Diversity and resilient food systems are crucial to avoid even worse global food price crisis

06 May 2022 --- Food systems are in need of urgent reform if millions are to be spared from critical food insecurity, according to the International Panel of Experts on Sustainable Food Systems (IPES).

IPES calls for urgent action to provide financial assistance and debt relief to vulnerable countries and a crackdown on excessive commodity speculation. In addition, it implores food industry players to build regional grain reserves, diversify food production and restructure trade flows, reduce biofuels, livestock numbers and reliance on fertilizers and fossil energy in food production. 

The IPES warnings come in light of a third food price crisis in 15 years initiated by the invasion of Ukraine by Russia. IPES experts say “underlying rigidities, weaknesses and flaws in global food systems” are fanning the flames of global hunger.

However, today’s Food and Agriculture Organization (FAO) Food Price Index shows world food commodity prices decreased in April after a large jump the previous month, led by modest declines in the prices of vegetable oils and cereals.

“One thing that can be done right away is to cancel the debt of food import-dependent countries hit by rising food prices so that they can access food in the short term to avoid catastrophic hunger and invest in building their diverse food productions systems to reduce their vulnerability to shocks,” Jennifer Clapp, IPES-Food expert and Canada research chair, global food security and sustainability, University of Waterloo tells FoodIngredientsFirst.IPES-Food calls for urgent action to provide financial assistance and debt relief to vulnerable countries.

“In the current moment, food systems are facing multiple challenges due to conflict, climate change, and disease – and it’s vital that we build greater diversity into food systems to make them more resilient and able to respond and adapt to shocks,” Clapp continues.

The panel details the situation, concerns and potential solutions in a special report, “Another Perfect Storm? How the failure to reform food systems has allowed the war in Ukraine to spark a third global food price crisis in 15 years, and what can be done to prevent the next one”. 

Flawed food system needs urgent fix-up
The IPES-Food report was meant to coincide with the FAO Food Price Index. 

FAO still predicts global wheat production to grow in 2022, to 782 million metric tons. The forecast incorporates an expected 20% decline in harvested area in Ukraine as well as drought-driven output declines in Morocco.

The FAO Vegetable Oil Price Index decreased by 5.7 percent in April, shedding almost a third of the increase registered in March, as demand rationing pushed down prices for palm, sunflower and soy oils. Uncertainties about export availability out of Indonesia, the world’s leading palm oil exporter, contained further declines in international prices. 

“The small decrease in the index is a welcome relief, particularly for low-income food-deficit countries, but still food prices remain close to their recent highs, reflecting persistent market tightness and posing a challenge to global food security for the most vulnerable,” says Máximo Torero Cullen, chief economist, FAO.One of the main drivers of food insecurity is food import dependencies concentrated on wheat, rice and maize.

This month, the FAO reported that in 2021 around 193 million people in 53 countries or territories are experiencing acute food insecurity at crisis or worse levels. This represents an increase of nearly 40 million people compared with the already record numbers of 2020.

The Russian invasion of Ukraine will cause severe malnutrition globally, especially for women and children, according to a new multi-sourced expert analysis for the scientific journal Nature.

World food commodity prices made a significant leap in March to reach their highest levels ever, as war in the Black Sea region spread shocks through markets for staple grains and vegetable oils, the FAO reported in April.

The experts report that heavy reliance on food imports and excessive commodity speculation was not corrected following previous food price spikes in 2007-2008. As a result, flaws in the food system were exacerbated and allowed the Russian conflict to become a global food price crisis. 

FAO modeling suggests that the number of undernourished people could increase by 13 million this year. 

Clapp explains: “At present, the bulk of the calories consumed in the world comes from a very narrow range of crops (wheat, rice, maize) with production of those crops concentrated in a small number of countries, which is exported globally by just a handful of trading firms. 

“The concentrated nature of the global food system along these various dimensions creates rigidities, which can have cascading consequences when there are disruptions to any part of it. Diversity can help make food systems more resilient by providing alternative options when shocks occur,” she says. 

Diversification of food production will mean producing a wider variety of foods, including more traditional and ecologically appropriate crops in a wider variety of countries. In addition, environmentally diverse production methods are needed to balance global supply chains.

Rising price of breadThe warnings come in light of a third food price crisis in 15 years initiated by the invasion of Ukraine by Russia. 
Roughly 26 countries source more than 50% of wheat imports from Ukraine and Russia. The figure is between 80 and 100% for Eritrea, Somalia and the Democratic Republic of Congo.

The price of bread has doubled in Sudan and increased by 70% in Lebanon. The report stipulates that the cost of importing wheat in Kenya and Egypt has increased by 33%. The poorest populations in low-income countries spend over 60% of their income on food, and as such, even small price rises can have devastating impacts. 

“To prevent prices spiking even further, we urgently need transparency on the market situation, and governments must follow through on commitments to start sharing information on privately held stocks,” Clapp continues. 

Unresolved drivers of food insecurity
IPES-Food has taken stock of growing food insecurity ten weeks after the outbreak of war in Ukraine. 

One of the main drivers of food insecurity is food import dependencies concentrated on wheat, rice and maize, which has led to a decline in global dietary diversity. Cash crops have been promoted over more diverse food provision, and some countries are entirely dependent on imports of staple foods while being in mass debt.

Entrenched production systems are other worrying factors. Geographical over-specialization, trader and governmental preferences for commodity crops and biofuels, and reliance on synthetic fertilizers hold back farmers’ abilities to diversify food production and shift food production practices.

Reducing dependency is key to reform
The expert panel warns against short-sighted responses to the crisis that exacerbate the situation, such as suspending environmental regulations, ramping up industrial food production, and promoting export-oriented fertilizer-dependent agriculture. 

“A new generation faces mounting food insecurity, and it seems no lessons have been learned since the last food price crisis. Continuing to rely on a handful of food commodities and countries for global food supplies, combined with predatory financiers betting on food, is a recipe for disaster,” adds Olivier De Schutter, co-chair, IPES-Food and UN special rapporteur, extreme poverty and human rights.

By Inga de Jong