Cost-Effective Improvements in the Quality of Food Aid

Improving the nutritional quality of U.S food aid is a daunting challenge in the context of a shrinking federal budget. Cost will significantly affect how quickly U.S. food aid can be changed to better meet the nutritional needs of the most vulnerable groups. Bulk commodities and unfortified cereal products cost less per ton than fortified or processed foods with enhanced nutritional value. Yet efforts to strengthen nutritional status, particularly those that supply people with more micronutrients,³¹ yield an extraordinarily high return on investment: they enable people to live longer, more productive lives.

As a wider range of new and/or reformulated foods become available, understanding and evaluating the tradeoffs is increasingly complex. When food aid costs are calculated on a per ton basis, the real value of these new and improved products is not apparent. But considering the cost of each improvement in nutritional status is a different approach that leads to a different verdict. This is particularly true of food aid designed for very young children and pregnant women. As mentioned earlier, undernutrition before age 2 leads to irreversible damage to growth and brain development. It causes stunting and wasting. Women who are malnourished during pregnancy face a greater risk of dying in childbirth and of giving birth to a low birth weight baby.

The U.S. government and implementing partners should begin taking steps immediately to move effective nutrition interventions “to scale” so they reach more of those who could benefit. Here are some ways to cut down on the cost of such initiatives:

1. Adopt local and regional purchase (LRP).

Under this arrangement, implementing partners receive cash grants to purchase food aid commodities from nearby areas with surpluses rather than procuring them in the United States. This not only reduces transport fees but helps get food to people in need more quickly.

LRP is coming into widespread use. For fiscal year 2011, USDA has eight LRP projects and USAID’s Food for Peace Office has 13, valued at $11.5 million and $98 million respectively. The World Food Program and other bilateral donors also purchase food aid locally and regionally. Of the 3.2 million tons of commodities that the World Food Program purchased in 2010, more than 78 percent came from developing countries.Donor use of LRP increased from 13 percent of total food aid in 1994 to 50 percent in 2009. LRP projects continue to evolve and yield additional information on reducing costs and working more efficiently.

2. Preposition food aid closer to where it is most likely to be needed.

USAID has scaled up its efforts to do this; it now has six sites around the world where food aid is stockpiled. The World Food Program also maintains advance-purchase facilities so that food aid is closer to areas that frequently face food shortages.

3. Coordinate more effectively.

A Food Aid Consultative Group, consisting of multiple government agencies and stakeholders, should update policy recommendations for best practices and help offices coordinate with each other. Several offices in USDA, USAID, and the State Department develop and guide the implementation of U.S. food aid policy regulations. The current division of labor has USDA approving food aid commodities and arranging their purchase and delivery to port, after which USAID receives, transports, and distributes food aid in the field.

4. Report nutrition outcomes.

Current end-of-year reporting by implementing partners does not include reporting on nutrition. A simplified Country Progress Report on nutrition outcomes will provide timely information on program successes and needed changes.

5. Seek advice from experts.

Outside expertise on nutrition is widely available and should be weighed when the time comes to make decisions. In particular, the USDA/USAID food aid coordination group should consult with research institutions in the United States, such as Tufts University, as well as comparable institutions in developing countries.

6. Reform the Food Aid Convention.

The Food Aid Convention is a multilateral treaty set up to guarantee a minimum annual disbursement of food aid, thus enabling the international community to better respond to emergencies and build global food security. The United States, as the largest food aid donor, needs to lead an effort to reform the treaty.