KENYA. A member of the FAO-trained youth Blessed Achievers Group waters a garden of vegetables at a farm in Kiambu.
©FAO/Luis Tato

With eight years remaining to end hunger, food insecurity and all forms of malnutrition (SDG Targets 2.1 and 2.2), the world is moving in the wrong direction. As this report reveals, food insecurity further deteriorated in 2021, and the only progress made towards the 2030 global nutrition targets was for exclusive breastfeeding among infants under six months of age and child stunting, while anaemia among women and adult obesity are actually worsening. To help prevent rising levels of malnutrition and realize the human right to food, everyone must have access to healthy diets, but updated estimates suggest they are unaffordable for almost 3.1 billion people around the world.

The lingering effects of the COVID-19 pandemic and their consequences continue to impede progress towards the achievement of SDG 2 by 2030. The unequal pattern of economic recovery in 2021 among countries and the unrecovered income losses among those most affected by the pandemic have exacerbated existing inequalities and have worsened the food security situation for the populations already struggling the most to feed their families. Food prices have also increased in the past year due to bottlenecks in supply chains, soaring transport costs and other disruptions caused by the COVID-19 pandemic. Furthermore, the war in Ukraine, involving two of the biggest producers in agriculture and staple cereals globally, is disrupting supply chains and further affecting global grain, fertilizer and energy prices, leading to shortages and fuelling even higher food price inflation. On top of this, the growing frequency and intensity of extreme climate events are proving to be a major disrupter of supply chains, especially in low-income countries (LICs).

Altogether, the intensification of the major drivers of food insecurity and malnutrition – conflict, climate extremes, economic shocks, combined with growing inequality – often occurring in combination, continues to challenge the quantity and quality of foods people can access, while making the fiscal situation of many countries more challenging for governments trying to mitigate the effects of these drivers.

As emphasized in the last two editions of this report, to meet the targets of SDG 2 by 2030, agrifood systems must be transformed in ways that ensure they deliver lower cost and safe nutritious foods that make healthy diets more affordable for all, sustainably and inclusively. In this report, it is argued that healthy diets must be delivered at lower costs to contribute to people’s ability to afford them, which implies both an expansion in the supply of the nutritious and safe foods that constitute a healthy diet and a shift in consumption towards them. From both a policy and advocacy perspective, this also implies that healthy diets need to be more affordable relative to unhealthy diets. There are several entry points to do this, but the current context of economic recession, reduced household income (at least for the lowest deciles of the income distribution), erratic tax revenues, and inflation pressures is not one in which many countries – certainly not many middle-income countries (MICs) and LICs – could massively invest in agrifood systems to enable a recovery with improved food security and nutrition of their inhabitants.

Thus, the options available to transform agrifood systems need to be carefully considered, aiming at the most cost-effective and efficient use of limited resources in ways that contribute to making healthy diets more affordable for all. In the current recessionary context, public spending and investments become particularly important, because many private investors (including agrifood systems actors) are more risk averse in terms of investments within the agrifood systems sphere as they tend to be more on the high-risk, low-reward spectrum in terms of monetary reward, especially in the short term. To this end, governments must wield public policy to support delivery of affordable healthy diets in order to create an environment more conducive for private investment that helps accelerate recovery with improved food security and nutrition of their inhabitants.

Repurposing policy support to make healthy diets more affordable, sustainably and inclusively

Against this backdrop, allocating existing public budgets and price incentives in a different manner becomes more an urgent necessity; it must indeed be the primary step, even for countries that need and can increase these budgets. It is possible to allocate public budgets more cost-effectively and efficiently for achieving development objectives, including reducing the cost of healthy diets, thus improving affordability, sustainably and inclusively, ensuring no one is left behind.a In this regard, many countries can repurpose their food and agricultural policies towards these objectives, while ensuring that other agrifood systems policies and complementing policies in other sectors – such as health, social protection and the environment – are there to create incentives that are coherent to this end (see Box 1 for definitions of repurposing, and food and agricultural policy support).

