FAO is focusing its attention on the pursuit of healthy diets and transformations of agrifood systems to ensure healthy diets are affordable for all. Measuring and systematically monitoring the cost and affordability of healthy diets and making progress towards ensuring the affordability of healthy diets is of upmost importance and is urgently needed. To this end, FAO is committed to institutionalize the computation of the least-cost healthy diet, and the corresponding affordability indicator, and to publish updated estimates in the annual The State of Food Security and Nutrition in the World report, as well as provide the full data series on FAOSTAT. This background paper to The State of Food Security and Nutrition in the World 2022 report presents the new methodological refinements applied in the estimation of the average cost of a healthy diet. This is an important methodological update as it results in a more robust indicator that provides greater transparency and supports long-term systematic monitoring utilizing annually updated price data. The paper then explores potential mechanisms and data sources for monitoring globally the cost of a healthy diet.

Malnutrition is endemic in India. In 2015-16 some 38% of preschool children were stunted and 21% were wasted, while more than half of Indian mothers and children were anemic. There are many posited explanations for the high rates of malnutrition in India, but surprisingly few discuss the role of Indian diets, particularly the affordability of nutritious diets given low wages and the significant structural problems facing India's agricultural sector. This study was undertaken to address knowledge gaps around the affordability of nutritious diets in rural India. To do so we used nationally representative rural price and wage data to estimate the least cost means of satisfying India-specific dietary recommendations, referred to as the Cost of a Recommended Diet (CoRD), and assess the affordability of this diet relative to male and female wages for unskilled laborers. Although we find that dietary costs increased substantially over 2001-2011 for both men and women, rural wage rates increased more rapidly, implying that nutritious diets became substantially more affordable over time. However, in absolute terms nutritious diets in 2011 were still expensive relative to unskilled wages, constituting approximately 50-60% of male and about 70-80% of female daily wages, and were often even higher relative to minimum wages earned from the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). Since many poor households have significant numbers of dependents and substantial non-food expenditure requirements, it follows that nutritious diets are often highly unaffordable for the rural poor; we estimate that 45-64% of the rural poor cannot afford a nutritious diet that meets India's national food-based dietary guidelines. Our results point to the need to more closely monitor food prices through a nutritional lens, and to shift India's existing food policies away from their heavy bias towards cereals. Achieving nutritional security in India requires a much more holistic focus on improving the affordability of the full range of nutritious food groups and ensuring that economic growth results in sustained income growth for the poor.

The high cost of nutritious foods can worsen poor diets and nutrition outcomes especially among low-income households. Yet little is known about the spatial and temporal patterns of the cost of nutritious diets in South Asia, where malnutrition in multiple forms remains high. Using existing food price data from Sri Lanka, Pakistan, Afghanistan, and India, two methods are applied to assess the affordability of nutritious foods: Cost of a Recommended Diet (CoRD) and Nutritious Food Price Index (NPI). The analysis finds that the cost of a nutritious diet is 38 percent higher in Sri Lanka using CoRD compared to the cost of a (calorie-based) diet that meets basic food needs, and 15 percent higher in Afghanistan. In addition, CoRD varies across cities due to variability in the price of dairy and vegetables. Comparison of the NPI and the food Consumer Price Index (CPI) indicates that, for some countries, the price of a nutritious food basket varies more by season and has been increasing at a faster rate than the price of a typical food basket. This phenomenon is largely due to the variable cost of vegetables.

Policies and programs often aim to improve the affordability of nutritious diets, but existing food price indexes are based on observed quantities which may not meet nutritional goals. To measure changes in the cost of reaching international standards of diet quality, we introduce a new Cost of Diet Diversity (CoDD) index based on the lowest-cost way to include at least five different food groups as defined by the widely-used Minimum Dietary Diversity for Women (MDD-W) indicator, and compare that to a Cost of Nutrient Adequacy (CoNA) indicator for the lowest-cost way to meet estimated average requirements of essential nutrients and dietary energy as defined by Dietary Reference Intake (DRI) values for an adult woman. We demonstrate application of both indexes using national average monthly prices from two very different sources: an agricultural market information system in Ghana (2009-14), and the data used for national consumer price indexes in Tanzania (2011-15). We find that the CoDD index for Ghana fluctuated seasonally and since mid-2010 rose about 10 percent per year faster than national inflation, due to rising relative prices for fruit, which also drove up the cost of nutrient adequacy. In Tanzania there were much smaller changes in total daily costs, but more adjustment in the mix of food groups used for the least-cost diet. These methods can show where and when nutritious diets are increasingly (un)affordable, and which nutritional criteria account for the change. These results are based on monthly national average prices, but the method is generalizable to other contexts for monitoring, evaluation, and assessment of changing food environments.