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Agriculture 2.0: how the Internet of Things can revolutionize the farming sector

Hyea Won Lee's picture
The following is a response to an earlier blog post by Ulrich Bartsch and Donato De Rosa
 


Although there exists plenty of analysis of the Dutch disease, the resource curse, and Hotelling’s rule to fill several large libraries, there is nonetheless still ample room for debate about optimal policies in resource-rich countries. What is the optimal pace of extraction? Should they diversify? If so, how should they diversify and when should they diversify? What role should sovereign wealth funds play? Can the destabilizing adjustment process in the wake of an oil price collapse be avoided?

In a recent blog, Ulrich Bartsch and Donato De Rosa revisit the issue of resource revenue management. There are many good elements in this analysis, but there is one big problem: The same rigor that is used to analyze the goods markets is not used to analyze the accumulation of assets. While market forces are declared essential in the goods markets, little is said about the role of market forces in the accumulation of assets.
 
Let’s explore a bit more the relation between market forces, asset accumulation, and comparative advantages.

Three misconceptions about women in agribusiness that hold companies back

Nathalie Hoffmann's picture

Debunking common misconceptions about women in agribusiness can unlock business opportunities for the private sector

At the recent World Economic Forum meeting in Davos, global leaders from across the world came together to deliberate on some of the most pressing issues of our time, such as agriculture and food security and greater social inclusion. With the global population projected to rise more than 9 billion by 2050 and the demand for food expected to jump sharply, the need for addressing the challenges of food security assumes greater urgency than before. There is also a growing need to adopt stronger measures to reduce the gender gap—women shouldn’t have to wait 170 years to bridge the divide.

Ahead of the Davos meeting, IFC released a report on agribusiness, Investing in Women along Agribusiness Value Chains, highlighting how companies can increase productivity and efficiency in the agriculture sector by closing economic and social gaps between women and men throughout the value chain, from farm to retail and beyond. The solution to address two of the most pressing challenges—food security and gender parity—isn’t difficult to find, as my research for the report suggests.

Women comprise over 40 percent of the agricultural labor force worldwide and play a major role in agriculture; yet they face a variety of constraints, such as limited access to agricultural inputs, technologies, finance, and networks. As the report shows, an increasing number of companies now recognize that investing in women can help increase companies’ bottom lines—while helping improve the lives of people in rural areas.

Yet, despite the clear business rationale, one wonders why more companies aren’t replicating the efforts of successful companies. The answer probably lies in the prevailing misconceptions about women in agribusiness—despite promising business case testimonials for gender-smart investments from multinational companies such as Mondelēz International and Primark.

Agribusiness companies need support in identifying where and how they can close gender gaps in their value chain. A good start would be to debunk those common misconceptions about women in the sector:

What is the impact of rural transformations on women farmers?

Vanya Slavchevska's picture

Migration, security, and development are inextricably linked. Understanding these linkages is important to correct public misperceptions as well as promote more effective policies; but they have largely defied research and analysis to date. KNOMAD Thematic Working Group on Migration, Security, and Development seeks to articulate an analytical framework on the linkages, drawing on a range of existing empirical case studies.

It is clear that migration, security and development are linked. Policies in one arena can promote positive outcomes in another. For example secure borders are an integral component of well-managed migration, which in turn can help match migrants’ skills to labour market demands, while also empowering migrants to contribute to development in their countries of origin. Equally, and especially where policy is poorly coordinated, unintended consequences can ensue. While numerous factors contribute to the global growth of migrant smuggling, there is strong research evidence that smugglers may profit when border controls tighten, in turn exposing migrants to risk, exploitation and vulnerability.

Rabobank Foundation and the World Bank team up to strengthen financial cooperatives for agrifinance

Juan Buchenau's picture

The World Bank and Rabobank Foundation are teaming up to strengthen financial cooperatives in rural areas to improve financial services for smallholder farmers and agricultural SMEs.
 
Financial services in rural areas are scarce and expensive. Servicing smallholder farmers spread across wide geographical areas isn’t attractive to mainstream financial institutions as their transactions are small, their cash flows seasonal and returns on investments can be risky due to potential crop failures or weather calamities.

To get access to savings and credit, rural households and farms often establish cooperative financial institutions (CFIs). While CFIs have a strong local presence and knowledge, they often have weak institutional capacity and governance, lack access to information technology, and suffer from political interference. Also, the laws regulating CFIs are often inadequate and supervision is weak, all of which hampers CFIs’ ability to deliver financial services. Often, CFIs don’t fall under the purview of the main financial sector regulator and supervisor, but of other entities that don’t always have the required capacity and expertise.

