With eight years remaining to end hunger, food insecurity and all forms of malnutrition (Sustainable Development Goals [SDGs] Targets 2.1 and 2.2), the world is moving in the wrong direction. As argued in the last two editions of this report, to meet the targets of SDG 2 by 2030, healthy diets must be delivered at lower cost to contribute to people’s ability to afford them. This implies both an expansion in the supply of the nutritious foods that constitute a healthy diet and a shift in consumption towards them.
Most of the food and agricultural policy support currently implemented is not aligned with the objective of promoting healthy diets and in many cases is actually inadvertently undermining food security and nutrition outcomes. Furthermore, much of the support is not equitably distributed, is market distortive and environmentally harmful.
It is possible to allocate public budgets more cost-effectively and efficiently to help reduce the cost of healthy diets, thus improving their affordability, sustainably and inclusively, ensuring no one is left behind.
This year’s report first presents the latest updates of the food security and nutrition situation around the world, including updated estimates on the cost and affordability of a healthy diet. The report then takes a deep dive into “repurposing food and agricultural policy support to make healthy diets more affordable” through reducing the cost of nutritious foods relative to other foods and people’s income, which, in turn, helps countries make more efficient and effective use of – in many cases – limited public resources.
Food security and nutrition around the world
Food security indicators – latest updates and progress towards ending hunger and ensuring food security
Despite hopes that the world would emerge more quickly from the crisis and food security would begin to recover from the pandemic in 2021, world hunger rose further in 2021, following a sharp upturn in 2020 in the midst of the COVID-19 pandemic. Disparities in the impact of the pandemic and the recovery, together with the limited coverage and duration of the social protection measures, led to widening inequalities that have contributed to further setbacks in 2021 towards achievement of the Zero Hunger target by 2030.
After remaining relatively unchanged since 2015, the prevalence of undernourishment (SDG Indicator 2.1.1) jumped from 8.0 in 2019 to around 9.3 percent in 2020 and continued to rise in 2021 – though at a slower pace – to around 9.8 percent. It is estimated that between 702 and 828 million people in the world (corresponding to 8.9 and 10.5 percent of the world population, respectively) faced hunger in 2021. Considering the middle points of the projected ranges (which reflect the added uncertainty induced by the lingering consequences of the COVID-19 pandemic), hunger affected 46 million more people in 2021 compared to 2020, and a total of 150 million more people since 2019, prior to the COVID-19 pandemic.
The numbers show persistent regional disparities, with Africa bearing the heaviest burden. One in five people in Africa (20.2 percent of the population) was facing hunger in 2021, compared to 9.1 percent in Asia, 8.6 percent in Latin America and the Caribbean, 5.8 percent in Oceania, and less than 2.5 percent in Northern America and Europe. After increasing from 2019 to 2020 in most of Africa, Asia and Latin America and the Caribbean, the PoU continued to rise in 2021 in most subregions, but more slowly.
Updated projections of the number of undernourished people suggest that nearly 670 million people will still be undernourished in 2030 – 78 million more than in a scenario in which the pandemic had not occurred. Another crisis now looms that is likely to impact the trajectory of food security globally. The war in Ukraine will have multiple implications for global agricultural markets through the channels of trade, production and prices, casting a shadow over the state of food security and nutrition for many countries in the near future.
SDG Target 2.1 challenges the world to go beyond ending hunger by ensuring access for all to safe, nutritious and sufficient food all year round. SDG Indicator 2.1.2 – the prevalence of moderate or severe food insecurity in the population, based on the Food Insecurity Experience Scale – is used to monitor progress towards the ambitious goal of ensuring access to adequate food for all.
Moderate or severe food insecurity at the global level has been increasing since FAO first started collecting Food Insecurity Experience Scale data in 2014. In 2020, the year the COVID-19 pandemic spread across the globe, it rose nearly as much as in the previous five years combined. New estimates for 2021 suggest that the prevalence of moderate or severe food insecurity has remained relatively unchanged compared with 2020, whereas that of severe food insecurity has increased, providing further evidence of a deteriorating situation mainly for those already facing serious hardships. In 2021, an estimated 29.3 percent of the global population – 2.3 billion people – were moderately or severely food insecure, and 11.7 percent (923.7 million people) faced severe food insecurity.
There is also a growing gender gap in food insecurity. In 2021, 31.9 percent of women in the world were moderately or severely food insecure compared to 27.6 percent of men – a gap of more than 4 percentage points, compared with 3 percentage points in 2020.
