OPEC Fund Quarterly - 2023 Q2

SPECIAL FEATURE

Agriculture is one of the primary producers of GHG and emissions over the past 50 years have nearly doubled. Agriculture contributes the

According to FAO, 80 percent of the causes behind an unpredictable

largest share of global methane and nitrous oxide emissions. Projections suggest a further increase by 2050. Agriculture causes about 23 percent of human- caused GHG emissions and uses up to 92 percent of the world’s fresh water. One effect of climate change is a marked increase in severe weather events ranging from heavy floods to extended droughts with serious impacts on arable land and crop yields. Although higher temperatures can improve crop growth,

harvest for cereal crops in areas like Africa’s Sahel come down to climate variability. In other areas like Bangladesh and Viet Nam, coastal farmlands are often flooded by saltwater due to rising sea levels, which kills off rice crops. With half of Viet Nam’s national rice production centered

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Climate change will affect every aspect of food production. Increasing variability of precipitation and more droughts and floods are likely to reduce yields. Climate change will contribute to existing long-term environmental problems such as groundwater depletion and soil degradation, which will affect food and agriculture production systems.

in the Mekong Delta, even a minor flood can have major implications.

studies have shown that crop yields decline significantly when daytime temperatures exceed a certain crop-specific level.

As climate change threatens to

reduce the amount of food produced, it also reduces the

The world’s farmland is becoming increasingly unsuitable for production with 25 percent of all farmland already rated as highly degraded and another 44 percent moderately or slightly degraded. Water resources are highly stressed, with more than 40 percent of the world’s rural population living in water-scarce areas. Land shortage has resulted in smaller farms, lower production per person and greater landlessness – all adding to rural poverty.

amount of food people can access. This simple supply-and-demand function has big impacts, leading to massive price spikes, which tend to hit the most vulnerable the hardest: According to the World Bank, people living in urban areas under the poverty line spend up to 75 percent of their budget on food alone.

Between 33 percent and 50 percent of all food produced globally is never eaten. The value of this wasted food is more than US$1 trillion, says the industry consultancy Oliver Wyman.

To put that into perspective: US food waste represents 1.3 percent of total GDP. Food waste is a massive market inefficiency. At the same time 830 million people go to bed hungry every night and each and every one of

them could be fed on less than a quarter of the food that is wasted in the USA and Europe each year.

Agriculture is a primary cause

of farmland degradation. Soil erosion is caused by overcutting of vegetation, while excessive use of fertilizers to restore yields is leading to an imbalance in nutrients. Approximately 80 percent of global deforestation is driven by agricultural firms, while clearing

Food waste is also bad for the environment. It takes a land mass larger than China to grow

food that ultimately goes uneaten – land that has been deforested, species that have

vegetation to make way for farmland is eroding water resources.

been driven to extinction, indigenous people that have been evicted from their land, soil that has been degraded – all to produce food that is then thrown away. In addition, food that is never eaten accounts for 25 percent of all fresh water consumption globally. The problem, however, does not stop there: When food waste goes to the landfill, which is where the vast majority of it ends up, it decomposes without access to oxygen and creates methane, which is 23 times

Growing populations exacerbate water security and scarcity: The investment necessary for irrigation and water management in developing countries is estimated at US$1 trillion until 2050, says the World Government Summit, a global platform. Meanwhile, a projected investment of US$160 billion will be necessary for soil conservation and food control.

more potent than carbon dioxide. If food waste were a nation, it would be the third- largest GHG emitter after China and the USA.

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