Presentation prepared by Xinshen Diao, Paul Dorosh, Josee Randriamamonjy, and James Thurlow, all with the International Food Policy Research Institute, Washington, DC. This is part of the Global Crisis Country Series.

1. Version: 15 June 2022
Mali
Impacts of the Ukraine and Global
Crisis on Food Systems and Poverty
Xinshen Diao, Paul Dorosh, Josee Randriamamonjy, James Thurlow
International Food Policy Research Institute, Washington DC
These country studies are conducted by IFPRI with financial support from
BMGF, FCDO, and USAID. All studies use data and models developed with
ongoing support from BMGF, USAID and the CGIAR’s “Foresight and Metrics”
initiative.
Xinshen Diao (x.diao@cgiar.org) | Paul Dorosh (p.dorosh@cgiar.org) | James Thurlow (j.thurlow@cgiar.org)

2. Version: 15 June 2022
Overview
• Series of country case studies
• Economywide modeling
• Capture world market shocks
• Estimate impacts on economy, agri-food
system, poverty, food security, etc.
• Simulate policy responses
• Three phases of analysis:
1. Initial data collection and impact assessment
2. Data revisions and analysis of broad policy options
• Cash transfers, food aid, and fertilizer subsidies
• Fiscal implications for national governments
3. In-country engagement and tailored policy analysis
Impact
assessment
Policy
analysis
Country coverage
Countries with IFPRI RIAPA models
May June
July

3. Version: 15 June 2022
Shocks | World Food, Fuel and Fertilizer Prices
World price
Trade share
Direct use
Indirect use
Incomes
How big is the increase in world price?
How important are imports in local market?
Can local producers substitute for imports?
Which sectors use the product as an input?
Which other sectors are affected via supply chains?
What kinds of workers and households earn
incomes within the affected sectors?
Final use Which households consume the affected products?
Impact Channel Considerations World Price Shocks
Source: World Bank Pink Sheets
Global data
11%
-13%
100%
56%
34%
88%
101%
Maize Rice Wheat Palm oil Crude oil Natural gas Fertilizer
Change in real world prices (June 2021 to April 2022)
30 Jun 2021 - 31 Jan 2022 31 Jan 2022 - 30 Apr 2022
30 Jun 2021 - 30 Apr 2022

4. Version: 15 June 2022
Shocks | World Food, Fuel and Fertilizer Prices
World price
Trade share
Direct use
Indirect use
Incomes
How big is the increase in world price?
How important are imports in local market?
Can local producers substitute for imports?
Which sectors use the product as an input?
Which other sectors are affected via supply chains?
What kinds of workers and households earn
incomes within the affected sectors?
Final use Which households consume the affected products?
Impact Channel Considerations Supply and Demand
Supply
(% by source)
Demand
(% by use)
Mali data
Source: IFPRI Mali RIAPA Model
100%
19%
95%
81%
5%
96%
Maize Wheat Edible oils Oil products
Imports
Domestic
22%
100%
50%
69%
78%
45%
31%
5.5%
Maize Wheat Edible oils Oil products
Exports
Final use
Input use
+ Others = 100%
+ + +
1.4% 0.4% 1.3% 3.5%
Products’ share of the
value of total demand
throughout the economy

5. Version: 15 June 2022
Shocks | World Food, Fuel and Fertilizer Prices
World price
Trade share
Direct use
Indirect use
Incomes
How big is the increase in world price?
How important are imports in local market?
Can local producers substitute for imports?
Which sectors use the product as an input?
Which other sectors are affected via supply chains?
What kinds of workers and households earn
incomes within the affected sectors?
Final use Which households consume the affected products?
Impact Channel Considerations Consumption Baskets
Mali data
Source: IFPRI Mali RIAPA Model
19.7%
26.7%
13.7%
31.2%
19.4%
49.1%
57.0%
51.5%
49.7%
56.7%
31.3%
28.9%
46.5%
31.3%
36.2%
All households Rural Urban Poor Nonpoor
Composition of household consumption spending
Cereals & edible oils Other foods Non-food goods & services

