Soaring food prices and the rural poor

Impact on poor rural people

Recent price volatility on international markets is putting pressure on global food security. For the 2 billion people who live and work on small farms in developing countries, life has become more precarious. But with the right investments, policies and development programmes in place, smallholder farmers have a huge potential to increase food production, improving their lives and contributing to greater food security for all.

The roots of the recent food security crisis go back almost 30 years, when investment in agriculture started to decline because of the growing perception that agriculture was unprofitable. In 1979, aid to agriculture was 18 per cent of total assistance. By 2006, it was just 2.9 per cent. Domestically, government investment in agriculture in developing countries also fell, by one third in Africa and by as much as two thirds in Asia and Latin America during this period.

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Key facts

  • The world population is expected to grow by 50 per cent by 2050.
  • Food production will need to rise by 50 per cent by 2030 to meet growing demand.
  • There are about 500 million small farms in developing countries, supporting almost 2 billion people – one third of humanity.
  • From 2007 to 2008, the number of undernourished people in the world rose by 40 million to a total of 963 million.
  • Despite the decline in international prices in the second half of 2008, in December 2008 FAO’s Food Price Index was 28 per cent higher than in 2005. Domestic food prices remain very high in several developing countries affecting access to food of low-income population groups.
  • Government spending on agriculture in the world’s poorest countries averages 4 per cent of public expenditure.
  • Development aid to agriculture was 4.6 per cent in 2007, compared with 18 per cent in 1979.

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