12 September 2012
Food prices have been in the press again in recent weeks, and it’s particularly important news here in China, where vegetable prices surged 24% in August, while fruit prices rose nearly 10%, driving the overall inflation rate back up to 2% in August and contributing to the broader conversation on the health of China’s economy.
So it’s not surprising that the discussion here at the Annual Meeting of the New Champions was lively. We started off with some pretty tough questions: will it be possible by 2030, with a growing and wealthier population of 8 billion, to provide affordable food for all? Even if sometimes affordable, can prices be kept stable to avoid shocks for consumers? We may be able to provide the basic calories, but will the food be nutritious enough? Can it be produced in a way that protects biodiversity, or are more monocultures inevitable to grow the sheer volume of food we need? Does the small farmer have a long-term role? Can we more fast enough to improve yields to cope with water scarcity as it begins to bite? And did someone mention climate change?
Much of the discussion, unsurprisingly, concerned agriculture. Environmental best practices have been developed. But how widely are they applied, and how can this be accelerated? There are some nice examples of microfinance for small farmers, or using mobile technologies to share weather information and agricultural advice, but getting these beyond the project scale to tens of millions of farmers is vital.
To improve environmental efficiency in agriculture, we need to look through the lens of the water-food-energy nexus and recognize that we need solutions that tackle all three challenges intelligently. Drip irrigation saves water, but can also be more energy efficient and, in fact, that may be the greater driver.
The role of new technologies was well debated – but many concluded that we already have extensive agricultural technologies that need to be made available more widely. However, this isn’t always a developed-to-developing world transfer: the Western system of high-input agriculture isn’t sustainable in a resource-scarce world.
Education is a critical step to address this, and perhaps NGOs, companies and governments could work more effectively together towards a common interest of better-educated and more aware farmers.
On smallholder finance, cooperatives to leverage greater scale to secure finance may work well for dairy and livestock farming in India but, when it comes to arable land, farmers are wary of pooling their land. Indeed, in many countries, the long and difficult journey of improving land tenure is one of the critical paths that must be followed to secure finance for small farmers. Accessible and affordable crop insurance is also important, and better pricing of natural resources such as water will also lead to a more sustainable model over the long term, although it needs to be phased in carefully.
The Forum’s New Vision for Agriculture initiative brings together key agricultural firms, their major multinational food and beverage company customers, farmers and a range of government and other stakeholders to set aggressive targets for 2020 to accelerate the implementation of many of these challenges.
But we must remember that the food debate is not just about agriculture. One of the hottest discussions of the day was how we can drive waste out of the total food system, sometimes estimated at 25-30% in both the developed world (post-consumer) and the developing world (post-harvest). In the developed world, awareness of the broader environmental impact of food waste among consumers is low, but if you follow the water-food-energy nexus to its logical insights, the impact of our inefficiency is vast. A shadow price for food waste shown on a consumer’s shopping receipt – “Today you bought US$ 100 of food but you will waste US$ 26 of it” might be one idea.
In the developing world, investments in better infrastructure to access agricultural areas would make a major difference: reducing waste through better storage and quicker processing; improving access to international markets; allowing increased mechanization on the farm; and applying simple technologies to significantly improve yields.
But, beyond being more efficient in the field and wasting less in the system, do consumers need to change their tastes on a major scale? Should those of us who consume it choose to eat far less meat because of the huge impact in terms of water use, greenhouse gases and land use?
One of my own highlights of three days with the Forum’s Young Global Leaders in Beijing, immediately before the Annual Meeting of the New Champions, was the quality of the vegetarian restaurants we visited. Normally I wouldn’t have hunted one out, but it challenged me to reconsider my view of vegetarian food. That was one lesson I didn’t expect to take home from China.