Upgrading Wholesale Food Markets For Food System Resilience
“Wholesale food markets are a critical partner in global efforts to transform agri-food systems and fight food insecurity.” Director-General of FAO, QU Dongu
Unleashing the Potential of Wholesale Food Markets
A study carried out by FAO Investment Center in collaboration with partners through their Knowledge for Investment (K4I) series has reviewed 33 wholesale food markets around the world aiming to better understand their diversity and complexity. To enrich this understanding, the study will result in a set of reports and an investment guideline aimed at public and private investments to help wholesale food markets adapt to 21st-century challenges and strengthen food system resilience.
Wholesale food markets are marketplaces where professional vendors and buyers trade fresh produce. The bulk of the trade is fruits and vegetables, although it can also include meat, fish, dairy products and fresh flowers. Often situated in urban environments, the markets are an important link in the food chain connecting farmers to markets and facilitating supply networks that deliver fresh food to consumers.
Cases for Investment to Meet 21st Century Challenges
When wholesale food markets function well, the benefits can be far-reaching for the food system and its stakeholders providing:
- Improved market access for producers and distribution for consumers
- Better information exchange for value chain efficiency and transparent transactions
- Infrastructural flexibility for market development - adaptability in facing changes and disruptions
- Participatory food systems governance – coordinating, integrating and regulating supply chains
Yet recurrent food crises and issues in urban food supplies particularly those revealed during the COVID-19 pandemic are highlighting the need to invest in markets – from the older, traditional city center markets, which have not been updated for decades, to the new infrastructures that are missing to strengthen food supply and distribution mechanisms in many towns.
Simply put, upgraded infrastructure, financial viability, and strong governance and management – both public and private – can unleash the potential that wholesale food markets can play in providing higher resilience and a better capacity to deal with disruptions within food systems.
Upgrading wholesale food markets – not one size fits all
As highlighted in the study, upgrading wholesale food market projects need to include consideration of local, diverse contexts, for example, local regulatory frameworks and supply and distribution pathways, considering:
- The policy, investment and operational environment: What are the opportunities for a wholesale food market upgrade project including the role it plays in local food systems, stakeholders and the regulatory environment?
- Market governance: Who takes the decision and who are the partners? For example, the owners, managers and funders.
- Infrastructure and logistics: What type of project design is suitable? What are the drivers and processes that need to be upgraded?
About the study
‘Upgrading wholesale food markets for food systems resilience in the 21st century’ is a two-year study that started in December 2020 to pool knowledge on wholesale food markets, particularly identifying their roles within food supply and distribution, their links with production, wholesale and retail actors, and their relevance for food security in most parts of the world. Partners include the World Union of Wholesale Markets (WUWM), World Bank, EBRD, ADB, IDB, AfDB,and several FAO units.
Activities included primary research supported by data collection through surveys designed for wholesale food market authorities, interviews with wholesale food market participants, as well as secondary sources, focused on wholesale food markets, urban food supply, and distribution. Over 100 interviews were conducted throughout the study.
Watch out for the first set of reports coming out September 2022
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