New report looks at “quiet revolution” made of improved value chains and vibrant roles for smaller towns

Managing urbanization sustainably poses new challenges and opportunities to recast food and agriculture systems in ways that benefit both cities and the countryside, according to a new report presented by the International Food Policy Research Institute (IFPRI) and FAO.

Meeting the rising urban demand for food can increase the incomes of the rural poor, most of whom derive their livelihoods from small and family farm agriculture, said FAO Director-General José Graziano da Silva. “This could generate much-needed employment and development prospects for the people who will remain in the countryside of developing countries while also making healthier food easier to access in cities.”

“But growing urban demand will not automatically benefit small farmers, so we must look for solutions that can seize on the opportunities, and avoid the downside of increasing urbanization,” he added, noting the pressure the expected changes will put on nutritional needs, scarce natural resources, employment and income, migration and a host of other critical factors.

IFPRI’s Global Food Policy Report, to which FAO contributed the lead chapter, addresses a wide range of issues linked to urbanization.

Growing urban populations will be especially visible in Africa, as a majority of the continent’s fast-growing population will be living in cities by 2030. Globally, some 2.5 billion more people will be living in urban areas than do today. Africa and Asia will account for 90 percent of the increase.

“The urban poor are more vulnerable than their rural counterparts are to fluctuations in food prices and devote a higher share of their household budgets to food purchases than rural populations,” said IFPRI Director-General Shenggen Fan, Director-General of IFPRI, a non-profit research institute that is part of the CGIAR network.

Rebuild the value chain

One way to encourage mutually beneficial developments for urban and rural areas alike is to develop value chains and make food systems that are more efficient and inclusive, the report says.

Better roads, reliable and extensive electrification, refrigerated transportation and better storage facilities are all key to making that happen, Graziano da Silva said, noting that such transformation would also lead farmers to grow higher-value and more nutritious produce, which is essential for the proper nutrition of growing urban populations.

Quality concerns over locally produced food by urban residents in many developing countries often result in greater preference for imported varieties, according to the report. Better vertical integration of the domestic food value chain – requiring improved processing, milling, cleaning, marketing, bagging, branding and possibly even supermarkets - could remedy that. Such an effort would produce a host of agribusiness jobs and enhance the agricultural sector’s ability to make productivity-boosting investments.

The report shows how farmers benefit more when non-farm activities are developed close to their holdings. For that reason, fostering the role of intermediate towns, which can play a catalysing role in mediating the urban-rural nexus, should be a key consideration for policy makers, according to the report. It cites evidence that the vicinity of smaller towns tend to provide smallholder farmers with greater opportunities to market their products and share in the gains from economic growth.

Smaller towns also offer migration destinations that more likely help the rural poor escape from poverty than big cities do.

“Intermediate cities can be, and most of the time are, the effective promoter of rural development,” Graziano da Silva said. Strong rural-urban linkages also allow migrants to keep stronger ties with their family networks, whereas when the ties are broken both rural and urban areas suffer.

A quiet revolution is taking place

The report looked at rural-urban value chains bringing major staple crops – potato, rice and teff – to cities in Bangladesh, China, India, and Ethiopia and found a “quiet revolution” is taking place.

Farmers are using new inputs, and in many cases preferring higher-quality varieties over higher-yielding ones to respond to demand from urban consumers willing to pay premium prices. New techniques are proliferating in the post-farmgate segment of the value chain, such as large cold storage operations used by small farmers in India and Bangladesh - use of which is also supporting local credit systems and allowing farmers to access improved seeds and inputs, or the rapid emergence of packaged and branded rice in China.

In short, building better rural infrastructure pays off for farmers and city dwellers alike.

» Download: Global Food Policy Report 2017 (PDF, 5.95 MB)

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Informal Food Markets in Africa’s Cities

Urbanization is a global phenomenon, but in Africa south of the Sahara its pace and impact are particularly notable. Africa’s urban population is the fastest growing in the world. By 2030, the continent is expected to reach a tipping point, when for the first time the majority of the region’s population will live in urban areas. These broad trends capture a tremendous degree of variation across urban Africa, ranging from the megacities of Kinshasa and Lagos, which are home to more than 10 million people, to secondary cities like Tema in Ghana and Ndola in Zambia, with populations of fewer than 750,000 people. While these demographic shifts contribute to a number of urban policy challenges, including limited housing supplies, infrastructure bottlenecks, pressure on scarce public services, and environmental degradation, the implications for food security in urban Africa are equally significant.

The urban poor are more vulnerable than their rural counterparts are to fluctuations in food prices and exchange rates. Urban residents in Africa are less likely to produce food for their own consumption and they devote a higher share of their household budgets to food purchases than rural populations. This vulnerability was evident during the 2008 and 2011 global food price spikes, when Africa experienced the highest incidence of urban food price riots. Africa’s urban centers are characterized by both a growing middle class and growing urban poverty. Significant pockets of food insecure populations can be found in even the wealthiest countries in the region. For example, food insecurity is endemic in the poorest neighborhoods of Gaborone, Botswana, and Windhoek, Namibia. More broadly, diets in African cities rely heavily on starchy staples, and this lack of diversity contributes to malnutrition.

The governance challenges to enhancing food security in urban Africa span institutional, administrative, and political dimensions. Institutionally, food security policies involve intersectoral coordination across multiple ministries, which typically occurs under the leadership of ministries of agriculture or health. When the focus is explicitly on the urban dimensions of food security, greater engagement is needed with ministries of urban and local development. National food security strategies, however, are often created parallel to, rather than in concert with, urban development strategies. This hinders full integration of urban food security into national planning. For example, Uganda’s recent national urban policy focused on water, housing, and waste management but neglected food security.

» Download: Ch 6. Informal Food Markets in Africa’s Cities (PDF, 437 KB)

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Regional Developments: Africa

Measures of poverty, hunger, and malnutrition have improved steadily if slowly in Africa south of the Sahara, as has agricultural value added. But African countries continued to face low commodity prices and limited external finance in 2016. A continent-wide campaign known as “Seize the Moment” kicked off to accelerate efforts of the Comprehensive Africa Agriculture Development Programme (CAADP) to raise investments in agriculture in the region. But the impacts of severe drought, climate change, conflict, and rapid urbanization will create ongoing challenges in 2017.

» Download: Regional Developments: Africa (PDF, 1.14 MB)