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Sustainable Agribusiness and Food Value Chains

Small-scale producers provide over 70% of the world’s food needs while agribusinesses are important generators of employment and income worldwide. Improving the sustainability of food value chains can benefit millions of poor households in developing countries as well as ensuring access to nutritious food to all.

Integrating smallholders into food value chains and improving food systems.

Farmers, agribusinesses, governments and civil society must collaborate to promote inclusive and efficient food systems that better integrate small farmers and small and medium agribusinesses into value chains in ways that improve their access to markets, generate decent employment, and make nutritious food available.

FAO has developed principles and evidence-based tools to achieve this. FAO also provides capacity building to strengthen government work with the private sector on sustainable food value chain development, institutional procurement, public private partnerships, responsible contract farming, and value addition through quality linked to origin labelling. 

Key policy messages

·        Inter-institutional coordination and collaboration on policy development, legislation and implementation is required, from the ministry to the district level, to create the enabling environment for Sustainable agribusiness and food value chains.

·        Adding value to agricultural production in rural areas (e.g. through processing industries) offers tremendous potential to boost rural employment, incomes, reduce poverty and improve nutrition. Policies, incentives and frameworks promoting agroindustries, in particular small and medium enterprises has proven to be a very effective pathway to lift rural populations out of poverty in many countries.

·        Policies to promote sustainable agribusiness and food value chains have a crucial role to play in meeting the 2030 Sustainable Development Goal by, particularly Goal 2 on achieving zero hunger and Goal 12 on responsible consumption and production.

·        Nutrition-sensitive value chains (NSVCs) leverage opportunities to enhance nutrition value as well as increasing supply and demand for safe and diverse food. A sustainable food value chain (SFVC) comprises of the full range of farms and firms and their successive coordinated value-adding activities that produce particular raw agricultural materials and transform them into particular food products that are sold to final consumers and disposed of after use, in a manner that is profitable throughout, has broad-based benefits for society and does not permanently deplete natural resources.

·        Large-scale crises such as Covid-19 have the potential to weaken even well-established food value chains, and bring about income reductions and loss of employment, thereby leaving people vulnerable to food and nutritional insecurity. At the firm level, while some agribusinesses may benefit from particular shocks (e.g., firms with strong e-commerce channels during the 2020 COVID-19 lockdown periods), many will be negatively affected. Hence, resilience, as a meta-dimension of sustainability, should be considered when working on policies to promote sustainable agribusiness and food value chains.

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