Join Moneyweb for a post-budget webinar with Dr Adrian Saville, Dr Iraj Abedian, Sizakele Marutlulle and Dr Azar Jammine for further insights on Wednesday, 28 October at 15h30.

Africa has a growing food security problem: Why it can’t be fixed without proper data

Food production has been disrupted.
Data on food prices are crucial for political and economic stability but are not easily accessible. Image: Shutterstock

The Covid-19 pandemic and consequent lockdown measures have had a huge negative impact on producers and consumers. Food production has been disrupted, and incomes have been lost. But a far more devastating welfare consequence of the pandemic could be reduced access to food.

A potential rise in food insecurity is a key policy point for many countries. The World Economic Forum has stated this pandemic is set to “radically exacerbate food insecurity in Africa”. This, and other supplier shocks, such as locust swarms in East Africa, have made many African economies more dependent on externally sourced food.

As the pandemic continues to spread, the continued functioning of regional and national food supply chains is vital to avoid a food security crisis in countries dependent on agriculture. This is true in terms of both nutrition and livelihoods. Many countries in Southern and East African economies are in this situation.

The integration of regional economies is one vehicle for alleviating pervasive food security issues. But regional integration can’t be achieved without the appropriate support for investment in production, infrastructure and capabilities.

And, crucially, there must be more accurate and timely information about food markets. Data on food prices are crucial for political and economic stability. Yet they are not easily accessible.

A study by the Centre for Competition, Regulation and Economic Development highlights how poor and inconsistent pricing data severely affects the quality of any assessment of agricultural markets in the Southern and East African region.

What’s missing

There have been attempts to collate and disseminate agricultural prices internationally. National commodity exchanges have also been created in some countries to facilitate wholesale agricultural trade and the collection of market and price information in Africa. These include the Regional Agricultural Trade Intelligence Network, the Food and Agricultural Organization’s Corporate Statistical Database and the World Food Programme’s Vulnerability Analysis and Mapping database.

But the overall effectiveness of commodity exchanges has been limited in countries in Southern and East Africa. With some exceptions, they have not been widely used, meaning that small producers have not had good access to reliable pricing information.

The patchy data that is available at the producer level indicates very large price differentials across Southern and East Africa. These differentials are far in excess of reasonable transport and related costs. They speak to the lack of integration of markets. They also point to the potential that local market power is being exploited. An example would be the power of large buyers over small producers who face high transport costs to individually transport goods to faraway markets.

Having up-to-date information on food prices – along with other market information relating to production and market structures – is necessary to understand agricultural food systems in the region. This is crucial to track events ranging from the effects of this pandemic to the weather as well as locust swarms.

Without close to realtime data, it is not possible to rapidly plan appropriate responses.

In addition, the lack of readily available market data restricts our understanding of the impact of changing supply and demand conditions in local markets, and regional value chains more broadly. The climate crisis – and other supply shocks like the pandemic – imply much greater volatility in production and food prices. The effects will become ever more dire for farmers, vulnerable consumers and downstream industries.

Hit the reset button

Máximo Torero, chief economist of the Food and Agriculture Organization, has observed that this pandemic is an opportunity to hit the reset button on policies to alleviate food security problems. It has emphasised the fragility of overdependence on a globalised agricultural system. What is needed to achieve a more integrated and regionalised agricultural system is coordinated public policy responses to support agribusiness. These responses must also ensure small and medium-sized farmers are included.

The World Bank is working closely with many governments to track domestic food and agricultural supply chains. The goal is to ensure that food systems continue to function despite the challenges wrought by Covid-19. In addition, the Food and Agriculture Organization has mapped a way to potentially avoid a looming food crisis in Africa. These short-term measures are welcomed.

Action can be taken at a regional level too. For example, an effective market observatory would assist in the promulgation of wider, deeper and more competitive agricultural markets. Market observatories help market participants in reading market signals while also reducing market volatility.

Examples of these can be found throughout the European Union covering a range of agricultural products. Developing this capability would also contribute to identifying key trends in the region in close to realtime. And it would help identify issues relating to market access, border and transport-related problems, and possible anticompetitive behaviour.

In the medium to long term, greater attention is needed on ensuring appropriate market shaping measures for more resilient and integrated regional agricultural systems in the Southern and East African region. Such measures depend on having accurate and timely information on market participants, food production and prices.The Conversation

Simon Roberts, professor of Economics and Lead Researcher, Centre for Competition, Regulation and Economic Development, UJ, University of Johannesburg and Jason Bell, Researcher at the Centre for Competition Regulation and Economic Development, University of Johannesburg

This article is republished from The Conversation under a Creative Commons license. Read the original article.

COMMENTS   7

Sort by:
  • Oldest first
  • Newest first
  • Top voted

You must be signed in to comment.

SIGN IN SIGN UP

Typical Conversation article. We need more data and who better to supply it than organisations leeching off the taxpayer such as governments, the EU, academics and quasi government organisations. Of course, the primary parasite, the World Bank, whose sole stock in trade is irredeemable debt, punitive taxation to collect its dues and perpetual misery/ modern economic slavery is never far from the pig trough. African individuals were enslaved hundreds of years ago. Today their government work with the World Bank to carry on this legacy.

Africa’s problem is lack of responsible governance, an exploding population and intensive subsistence agriculture. The USA solved the food problem almost a century ago by not doing this. Market forces facilitated mass migration to the cities where jobs and lifestyles were, farm mechanisation, farm consolidation, large scale extensive agriculture, the emergence of professional farmer, outsourcing of harvesting, bountiful harvests and massive surpluses.

