Friday, January 13, 2012


The 21st century is expected to be dominated by the poor and famished farmers of the third world because many global food processors need precious raw materials for their manufacturing programs which cannot be met entirely from their patrons in the wealthy nations. While country to country exports do involve many developing countries which are strong in some agricultural produce, the new initiative by some of the internationally strong branded products manufacturing companies to tie up with farmers and farmer organizations for direct access on a long term is a welcome development. Whether it is due to supply compulsions or genuine desire on the part of these MNCs to help the farmers of the third world countries is immaterial as long the latter is benefited. Many developing countries in Asia, Africa and South America are expected to benefit from the new perception on the part of the big food industry players. One can only hope that the new relationship will be of longer duration based on mutual respect and appreciation rather than the old colonial mindset. 

"While governments and non-profits have a critical role to play in reducing poverty and hunger around the world, it is becoming clear that the global food and beverage companies may have an even stronger hand to play. The sector is powerful and highly concentrated with a just a few companies controlling thousands of brands around the world. Nestle, once a mere chocolate company, is now the world's largest food and beverage company with 6000 brands including coffee (Nescafe), breakfast cereals (Cheerios), and nutrition bars (PowerBar). Kraft Foods sells snacks in 170 countries, including brands such as Nabisco and Cadbury. PepsiCo is now a larger "food" company than a "beverage" company with global brands like Frito-Lay and Quaker Oats. These global companies are buying the ingredients (corn, rice, wheat, cocoa, etc.) for food products on an enormous scale, but not from small farmers in the developing world who make up the majority of the world's poor. They turn, instead, to farmers in Australia, South Africa or the U.S. -- rather than their counterparts in Ethiopia, Haiti or South Sudan. Thus, poor farmers lack dependable buyers that could give them fair prices and a consistent market, helping them and their families out of poverty. Given that subsistence farmers comprise 70 percent of the world's poor, improving their income is our best strategy for reducing global poverty".

The new trend in leasing of land in the third world countries for agricultural activities is like a double edged sword that can be dangerous or beneficial depending on the conditions of lease. While using the land in third world countries exclusively for 100% export may attract criticism if the local population is starved of food, it can be a boon in raising the land productivity to unimaginable levels by using modern techniques of cultivation. The contract system of engaging farmers to raise particular crops for dedicated use by the industry giants on a long term basis can be another route for boosting farmer incomes in the lessee country besides receiving high quality inputs and training for producing crops of particular specifications required by the manufacturers. It is imperative for western nations that they engage the developing countries in genuine partnership through mutually beneficial organizational linkages on a long term basis.


No comments: