Computation Method:
SDG 12.3 for a single country, called Food Loss Index (FLI), is a fixed-based index as follows:
Where:
- is the average food loss percentage of the country in the current year,
- is the average food loss percentage of the country in the base year,
- i = country,
- j = commodity,
- t = year, 0 is the base year
- is the loss percentage (estimated or observed) of commodity j in country i in year t,
- are the production quantities of commodity j in country i in the base period,
- is the average international price of commodity j (at international $) in the base period.
For the FLI and FLP, the weights are the value of production at international dollar prices. The weight is fixed in the reference year.
Commodity Coverage
The index covers five food groups and two commodities within each group:
1. Cereals & Pulses
2. Fruits & Vegetables
3. Roots & Tubers and Oil-Bearing crops
4. Animals Products
5. Fish and Fish Products.
Cross-country comparisons are possible at the group level, while the key commodities within groups can differ across countries. This is to ensure that the index is relevant to the countries while providing some degree of international comparability.
The default selection criterion for the commodities is to rank them by their value of production within each country and commodity group. The default process is to:
• Compile value of production for every commodity
• Sort the commodities by group and rank them
• Select the top 2 in each group
The default selection process is based on value of the commodity in international dollar prices in the base period. At national level, countries can use their own set of values, quantities, or prices, or use different policy-based criteria, as long as the main headings are covered.
Compiling a commodity food loss percentage: aggregating loss percentages along the supply chain
The FLI covers losses at the national level from production to the retail stage. Using the index notation, the percentage losses of each commodity are the where:
is the loss percentage (estimated or observed) of commodity j in country i year t
When loss estimates are available separately for the various stages of the value chain, they need to be aggregated into an overall percentage with the following simplified and standardized supply chain:
It is expected that the losses at each stage of the value chain are nationally representative.
The overall percentage of production that does not reach the retail stage () can be obtained with the simplified process below, illustrated in the table:
- Set a Starting Amount of product, 1000 tons in the example
- Compile the Amount Lost at each stage by multiplying the Average Losses (%) of that stage to the reference quantity. The reference quantity is 1000 at the Production stage; in the other stages the reference quantity is the Amount Remaining from the previous stage.
- Compile the Amount Remaining at each stage by subtracting the Amount Lost from the Amount Remaining of the previous stage.
- Compile the percentage of supply still in the market at the end of the chain as the ratio of the last Amount Remaining and the Starting Amount.
- Compile the loss percentage of the commodity as the difference between the 100 and the % of supply still in the market.
Table 1: Food Loss Percentage Compilation Example (starting from an arbitrary figure of 1000 and using fictional loss percentages)
Starting Amount - Agriculture production
|
1000
|
|
Average Losses (%)
|
Production
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Transport
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Storage
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Wholesale
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Processing
|
7.3
|
1.5
|
7.7
|
0
|
3.5
|
Amount Lost
|
73
|
13.905
|
70.308
|
0
|
29.497
|
Amount Remaining
|
927
|
913.095
|
842.787
|
842.787
|
813.289
|
|
% of supply still in the market
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81.3% = (813.289/1000) *100
|
=
% lost from farm to (but not including) retail
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18.7% = 100 – 81.3%
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|