FAO’s Big Data tool on food chains
under the COVID-19 pandemic


NEWS DIGEST 22/7/2020

Selected daily news on food chain disruptions and countries responses to the COVID-19 impact on food chains.

A truck unloading corn grains at the reception center of the Skvirsky grain processing factory in Skvyra town, some 120 km South from Kiev
©FAO/Genya Savilov

FOOD CHAIN DISRUPTIONS

Food security concerns in China and Kenya have different roots: the former's southern regions have been recently hit by heavy floods, which may cause a meat and vegetable shortage in the future (although China's cereal stock and supply are sufficient for the rest of the year), while the latter has to import much of its food products (e.g. maize from South Africa, onions and pineapples from Tanzania, eggs and tomatoes from Uganda) despite being agriculturally endowed, because of substantial post-harvest losses. On the other hand, the production of palm oil in Indonesia and Malaysia requires intensive deforestation, which leads to enhanced GHG emissions and biodiversity losses.

Floods in China highlight importance of food security

The recent floods in Southern China have raised some concerns about a possible nutrition crisis in the country. China's economy has mostly recovered from the disruptions caused by the coronavirus pandemic, and the country's grains supply is enough to feed the population for the rest of the year; however, the fact that vegetables and meat prices increased in June may be connected to a shortage in the future. In order to avoid this eventuality, more support should be provided to the farmers affected by the floods, in the form of an additional supply of seeds for the crops and feed for livestock, for example.

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Post-Harvest Losses, Threatening Food Security in Kenya

According to Kenya's Ministry for Agriculture, post-harvest losses in the country amount to 40% of the total agricultural production, which gets lost before it actually reaches the market because of poor management, storage and transportation practices. This is one of the causes for Kenya's substantial food imports which have been growing over the last 30 years, even though the country is agriculturally endowed. Infrastructural developments are needed to reduce post-harvest losses and the threats to food security.  

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The palm oil value chain and India's links with global deforestation

Palm oil is vastly consumed in India, mainly because of its low price and high productivity at the production stage. Most of it is imported from Indonesia and Malaysia (which are responsible for 85% of the world's production of palm oil), where rainforests have been deforested and replaced with vast palm oil plantations. These monocultures are dangerous for the environment, because they ultimately cause depletion of soil health, a reduction of carbon-rich forests (Indonesia is one of the principal emitters of greenhouse gases) and biodiversity losses.

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IMPACT ON COMMODITIES AND FOOD PRICES

Georgia (country) exported more fruits and nuts during the first half of 2020, compared to the same period last year, especially hazelnuts, which make up for more than half of the total value of these exports (USD 18.72 million, out of a total value of USD 35.17 million); on the contrary, vegetable exports decreased by 6.5%. In Texas, the recent high temperatures and insufficient rainfall, combined with the closure of various ethanol plants in the Midwest, determined a poor corn harvest. Since corn prices plummeted in early 2020, most of the farmers now prefer storing it until prices rise again.

Georgia's fruit exports grew by 20.5% in first half of 2020

The National Statistics Service of Georgia recently announced that the country's fruit and nut exports (mostly hazelnuts, mandarins, blueberries, bananas, oranges and apples) in the first half of the current year amounted to USD 35.17 million, 20.5% more than the same period last year, when fruit and nut exports were worth USD 29.19 million. Vegetable exports (tomatoes, potatoes, mushrooms and eggplant), on the other hand, are down by 6.3%, compared to last year's figures.

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Texas corn harvest: Average to below average yields seen

Corn harvests in Texas, where millions of acres of corn are planted each year, are average or below average this season, because of early rains and high temperatures. Corn prices have been depressed in recent years, and now they are even lower because of the recent closure of ethanol plants in the Midwest (which use corn biomass as raw material) and consequent lower demand. The price of corn has dropped by about 80% since February, meaning that corn farmers earn USD 72 per acre less than last year: this resulted in the fact that most of them now prefer storing corn until prices rise.

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COUNTRIES' RESPONSE

After both Ghana's and Zambia's economies hit a downturn as a result of the difficulties posed by the coronavirus pandemic, both of them are focusing on the development of the agricultural sector, which respectively employs around 50% and 66% of the total labour force. In the USA, the PLUS Act would fill the gaps in the previous CARES Act, which provided assistance to food service businesses but did not solve the issue of the large debts owed by restaurants to distributors for food that they could not use. The said debts amount to around USD 12 billion in the whole industry: USD 2.2 billion are owed to seafood distributors, USD 5 billion to fruit and vegetable distributors and another USD 5 billion to broadline food service distributors.

Greater attention required for Agriculture, CSOs tell government of Ghana

Since the agricultural sector in Ghana employs around 50% of the total workforce, a group of Civil Society Organizations that are committed to developing agricultural value chains in the country urged the government to exploit the agricultural sector's potential to rebound the economy and build up post-Covid-19 resilience. More in particular, the group asked for an improvement of the farmers' access to inputs and bank loans with flexible lending terms, and for a reduction of post-harvest losses.

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USA legislation aims to offset uncollectable debt due to COVID shutdowns

Two congressmen have recently introduced the Providing Liquidity for Uncollectible Sales (PLUS) Act, a legislation that would provide a tax credit to offset debts incurred by food service businesses (and owed to food distributors) as a result of the difficulties posed by the coronavirus pandemic. Since many restaurants had to close during the early phase of the pandemic, the food service industry experienced around USD 12 billion in uncollected debts.

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Agriculture project in Zambia helps youth turn away from copper and live off the land

In Zambia's Serenje district, the Agriculture Productivity and Market Enhancement Project, financed by the Global Agriculture and Food Security Program (a financial intermediary fund hosted within the World Bank Group), is developing irrigation schemes, enhancing agricultural mechanization, and promoting crop diversification and livestock development. This program is part of the Ministry of Agriculture's strategy to focus on the agricultural sector, as a result of a decrease in copper price caused by the coronavirus pandemic.

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REGIONAL FOCUS

Jihadist terrorism (whose epicentre in Africa is represented by the Sahel region), misinformation, climate change phenomena and poor infrastructures are just some of the underlying causes of food insecurity in West and Central Africa, which have been further aggravated by the coronavirus pandemic. According to Action Against Hunger and the Economic Community of West African States (a regional political and economic union), the impact of the coronavirus pandemic could increase the number of food insecure people up to a maximum of 50 million by the end of August.

AFRICA - An African Powder Keg: Terrorism in the Sahel

High percentages of unemployment, poor transportation, healthcare and education infrastructures and the fact that state institutions are perceived as less authoritative than tribal or ethnic authorities are just three factors of the exacerbation of terrorism in Africa, whose core lies in the Sahel region. Unlike terrorists in the Middle East, Sahel jihadists are hired from local communities to conduct specific operations against government targets and military facilities, causing a rise in the number of internally displaced people (especially in Burkina Faso, Mali and Niger).

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AFRICA - More than 19 M people can face food insecurity in west, central Africa

According to Action Against Hunger, a global humanitarian organization that is committed to ending world hunger, at least 19 million people could face food insecurity between June and August 2020 in West and Central Africa (especially in countries like Chad, Mali, Mauritania, Niger, Senegal and Burkina Faso), due to climate change, and to the impact of the coronavirus pandemic on food production and distribution. Furthermore, misinformation in these regions hampers women's access to reproductive health services, and the possibility for children to undergo an active screening for malnutrition.

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Contacts: FAO Datalab (ESS-datalab@fao.org)