The world is experiencing a situation of slower economic growth and lower commodity prices translated into relatively lower Food Price Indices for many countries. This “new norm” benefits urban consumers but poses potential problems for agribusiness and rural producers, since, inter alia, it discourages them to invest. Will this “new norm” last? Or will it prove a “false dawn”?

Food security as a matter of national concern cannot be considered in isolation from the broader economic, social and physical environments. In recent years, many countries have experienced slower economic growth, affecting disposable income levels and consequently consumer spending and food consumption patterns. The physical environment has likewise experienced challenges from climate events and continued loss of arable land and freshwater resources.

During the same period, many food commodity prices have also fallen. While this makes food more affordable, it also reduces farmer incomes and reduces investment in infrastructure and technology needed to improve overall productivity. A vicious cycle may ensue in which reduced productivity can further reduce farm incomes and a country’s agricultural competitiveness.

… Paul S. Teng is Professor and Principal Officer, NIE, and Adjunct Senior Fellow at the Centre for Non-Traditional Security Studies (NTS Centre), S. Rajaratnam School of International Studies (RSIS), Nanyang Technological University (NTU), Singapore. He is also a member of the Advisory Board of the Rice Bowl Index.