The Potsdam Institute for Climate Impact Research (PIK) in Germany recently conducted a study revealing that, even with ambitious climate policies in place, lower-income countries are projected to experience a three-fold rise in food prices by 2050. While the price hike will be less pronounced for farmers in these nations, it will still make it harder for people to afford sufficient and healthy food.
The study highlights a significant disparity in the way food systems function across different regions. In high-income countries, farmers receive less than 25% of food spending, whereas in Sub-Saharan Africa, they retain over 70% of the food dollar, where farming costs contribute heavily to food prices. The rise in food prices will hit consumers in poor nations more severely, with producers also expected to face a substantial increase in prices.
The research, which analyzed food price components across 136 countries and 11 food groups, found that ambitious climate policies aimed at reducing agricultural emissions would have a more significant impact on consumers in lower-income nations. By 2050, consumer food prices in these countries would rise by 2.45 times, while producer prices could see a 3.3-fold increase. This stark contrast with wealthier nations—where consumer food prices would rise by just 1.25 times—reveals how differently food systems function in developed and developing economies.
The study also emphasizes the importance of considering the entire food value chain, including grocery stores and restaurants, to assess the full impact of climate policies on food prices. Researchers noted that while modern food systems in wealthier countries buffer consumer prices, lower-income nations face greater risks due to their more direct reliance on farming.
The researchers suggest that revenues from carbon pricing could help offset the impact on poor consumers, providing financial support for low-income households to mitigate the effects of rising food prices. They also recommend designing climate policies that include mechanisms for a smooth transition, such as fair carbon pricing, financial support for vulnerable regions, and investments in sustainable farming practices.
The study concludes that while climate policies might pose short-term challenges, they are essential for the long-term sustainability of agriculture and food systems, particularly in the face of climate change.
