Declining Food Prices May Affect Farmers – FAO

farmers

Declining prices can thwart international efforts to eradicate hunger and  poverty unless steps are taken to guarantee decent incomes and livelihoods for small-scale producers, Food and Agriculture Organisation (FAO) Director-General José Graziano da-Silva has  said.


Globally, food prices are believed to be back to their long-term downward trend in real terms, as supply growth outpaces demand.

This follows the price surges experienced during the 2008 to 2012 and a prolonged period of volatility in food markets, Graziano da Silva told Agriculture and Trade Ministers and other government officials and experts, attending a high-level meeting on agricultural commodity prices at FAO’s headquarters in Rome.

“As policy makers, you are confronted by the challenge of keeping nutritious food affordable for the poor, while ensuring good incentives for producers, including family farmers,” he added.

“Low food prices reduce the incomes of farmers, especially poor family farmers who produce staple food in the developing countries. This cut in the flow of cash into rural communities also reduces the incentives for new investments in production, infrastructure and services,” the FAO Director-General said.

He underscored the need to consider the current decline in agricultural commodity prices in the context of the international community’s efforts to achieve the 2030 Agenda for Sustainable Development and the Sustainable Development Goals.

In a video address to the meeting, World Trade Organisation (WTO) Director-General Roberto Azevêdo said that “under the right circumstances” trade provides people with opportunities to join global markets and helps to create incentives for producers to invest and innovate.

The “historic decision” struck in Nairobi in December 2015 by WTO members to eliminate agricultural export subsidies, according to Azevêdo will “help level the playing field in agriculture markets, to the benefit of farmers and exporters in developing and least-developed countries.”

For his part, Graziano da Silva pointed to the potential of trade in contributing to global food security and better nutrition, specifically underlining its potential role as an “adaptation tool” to climate change.  Countries that are projected to experience decreasing yields and production due to climate change, will have to resort to the global markets to feed their populations.