A real-time food security information system is a Big Data reality

John Corbett's picture
Ancient cities, like Mohenjodaro in modern-day Pakistan, emerged relatively recently in human history.
Ancient cities, like Mohenjodaro in modern-day Pakistan, emerged relatively recently in human history (photo courtesy of Saqib Qayyum used through a Creative Commons license.)​


The growth of large metropolitan areas around the world has been very recent and very rapid, particularly when measured against the duration of human beings’ existence as a species. For the first 95% of our time on earth, we built no settlements at all. Cities of a million people arose during only the last 1% of homo sapiens’ time on earth, and there are already 500 such cities in the world today.

If we have spent most of our existence as small wandering bands, does that mean we are ill-equipped to manage urban settlements of this vast size? The key to success in our current urban transformation may in fact be the same as the key to mankind’s earliest origins - our ability to cooperate.

Will cheap oil lead to cheap food?

Juergen Voegele's picture

The halving of world oil prices over the last six months raises questions about the implications for food prices and the welfare of poor people.
 
Do lower oil prices mean lower food prices? To a certain extent. But for low-energy cropping systems common in most developing countries, and in areas where food is not transported far, the impact will be dampened. For large oil exporters, however, food prices may increase. In general, lower oil prices should lower the cost of moving food from producers to consumers and reduce on-farm fuel and fertilizer costs. But a countervailing factor is that cheap oil may also induce people to drive more, and as fuel ethanol mandates link biofuel use to overall fuel use, ethanol use and the volume of maize used to produce it would also go up. In countries where oil is a large share of exports, real exchange rates may depreciate, which will disproportionately increase the price of traded goods like grains relative to other prices.
 
Is the downturn in agriculture commodity prices necessarily bad for farmers who produce food? A major downturn in commodity prices would not be great for farm incomes, and high crop yields would be needed to help dampen the effect on farm profits.  Lower fertilizer and transport costs may help mitigate any negative impacts.
 
How long will oil prices remain low? While there is no certainty in forecasts, current estimates suggest fuel prices will remain low for 2015, increasingly slightly in 2016. There are three main drivers of the oil price decline which are structural: Significant increases in US shale oil production, receding concerns of oil supply disruptions in the Middle East, and a change in OPEC policy to maintain rather than cut production.

Socio economic consequences of food price spikes

Will Martin's picture
Data on the sharing economy (Uber, Airbnb and so on) are scarce, but a recent study estimates that the revenue growth of these platforms has been dramatic. In the European Union (EU), the total revenue from the shared economy increased from around 1 billion euros in 2013 to 3.6 billion euros in 2015. While this estimate may equal just 0.2% of EU GDP, recent trends indicate a continued, rapid expansion.

This is important, as the sharing economy has the potential to bring efficiency gains and improve the welfare of many individuals in the region.

This can also generate important disruptions.

While online platforms represent a small fraction of overall incomes, the share of individuals participating in these platforms is large in many European countries. For example, roughly 1 in 3 people in France and Ireland have used a sharing economy platform, while at least 1 in 10 have in Central and Northern Europe (see figure below).

At the same time, the share of the population that has used these platforms to offer services and earn an income is also significant, reaching 10% or more in France, Latvia, and Croatia. This means that at least one out of every ten adults in these countries worked as a driver for a ride-sharing platform such as Uber, rented out a room of his or her house using a peer-to-peer rental platform such as Airbnb, or provided ICT services through an online freelancing platform such as Upwork, to name a few examples.

Kenya’s undisputed wheat basket

The sight of farmers around Narok drying wheat on the ground with agents haggling over price and quality is a reminder of how Kenya’s farmers take advantage of the plentiful sunshine to cut post-harvest costs. Makeshift canvas driers line both sides of the Maai Mahiu-Narok-Bomet highway, a section of the Northern Corridor transport system that creates a shorter link to western Kenya.

Narok is Kenya’s undisputed wheat basket, producing half of the national wheat output in any given year. Its lush wheat and maize (corn) farms, as well as livestock ranches dotted with thousands of cattle, sheep and goats, tell you why the over 2,000 farmers in this fertile region of the Rift Valley are so powerful. Moreover, it is gateway to the world famous Masai Mara game reserve, where wildlife riches and revenue, especially bountiful during this period of the famous wildebeest migration, are shared by the Narok and Trans-Mara county councils.


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