BOX 1Definitions of repurposing, and food and agricultural policy support

Repurposing policy support – as defined recently in a joint report published by the Food and Agriculture Organization of the United Nations (FAO), United Nations Development Programme (UNDP) and United Nations Environment Programme (UNEP) (2021),1 is the reduction of support measures that are inefficient, unsustainable and/or inequitable, to replace them with support measures that are the opposite. In other words, support is not eliminated but reconfigured. In this way, repurposing will always imply reforming.*

Policy support to food and agriculture, in this report, refers to any form of government financial support to these sectors or government policy that directly or indirectly impacts the production and trade of food and agriculture goods throughout the food value chain.

  • Agricultural policy support typically consists of various types of measures that implicitly or explicitly affect farm gate prices or profitability or provide monetary transfers to farmers or public expenditure and investment in general services and public goods** that benefit the agricultural sector. This includes, for example, price (dis)incentives (mainly border measures and domestic price interventions), which implicitly represent transfers from consumers and taxpayers to farmers (or vice versa).
  • Food policy support is generally broader in scope covering not only how food is produced but also how it is processed, distributed, purchased, or provided, and how these policies are designed to ensure human health and nutrition needs. Unfortunately, the availability of globally comparable data on this support to the food part of the agrifood system as a whole is limited, as opposed to the policy support to agriculture only, which is less limited.

Governments use policies to create either incentives and/or disincentives to induce a behavioural change among agrifood systems actors, the population and agrifood sector outcomes.*** Governments are also subject to policies of other countries; as such, it is not only countries’ own policies that matter.

Because this report’s theme focuses on repurposing both food and agricultural policies, the term “agrifood systems” is used instead of the term “food systems” used in previous editions. The reason is that the term “agrifood systems” is increasingly used in the context of transforming food systems for sustainability and inclusivity and is broader in its definition as it encompasses both food and agricultural systems and focuses on both food and non-food agricultural products, with clear overlaps.****

  • * The definition of policy reform adopted in this report is aligned with the Organisation for Economic Co-operation and Development (OECD) definition. Accordingly, policy reform is a process in which changes are made to the “rules of the game” – including laws, regulations and institutions – to address a problem or achieve a goal.2 ** This refers to general services and support to public goods such as public investments to research and development (R&D), marketing services and infrastructure (e.g. irrigation, roads and electrification). *** Incentives (or disincentives) in this context are the result of policies that influence change in behaviour for a desired sector outcome. They are broader than (but include) more specific technical definitions of price incentives that reflect the effect of agricultural trade and market policy measures. **** See Annex 7 Glossary for the definition of the agrifood systems and the difference between this term and food systems.

Unfortunately, very little food and agricultural policy support has been explicitly designed to meet the objectives related to all dimensions of food security and nutrition, and environmental objectives, simultaneously and coherently. Furthermore, the majority of the policy support measures have been designed and implemented in isolation, for a specific purpose, without considering the unintended consequences that they might generate in other dimensions.

As a result, existing policies have provided incentives for modern agrifood systems to evolve in such a way where the cost of a healthy diet is five times greater than the cost of diets that meet dietary energy requirements only through a staple cereal.3 These policies have also triggered the rise of low-priced foods of high energy density and minimal nutritional value. The health costs of unhealthy diets are also high – with diet-related health costs linked to mortality and non-communicable diseases (NCDs) projected to exceed USD 1.3 trillion per year by 2030.3 At the same time, agrifood systems have become a major source of global greenhouse gas (GHG) emissions and are placing excessive pressures on land, water and other natural resource systems. The diet-related social costs of GHG emissions associated with current agrifood systems and the dietary patterns they support are projected to exceed USD 1.7 trillion per year by 2030. Switching to plant-based dietary patterns would reduce the social costs of GHG emissions by 41–74 percent by 2030.3

There is a long history of food and agricultural policy support, mostly motivated by the need to promote agricultural productivity, particularly for staple cereals, protect farm incomes and/or ensure national food security.4 Historically, national food security policies were designed with the aim of ensuring national food availability, particularly for cereals (e.g. maize, wheat or rice). As a result, agrifood systems worldwide have been successful in supplying foods that provide dietary energy in the form of low-cost cereals. The majority of the poor in every region and country around the world can afford cereals to meet their daily dietary energy requirement.3 This, however, is insufficient for meeting other dietary requirements, including adequate macronutrients and micronutrients and a diverse intake of foods that help prevent malnutrition in all its forms, as well as diet-related (NCDs).3 The share of the total cost of staple foods in a healthy diet is, on average, only 15 percent of its total cost.