6. Version: 15 June 2022
Shocks | Fertilizer Response (crop productivity effect)
Adoption
Application
Price
Demand
Response
What share of cultivated land uses fertilizers?
How much fertilizer is being used?
(i.e., fertilizer application rate)
How big is the domestic fertilizer price increase?
How do farmers react to rising fertilizer prices?
(i.e., price elasticity of fertilizer demand)
How do yields change with reduced fertilizer use?
(i.e., fertilizer response ratio)
Impact Channel Considerations Fertilizer Adoption Rate
Source: Harmonized Survey on Household Living Conditions (EHCVM) 2018/19, Mali
Timing When is the fertilizer needed?
Mali data
75%
34%
44%
24%
30%
7%
10%
64%
45%
65%
64%
38%
38%
100%
49%
Maize
Sorghum & millet
Rice
Other cereals
Pulses
Groundnuts
Oilseeds
Cassava
Irish potatoes
Sweet potatoes
Other roots
Leafy vegetables
Other vegetables
Cotton
Fruits
Share of cultivated land using fertilizer

7. Version: 15 June 2022
Shocks | Fertilizer Response (crop productivity effect)
Adoption
Application
Price
Demand
Response
What share of cultivated land uses fertilizers?
How much fertilizer is being used?
(i.e., fertilizer application rate)
How big is the domestic fertilizer price increase?
How do farmers react to rising fertilizer prices?
(i.e., price elasticity of fertilizer demand)
How do yields change with reduced fertilizer use?
(i.e., fertilizer response ratio)
Impact Channel Considerations
Crop Calendar
Source: FEWSNET Mali
Timing When is the fertilizer needed?
Planting for Mali’s 2022 season is underway
Mali

8. Version: 15 June 2022
Results | GDP and Employment
• National GDP and employment declines slightly
• Negative terms-of-trade shock
(i.e., negative effect of higher import prices outweighs positive
effect of higher export prices)
• Rising import costs reduce spending on
domestically produced goods
• Falling production leads to some job losses
• Agri-food system GDP and employment also fall
• GDP declines in both primary agriculture and off-
farm agri-food sectors (e.g., processing, trading)
• Larger declines in agriculture GDP than total GDP
(equal to 33% of overall GDP losses in the country),
while off-farm GDP falls more (equal to 39% of
total GDP losses)
• Rising food and fuel prices increase cost of food
processing and food related services
• Much faster job losses in off-farm sectors, because
many food related services are highly labor
intensive
• Smaller impact on GDP and more on employment
outside agri-food system
Source: IFPRI Mali RIAPA Model
-0.6%
-0.9%
-0.5%
-2.4%
-0.3%
-0.7%
-0.6%
0.1%
-8.0%
-0.8%
-9.0% -8.0% -7.0% -6.0% -5.0% -4.0% -3.0% -2.0% -1.0% 0.0% 1.0%
Whole economy
Whole AFS
Agriculture
Off-farm
Outside AFS
Agri-food
system
Change in GDP and employment due to
food, fuel and fertilizer shocks (%)
GDP Employment
Contribution to total change
GDP
Jobs
33%
39%
28%
Agriculture
Off-farm
Outside AFS
-8%
63%
45%

9. Version: 15 June 2022
Results | Drivers of GDP Losses
• Fuel and fertilizer shocks drive the decline in national
GDP
• More fuel shock impact and smaller food shock impact
• Agri-food GDP losses mainly driven by fertilizer shock
• Fertilizer directly affects primary agricultural production,
which then disrupts downstream supply chains
• But overall, the off-farm sectors are more adversely
affected by higher food prices
• GDP losses outside the agri-food system are from
higher fuel prices
• Higher transaction costs
• Lower consumer demand
Source: IFPRI Mali RIAPA Model
Contribution
to change
-0.2%
-1.6%
-0.3%
-0.2%
-0.5%
-0.2%
-0.6%
-0.6%
-0.6%
0.1%
-0.6%
-0.9%
-0.5%
-2.4%
-0.3%
Whole economy
Whole AFS
Agriculture
Off-farm
Outside AFS
Agri-food
system
Percentage change in real GDP due to food, fuel
and fertilizer shocks (%)
Food prices Fuel prices Fertilizer prices & response
20%
42%
38%

10. Version: 15 June 2022
Results | Household Consumption
Source: IFPRI Mali RIAPA Model
• Household consumption falls significantly
• Much larger than GDP losses as households are hit twice, by
rising prices and falling incomes
• Rising fuel price and fertilizer shocks are more important drivers
of consumption losses
• Importance of shocks differs across population groups:
• Fuel shocks affect all households but more important for urban
and nonpoor households
• Earn more income outside the agri-food system
• Consume products with larger transaction cost margins
• Larger declines in consumption among urban and less poor
households
• Fertilizer shocks relatively important for rural households
• Rely more on farm incomes
• Consume more domestically-produced foods
• Food price shocks slightly more important for urban and
nonpoor households
• More import-intensive consumer basket
• Rural and poor households consume less products affected
directly by rising food prices
Contribution
to change
-0.6%
-0.4%
-1.1%
-0.2%
-0.8%
-2.4%
-2.1%
-3.0%
-2.2%
-2.5%
-1.3%
-1.4%
-1.1%
-1.5%
-1.2%
-4.3%
-3.8%
-5.2%
-3.9%
-4.4%
National
Rural
Urban
Poor
Nonpoor
Percentage change in real consumption
Food prices Fuel prices Fertilizer prices & response
15%
56%
29%

