Emergency needs assessments and the impact of food aid on local markets


 In humanitarian emergencies, the highest priority is to save lives, but the decision on how to respond may have longer term consequences for households and for the markets where households derive income and purchase goods. This desk study is designed to assist WFP and other humanitarian agencies in understanding markets as they relate to emergencies, particularly the assessment of the impacts of emergencies and food aid deliveries on local commodity markets. In this work, we will focus on the impact of actual food commodity distribution on commodity markets, one of the most common emergency response alternatives. However, the report widens the debate to assist humanitarian agencies in seeing the link between actions taken by and with households and individuals during and after an emergency, the effects those actions have on markets, but also effects that market structure and performance may have in mitigating food insecurity. Understanding of market dynamics will help to build better emergency responses, such that the responses can actually strengthen markets’ capacity to avoid food crises in the future, when alleviating food insecurity in the present. Since the 1960s, the debate on the potential negative effects of food aid on local commodity markets has focused on the “disincentive effects” of lower producer prices in recipient countries. Researchers have developed increasingly sophisticated quantitative methods to assess potential commodity market disincentives. This research indicates that large amounts of food aid delivered into markets or for free distribution without any targeting of households were the main sources of disincentive effects, particularly when the food aid commodity chosen was also produced locally and the delivery coincided with local harvests. Even where negative market effects were identified, however, longer term effects were often found to be  beneficial.



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Date and language
Jan 2005

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Agris Subject Categories: 
Trade, marketing and distribution
Agris Subject Categories: 
Consumer economics
Agris Subject Categories: 
Food Security
Physical Location: 
FPMU Documentation Center
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