Most of the agricultural policy support that is currently implemented is not aligned with the national objective of promoting healthy diets and in many cases is actually inadvertently undermining food security and nutrition outcomes and contributing to the rise in overweight and obesity and diet-related NCDs. For example, as shown in Section 3.1, sugar or emission-intensive commodities (e.g. beef, milk) receive the most support worldwide despite the potentially negative impacts on health of high sugar intakes, and on climate change adaptation and mitigation due to the high carbon emissions from the livestock sector. This support also creates (relative) disincentives towards producing higher amounts of nutritious foods, such as fruits, vegetables and leguminous crops. The detailed evidence on what the impact of these policies means in terms of the cost of nutritious foods and the affordability of healthy diets remains scarce, nonetheless.

Furthermore, much of the current food and agricultural policy support is not equitably distributed, particularly support that is conditional (or coupled) to specific volumes of production for some commodities or to the use of certain inputs, requirements that some small farmers in particular cannot meet. In other words, much of the existing food and agricultural policy support is market distortive in terms of the absence of free and open competition, and as is particularly the case of coupled support, tends to benefit larger producers who can meet requirements to access it (i.e. production volumes for specific products, inputs use, etc.).

For these reasons, rethinking the allocation of public spending in order to repurpose food and agricultural policies is urgently needed. Repurposing options need to be looked at carefully, not only in terms of agricultural production (both its quantity and its diversity), but also all along the food supply chains, in food environments, as well as with regard to consumer behaviour. This rethinking is crucial because the factors driving the high cost of nutritious foods are found throughout agrifood systems, as shown in the 2020 edition of this report.b In addition, possible trade-offs triggered by repurposing food and agricultural support need to be carefully evaluated. For example, rice is a high emission-intensive commodity that provides calories but few micronutrients, and yet it receives significant support worldwide as it is also the staple food for more than 3 billion people (Section 3.1). Environmental sustainability considerations, nutrition outcomes and affordability of healthy diets need all be part of a carefully considered strategy to repurpose rice support.

These considerations highlight how an agrifood systems approach is essential for repurposing food and agricultural policy support (Figure 1). This approach will entail considering the nexus between policies and the availability and cost of nutritious foods relative to the foods of high energy density and minimal nutritional value, which are often low priced, people’s incomes, and the nutritional and environmental impact of agrifood systems. This consideration implies both an expansion of the supply of nutritious foods that constitute a healthy diet while reducing their absolute cost, and a reduction in the relative cost of healthy diets. To shift current food consumption patterns to end hunger and all forms of malnutrition will require both the implementation of policies and advocacy.

FIGURE 1An agrifood systems approach is essential to repurpose food and agricultural policy support

SOURCE: Adapted from FAO, IFAD, UNICEF, WFP & WHO. 2021. The State of Food Security and Nutrition in the World 2021. Transforming food systems for food security, improved nutrition and affordable healthy diets for all. Rome, FAO; and from HLPE. 2020. Food security and nutrition: building a global narrative towards 2030. A report by the High-Level Panel of Experts on Food Security and Nutrition of the Committee on World Food Security. Rome.
SOURCE: Adapted from FAO, IFAD, UNICEF, WFP & WHO. 2021. The State of Food Security and Nutrition in the World 2021. Transforming food systems for food security, improved nutrition and affordable healthy diets for all. Rome, FAO; and from HLPE. 2020. Food security and nutrition: building a global narrative towards 2030. A report by the High-Level Panel of Experts on Food Security and Nutrition of the Committee on World Food Security. Rome.

