Fuel and Food Tradeoffs: A Preliminary Analysis of South African Food Consumption Patterns

Athur Mabiso and Dave Weatherspoon

No 6126, 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: As oil prices continue to skyrocket and food riots surface across the globe, there are growing concerns that food-fuel tradeoffs are beginning to present serious challenges for food security across the world. In South Africa, where the government is embarking on a biofuels expansion strategy, understanding the nature of food-fuels tradeoffs is imperative for effective policy making and ultimately safeguarding consumers' welfare. Using time series monthly data constructed from various sources, this preliminary study makes a step toward explaining the nature of food-fuel tradeoffs in South Africa. By including fuel prices in the estimation of single-equation and seemingly unrelated regression (SUR) estimates of demands for maize meal (the South African staple food) and wheat bread (which is increasingly accounting for a large proportion of total expenditure in South Africa) the study presents preliminary findings. Further construction of the data used in this preliminary analysis is anticipated in order to allow for a systems approach that entails testing of separability between fuel and food, the estimation of cross-price elasticities and simulations of the expansion in the biofuels industry, for the elicitation of more information on the food-fuel tradeoffs in South Africa.

Keywords: Food Consumption/Nutrition/Food Safety (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-agr and nep-ene
Date: Written
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