2.2 The sustainable production challenge

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Agriculture faces a daunting challenge. It must dramatically increase food production while completely transforming the way in which food is produced. On current trends, demand for food may increase by 70 per cent by 205010 due to population growth and economic development. The Earth’s population is expected to grow from around 6.9 billion today to 9.1 billion in 2050 – an increase of one-third11 – by which time an estimated seven out of ten people worldwide will live in Low-Income Food Deficit Countries (LIFDCs).12

These are forecasts with big margins of error. Greater investment in solutions that increase women’s empowerment and security – by improving access to education and healthcare in particular – will slow population growth and achieve stabilization at a lower level.

But the Malthusian instinct to blame resource pressures on growing numbers of poor people misses the point, because people living in poverty contribute little to world demand. Skewed power relations and unequal consumption patterns are the real problem.

The global economy is forecast to be three times bigger by 2050, with emerging economies’ share of output rising from one-fifth to well over a half.13 This is a good thing, and fundamental to addressing the challenges of equity and resilience. But for this level of development to be viable, an unprecedented shift to more sustainable consumption trends must take place in both industrialized and emerging economies.

Fig3.eps

At present, higher incomes and increasing urbanization leads people to eat less grains and more meat, dairy, fish, fruit, and vegetables. Such a ‘Western’ diet uses far more scarce resources: land, water, atmospheric space (see Figure 3).

In the meantime, in more than half of industrialized countries, 50 per cent or more of the population is overweight,14 and the amount of food wasted by consumers is enormous – quite possibly as much 25 per cent.15

Yield increases drying up

In the past, rising demand has been met and surpassed by increasing crop yields, but the dramatic achievements of the past century are running out of steam. Global aggregate growth in yields averaged 2 per cent per year between 1970 and 1990, but plummeted to just over 1 per cent between 1990 and 2007. This decline is projected to continue over the next decade to a fraction of one per cent.16

The US Department of Agriculture’s Economic Research Service observed in 2008 that global consumption of grain and oilseeds outstripped production for seven of the eight years between 2001 and 2008.17

Modern agro-industrial farming is running faster and faster just to stand still. Put simply, increasing irrigation and fertilizer use can only get us so far, and we’re nearly there. With the exception of parts of the developing world, the scope for increasing the area under irrigation is disappearing.18 Increasing fertilizer use offers ever diminishing returns and serious environmental consequences.

But it is not like this everywhere. Throughout the developing world, there is huge untapped potential for yield growth in small-scale agriculture.19 With the right kind of investment this potential can be realised – helping to meet the sustainable production challenge while delivering agricultural development for people in poverty.

Policy making captured by the few

Sadly, investment in developing country agriculture, despite the huge potential benefits, has been pitiful. Between 1983 and 2006, the share of agriculture in official development assistance (ODA) fell from 20.4 per cent to 3.7 per cent, representing an absolute decline of 77 per cent in real terms.20 During this time rich country governments did not neglect their own agricultural sectors. Annual support spiralled to over $250bn a year21 – 79 times agricultural aid22 – making it impossible for farmers in poor countries to compete. Confronted with these odds, many developing country governments chose not to invest in agriculture, further compounding the trend.

The costs of rich country support are borne not only by poor farmers in the developing world, but also by people in rich countries, who pay twice – first through higher tax bills, and second through higher food prices. It is estimated that in 2009, the EU’s Common Agricultural Policy (CAP) added €79.5bn to tax bills and another €36.2bn to food bills.23 According to one calculation, it costs a typical European family of four almost €1,000 a year. The real irony is that the CAP purports to help Europe’s small farmers, but it is the rich few that benefit the most, with about 80 per cent of direct income support going into the pockets of the wealthiest 20 per cent – mainly big landowners and agribusiness companies.24 Never, in the field of farming, has so much, been taken from so many, by so few.

In the aftermath of the 2008 food price crisis, rich countries at the G8 Summit announced the l’Aquila Food Security Initiative: a commitment to mobilize $20bn over three years for investment in developing countries. If this was an attempt to atone for past sins, it was, at best, underwhelming. The pledge amounted to a derisory fraction of the subsidies that rich countries were lavishing on their biofuels industries at the time – one of the key drivers of the 2008 price hike.25 Incredibly, a large portion of this figure has turned out to be recycled from past promises or double-counted against other commitments. In the case of Italy, the l’Aquila commitment actually represented a reduction in aid.26

Rich country governments have spectacularly failed to resist the capture of agricultural policy making by their farm lobbies. The results? Drastically reduced agricultural productivity and increased poverty in the South, and the plunder of hundreds of billions of dollars a year from taxpayers in the North.