intensity and energy efficiency changes in the supply chain? What is the impact of energy policies and public investments on energy intensity and efficiency in those chains? What are the distributional and food price consequences of the above, and what are various scenarios? Is there a match or mismatch between energy policies and investments and "hot spots" in the supply chains' energy use? Do the policies lead to energy savings hence cost savings and competitiveness for the farms and firms? Data and Method. 1) Inventory per country the energy policies and public and private-sector investments related to energy costs and access for all segments of the value chains studied. 2) Inventory and "map" the different value chains for the two products, in two study provinces/states. 3) Collect detailed data in "stacked surveys", with a representative sample survey in each segment of the value chains, as well as supplemental case studies, as discussed above. 3) Analyze the data from all the segments of the value chain surveys. 5) Use the findings from step four, arrayed as parameters in simulations at different levels to model the impacts of energy policies and investments on energy costs, intensity, efficiency, and energy cost burdens of the poor. Output and Impact. Eight papers and four policy briefings will be prepared. The study will provide evidence base and analytical tools that facilitate policy makers and other decision makers to make more informed decisions and evaluate their alternative options with respect to energy use and management in agri-food system for the enhancement of its performance that are critical to the poor. Lessons learnt from the three emerging economies would have implications for the low income countries in the world. The ultimate beneficiary is the rural poor in the developing countries who engage in the agricultural sector and whose livelihoods depend on the performance of the agri-food system.