Affordability of healthy diets is not only determined by the cost of the nutritious foods that constitute such diets, but also by the cost of such diets relative to people’s incomes, and the cost of nutritious foods relative to foods high in fats, sugars and/or salt that may be widely available and heavily promoted. Past editions of this report have shown how poverty and inequality reduction is critical to improving people’s capacities to access sufficient nutritious food, pointing to concrete policy recommendations. While the broader issue of how to increase people’s incomes is at the core of economic development, this topic is beyond the scope of this year’s report; instead, the focus is on repurposing policy support to lower the cost of healthy diets. However, in repurposing food and agricultural policy support to lower the cost of healthy diets, it is important to consider the impact of different mixes of repurposed policies on income, including farm income, and the trade-offs these create, and the need to carefully consider and manage both.

At the same time, it is important to recognize that while food and agricultural policy support may eventually create the right incentives and leading to the intended effects within agrifood systems, what happens elsewhere may be resulting in the opposite. Thus, complementing policies within agrifood systems and in other sectors outside agrifood systems need to be considered in the interim and in terms of synergies and trade-offs to achieve the policy coherence that will be needed to make the most of available resources, including those in the health and environmental sectors.

Nonetheless, repurposing food and agricultural policy support may take time to bear fruit in terms of reducing the cost of nutritious foods or could lead to short-term livelihood insecurity and loss of income. In other words, it will not be fully free of trade-offs; therefore, mitigation measures such as social protection may be needed to avoid unintended consequences, especially for those most vulnerable to the changes during the transition. Repurposing food and agricultural policy support, and complementing policies within and outside agrifood systems, will need to be devised differently depending on the structural characteristics of the countries including their income status, production structure, natural resource endowments, net trade position, and food security and nutrition situation, as well as political economy considerations.

Repurposing existing food and agricultural policy support is a critical first step on which this report provides evidence and policy guidance. However, for many countries, this alone will not be enough to ensure the affordability of healthy diets for all, and they will need to scale up investments in the food and agriculture sectors. Some countries will actually not be in a position to repurpose anything, given the limited amounts of public resources they currently devote to food and agricultural policy support. For these countries in particular, it will be necessary to scale up spending, both public expenditure and private investment, including through blended financing options. Identifying these countries is another key contribution of this report.

Links between food and agricultural policy support and the cost of nutritious foods

Repurposing food and agricultural policy support with an objective to lower the cost of nutritious foods to make healthy diets more affordable for all will be a critical move for many countries to reach the SDG 2 targets by 2030, including those targets related to sustainable agriculture, as well as other SDGs. Currently, almost 3.1 billion people (Section 2.3) in the world cannot afford even the cheapest healthy diet even though this diet is essential to good health and well-being. Therefore, making healthy diets more economically accessible for everyone will also contribute to the achievement of SDG 3 (Good Health and Well-Being) and will create more equitable access to nutritious foods and enhance health, food security and nutrition, contributing to the achievement of SDG 10 (Reduced Inequalities). Furthermore, shifting to healthy diets can contribute to reductions in GHG emissions as shown in previous editions of this report;3 therefore, they are not only good for the health of the population, but also for the health of the planet and thus can be a win-win solution contributing to both SDG 12 (Responsible Consumption and Production) and SDG 13 (Climate Action).

This year’s report first presents the latest updates of the food security and nutrition situation around the world, including updated estimates on the cost and affordability of a healthy diet (Chapter 2). The report then takes a deep dive into “repurposing food and agricultural policy support to make healthy diets more affordable” through reducing the cost of nutritious foods relative to other foods and people’s incomes, which, in turn, helps countries make more efficient and effective use of – in many cases – limited public resources.

First, a stocktaking exercise is undertaken to explore the most predominant food and agricultural policy support currently in place around the world, the amount of support provided, the activities and actors mostly supported (or, on the contrary, penalized), and the pathways through which this support is pushing up the relative cost of nutritious foods and promoting unhealthy diets (Chapter 3). Second, guidance – grounded in analysis and evidence – is provided on alternative food and agricultural policy support mixes that help reduce the cost of nutritious foods, as well as on how the resulting trade-offs need to be managed to ensure agrifood systems are not only more efficient, but also more sustainable and inclusive. Lastly, the report takes a close look at complementing policies, within and outside agrifood systems that are important to support repurposing efforts and at the political economy factors and dynamics that hamper or facilitate repurposing efforts (Chapter 4).

back to top TOP