The World Bank‘s latest update indicates that almost all low- and middle-income countries and close to half of high-income countries now experience high food price inflation.
Inflation higher than 5% is experienced in 63.2% of low-income countries, 73.9% of lower-middle-income countries, 48% of upper-middle-income countries, and 46.3% of high-income countries. In real terms, food price inflation exceeded overall inflation in 73% of the 165 countries where data is available.
Domestic food price inflation remains high. Inflation higher than 5% is experienced in 63.2% of low-income countries (1.3 percentage points higher than in the last update on December 14, 2023), 73.9% of lower-middle-income countries (2.2-percentage points lower), 48% of upper-middle-income countries (2.0 percentage points lower), and 46.3% of high-income countries (11.1 percentage points lower). In real terms, food price inflation exceeded overall inflation in 73% of the 165 countries where data is available.
Nigeria’s food outlook nothing to cheer about
In 2024, Nigeria is expected to see about 26.5 million people grappling with high levels of food insecurity, as disclosed by the Government of Nigeria and its partners during the unveiling of the October 2023 Cadre Harmonisé analysis on food insecurity.
This is just as approximately 9 million children are at risk of suffering from acute malnutrition or wasting. Of these, an alarming 2.6 million children could face Severe Acute Malnutrition (SAM) and require critical nutrition treatment.
The Cadre Harmonisé, an initiative focused on food and nutrition analysis, conducts studies biannually (in March and October) across 26 states and the Federal Capital Territory (FCT). With the Government’s leadership and the United Nations (UN) system’s support, the latest projection for 2024 indicates a sharp rise from the 18.6 million people currently vulnerable to food insecurity from October to December 2023.
Several factors are driving this trend, including ongoing conflicts, climate change impacts, escalating inflation, and rising costs of both food and essential non-food commodities (in part due to the devaluation of the naira and the discontinuation of the fuel subsidy). Persistent violence in the north-eastern states of Borno, Adamawa, and Yobe (BAY) hinders food availability and access.
Additionally, armed banditry and kidnappings in northwest and north-central states, including Katsina, Sokoto, Kaduna, Benue, and Niger, exacerbate the prevailing economic struggles.
Dr. Ernest Umakhihe, the Permanent Secretary of the Federal Ministry of Agriculture and Food Security, underscored the significance of the Cadre Harmonisé during a presentation in Abuja.
Represented by Mrs. Fausat Lawal, Director of Special Duties, Umekhihe highlighted that despite Government efforts, external challenges like the ongoing global economic effects of COVID-19 and the Russia-Ukraine war, which disrupts food systems, persist.
Of the 18.6 million people who experience food insecurity today, 3.3 million live in the northeastern states of the BAY region. This number might rise to 26.5 million nationwide by the height of the 2024 lean season (and to 4.4 million in the BAY states) if immediate action is not taken.
Dominique Koffy Kouacou, the FAO Representative ad interim in Nigeria and to ECOWAS, while calling on the Government to expand CH coverage to the remaining 10 states said, FAO would continue to support the Government and the people of Nigeria to overcome food insecurity and malnutrition.
He stated, “In 2024, alongside our partners, FAO’s focus will be on agrifood systems transformation with deliberate attention on resilience-building, nutrition-sensitive agriculture, livestock, fisheries, and providing extension services.”
The Office for the Coordination of Humanitarian Affairs (OCHA) reported that floods in October 2023 in Adamawa impacted around 8,500 households, leading to mass displacements, particularly among women, children, and the elderly. Such extreme weather patterns, linked to the El Niño phenomenon, are further undermining food security “Food insecurity and malnutrition are among the main drivers of humanitarian need in the BAY states,” said Mr. Trond Jensen, the head of OCHA in Nigeria.
“People have been forced to adopt negative coping mechanisms such as survival sex and child labour to stay alive. Over the past year, dozens of farmers have lost their lives, and others have been abducted or injured while eking out a living outside the security perimeters of Borno’s garrison towns due to limited farming lands and few or no livelihood options.”
Since the last update, of December 14, 2023, the agricultural and cereal price indices closed 2% and 4% lower, respectively, while the export price index closed 1% higher. Maize and wheat declined 8% and 6%, respectively, driving the decrease in the cereal price index, whereas rice prices have increased 4%. On a year-on-year basis, maize and wheat prices are 29% and 20% lower, respectively, while rice prices are 39% higher. Maize prices are 13% lower than in January 2021, wheat prices are 10% lower, while rice prices are 24% higher.
In December 2023, the FAO Food Price Index was 118.5 points, 1.8 points (1.5%) lower than in November 2023. Decreases in the price indices for sugar and vegetable oils were the primary driver of this decrease; dairy and cereal prices increased. The index was 13.3 points (10.1%) below its December 2022 level. It averaged 124.0 points for 2023, 19.7 points (13.7%) less than for 2022.
