This week I attended an expert meeting on climate change and agriculture organized by the Trade and Markets Division at FAO. I gave a presentation on ITC’s experience in working on addressing climate change in traded agricultural commodities, specifically tea in Kenya. One of the emerging themes was how trade is linked to the issues. Firstly, the big picture:
Climate change will have an impact on all four dimensions of food security, namely, food availability, access to food, utilization of food, and stability of the food system
(IPCC AR5 WG2 C7) (see Wheeler, T & von Braun, J. Science 134, 508 (2013)CC Impacts on global food security Doi 10.1126/science.1239402)
Trade smoothes out regional differences in food availability
Climate change is reducing crop productivity in regions close to the equator. This is putting food security at risk. According to the IPCC, the combined effect of climate and CO2 change appears about as likely or not to increase prices with a range of 30 to 45% by 2050 (IPCC AR5 WG4 ch7)
Food instability will grow so trade will grow in importance as way to smooth out regional differences
Thus it is important to keep trade open so that obstacles like tariffs and export quotas do not restrict the flow of food from surplus areas to food insecure areas. In 2007, the food crisis due to crop failures was exacerbated by restrictions placed on exports from Russia and Ukraine. By contrast a food crisis was averted following the drought in the US in 2012 as trade was not subject to these restrictions.
However, trade can only go so far to ensure food security
- Under IPCC scenarios,, the imbalance of food availability between temperate and tropical regions will increase. Trade will not be enough given the reduced supply and variability of supply in the latter. The vast majority of food is eaten domestically and is not traded. Trade can “knock tops and bottoms off variability” but climate change scenarios are worrying as variation between supply and demand is already great in food insecure countries.
- Furthermore, trade requires that the recipient country pays for the transfer. This is a challenge for already food insecure, resource constrained countries.
Trade is efficient way to access water in water scare areas
Trade is an efficient way to redistribute water from water rich areas e.g. northern France to water scarce areas, e.g. central Spain. Water is often redistributed in the form of cereals imports. It spreads the risk of agricultural production in a region that is food insecure. In the Horn of Africa, imports of crops into water-scarce regions are vital for smoothing out seasonal scarcities.