The state of nutrition: progress towards global nutrition targets
This report also assesses global and regional levels and trends for the seven global nutrition targets. The estimates presented are based primarily on data collected prior to 2020 and do not fully account for the impact of the COVID-19 pandemic.
The latest estimate for low birthweight revealed that 14.6 percent of newborns (20.5 million) were born with a low birthweight in 2015, a modest decrease from the 17.5 percent (22.9 million) in 2000. Optimal breastfeeding practices, including exclusive breastfeeding for the first six months of life, are critical for child survival and the promotion of health and cognitive development. Globally, the prevalence has risen from 37.1 percent (49.9 million) in 2012 to 43.8 percent (59.4 million) in 2020. Still, more than half of all infants under six months of age globally did not receive the protective benefits of exclusive breastfeeding.
Stunting, the condition of being too short for one’s age, undermines the physical and cognitive development of children, increases their risk of dying from common infections and predisposes them to overweight and non-communicable diseases later in life. Globally, the prevalence of stunting among children under five years of age has declined steadily, from an estimated 33.1 percent (201.6 million) in 2000 to 22.0 percent (149.2 million) in 2020.
Child wasting is a life-threatening condition caused by insufficient nutrient intake, poor nutrient absorption, and/or frequent or prolonged illness. Affected children are dangerously thin with weakened immunity and a higher risk of mortality. The prevalence of wasting among children under five years of age was 6.7 percent (45.4 million) in 2020.
Children who are overweight or obese face both immediate and potentially long-term health impacts, including a higher risk of non-communicable diseases later in life. Globally, the prevalence of overweight among children under five years of age increased slightly from 5.4 percent (33.3 million) in 2000 to 5.7 percent (38.9 million) in 2020. Rising trends are seen in around half of the countries worldwide.
The prevalence of anaemia among women aged 15 to 49 years was estimated to be 29.9 percent in 2019. The absolute number of women with anaemia has risen steadily from 493 million in 2000 to 570.8 million in 2019, which has implications for female morbidity and mortality and can lead to adverse pregnancy and newborn outcomes. Globally, adult obesity nearly doubled in absolute value from 8.7 percent (343.1 million) in 2000 to 13.1 percent (675.7 million) in 2016. Updated global estimates are poised to be released before the end of 2022.
Children in rural settings and poorer households are more vulnerable to stunting and wasting. Children and adults, particularly women, in urban areas and wealthier households are at higher risk of overweight and obesity, respectively. Infants residing in rural areas, in poorer households, with mothers who received no formal education and female infants are more likely to be breastfed. Women with no formal education are more vulnerable to anaemia and their children to stunting and wasting. Addressing inequalities will be essential to achieving the 2030 targets.
Although progress is being made in some regions, malnutrition persists in many forms across all regions and may in fact be worse than these findings suggest as the impact of the COVID-19 pandemic on nutritional outcomes is still unfolding. Reaching the 2030 global nutrition targets will require immense efforts to counteract severe global setbacks. Global trends in anaemia among women aged 15 to 49 years, overweight in children, and obesity among adults especially, will need to be reversed to achieve the progress needed to reach the SDGs.
Cost and affordability of a healthy diet: an update
The 2020 edition of this report included, for the first time, global estimates of the cost and affordability of a healthy diet. These are useful indicators of people’s economic access to nutritious foods and healthy diets.
The effects of inflation in consumer food prices stemming from the economic impacts of the COVID-19 pandemic and the measures put in place to contain it, are clear and significant. Global consumer food prices were higher by the end of 2020 than they were during any month in the previous six years. This translated directly into an increased average cost of a healthy diet in 2020 for all regions and almost all subregions in the world.
The affordability of a healthy diet measures the average cost of the diet relative to income; therefore, changes over time can be the result of changes in the cost of the diet, people’s income, or both. In 2020, the measures put in place to contain COVID-19 sent the world and most countries into economic recession, with per capita incomes contracting in more countries than at any time in the recent past. However, while affordability estimates in 2020 reflect food price shocks, the income shocks are not yet captured due to the unavailability of 2020 income distribution data. The estimated number of people who could not afford a healthy diet, therefore, might increase further once income distribution data become available that will allow to account for the combined effects of inflation in consumer food prices and income losses.
