Africa the key to feeding the world (and itself)
A critical meeting is now underway at Dakar, Senegal. It is about food, but it is also about much more than that: it is about fertilizer (potash and phosphate) and about the stability of two continents, Africa and Europe.
It is the African Development Bank’s (AfDB) conference on food for Africa, held Wednesday through Friday this week. As the bank puts it, Africa has 65% of all the arable land left in the world and, by 2050, that land will be vital to meeting the food needs of nine billion people living on the planet by that year.
Yet, Africa imports $35 billion worth of food annually. Africa’s food needs are set to double by 2050. How can Africa feed itself and the world? Sub-Saharan Africa has the highest prevalence of under-nourishment in the world. One in every four people in Sub-Saharan Africa is under-nourished with 39% of children being malnourished.
According to one study, Uganda alone spends around $254 million year treating cases of diarrhoea, anaemia and respiratory infections linked to malnutrition.
But the AfDB president, Nigeria’s Akinwumi Adesina, sheets home the food issue as one of the causes of a problem that is headline news in Europe right now. “Migration out of rural areas is rising rapidly, and thousands of young people now jump on boats to the Mediterranean looking for new opportunities in Europe,” he says. “That is why we make the claim that we can diminish the migrant crisis in Europe by supporting agricultural transformation in Africa.”
Alliance for a Green Revolution, based in Nairobi, Kenya, has recently warned that Africa will not alleviate its chronic food shortages unless more youth get involved in farming. Yet a survey in Ethiopia found only 9% of youth there planned to work in agriculture.
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By 2050 the world will probably not be in a position to supply food to Africa; everyone will need to feed their own, ever growing populations. The AfDB notes that by 2030 (only 15 years away, folks) the value of the food and agribusiness market is estimated to reach $1 trillion. Rather than importing food, Africa will need to be a net exporter within decades if there is going to be enough food to go around. This is an enormous task, and opportunity (for the fertilizer feedstock miners particularly).
In early 2014 I reported on InvestorIntel that sub-Saharan Africa consumes only about 750,000 tonnes a year of potash. But it could easily absorb 6 million tonnes if the money was there to pay for it and the infrastructure to get it to the farmers.
Over the past 50 years, cereal productivity for Sub-Saharan Africa has stagnated at 1 tonne a hectare compared to 4 tonnes a hectare in developed countries. Average fertilizer use in Africa is 8kg/hectare compared with the global average of 107kg/ha.
We have been disappointed many times before by promises made by and for Africa, only to see hopes dashed in the longer term. But Akinwumi Adesina puts his finger on the key point: how will Africa turn agriculture from a sector that now manages poverry to one that creates wealth. “How will we move away from exporting primary commodities to the point where we sell processed cocoa not cocoa beans, processed coffee not coffee beans, and textile instead of cotton?” he adds.
The problem is that African farmers have usually been on the wrong end of any deal, with decades of possible progress squandered in the colonial era. My recently published book, Fighting on Empty: How Hitler and Hirohito Lost the Economic War, contains details of one shameful fact about how Britain treated farmers in its African colonies during the Second World War who faced a loss of their European markets as Germany invaded those markets, and reduction in exports to Britain due to shortages of merchant ships. It is an episode that should be better known:
The colonies which relied on agricultural products were faced with sudden contractions in the market for their produce; coffee growers in east Africa suffered, as did copra producers in the Pacific islands, banana growers in Jamaica and cocoa and palm oil plantation operators in West Africa. London made a good deal of the fact that it bought the whole cocoa crop of 1940 in the Gold Coast (now Ghana) and Nigeria at prices higher than had obtained in 1939, but this was small comfort to the growers as their receipts were still lower than they had been in 1931 before the worst of the Great Depression was felt. In fact, Britain did not buy the entire output of cocoa: the mid-crop had no taker and was destroyed, and then in 1941 London sliced twenty per cent off what it paid for that year’s crop at the same time as raising the price of the cocoa to wholesalers within Britain by £10 per ton, the extra margin accruing to the government.
When it came to palm oil, Britain did not need the entire output from Sierra Leone and Nigeria. Those farmers in Nigeria who grew oil palms as part of a diversified operation (and therefore did not rely solely on this crop) were told their output would not be needed, so they should switch to other crops (cassava was one suggested, as Britain needed 10,000 tons of that). The Economist estimated that palm oil growers who could not sell their palm oil lost, in total, about half a million pounds. As for cocoa crops, African officials had recommended to London that some extra payment be made to compensate for the fact that growers no longer had an open market. This fell on deaf ears at the Colonial Office, the price being set at £16 10s a ton when growers could not make a viable living at much less than £25. The London response was that, with Germany’s market closed off and American demand declining, the growers had no option other than to take what London was offering.
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