Academics have become an irrelevant joke thinking they can solve the food problem with statist intervention and information rather than market forces.

On their own version: “Established in 2017, the Industrial Development Think Tank (IDTT) is supported by the Department of Trade and Industry (the dti) and is housed in the Centre for Competition, Regulation and Economic Development (CCRED) in partnership with the SARChI Chair in
Industrial Development at the University of Johannesburg. The studies review trends of (de)industrialisation and assess the potential for structural transformation to drive growth, industrialisation and development in different sectors in South Africa.”

Wonderful. I have two suggestions for economic growth in SA that you should (but won’t) consider: 1. Abolish the whole DTI, from the minister down. Save some serious cash on public sector wages in the process – in case you haven’t noticed, the country really needs it. 2. Educate all children to the absolute limits of their potential. This will only happen if SADTU is marginalised and all its members prohibited from entering school premises, ever again. Appoint only teachers who have a passion for education and are, at a minimum, willing to show up for work.

Lack of data could be a problem. But the lack of property rights and the potential infringements on them are the biggest problem. The market will function well enough if property rights are a healthy cornerstone of an economy.

Agricultural subsidies in developed nations combined with the populist policies in third world countries is a recipe for food insecurity in developing nations. In modern times, famine is not a result of adverse weather or a disease, but allways the result of political policies.

As tievo stated, there is never food insecurity where farmers enjoy property rights. That is why the USA and Europe can dump their overproduction in Africa, bankrupting African entrepreneurs. Socialist policies turn societies into beggar nations.

This is also the South African future under the communist Department of Trade and Industry. The DTI is the organization that exports food security and employment opportunities to developed nations and imports unemployment and food insecurity from them.

The unemployment stats and the rising food insecurity prove that the DTI is very successful at the implementation of their communist policies.
DTI = hunger

Africa’s lack of freehold land tenure is the problem.

The sudden unnecessary lock downs have caused huge disruptions in global supply chains, from which Africa is not exempt.

Idiots like the leader of WEF (Klaus Schwab) and other academics that pretend to know what is best for Africa have no clue. They refer to the devastating ‘pandemic’ – sorry what pandemic? There are 29,000 supposed deaths on a continent of 1.4 billion. Remove RSA and Egypt and this plummets to 11,000 for 1.3 billion.

https://www.worldometers.info/coronavirus/

The list of African countries and their cumulative 6mth death tolls read on average like a bad weekend of bus and taxi accidents, not a devastating black plague like epidemic it has been made out to be. According to Neil Ferguson Africa would have well over 5 million deaths by now, yet we are only at 0.58% of his prediction. How many of you would keep your jobs if you, with a straight face made a ‘calculated’ forecast, that was WRONG by a factor of 200 times?

I keep on seeing in the RSA news these remarkable stories, on how we are lucky the flu has been non-existent this year!? Really, has it ever occurred to anyone that the flu is as ever present and fatal as it always is, however, now everything is classified as Covid – in the desperate pursuit of serious relevance. You will see similar bizarre remarks made about how lucky Londoners and New Yorkers are that they have been ‘strangely’ spared the usual heavy load of heart attack deaths, stroke deaths and other cardio vascular type deaths that usually plague the medical systems this year – again this is playing out all over the world. It would appear unless you are hit by a bus with multiple witnesses and a live mainstream TV feed running at the time, that every death is a Covid death unless proven otherwise!

Maximo Torero and the infamous FAO, is singing Klaus Schwabs great RESET plan. Complaining that AFRICA has no real time data and comparing it to the EU and their real time data, is both meaningless and laughable. First of all, the consideration that there exists any form of a real and free market in the EU agricultural market, is insanity. It is the most heavily distorted/ subsidized and government centrally planned and regulated market in the world – to render real time data outside of the centrally planned corridors of power useless.

Generally the African continent gets along just fine and are not the mindless idiots the EU makes them out to be. The internet and smart phones now mean the EU is unable to take advantage of the continent in a way they used to. A rural artisanal miner selling his product in Goma can see the real time gold price, just as easily as a seller of sesame or corn in Gulu can see the international and their closest market prices.

Agricultural prices in the EAC region have a way of finding their levels within hours on a daily basis by natural arbitrage. Every player, small and large is acutely aware of the transport costs in real time to their practical markets. I would argue that smaller players have been more fleet of foot in this nonsensical lockdown and staying alive a lot better than the big boys. The large players when faced with closed borders, have in a lot of cases far too much product for the local market, so it has rotted or spoiled and has been written off, this is a sad fact the world over of many products not just African ones. Look how many millions of litres of milk are flushed daily, how products in silos is rotting and over flowing. How beer has been flushed… the list is endless.

Total supply chain destruction occurs, when you get a bunch of academics/ idealists/’epidemiologists’ and agenda driven politicians deciding what is best for them, not us.

If they had even bothered to sit down with logistics experts, company owners and operators and real life economists – they would never have even considered a lock down. There is a perception that the worst is over – it has sadly not even really started. Chronic shortages in just about everything are coming and in many cases are already here.

The authors might firmly believe in the need of what they call market shaping measures for Africa – which interpreted means a 1st world distorted EU type system superimposed on 3rd world Africa. But then their experience consists of likely 2 degrees and 6yrs on college campuses – try spending 30yrs on the ground in Africa and seeing things in real time, in the real African world.

And in THIS African country, food security will also NOT BE fixed with farm murders!!

End of comments.

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR

Podcasts

NEWSLETTERS WEB APP SHOP PORTFOLIO TOOL TRENDING CPD HUB

Follow us:

Search Articles:Advanced Search
Click a Company: