High Food Prices Provide Opportunity for Agriculture
29/04/08

FAO Director-General Jacques Diouf today called on the international community not only to take immediate action to de-fuse the current world food emergency but also to seize the opportunities offered by higher food prices and prevent similar dramatic situations occurring in the future.

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In a statement published on the FAO website, Dr Diouf said, “The time for re-launching agriculture is now and the international community should not miss the opportunity.”

High food commodity prices called for a twin-track approach featuring policies and programmes to assist the millions of poor whose livelihoods were at risk, and steps to help farmers in the developing world take advantage of the new situation.

“We must produce more food where it is urgently needed to contain the impact of soaring prices on poor consumers, and simultaneously boost productivity and expand production to create more income and employment opportunities for the rural poor,” Dr Diouf said.

“We have to ensure that small holder farmers have proper access to land and water resources and essential inputs such as seeds and fertilisers. This will enable them to increase their supply response to higher prices, boosting their incomes, improving their livelihoods, and ultimately benefiting consumers as well,” Dr Diouf said.

June summit

The issue of food prices will be discussed on June 3-5 when world leaders meet in Rome at FAO’s invitation to attend a High Level Conference on World Food Security: the Challenges of Climate Change and Bioenergy. Guests whose presence at the summit has already been confirmed include Presidents Sarkozy of France and Lula of Brazil, and UN Secretary-General Ban Ki-moon.

While high food prices exacerbate food insecurity and create social tensions there was a danger of the emergency overshadowing the longer-term aspects, Dr Diouf warned.

“To ensure that small farmers and rural households benefit from higher food prices, we need to create a favourable policy environment that relaxes the constraints facing the private sector, farmers and traders,” he added.

That would mean reversing the decline in the level of public resources spent on agriculture and rural development and investing more in agriculture, Dr Diouf said. Investments by the private sector in agriculture and related sectors would be forthcoming if appropriate investments in public goods were put in place

Constraints not just low prices

Besides historically low prices, farmers in the developing world have had to battle constraints including lack of infrastructure such as transport and communications, access to technology and extension services and well-functioning marketing and credit systems.

Lack of irrigation, especially in sub-Saharan Africa, was another major problem that must be resolved. When food prices soared in the 1970s many Asian governments chose to invest in irrigation and agricultural research, and this set the stage for rapid productivity growth that saved millions from poverty and hunger, Dr Diouf recalled.

“A similar response is urgently needed today – particularly in sub-Saharan Africa,” he added.

Last December FAO launched an emergency Initiative on Soaring Food Prices (ISFP) to provide 37 Low-Income Food Deficit countries (LIFDCs) with the seeds and inputs to boost their domestic food production. FAO has called for 1.7 billion dollars of international financing to implement the plan.

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