Preeti Ahuja Practice Manager, Agriculture & Food Global - - PowerPoint PPT Presentation

Preeti Ahuja

Practice Manager, Agriculture & Food Global Practice

ARGENTINA IN THE GLOBAL FOOD SYSTEM – Challenges and Opportunities Looking Ahead

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June 2019

Preeti Ahuja

Practice Manager Agriculture & Food Global Practice

OUTLINE OF THE PRESENTATION

1. Global Food System Challenges 2. Argentina’s Agriculture: Role and Contributions 3. Argentina in the Global Food System: Challenges and Opportunities 4. The Way Forward: SOME OVERARCHING IDEAS

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GLOBAL FOOD SYSTEM CHALLENGES

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9.8B people Increasing food demand by 60-70%

2050

Need to reduce

70% of AGR GHG

emissions to keep

global warming

below 2 °C

¼ GHG emissions are

from agriculture &

land-use change

Food gap Land gap Emissions gap

WHAT DOES THE FUTURE ASK OF THE GLOBAL FOOD SYSTEM?

Agriculture land required ~600 M ha.

Twice the size of India

Food demand growth

• pportunity

To increase food quality, production, incomes and employment Efficient land management

• pportunity

To enhanced Natural Resources Management & leverage technologies for better land use and management Emissions reduction

• pportunity

To adopt Climate Smart Agriculture & Integrated Risk Management techniques

GLOBAL FOOD SYSTEM OPPORTUNITIES

Food gap Land gap Emissions gap

GLOBAL SUSTAINABLE & INCLUSIVE DEVELOPMENT

Sustainable Development Goals:

Reducing the food, land and emission gaps, among other factors, are vital for achieving the SDGs

World Bank Twin Goals:

Ending Extreme Poverty  From 18% to 3% of world population by 2030 Boosting Shared Prosperity  Increased incomes for bottom 40% of every country

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VISION

How can LAC help contribute to adequately and nutritiously feeding nearly 10 billion people and billions more of livestock by the year 2050 in ways that help combat poverty, modernize the sector for better jobs, and allow the world to meet climate goals, and reduce pressures on the environment?

ARGENTINA’S AGRICULTURE: ROLE AND CONTRIBUTIONS

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ARGENTINA’S AGRICULTURE: A SNAPSHOT

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• ~7% GDP (primary production) & ~23% (agro-processing

goods)

• >50% of total exports
• 17% of total employment
• 2nd grain producer in Latin America and Caribbean
• 4th soybean, maize & citrus producer
• 2nd wheat producer in LAC/ 7th globally

STRATEGIC IMPORTANCE OF ARGENTINA’S AGRIFOOD SYSTEMS

• 1 of every 6 private jobs
• 1 of every 10$Ar GDP
• 1 of every 10$Ar tax collection
• 7 of every 10USD total exports

Source: Fundación agropecuaria para el desarrollo de argentina

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ARGENTINA’S WHEAT PRODUCTION

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 The 2018/2019 season likely to be strong :

 Over 6 million hectares of wheat Over 19 million tons of wheat

 Strong and growing global demand

• But how to repeat this strong performance in the

face of challenges around climate and other risks, and productivity gaps?

Source: Bolsa de Cereales

Wheat yields, 2014

ARGENTINA IN THE GLOBAL FOOD SYSTEM : CHALLENGES AND OPPORTUNITIES

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CHALLENGE #1: COMPETITIVENESS AND MARKETS

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Opportunity to increase productivity and value addition

• 50% total exports are agricultural products, but…
• Just 3 products account for ~70% of total agricultural exports, and
• Only 35% of total agricultural exports are processed products (10% in the case of wheat)

Agri-food chains participation in total exports (%)

Source: ARGENTRIGO & Secretaria de Agroindustria & Banco de Cereales

Exported value (Mlns USD) Top wheat world producers

CHALLENGE #2: INCLUSIVE FOOD SYSTEMS

Opportunity to address duality of rural populations and lagging regions

• 67% small-scale farmers live in rural areas
• 300.000 family farms = 75.5% total farms
• 50% of food’s consumption is produced by smallholders

Types of Food Produced by small-scale farmers

Source: Censo 2002

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Argentina’s Family Farmers map

