Food Policy Lessons for 2012 and Beyond

By Shenggen Fan
Posted on 21 June 2012
Filed under Food

Despite ongoing challenges to global food security -- from food price volatility and extreme weather shocks, to famine, unrest and conflicts, the year 2011 featured major policy developments that offer encouragement and point to areas where further action is needed in 2012 and beyond.

After many years of neglect, agriculture and food security are back on the development and political agendas.  Developing countries are continuing to expand their spending on food security and agricultural production, and donors and research institutions--including the US Agency for International Development, the World Bank, and CGIAR, a global agriculture research partnership of which IFPRI is a member, are increasing their commitments to agricultural research and development.

In addition, agriculture is increasingly seen as part of a larger context, contributing not just to food production, but also to human nutrition and health, and to economic, sociopolitical, and environmental security.

A new flagship report of the International Food Policy Research Institute (IFPRI), the 2011 Global Food Policy Report, offers a summary of the year’s highlights and challenges, and suggests needed future actions.

Food price levels and volatility

Global food prices rose during the first half of 2011 and fell during the second half of the year. High oil prices, biofuel policies promoting expanded production,  weather-related shocks such as droughts and floods, and growing demand from emerging economies all played a role in this food price volatility. Volatile food prices harm both consumers and producers by increasing uncertainty and making it difficult to plan production.

Global response to this volatility included an action plan by the G20 ministers of agriculture to reduce price volatility, regulate commodity markets, and promote long-term agricultural productivity and an emergency rice reserve to help ensure long-term food security in the Southeast Asian region .

However, some national policies taken in response to changes in food prices may have increased the strain on the global food system. To raise producer incomes, the government of Thailand, the world’s largest exporter of milled rice, established a rice subsidy scheme  that threatened to shrink its exports and contribute to higher global prices. Several countries, including China, turned to large grain imports to build up strategic reserves, raising concerns about tighter grain markets.

Natural and human-caused shocks

The world saw some of the most severe natural disasters on record in 2011, including earthquakes and a tsunami in Japan;  severe floods and storms in Brazil, Pakistan, the Philippines, Thailand, and the United States; and drought in the Horn of Africa. According to the International Disaster Database, more than 200 natural disasters, affecting nearly 100 million people around the world, occurred during the year. Poor and hungry people are particularly susceptible to these natural shocks.

In the Horn of Africa, extreme drought conditions triggered a widespread crisis in the region that was especially catastrophic in Somalia. More than 13 million people, principally pastoralists and farmers, were affected and their food and nutrition security was severely undermined. Vulnerable groups such as women and children experienced acute food insecurity and undernutrition. The United Nations Children’s Fund reported that more than 320,000 children suffered from severe malnutrition at the height of the crisis.

Although exposure to natural shocks is inevitable, human vulnerability to these shocks is not inevitable. Reducing vulnerability means improving society’s ability to cope and build resiliency toward future shocks.

Climate change

The record-breaking extreme weather events of 2011 suggested that climate change will put additional pressure on world agriculture in the coming decades. The year provided more evidence that greenhouse gas emissions are rising and that climate change is already affecting agricultural productivity.

There was encouraging progress at the annual climate conventions in 2010 in Cancun and in 2011 in Durban. A key result was the creation of the Durban Platform for Enhanced Action, which aims to forge a treaty by 2015 to bring both developed and developing countries together under a legally binding agreement by 2020. Outside of formal negotiations, countries and regions are proceeding with their own efforts to adapt to and mitigate climate change. China, India, and Kenya, for instance, have all undertaken significant agricultural adaptation and mitigation activities. These national and subnational activities could be the basis for a binding multilateral agreement to pursue low-emission development strategies.

Biofuels

Biofuel markets in 2011 were dominated by the European Union, the United States, and Brazil. In the United States, debate centered on whether a tax credit for blending ethanol into gasoline should be repealed. Research suggests that this tax credit, combined with the ethanol blending mandate, results in both welfare and efficiency losses. In addition, the US launched  a mechanism for certifying biofuel producers who meet environmental and fair labor standards with a  “green label” that could earn them a price premium as the market further develops.

In the European Union, debate concerned whether the growing use of land for biofuel crops ultimately leads to conversion of natural land to cropland, diminishing the extent to which biofuel production cuts carbon emissions. Research on impact findings and policy options is underway, and the region is expected to move forward with adjusting its Renewable Energy Directive. Brazil, China and India have also substantially developed and revised their policies on biofuel that could have large impact on global food security.

The food and agriculture nexus

In an increasingly interlinked global environment, policymakers have begun to more overtly recognize the links between agriculture and nutrition, health, water, and energy.

The agriculture, nutrition, and health nexus came to prominence in early 2011 with an international conference “Leveraging Agriculture for Improving Nutrition and Health” in New Delhi, organized by IFPRI and its 2020 Vision Initiative. This conference inspired and supported a range of new initiatives, including the launch of a major CGIAR research program,  “Agriculture for Improved Nutrition and Health.”  Several development agencies—USAID’s Feed the Future Initiative and the United Kingdom Department for International Development—also began to design or redesign their programs to better tap the links among agriculture, nutrition, and health.

