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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 hundreds of millions of poor households in developing countries.

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 into value chains and agribusiness and improve their access to markets. Such models can increase the value added from raw materials, hence boosting local rural economies, food security and nutrition and off-farm decent employment.

FAO has developed principles and evidence-based tools (guidelines, handbooks, good practices) to achieve this. FAO also provides capacity building (workshops, peer-to-peer learning) to strengthen government work with the private sector on inclusive business models, institutional procurement, public private partnerships, responsible contract farming, and territorial planning for agro-industrial development.  

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.

·        Public-Private Partnerships (PPP), which bring together business, government, smallholder farmers and civil society, can deliver multiple benefits. Policy makers should adopt agricultural PPPs when they represent value for money and generate greater public benefits compared to alternative approaches, such as public procurement or private investment.

·        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.

·        Agribusiness provide a decisive “pull factor” in value chains, which can increase agricultural productivity, market access, food storage, create employment, and drive changes in production patterns and consumption choices, including for more nutritious food. Policies enabling changes in agribusiness models are hence fundamental to sustainable value chains and the overall food system.

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