It is estimated that the number of people who could not afford a healthy diet in 2020 increased globally and in every region in the world. Almost 3.1 billion people could not afford a healthy diet in 2020, an increase of 112 million more people than in 2019. This increase was mainly driven by Asia, where 78 million more people were unable to afford this diet in 2020, followed by Africa (25 million more people), while Latin America and the Caribbean and Northern America and Europe had 8 and 1 million more people, respectively.
Food and agricultural policy support in the world: How much does it cost and affect diets?
Stocktaking: What policy support is currently provided to food and agriculture?
Governments support food and agriculture through various policies, including trade and market interventions (e.g. border measures and market price control) that generate price incentives or disincentives, fiscal subsidies to producers and consumers, and general services support. These policies impact all stakeholders, part of the food environment and can affect the availability and affordability of healthy diets.
Worldwide support for the food and agricultural sector accounted for almost USD 630 billion a year on average over 2013–2018. Support targeting agricultural producers individually averaged almost USD 446 billion a year in net terms (i.e. accounting for both price incentives and disincentives for farmers), which corresponds to about 70 percent of the total sector support and about 13 percent of the global value of production, on average. About USD 111 billion were spent yearly by governments for the provision of general services to the sector, while food consumers received USD 72 billion on average every year.
Policy support to food and agriculture differs across country income groups and across time. Overall, price incentive measures and fiscal subsidies have been the most widely used in high-income countries and are becoming increasingly popular across some middle-income countries, in particular those at the upper level of income. Low-income countries have historically implemented policies that generate price disincentives for farmers to facilitate consumers’ access to food at a lower price. These countries have limited resources to provide fiscal subsidies to producers and consumers as well as to fund general services that benefit the whole of the food and agricultural sector.
In middle-income countries, fiscal subsidies to agricultural producers accounted for just 5 percent of total value of production – versus almost 13 percent in high-income countries. General services support, expressed as share of value of production, is lower in low-income countries (2 percent) compared to high-income countries (4 percent). Two-thirds of the world’s fiscal subsidies to consumers (either final or intermediary, such as processors) were disbursed in high-income countries.
Policy support differs across food groups and commodities. Countries with higher levels of income provide support to all food groups, and particularly to staple foods, including cereals, roots and tubers, followed by dairy and other protein-rich foods. In high-income countries, support within these three food groups is equally provided in the form of price incentives and fiscal subsidies to producers. On the contrary, for fruits and vegetables, and fats and oils, fiscal subsidies (accounting for about 11 percent of the value of production) were substantially larger than price incentives on average during 2013–2018.
Lower-middle-income countries consistently penalized production of most products through policies that depress farm gate prices, but these countries provided fiscal subsidies to farmers, especially for staple foods, fruits and vegetables, as well as fats and oils. Price incentives were negative for most food groups in low-income countries, ranging from a minus 7 percent on staple foods (mainly cereals) to 1 percent for other crops (e.g. sugar, tea, coffee).
How are food and agricultural policies affecting diets?
In many countries, the amount of public support is significant and depending on how it is allocated, it can either support or hinder efforts to lower the cost of nutritious foods and make healthy diets affordable for everyone.
Border measures affect the availability, diversity and prices of food in domestic markets. While some of these measures target important policy objectives including food safety, governments could do more to reduce trade barriers for nutritious foods, such as fruits, vegetables and pulses, in order to increase the availability and affordability of such foods to reduce the cost of healthy diets.
In low- and middle-income countries, market price controls such as minimum or fixed price policy overwhelmingly target commodities like wheat, maize, rice, as well as sugar, with the objective of stabilizing or raising farm incomes while ensuring supplies of staple foods for food security purposes. However, these policies could be contributing to the unhealthy diets that one observes all over the world.
Fiscal subsidies allocated to some specific commodities or factors of production have significantly contributed to growing production and reducing the prices of cereals (especially maize, wheat and rice), but also beef and milk. This has positively impacted food security, farm incomes and indirectly supported the development and use of better technology and of new agricultural inputs. On the other hand, these subsidies have de facto created (relative) disincentives towards producing nutritious foods, encouraged monocultures in some countries, ceased the farming of certain nutritious products, and discouraged the production of some foods that do not receive the same level of support.
Public support through the funding and provision of general services benefits actors of the food and agricultural sector collectively, which is in principle good for small-scale farmers, women and youth. But this type of support is significantly lower than the support provided to individual producers through price incentives and fiscal subsidies, and it is more widely funded in high-income countries. In some cases, services such as research and development are biased towards producers of staple foods.