According to the Integrated Food Security Phase Classification (IPC), the Gaza Strip is facing an alarming humanitarian crisis marked by catastrophic levels of acute food insecurity. The IPC indicates that, between November 24 and December 7, 2023, more than 90% of the Gaza Strip’s population, approximately 2.08 million people, faced high levels of acute food insecurity, classified as IPC Phase 3 or above (Crisis or worse), with more than 40% of these in Emergency (IPC Phase 4) and more than 15 percent in Catastrophe (IPC Phase 5). Between December 8, 2023, and February 7, 2024, the entire population (approximately 2.2 million people) will be in IPC Phase 3 or above—the largest share of any population in any area or country facing such severe food insecurity in the history of the IPC initiative. Approximately half of these will be in Emergency (IPC Phase 4), and more than one-quarter (500,000 people) will be in Catastrophe (IPC Phase 5). These catastrophic conditions involve extreme food scarcity, starvation, and depletion of coping capacities.
Following Russia’s invasion of Ukraine, trade-related policies imposed by countries have surged. The global food crisis has been partially made worse by the growing number of food trade restrictions put in place by countries with a goal of increasing domestic supply and reducing prices. As of January 17, 2024, 15 countries have implemented 21 food export bans, and 11 have implemented 14 export-limiting measures.
World Bank action
It may be recalled that in May 2022, the World Bank made a commitment of making available $30 billion over a period of 15 months to tackle the crisis. We have surpassed that goal.
The World Bank has scaled up its food and nutrition security response, to now making $45 billion available through a combination of $22 billion in new lending and $23 billion from existing portfolio.
However, the Bank’s intervention is expected to benefit 335 million people, equivalent to 44% of the number of undernourished people. Around 53% of the beneficiaries are women – they are disproportionately more affected by the crisis.
The $766 million West Africa Food Systems Resilience Program is working to increase preparedness against food insecurity and improve the resilience of food systems in West Africa. The program is increasing digital advisory services for agriculture and food crisis prevention and management, boosting adaptation capacity of agriculture system actors, and investing in regional food market integration and trade to increase food security. An additional $345 million is currently under preparation for Senegal, Sierra Leone and Togo.
In Honduras, the Rural Competitiveness Project series (COMRURAL II and III) aims to generate entrepreneurship and employment opportunities while promoting a climate-conscious, nutrition-smart strategy in agri-food value chains. To date, the program is benefiting around 6,287 rural small-scale producers (of which 33% are women, 15% youth, and 11% indigenous) of coffee, vegetables, dairy, honey, and other commodities through enhanced market connections and adoption of improved agricultural technologies and has created 6,678 new jobs.
The $2.75 billion Food Systems Resilience Program for Eastern and Southern Africa, helps countries in Eastern and Southern Africa increase the resilience of the region’s food systems and ability to tackle growing food insecurity. Now in phase three, the program will enhance inter-agency food crisis response and also boost medium- and long-term efforts for resilient agricultural production, sustainable development of natural resources, expanded market access, and a greater focus on food systems resilience in policymaking.
A $95 million credit from IDA for the Malawi Agriculture Commercialization Project (AGCOM) to increase commercialization of select agriculture value chain products and to provide immediate and effective response to an eligible crisis or
emergency.
The $200 million IDA grant for Madagascar to strengthen decentralized service delivery, upgrade water supply, restore and protect landscapes, and strengthen the resilience of food and livelihood systems in the drought-prone ‘Grand Sud’.
A $60 million credit for the Integrated Community Development Project that works with refugees and host communities in four northern provinces of Burundi to improve food and nutrition security, build socio-economic infrastructure, and support micro-enterprise development through a participatory approach.
The $175 million Sahel Irrigation Initiative Regional Support Project is helping build resilience and boost productivity of agricultural and pastoral activities in Burkina Faso, Chad, Mali, Mauritania, Niger, and Senegal. More than 130,000 farmers and members of pastoral communities are benefiting from small and medium-sized irrigation initiatives. The project is building a portfolio of bankable irrigation investment projects of around 68,000 ha, particularly in medium and large-scale irrigation in the Sahel region.
Through the $50 million Emergency Food Security Response project, 329,000 smallholder farmers in the Central Africa Republic have received seeds, farming tools and training in agricultural and post-harvest techniques to boost crop production and become more resilient to climate and conflict risks.
The $15 million Guinea Bissau Emergency Food Security Project is helping increase agriculture production and access to food to vulnerable families. Over 72,000 farmers have received drought-resistant and high-yielding seeds, fertilizers, agricultural equipment; and livestock vaccines for the country-wide vaccination program. In addition, 8,000 vulnerable households have received cash transfers to purchase food and tackle food insecurity.
