Prepared by Mark Elward
June 2010

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Review of FAO food balance sheets in fall of 2009
Worked through several steps
• Review of the fundamentals
• FAO needs
• Theory
• Credible Statistics
• Methods at FAO
• Issues
• Possibilities
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Focus on one basic option (a few variations)
• Only realistic option for FAO
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Current method is fundamentally flawed
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Other methods are ‘dreaming in technicolour’

• Balance sheet
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Simple
• Phenomenal challenge so keep it simple
• All countries
• All relevant food commodities (highest level)
• Displays relevant variables
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Depends on production and trade (exist)
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Consistent with fundamentals
(need, theory, credible stats)
• Therefore defendable
• Consistent with practices in countries with food stat programs
Minimises imputations
• Accepts data gaps (can be filled in time)
FAO has or could have capacity to produce
Complements other programs such as surveys
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One piece of food puzzle
Minimises revision ‘shock’
Can be applied at country level

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FAO
• important to basic objectives of FAO
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FAO is about adequate food balance sheets measure food
• internal users adding value
• multitude of external users
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 public good not a statistical organisation

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Portrait of an agricultural or food commodity over a period of time for a defined geographic level
 link over time
 for analysis or public use
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Stock and flow analysis
 numerous sources of data beginning stocks
+ flows in
= flows out
+ ending stocks

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Relevant
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Reliable
• accurate
• objective
 free of politics
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Timely

 balance sheet framework
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 country calendar year
 tree structure
 numerous processed products
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 up to 4 levels of processing distributed using ratios

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Food consumption = food available for consumption
• residual sum ??? but kept stable through balancing factor
• often expressed as an equivalent of level published
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Converted to display nutrients represented
• calories, protein and fat
• calculated at processed level and summed
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Calories per person per day = sensitive

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-adopt what has been provenkeep it important -is it properly funded?
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 public annual by country agriculture and food trade data supplementary data (area, yield, more)

 only balance sheets worked with = public
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96 published balance sheets
 cut the vast majority of processed products
 at working level
 review the commodities
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67 food types account for 99% of calories
 still more that are important
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Only 20 to 35 for each country

 stocks -display when available
 limit imputations
• accept the gaps
 focus analysis on food available and calories
• break the data
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 statistical discrepancy moving averages
 defendable and more transparent
• users can perform calculations

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Timeliness
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 publish with one year of reference year publish release dates and revision schedule
Clarify
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 naming conventions release on FAOSTAT
Working relationships
 beg, borrow & steal
Related data
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 agriculture and food area and yield food aid trade
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Waste-adjusted???
 maybe –in time

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Impact on data would be limited
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 due to consistency with current methods changes do not have to be taken back to beginning
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Limited shock to users
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 due to similarities in coverage & presentation small revisions
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Tried and tested
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EU, US, Canada
= confidence
= reduced risk
= world-class

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 program driven by fundamentals consistent with theory and practices in other countries relevant to FAO core business reflect good statistical practices reliable
 given limitations of data suppliers
 timely

Food is Key…
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Series of decisions to define the public data set
Food balance sheets
(not to be confused with agriculture)
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High level
Stocks are less variable and consistent over time
Less non-food use (feed, seed, etc)
Production and trade are main data drivers
What commodities???
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99% world calories
95% country level calories
 other

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Decisions or confirmation
 variables (elements)
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 use of statistical discrepancy factor timeliness goals (within one year) start point, smoothing?

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What would it look like???
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Click on spreadsheet to see!

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Focus on food available for consumption and calories/person/year
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 possible/probable/time element check data (household surveys)
Production and trade = core info
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Accept unless reason to adjust
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 document minimise use of statistical discrepancy factor moving averages suppress = gap
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Smoothing???
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Nutrients
 may need to derive factors
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Once established, consistency is important

6 countries, 5 commodities, 2000 - 2007
 demonstrates that suggested balance sheets will work well
 need production and trade
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 everything else is fine-tuning impact of stocks data gaps is small data adjustments limited
 in line with current FAO data
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20 to 35 commodities = 95%
 incorporating the new methods... works

Testing -more
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Excel works well for this application
 other good options
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Nutrient factors need review
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A knowledge of fundamentals is critical
Click open file to see actual data!

Wheat Flour
700
600
500
400
300
200
100
0
2000 2001
New-China
New-Ghana
2002 2003
Trad-China
Trad-Ghana
2004 2005
NEW-India
2006
Trad-India
2007

Rice
900
800
700
600
500
400
300
200
100
0
2000 2001
New-China
New-Ghana
2002 2003
Trad-China
Trad-Ghana
2004 2005
NEW-India
2006
Trad-India
2007

-referring to primary commodities-
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Format = EST or WAOB
Marketing year is OK
No need for duplication
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EST more exposure
ESS more efficient
FAO limits duplication and provides better service
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Is there a willingness???

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Independent value
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 detailed currently player in international trade statistics
• shares with Eurostat, UNSD, OECD
 original data
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Potentially more timely

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Independent value
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 cover more commodities
• agriculture and processed limited detail
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Potentially more timely

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Project
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 data and systems team data users
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3 major steps
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 planning
• data = define the public data set
• systems = builds specifications from data team development
• data = country specific commodity balance sheets
• system = programming working and public release
• experimental
Result = relevant, reliable and timely data set that will stand the test of time...