11. Version: 15 June 2022
Results | Changes in Inequality
• Differential effects across households will not greatly
affect inequality:
• Fuel shocks cause larger consumption losses for all
households and more for households in top quintile
• Fertilizer shocks have slightly more impact on households
of the two lower quintiles
• Food prices also have large impact for less poor
households that consume more import-intensive food
products
• Combined shocks are dominated by fuel and fertilizer
shocks
• Overall, inequality is less affected
• Because households in the top quintile mostly affected
Source: IFPRI Mali RIAPA Model
-5.5%
-5.0%
-4.5%
-4.0%
-3.5%
-3.0%
-2.5%
-2.0%
-1.5%
-1.0%
-0.5%
0.0%
Q1 Q2 Q3 Q4 Q5
Percentage change in quintile consumption
Food prices
Fuel prices
Fertilizer prices & response
Combined food, fuel and fertilizer shocks

12. Version: 15 June 2022
Share of population
falling into poverty
Results | Poverty
• Poverty rises significantly
• Headcount rate up 3.3% points
• 706 thousand more people pushed into poverty
• Larger increase in poverty in rural areas
• Three-quarters of expanded poor population
• Much larger increase in rural poverty headcount rate
• Rural population much larger than urban population
• Mainly driven by fuel and fertilizer shock
Source: IFPRI Mali RIAPA Model
Contribution
to change
0.3%
0.4%
0.3%
1.9%
1.2%
2.1%
1.1%
0.4%
1.3%
3.3%
2.1%
3.7%
National
Urban
Rural
Change in poverty headcount rate (%-point)
Food prices Fuel prices Fertilizer prices & response
80
35
46
401
104
298
224
37
186
706
175
530
National
Urban
Rural
Change in poor population (1000s)
Food prices Fuel prices Fertilizer prices & response
11%
57%
32%
25%
75%
Urban
Rural

13. Version: 15 June 2022
• Food, fuel and fertilizer shocks together are little effect
on the real cost of a healthy reference diet
• Reference diet is the EAT-Lancet’s “healthy” diet
thresholds for the six major food groups
• Rising prices for edible oils (in added fats) increase the real
cost of the recommended healthy diet, while falling
incomes has much larger impact, and it reduce demand for
fruits, diary and proteins (meats & fish), and thus lower
their real costs
Results | Diet Quality
Source: IFPRI Mali RIAPA Model
• Rising food prices and falling incomes cause diet quality
to worsen for many households
• Prior to the crisis, few households had consumption levels
and diversity needed for a healthy diet
• Rising food prices cause significantly increase the number
of people with at least one additional food group deprived
away from the required healthy diet
• Rural population accounts for more of the deterioration in
diet quality
-1.8%
-0.1%
-0.2%
-1.0%
-0.7%
0.4%
Net change in
cost of healthy
diet
Contributions of
food groups to
change
Change in the real cost of a healthy
reference diet caused by rising world
prices (%)
Added fats
Proteins
Dairy
Fruits
Vegetables
Staples
9.1%
14.0%
11.8%
30.2%
26.8%
8.0%
Shares of six food groups
in total cost of a healthy
diet prior to the crisis
Added fats
Proteins
Dairy
Fruits
Vegetables
Staples
342
107
235
41
11
30
383
118
265
National
Urban
Rural
People with an increasing number of food groups
they are deprived in (1000s)
Food prices Fuel prices Fertilizer prices & response

14. Version: 15 June 2022
Headlines
• Food, fuel and fertilizer shocks lead to reductions in GDP
and employment in Mali
• Agri-food system much more adversely affected
• Agriculture is particularly at risk to fertilizer shocks, esp. if it
leads to lower fertilizer use in the current season
• Poor and rural households are especially vulnerable
• Greater increase in poverty (esp. number of poor people)
• Larger contribution to the deterioration in diet quality
• Next steps
• Evaluate policy options available to governments and
development partners to mitigate impacts on food systems,
poverty, and food insecurity (e.g., cash transfers, food aid,
fertilizer subsidies, fiscal support, etc.)
Impact
assessment
Policy
analysis
Country coverage
May June
July