By Aminou Arouna, Guillaume Soullier, Patricio Mendez del Villar, and Matty Demo
Introduction
Around the world, governments and populations continue to grapple with the effects of the COVID-19 pandemic. Of particular concern are the potential impacts of the pandemic and related lockdown measures on food security. While global food supply chains have been generally untouched by COVID-19 and AMIS forecasts strong trade in 2020 for major food commodities, local and regional food value chains may not fare so well, particularly in developing countries. A new paper published in Global Food Security examines the potential impacts of COVID-19 on rice value chains in West Africa and identifies several policy options to help prevent increases in food insecurity in the region.
West Africa continues to face high levels of food insecurity, with almost 56 million people undernourished in 2018. As a staple in regional diets, rice has a substantial role to play in West Africa’s food security, and regional policymakers have ramped up investments in domestic rice value chains since 2008. However, rice consumption continues to outpace domestic production, and many consumers favor imported rice over lower quality domestically produced rice. This leaves the region reliant on rice imports — and vulnerable to supply disruptions and price spikes.
Policy options for mitigating impacts of COVID-19
The new study finds that global rice prices saw a steep rise between December 2019 — the initial outbreak of COVID-19 — and March 2020. While rice prices stabilized in May, it is not yet clear how rice prices will respond to a potential second wave of the pandemic.
The study also examines several channels through which COVID-19 could affect West Africa’s domestic rice value chains. It finds that the pandemic could significantly negatively impact paddy procurement, financing, human resources and labor, and marketing and sale of rice in the region. Value chain logistics and rice processing, on the other hand, should not experience marked effects.
Farmers are the main suppliers of paddy rice in West Africa, so impacts at the farm level could be important for overall value chain functioning as well. According to the authors, farmers’ access to crucial inputs like fertilizers, seeds, credit, and improved technologies and training could be diminished by the COVID-19 pandemic. At the same time, farmers may also have a harder time selling their paddy because of lockdown restrictions preventing access to open air markets and a lack of digital marketing capabilities.
To address these varied risks to domestic rice value chains, policymakers in West Africa should take several steps. In the short term, they should provide financial support for rice millers, both traditional and modern, in order to help improve coordination between farmers and millers, maintain continuity of milling operations, and assist in paddy procurement. This support could take the form of interest-free loans and should include safeguards to prevent speculation. In addition, movement of food should continue to be unrestricted in the region, and lockdown measures on millers should be avoided through strict sanitation requirements. Governments can also buy local milled rice to use in national and regional food stocks in order to bolster food security for vulnerable populations.
In the medium term, governments should focus on creating an enabling environment that fosters both domestic and foreign direct investment in modernized rice value chains. They should also build a regulatory framework for contract farming in order to reduce reliance on informal markets and make value chains more resilient to shocks like COVID-19.
Upgrading West Africa’s rice value chain
A more in-depth look at the state of upgrading West Africa’s rice value chains will be presented at an upcoming webinar, co-hosted by the CGIAR Research Program on Policies, Institutions and Markets and IFPRI’s Food Security Portal. The webinar will be held on October 27 at 10:00 EST.
About the Authors
Citation: Arouna, A., Soullier, G., Del Villar, P. M., & Demont, M. (2020). Policy options for mitigating impacts of COVID-19 on domestic rice value chains and food security in West Africa. Global Food Security, 26(2020) 100405.