The $60 million Accelerating the Impact of CGIAR Research for Africa (AICCRA) project has reached nearly 3 million African farmers (39% women) with critical climate smart agriculture tools and information services in partnership with the Consortium of International Agricultural Research Centers (CGIAR). These tools and services are helping farmers to increase production and build resilience in the face of climate crisis. In Mali, studies showed that farmers using recommendations from the AICCRA-supported RiceAdvice had on average 0.9 ton per hectare higher yield and US$320 per hectare higher income.
A $150 million grant for the second phase of the Yemen Food Security Response and Resilience Project, which will help address food insecurity, strengthen resilience and protect livelihoods.
$50 million grant of additional financing for Tajikistan to mitigate food and nutrition insecurity impacts on households and enhance the overall resilience of the agriculture sector.
A $125 million project in Jordan aims to strengthen the development of the agriculture sector by enhancing its climate resilience, increasing competitiveness and inclusion, and ensuring medium- to long-term food security.
A $300 million project in Bolivia that will contribute to increasing food security, market access and the adoption of climate-smart agricultural practices.
A $315 million loan to support Chad, Ghana and Sierra Leone to increase their preparedness against food insecurity and to improve the resilience of their food systems.
A $500 million Emergency Food Security and Resilience Support Project to bolster Egypt’s efforts to ensure that poor and vulnerable households have uninterrupted access to bread, help strengthen the country’s resilience to food crises, and support reforms that will help improve nutritional outcomes.
A $130 million loan for Tunisia, seeking to lessen the impact of the Ukraine war by financing vital soft wheat imports and providing emergency support to cover barley imports for dairy production and seeds for smallholder farmers for the upcoming planting season.
In May 2022, the World Bank Group and the G7 Presidency co-convened the Global Alliance for Food Security, which aims to catalyze an immediate and concerted response to the unfolding global hunger crisis. The Alliance has developed the publicly accessible Global Food and Nutrition Security Dashboard, which provides timely information for global and local decision-makers to help improve coordination of the policy and financial response to the food crisis.
The heads of the FAO, IMF, World Bank Group, WFP, and WTO released a Third Joint Statement on February 8, 2023. The statement calls to prevent a worsening of the food and nutrition security crisis, further urgent actions are required to (i) rescue hunger hotspots, (ii) facilitate trade, improve the functioning of markets, and enhance the role of the private sector, and (iii) reform and repurpose harmful subsidies with careful targeting and efficiency. Countries should balance short-term urgent interventions with longer-term resilience efforts as they respond to the crisis.
Food security outlook for 2024
From available information, with food security likely to remain one of the critical challenges for the world to face, the World Bank has therefore included food and nutrition security among the eight global challenges to address at scale, and has mobilised $45 billion in resources to tackle issues and protect livelihoods worldwide — surpassing its initial projected commitment of $30 billion announced in May 2022.
Global recovery
The global recovery from COVID-19 and Russia’s invasion of Ukraine is slow, impacting economic stability. Elevated inflation, tighter monetary policies, reduced fiscal support, and extreme weather events contribute to continued pressure on global economic growth. As a result, the October 2023 Outlook tentatively suggests a global peak in the prevalence of severe food insecurity was reached at 11.9% globally in 2020-2022, with only a slight near-term improvement to 11.8% (2021-2023) and 11.6% (2022-2023), showing significant variation across regions and income groups. Short-term food insecurity improvements may however stall, posing a risk of reaching a new high of 943 million people facing severe food insecurity by 2025. Looking to 2028, the global severely food insecure population is projected to hit 956 million, narrowly avoiding a billion in a downside economic scenario if central banks fail to control inflation and respond with further tightening, leading to suppressed growth.
While upper middle-income countries show promising improvements, lower middle-income nations experience only short-term gains, and low-income countries face a projected further increase in food insecure populations. The data exposes widening gaps compared to previous outlooks, with low-income countries expected to witness only a slight improvement in severe food insecurity rates by 2027-2029. Additionally, heavily indebted poor countries are particularly vulnerable, facing both economic challenges and elevated levels of food insecurity.
As global food security conditions evolve, the financial requirements to establish safety nets are escalating. The WFSO projects an annual financing need of $41 billion in International Development Association (IDA) countries and $47 billion in International Bank for Reconstruction and Development (IBRD) countries, nearly doubling pre-pandemic estimates. The shift toward lower-income countries intensifies, highlighting the urgency to reinforce measures safeguarding vulnerable populations. Projections indicate a continuous increase in safety net costs for low-income counties and lower middle-income countries, emphasising the need for effective monetary and fiscal policies to restore stability.
To provide a basic social safety net that covers 25 percent of daily caloric needs for the acutely food insecure, the World Food Security Outlook (WFSO) estimates annual global financing needs at approximately $90 billion from now until 2030, based on projections up to 2027-2029. This assumes no significant changes beyond these projections. However, in scenarios of heightened inflation, lower economic growth, and high commodity prices, these needs could rise substantially, potentially reaching 1.3 times the current estimates. This would elevate the annual financial requirements to around $120 billion.