88% Cuya - Mandioca 62% Yerba Mate 44 % Cotton 22 % Sugar Cane 41% Vegetables in field 30% Beekeeping 49% Porcine 17 % Fruits

CHALLENGE #3: RESILIENCE TO CLIMATE CHANGE

Source: Infobae

Opportunity to strengthen resilience to risks: extreme weather; climate change

1. Forgone revenues: USD5 Bln in harvest loss (Infobae 2018) USD 1.12 Bln loss in tax collection (Infobae 2018) 2. Emergency response expenditures

Spend through the Agriculture Emergency Fund (FONEDA)

3. Lack of investment in CSA technologies and inputs (e.g. soils, silvopastoral systems and seeds;

storage solutions; irrigation; current irrigated area ~5% total cultivated areas)

Estimated economic losses due to extreme climate events

THE WAY FORWARD: SOME OVERARCHING IDEAS

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AGRI-FOOD SYSTEMS: NEXT LEAP FORWARD

Actors COMPETITIVENESS & MARKETS INCLUSION

RISK RESILIENCE (INCL. CLIMATE CHANGE)

PUBLIC

• Support enabling environment for

investments in agri-food production, diversification & value addition

• Ensure access to transparent,

integrated information/research (production, markets, weather)

• Develop concrete, strategic

development and implementation plans backed by comprehensive diagnostics for key value chains

• Enable small-holders coordination (e.g. Support

to productive alliances) for access to inputs, infrastructure and markets

• Increase institutional procurement of food
• Support inclusion of lagging regions and

vulnerable populations, as well as women and youth

• Support human capital development
• Adopt Integrated Risk Management
• Strengthen strategic approach, systems and

institutions

• Promote investment in natural capital

management and Climate Smart Agriculture practices and technologies

• Enable development of a diversified,

competitive agri-food system

PUBLIC CROSS-CUTTING

• Conducive Policy & Governance
• Public Infrastructure investments (transport, water management systems, energy)
• Foster Technology Diffusion and Innovation (digitalization, big data, AI, bio-physical)

PRIVATE

• Further development of inputs and

services (seeds, nutrients, storage, cold chain, processing, financial services, insurance, guarantees)

• Improve efficiencies to reduce costs
• Innovations & bio-digital technology

services (market information, trading, drought resistant cultivars)

• Financial solutions for longer term

investments

• Financial options for small-scale agricultural

investments

• Improve inputs and processing, logistics and

commercialization services to small-scale agriculture, Productive Alliances

• Financial instruments to mitigate climate or

market shocks (emphasis on small-scale farmers)

• Technology packages for climate resilience and

inputs (droughts resistant seeds)

ARGENTINA: BOOSTING ADVANTAGES AND SEIZING OPPORTUNITIES Argentina - Comparative advantages

• Rich in natural capital assets, technological uptake, youth engagement in sector
• Well positioned in the world’s agricultural sector

Argentina –The road ahead

1- Increase COMPETITIVENESS in the overall FOOD SYSTEM and exploit MARKET OPPORTUNITIES 2-Boost INCLUSION, focus on LAGGING REGIONS & VULNERABLE PEOPLE 3- Improve RESILIENCE to CLIMATE CHANGE & OTHER SHOCKS

CURRENT WORLD BANK OPERATIONS IN ARGENTINA

• Proyecto de Inclusión Socio-Económica en Áreas Rurales (PISEAR) - US$52.5 MILLION

Objective: to increase the socio-economic inclusion of rural poor (small producers, indigenous people, and rural workers) Scope: investment in 10 provinces Results: 104 rural investment subprojects approved (101 in implementation) and 13 productive alliances approved (11 in implementation)

• Gestión Integral de los Riesgos en el Sistema Agroindustrial Rural (GIRSAR) - US$150 MILLION

Objective: to improve the management of agricultural risks by eligible beneficiaries and selected public institutions. Scope: investments in 8 to 12 provinces Projected results: 10 provincial integrated agricultural risk management plans

• Food Loss & Waste Knowledge Product

Food Lost and Waste Study on solutions for efficiency and competitiveness of the agricultural sector – e.g., analyzing the case of apples and pears in Argentina. Cost-benefit of reducing FLW; potential to improve productivity and profitability through the reduction of food loss

Agriculture & Food Global Practice, World Bank

June 2019