Addressing Food Price Volatility: G20 Action Plan

1. CTA Brussels, 30th November 2011 G20 AGRICULTURE Food price volatility

2. BACKGROUND French Presidency: Priority on the issue of commodities price volatility, including for agricultural commodities: => Organisation of a G20 meeting of the Ministers of Agriculture in June 22 and 23. Adoption of an Action Plan on food price volatility and agriculture. => Finance workstream: work on derivative markets, energy and macro-economic impacts. = > Development Working Group: impacts and solutions for developing countries. • Schedule: • Technical preparatory meetings of « deputies »: • 21st of January in Berlin • 23rd and 24th of March in Paris • 11th and 12th of May in Paris • 22nd of June in Paris Ministerial Meeting on the 22nd and 23rd of June in Paris. G20 Agriculture Brussels, 30th November 2011

3. THE ACTION PLAN : content and commitments 5 main areas of work: 1. Agricultural production and productivity: comprehensive action to strengthen the longer term productivity, sustainability and resilience of the food and agriculture system worldwide. => The Ministers decided to launch an International Research Initiative for Wheat Improvement. A kick-off meeting was organized on September 15 in Paris. => A G20 conference on agricultural research for development was held in Montpellier on September 12 and 13. Outcome: a platform on tropical agriculture in order to build capacity and share knowledge on agricultural production and productivity. => A G20 seminar on agricultural productivity was organized by France and Australia on October 13 in Brussels. G20 Agriculture Brussels, 30th November 2011

4. THE ACTION PLAN : content and commitments • 2. Market information and transparency • => Launch of an « Agricultural Market Information System » (AMIS) in order to enhance the quality, timeliness and reliability of food market outlook information. Secretariat hosted by FAO (+8 IOs). Information Group: 28 countries. • => An AMIS inception meeting was organized on September 15 and 16 in Rome: • Adoption of « terms of reference » and « rules and procedures » of AMIS • Election of a Chair for 1 year (France) and nomination of a Secretary => First AMIS report published on November 3. G20 Agriculture Brussels, 30th November 2011

5. THE ACTION PLAN : content and commitments • 2. Market information and transparency • => Launch of a Global Agriculture Geo-Monitoring initiative to improve the use of remote sensing tools for crop production projections and weather forecasting. • A technical meeting was held on September 22 and 23 in Geneva. G20 Agriculture Brussels, 30th November 2011

6. THE ACTION PLAN : content and commitments 3. International policy coordination => Launch of a Rapid Response Forum to promote policy coherence and coordination in times of crisis. The first meeting was held on September 16, together with the AMIS meeting. => Decision not to impose anymore export bans on food aid from the WFP. A declaration is in preparation for the WTO Ministerial Conference in december 2011. => Need to further analyse the links between biofuels and food security. HLPE study requested during the last CFS (Committee on world Food Security) session. G20 Agriculture Brussels, 30th November 2011

7. THE ACTION PLAN : content and commitments • 4. Reducing the effects of price volatility for the most vulnerable • => The Agriculture Ministers launched several actions that were further elaborated for the joint meeting of Finance and Cooperation Ministers in September 23 : • African Union/NEPAD roadmap on the integration of risk management into Comprehensive Africa Agriculture Development Programme (CAADP) national and regional investment plans and the development of a pilot project involving interested countries and regions. G20 Agriculture Brussels, 30th November 2011

8. THE ACTION PLAN : content and commitments • 4. Reducing the effects of price volatility for the most vulnerable • a risk management advisory mechanism, involving multilateral, regional and national development banks and agencies, to enable information and best practices sharing, help mainstream cost effective, non-market-distorting risk management in developing countries, agricultural development policies, and provide support to pilot programs on the basis of expressed interest by developing countries. • further exploration by multilateral, regional and national development banks and agencies, of the impediments to the use of existing risk management facilities G20 Agriculture Brussels, 30th November 2011

9. THE ACTION PLAN : content and commitments • 4. Reducing the effects of price volatility for the most vulnerable • implementation and scaling-up, in connection with the private sector as appropriate, of counter-cyclical instruments and mechanisms, such as contingent credit lines, catastrophe risk financing instruments and countercyclical loans. • Support to ongoing initiatives to expand innovative risk management tools, such as the IFC Agricultural Price Risk Management product, to Sub-Saharan Africa, and North Africa and the Middle East, and to provide encouragement to the development of similar tools by other multilateral and regional development banks. G20 Agriculture Brussels, 30th November 2011

10. THE ACTION PLAN : content and commitments • 4. Reducing the effects of price volatility for the most vulnerable • the development of a pilot project for a regional emergency humanitarian food reserves system led by ECOWAS. • the launch of an inclusive process to develop a code of conduct for responsible emergency food reserves management. The draft of this voluntary code of conduct will be submitted to the CFS for further consideration. G20 Agriculture Brussels, 30th November 2011

11. THE ACTION PLAN : content and commitments 5. Financial regulation => Political message to the Finance Ministers and Central Bank Governors to take appropriate decisions for a better regulation and supervision of agricultural derivatives markets. => The Finance Ministers and Central Bank Governors adopted conclusions on a better regulation of commodities derivatives markets in their October meeting on the basis of the IOSCO report. 6. Implementation => Commitment to monitoring and reporting the progress made in the implementation of the Action plan G20 Agriculture Brussels, 30th November 2011

12. THE CANNES SUMMIT : outcomes on food security and agriculture => Agriculture recognized as a key issue for economic growth and food security: • In the Communiqué: § 18 and 19 • In the final Declaration: § 40 to 51 + 72 • => The Leaders welcomed the Action plan on food price volatility and agriculture and decided to act on its five objectives. They asked the 10 IOs to pursue their work (with a specific mention of water) and agreed to follow the implementation of the Action Plan. • => Next G20 Presidency: Mexico from December 1st. Next Leaders' Summit in June 2012 in Los Cabos. • => Priorities yet to be defined: food security, agricultural productivity, green economy, climate change, private investments… G20 Agriculture Brussels, 30th November 2011

13. Thank you for your attention