By Stephen Cadogan, communications co-chair, IFAJ.
LACK of investment in the farmers that have fed us for the last 10 to 20 years has left the global food market vulnerable, according to Rabobank, the Netherlands based bank which claims the No 1 position in global food and agri banking.
Rabobank speakers at the Economist Conference in Geneva said farmers are not growing significantly more food for expanding populations – because of a double market failure.
On one side, farmers faced competition from other farmers, often in other countries, based on lowest price. Large global food companies also demanded lower prices for farm produce, while, on the other side, land major industrial firms demanded higher prices for inputs and agricultural supplies.
Meanwhile, global funding of agricultural research was still at the 40 billion USD per annum
level of more than 40 years ago, but the world population had doubled and , in the past 20 years, demand for food has increased 15 times faster than the available area of arable land.
At the end of the day, farmers feed the world, said Berry Marttin, member of the Executive Board of Rabobank (which sponsors the IFAJ website.) “Farming will become more high tech, more specialised and farm size will increase further. But, to create an enabling environment in which farmers can prosper, co-operation between private sector and public sector with farmers is needed,” said Marttin.
The bank has called on agri-commodity traders, food processors and retailers to act now and take the lead in collaborating with farmers, to help them increase productivity.
Many multinationals forget to invest in the critical primary food producers that can create much-needed stability – the individual farmers, according to Rabobank. But private enterprises were now in the driving seat for solving the dilemma of how to create stability in the vulnerable food supply chain, said Rabobank’s Global Head Food & Agri Coverage, Gilles Boumeester.
Rabobank identified four routes for collaboration between multinationals and farmers: long-term investments such as structural access to farm inputs and best agronomic practices; support for farmer innovation or training; improving logistics and finance and free trade; and investing directly in sustainable farmers.