During 2011, 24 countries with high rates of undernutrition joined the Scaling Up Nutrition initiative, a movement bringing together governments, civil society, the private sector, research institutions and the United Nations system to support countries in their efforts to develop nutrition-sensitive national plans. In Sub-Saharan Africa, the New Partnership for Africa’s Development and the Global Alliance for Improved Nutrition agreed to develop a five-year joint program to fully integrate nutrition security into the Comprehensive Africa Agriculture Development Program.

Despite progress, much is left to be done to maximize the opportunities of the agriculture nexus approach. Looking ahead, it will be important to promote evidence-based research that identifies viable opportunities to strengthen linkages across sectors and achieve win-win outcomes.

Land issues

A rising world population, growing demand for food, fiber, and biofuels, and recent spikes in global food prices have placed increased pressure on land, worsening land degradation and increasing land prices, particularly in Sub-Saharan Africa, East Asia, and parts of Latin America.

Major land policy developments in 2011 included a United Nations General Assembly high-level meeting to address desertification, land degradation, and drought. New IFPRI evidence shows that policymakers should pay attention to land degradation not just in dry areas, but also on many high-quality irrigated lands. More should be done to assure the availability of fertilizers in areas where additional fertilizer use is needed and appropriate.

One dimension of land management policies that particularly occupied public discourse in 2011 was the issue of foreign land acquisitions—often described as “land grabbing”—especially in Sub-Saharan Africa. Such acquisitions have the potential to inject much-needed investment into agriculture in developing countries, but they can also harm the food security and livelihoods of the local poor. Reports on the issue in 2011 by the FAO, World Bank, and the International Fund for Agricultural Development all highlighted the role of governments in ensuring responsible investment in agriculture and strengthening land administration systems that respect the rights, livelihoods, and resources of all citizens.

New players

The private sector, emerging economies, and philanthropic organizations are increasingly reshaping the structure and nature of the global food policy landscape. Not only are these new players a largely untapped source of financial support to food security efforts in developing countries, but they also offer a wealth of knowledge and expertise, providing new opportunities to address the increasing complexity and challenges facing the global food system.

TheG20 is quickly claiming a growing role, next to the G8, as a principal forum for managing global economic problems. Emerging economies such as Brazil, China, and India have increased their engagement, especially in terms of forging South–South cooperation. One noteworthy development has been the initiation of cooperation agreements between the Bill and Melinda Gates Foundation and emerging countries such as Brazil and China in support of agricultural and health innovations in the developing world.

In the private sector, the World Economic Forum’s  New Vision for Agriculture Initiative —a collaboration between the World Economic Forum’s partner companies—promotes market-based, multistakeholder strategies for sustainable agricultural development.  In addition, public-private partnerships have been launched to promote sustainable agricultural growth, reduce hunger, and improve nutrition. For instance, PepsiCo has signed several agreements with international organizations to support increased agricultural production(especially among smallholders) alongside long-term nutritional and economic security efforts in countries such as China, Ethiopia, and Mexico. Similarly, private philanthropic and civil society organizations have continued to be major supporters of agricultural development, nutrition, poverty alleviation, and natural resource management. Still, evidence from 2011 shows that the opportunities presented by these new players have not been fully harnessed. To involve new players and retain traditional players in the global food policy arena, we need to strengthen collaboration, build trust, and establish mechanisms for accountability among different stakeholders by constructing strong coalitions of willing partners at the local, regional, and global level.

Outlook for 2012 and opportunities for action

Overall, 2011 and the years immediately preceding it have revealed serious risks facing the global food system—volatile food prices, extreme weather, and inadequate response to food emergencies were among the most visible. But chronic, long-term problems such as food and nutrition insecurity also point to areas where the food system can do better. Addressing these issues in a resource-scarce world will require keeping agriculture and food security issues high on the global agenda.

More broadly, food policy decisionmakers will face a number of challenges in 2012 and beyond. We will soon reach the 2015 target date of the Millennium Development Goals, almost certainly without having met the goal of halving hunger globally. South Asia and Sub-Saharan Africa, in particular, still show alarming levels of food and nutrition insecurity, despite the progress achieved in recent years. In addition, more work will be needed to reach an effective international agreement on climate change.

We must find new ways to exploit the links between agriculture and other sectors, and pay attention to gender equity to make investments and interventions in these areas more effective. A global system to measure, track, and monitor the cross-sectoral impacts among agriculture, food and nutrition security, energy, and natural resources will be important. In addition, to allocate resources more effectively, we should begin to base the prices of natural resources and food on their full value to society, including their social and environmental costs, such as impacts on climate change and health. All of these actions require skills and knowledge at the national and local level, so capacity building can help improve outcomes.

The Global Food Policy Report points to some high-priority areas for action in 2012. The international community should consolidate global and regional agricultural growth strategies and create or strengthen the institutions needed to make these strategies work. Participants in the Rio+20 meeting should integrate economic, social, and environmental sustainability and commit to concrete action to meet the long-term challenges of development, including poor nutrition, degraded soils, and scarce water. Finally, a broad intersectoral coalition should work together to address the crucial and connected issues of nutrition, food, and health.

This article is excerpted from the overview, by IFPRI Director General Shenggen Fan, of  IFPRI’s 2011 Global Food Policy Report. IFPRI’s 2011 Global Good Policy Report - the first in a new annual series - reflects on the challenges and developments of 2011 and provides an outlook for 2012.

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