Friday, January 16, 2015

Why we must invest in local food storage in sub-Saharan Africa

By Emmely Wildeboer and Paul Bosch, The Guardian - UK

We often associate the term “food loss” with spoiled food in our kitchen fridges or overflowing bins behind restaurants. However, when we look at developing regions, food loss has more to do with grain slowly spilling from an aging truck as it bounces around on pothole-marked roads on its way from farm to market.

Post-harvest food losses are particularly high in sub-Saharan Africa (SSA), where a third of all food produced is lost before it reaches the marketplace (pdf). Grains and oilseeds are one of the main staples in SSA, representing the basis for food security for most of the population.

According to data supplied by the Food and Agriculture Organization of the United Nations, 30m tonnes of grains and oilseeds are lost each year in SSA (pdf). Of this, 85% is lost in the production, harvesting, handling and processing stages of the supply chain. Reducing food loss is important because it makes more food available for consumption, and this is crucial in low-income and food-deficit countries.

Farmers’ productivity could also increase: their incomes will rise, and this in turn allows for investments into inputs such as fertiliser and seeds needed to boost food production. At the moment, many farmers don’t have sufficient cash to buy high-quality inputs at the start of the growing season.

There is no simple quick fix to eliminating food losses in SSA. The approaches, tools and technologies required are just as varied as the causes themselves. However, significant steps towards loss reduction can be taken by focusing on a specific part of the supply chain, and investing in the storage stage of the supply chain – the distribution point right after harvesting – can yield significant gains over the next decade. Building local storage (or in the language of financial markets: securing a physical asset, such as safely stored grain) provides the collateral that local farmers can use to help them access commercial finance.

Many storage facilities in SSA are in poor condition, contaminated or infested with pests such as the larger grain borer, or their capacity is inadequate to meet local production. New storage technologies can reduce food losses by capturing a greater proportion of crop production and better preserving crop quality.

There are three opportunities for improving storage to reduce losses in grains and oilseeds. First, small-scale farmers could use sealed bags and low-capacity plastic or metal silos that accommodate the actual annual harvest, enabling a reduction in losses of up to 40% compared with current crop management practices.

Second, farmer collectives and commercial parties could install larger-capacity storage facilities, which would allow more harvested crops to be stored by an independent party. These larger facilities could be added to existing systems, or they could replace older systems that are in poor condition.

Third, traders could build large-scale warehouses in central locations. These could then be used for import or export purposes.

Unsurprisingly, such investments will incur costs. If we throw around a few numbers, how much would be needed to reduce food losses by 8m tonnes? In practice, a reduction of this magnitude would require investments of roughly $4bn (£2.65bn) over the next decade. While seemingly a huge sum of money, this amount is comparable to investments made in stadiums and public transport for the 2010 World Cup in South Africa. $4bn would build approximately 4m small-scale storage facilities, 600 medium-scale storage facilities and 100 large-scale warehouses.

In order to realise this financial investment, collaboration and cooperation is needed. The private sector would need to take a primary role in setting up larger-scale storage facilities. Not only do they have the capital, they also have the knowledge and long-term focus to make these businesses more profitable.

The private sector would also need to work with local farmers’ groups and NGOs to deliver training programmes, helping farmers to understand the benefits of using and upgrading storage systems. Commercially-oriented farmers and local businesses would also play a central role when it comes to the smaller storage options.

In a continent where grain consumption is growing at the same speed as its dependence on staple imports, fighting food losses can make a major impact on food availability. Aside from improving food security, investments in SSA’s storage infrastructure can both professionalise and improve the organisation of food supply chains. We have the opportunity to turn millions of tonnes of lost food into real gains: more food becomes available for the people of sub-Saharan Africa, and we can foster sustainable economic development by creating new business opportunities.