New Delhi: With the food prices rising 45 per cent in the last nine months, the world needs to take urgent measures to ensure that short-term adverse effects of higher food prices do not impact the poor.

Highlighting the role of agro-industry in tackling the problem, Food and Agricultural Organisation (FAO) Director-General Jacques Diouf said that the rise in world food prices could lead to a serious shortages of rice, wheat and maize world over.

Speaking at the first Global Agro-Industries Forum, here, on Wednesday, he said that various factors, including reduced production due to climate change and historically low levels of stocks, have led to surges in food prices.

"Also, the higher consumption of meat and dairy products in emerging economies, increased demand for biofuels production and the higher cost of energy and transport have contributed to this situation," Diouf said.

Addressing the Forum, the United Nations Industrial Development Organisation (UNIDO) Director-General Kandeh K Yumkella said that climate change will impose great stresses on the world's ability to feed ever growing populations.

"This challenge brings new threats to arable land areas, livestock rearing and fisheries through droughts, water shortages and pollution of land, air and sea," he added.

Speaking at the Forum, the International Fund for Agricultural Development (IFAD) President Lennart BÃ¥ge said that in recent years, a number of developing countries have become net importers of food.

Revealing the grim situation in countries from Bangladesh to Zambia, where nearly 40 per cent of the population is undernourished, he added that the explosive and rapid rise of food prices is worsening their situation.

"With greater investment in agriculture and rural development, the world's 400 million smallholders could mobilise their under-utilised potential, not only to improve their own nutrition and incomes but to enhance national food security and overall economic growth," the IFAD President said.

Stressing on the importance of effective marketing and processing systems for agricultural products, Diouf said it is essential to increase agricultural investment in water control and infrastructure and to facilitate small farmer access to inputs in raising their productivity.

He further noted that agro-industry helps preserve foodstuffs, add value and reduce post-harvest losses; it enables products to travel longer distances, including to the rapidly expanding cities.

"For its part, agro-industry generates demand for agricultural products and holds vast potential for off-farm rural employment. It also adds significant value to farm production, whether for domestic or export markets," the FAO Director-General said.

The Agency Heads warned that the benefits of agro-industrial development might not be universally shared, as small agricultural enterprises are facing difficulties in some countries.

Stating the unequal sharing of the benefits of agro-industrial development, the agency heads said that customs tariffs, non-tariff barriers, standards and certification requirements, and export volumes demanded constitute major impediments for many small exporters.

According to FAO, urbanisation, rising incomes and women joining the labour market in many countries have boosted demand for convenience food.

Worldwide, processed food and beverages now account for 80 per cent of total food and drink sales, which rose 57 per cent between 2001 and 2007.

FAO, in partnership with the other agencies and NGOs, is working to establish solid links between small farmers and buyers, by grouping and organising farmers into producer associations and cooperatives.

Yumkella said that the challenge for the UN system and its development partners was to cooperate in helping agro-industrial enterprises to grow and flourish, to provide jobs and create wealth and, thus to foster sustainable economic and human development.

The New Delhi Forum is jointly organised by FAO, UNIDO and IFAD, in close collaboration with the Government of India.
—iGovernment Bureau