FSP Blog

Russia's invasion of Ukraine has imperiled global food security—creating suffering within Ukraine and displacing millions, while disrupting agricultural production and trade from one of the world's major exporting regions. The latter threatens to drive rising food prices still higher and create scarcity, especially for regions most dependent on exports from Russia and Ukraine—particularly the Middle East and North Africa.

The unfolding crisis in Ukraine has roiled commodity markets and threatens global food security. Ongoing fallout from the COVID-19 pandemic and other factors have already driven up food prices. Poor harvests in South America, strong global demand, and supply chain issues have reduced grain and oilseed inventories and driven prices to their highest levels since 2011-2013.

In developing countries, rural non-farm labor is rapidly catching up with agriculture in socioeconomic importance. By engaging in non-farm labor—activities like handicrafts, small-scale manufacturing, construction, mining, quarrying, repair, transport, and petty trading—farmers can earn additional income outside of their farms. This income can in turn can be invested in household food security and in productivity-enhancing agricultural inputs. A study in Ghana published in Food Security also finds that participation in non-farm labor can also lead to greater participation in crop markets.

In countries across Africa south of the Sahara (SSA), agricultural value chains often rely on agro-dealers—small-scale local distributors—to help bridge the gap between input firms and farmers. Agro-dealers can thus form an important node of the value chain, providing access to critical inputs like seeds, inorganic fertilizers, and new agricultural technologies that can help increase productivity and improve food security.

Small and medium enterprises (SMEs) in the midstream of agrifood value chains—wholesalers, logistics, and processors—play a critical role to food security and value chain transformation. These enterprises help keep food supplies affordable and stable, provide employment and income for millions of rural and urban workers, and improve food quality and safety for consumers. However, in South Asia, Africa south of the Sahara (SSA), and other developing regions, SMEs often don’t play a role in the food system transformation conversation.