Potential options to repurpose policy support to food and agriculture for improving affordability of a healthy diet
What are the potential impacts of reallocating food and agricultural policy support differently to reduce the cost of nutritious foods?
A new analysis of model-based scenarios of repurposed food and agricultural policy support, specially developed for this report, points to potential options by which all countries in the world can repurpose existing public support to food and agriculture to increase the affordability of a healthy diet.
These scenarios simulate the reallocation of current budgets supporting agricultural producers using different policy instruments. This is done for all countries from all geographical regions, in order to reduce the cost and increase the affordability of a healthy diet. This reallocation is implemented linearly between 2023 and 2028, and impacts are examined for 2030.
In these scenarios, the reallocation of budgets targets “high-priority” foods for a healthy diet. These are food groups whose level of current per capita consumption in each country/region does not yet match the recommended levels for that country/region, as defined by the food-based dietary guidelines used for the computation of the cost of a healthy diet.
A general empirically grounded observation is that repurposing existing public support to agriculture in all regions of the world, with the objective of promoting the production of nutritious foods (whose consumption is low relative to the dietary requirements) would contribute to make a healthy diet less costly and more affordable, globally and particularly in middle-income countries.
Removing or reducing border support and market price controls for commodities that are priorities for a healthy diet reduces their prices, particularly in markets with high border protection. As a result, the percent of the global population for which a healthy diet is affordable increases (by 0.64 percentage point in 2030 compared with the baseline), while the cost of a healthy diet falls relatively more than that of the average diet (by 1.7 vs 0.4 percent, respectively).
The move towards a less costly and more affordable healthy diet is accompanied by a decline in global agricultural production that, in turn, is reflected in lower greenhouse gas emissions in agriculture. Greenhouse gas emissions fall in all income groups, except for the high-income countries (where agricultural production is found to increase).
Other effects include a small increase of global farm income (up 0.03 percent), although for low- and lower-middle-income countries, where border measures and market price controls account for a high share of total food and agricultural support, the farm income effects are negative and greater than the global average change. The impact on extreme poverty is minimal at the global level; small increases in lower-middle-income countries are offset by declines in the other income groups.
On the other hand, the simulated repurposing of fiscal subsidies to producers increases the affordability of a healthy diet more than the simulated repurposing of border measures and market price controls (by 0.81 vs 0.64 percentage point). It also reduces the percent of the global population in extreme poverty and experiencing undernourishment. However, an important trade-off – not seen in the previous repurposing scenario – is that total greenhouse gas emissions from agriculture increase (by 1.5 percent) reflecting the higher agricultural production, including protein-rich foods such as dairy products whose consumption increases to meet the recommended dietary levels particularly in lower-middle-income countries.
Instead, with fiscal subsidies going to consumers albeit still targeting “high-priority” foods, the cost of a healthy diet falls more notably than in the two previous repurposing scenarios, both in absolute terms (by 3.34 percent in 2030 compared with the baseline) and relative to the average diet. The percent of the population that can afford a healthy diet increases (by almost 0.8 percentage point), but slightly less than in the fiscal subsidies to producers' scenario due to the income effect.
Important positive synergies in this scenario include a reduction in extreme poverty and undernourishment levels, due in part to increased farm income in low-income countries. Moreover, world greenhouse gas emissions fall due to a reduction in agricultural production. In contrast, this scenario is found to hit producers hard in the absence of their subsidies. Globally, farm income and agricultural production fall (respectively, by 3.7 and 0.2 percent in 2030 relative to the baseline).
Whether through border measures and market controls or fiscal subsidies, policymakers will have to repurpose their support considering the potential inequality trade-offs that may emerge if small-scale farmers (including women and youth) are not in a position to specialize in the production of nutritious foods due to resource constraints.
A key challenge for policymakers in low-income countries, and perhaps some lower-middle-income countries, will not only be to reach compromises in repurposing food and agricultural support to achieve several inclusive agricultural transformation objectives that are well aligned with reducing the cost of nutritious foods. Considering their low budgets, governments of these countries will also have to mobilize significant financing to step up the provision of: i) general services support where it has to be prioritized to effectively bridge productivity gaps in the production of nutritious foods with inclusivity and sustainability; and ii) fiscal subsidies to consumers to increase affordability. In this regard, international public investment support will be key to ease the transition towards higher general services support, especially in low-income countries.
To take advantage of the opportunities that repurposing support offers, countries will have to get together at the multilateral table. The repurposing of border measures, market price controls and fiscal subsidies will have to consider countries’ commitments and flexibilities under current World Trade Organization rules, as well as issues in the ongoing negotiations.
In sum, repurposing support that targets the “high-priority” foods for a healthy diet would support economic recovery globally, provided this is realized through the reduction of border measures and market price controls or the shifting of fiscal subsidies from producers to consumers, but there are potential trade-offs to consider. Therefore, the results will differ by country income group and geographical region.
Complementing policies within and outside agrifood systems that are needed to ensure repurposing efforts are impactful
For repurposing to be most effective, contributing to making healthy diets less costly and more affordable, other agrifood systems policies, and policies and incentives outside agrifood systems, will be needed. If aligned and put in place, these complementing policies can offer support in two ways.
First, they can provide incentives (or disincentives) that can support shifts in food supply chains, food environments and consumer behaviour towards healthy eating patterns. Second, they can ease or mitigate the unintended consequences or trade-offs from repurposing support, particularly if these include a reduction in the access to nutritious foods and healthy diets for vulnerable and disadvantaged population groups.
Making nutritious foods more widely accessible and affordable is a necessary, albeit insufficient condition, for consumers to be able to choose, prefer and consume healthy diets. Thus, complementary policies that promote shifts in food environments and consumer behaviour towards healthy eating patterns will be critical. These could include implementing mandatory limits or voluntary targets to improve the nutritional quality of processed foods and drink products, enacting legislation on food marketing, and implementing nutrition labelling policies and healthy procurement policies. Combining land- use policies with other complementing policies to address food deserts and swamps can also be very important.
Given repurposing can lead to trade-offs that may negatively affect some stakeholders, in these cases, social protection policies may be necessary to mitigate possible trade-offs, particularly short-term income losses or negative effects on livelihoods, especially among the most vulnerable populations.
Environmental, health, transportation and energy systems policies will be absolutely necessary to enhance the positive outcomes of repurposing support in the realms of efficiency, equality, nutrition, health, climate mitigation and the environment. Health services that protect poor and vulnerable groups whose diets do not provide all the nutrients are particularly relevant. Not adequately addressing inefficiencies and problems in transportation would also undermine and render ineffective repurposing efforts.
The political economy and governance dynamics that influence repurposing policy support
The extent to which efforts to repurpose food and agricultural support will be successful will depend on the political economy, governance and the incentives of relevant stakeholders in a local, national and global context. Broadly speaking, the political economy refers to the social, economic, cultural and political factors that structure, sustain and transform constellations of public and private actors, and their interests and relations, over time. This includes institutional set-ups, “the rules of the game” that affect the everyday policymaking agenda and its structuring. Institutions, interests and ideas are dynamic factors at play that influence agricultural and food policy support. Governance refers to formal and informal rules, organizations and processes through which public and private actors articulate their interests and make and implement decisions.
There are three broad political economy elements that need to be considered and effectively managed when repurposing food and agricultural policy support: i) political context, stakeholder perspectives and the will of governments; ii) power relations, interests and the influence of different actors; and iii) governance mechanisms and regulatory frameworks needed for the facilitation and implementation of repurposing support efforts. The dynamics and the mechanisms for managing these elements are explored in detail in the report.
Given the diversity of each country’s political context, strong institutions on a local, national and global level will be crucial, as well as engaging and incentivizing stakeholders from the public sector, the private sector and international organizations to support the repurposing support efforts. For many countries, agrifood systems transformation pathways provide a framework through which to channel the repurposing efforts. The engagement of small- and medium-sized enterprises and civil society groups – as well as transparent governance and safeguards to prevent and manage conflicts of interest – will be key to balancing out unequal powers within agrifood systems.
This year’s report should dispel any lingering doubts that the world is moving backwards in its efforts to end hunger, food insecurity and malnutrition in all its forms. We are now only eight years away from 2030, the SDG target year. The distance to reach many of the SDG 2 targets is growing wider each year, while the time to 2030 is narrowing. There are efforts to make progress towards SDG 2, yet they are proving insufficient in the face of a more challenging and uncertain context.
The current recessionary context makes it even more challenging for many governments to increase their budgets to invest in agrifood systems transformation. At the same time, much can and needs to be done with existing resources. A key recommendation of this report is that governments start rethinking how they can reallocate their existing public budgets to make them more cost-effective and efficient in reducing the cost of nutritious foods and increasing the availability and affordability of healthy diets, with sustainability and leaving no one behind.