Hidden cost of global food, land use at $12 trillion: Report

This is expected to rise to more than $16 trillion a year by 2050, finds a report by Food and Land use Coalition 

By DTE Staff
Published: Monday 16 September 2019

The current methods of food production, consumption and land use systems need a serious transformation as they incur ‘hidden’ environmental, health and poverty costs estimated at almost $12 trillion a year, according to a new report.

These hidden costs can cause irreversible damage to key ecosystems, fundamentally undermine food security in certain regions, and increase public health costs, revealed the report published by the Food and Land use Coalition (FOLU), a collaboration of food, farming and green research groups.

If action is not taken timely the costs will rise to more than $16 trillion a year by 2050, the report warned. It will also put the United Nations-mandated Sustainable Development Goals (SDGs) and Paris Agreement climate targets out of reach. This can further unleash food scarcity, disrupt markets and cause political instability, particularly in poor countries, and greately affect women and children.

The hidden costs

Food and land use systems are defined as the way “land is used, food is produced, stored, packed, processed, traded, distributed, marketed, consumed and disposed of,” the report said.

These are the leading sources of greenhouse gas emissions (up to 30 per cent) driving climate change, according to the report.

They are responsible for the degradation of the world’s tropical forests, grasslands, wetlands and other remaining natural habitats. They are also the leading cause behind the ongoing ‘sixth extinction’ of biodiversity.

Global farm subsidies — more than $1m per minute — are triggering climate crisis and destruction of wildlife, while just 1 per cent of the $700 billion a year given to farmers is used to benefit the environment, the analysis found. Much of the total is, instead, used to promote high-emission cattle production, forest destruction and pollution from overuse of fertilisers.

The current food systems are also driving widespread malnutrition, besides directly impacting public health, the report noted.

Malnutrition leads to the largest hidden costs: Today one-third of the world’s population is malnourished; by 2030 it is expected to rise up to 50 per cent.

Since 2014, undernourishment has been rising and more than 820 million people are sufering from hunger. The most affected are in Asia and sub-Saharan Africa. Climate-related extreme weather, conflict and economic slowdown are responsible for undernourishment.

The economic structure of the food system also perpetuates poverty and inequality, according to the report.

Of the 740 million people living in extreme poverty (with less than $1.90 a day purchasing power parity 2011) two-thirds are agricultural workers and their dependents. This indicates that the world is not on track to eradicate poverty by 2030 (SDG 1).

“The world faces a remarkable opportunity to transform food and land use systems over the next 10 years, but as the challenges are growing, we need to act with great urgency,” the report stated.

The report proposes a reform agenda — centred around 10 critical transitions — of real actionable solutions:

  • Healthy diets
  • Productive and regenerative agriculture
  • A healthy and productive ocean
  • Protecting and restoring nature
  • Diversifying protein supply
  • Reducing food loss and waste
  • Local loops and linkages
  • Harnessing the digital revolution
  • Stronger rural livelihoods
  • Gender and demography

These “could enable food and land use systems to provide food security and healthy diets for a global population of over nine billion by 2050, while also tackling core climate, biodiversity, health and poverty challenges,” according to the report.

While an estimated $30 billion public investment is required to deliver the transition, if strongly implemented it can result in an estimated $1.285 trillion by 2030, and $1.920 trillion by 2050, it noted.

Further, reducing the current ‘hidden costs’ of food and land use systems would add $5.7 trillion economic gains to society annually by 2030 and $10.5 trillion annually by 2050. A reduction in public health costs of $1.090 trillion a year by 2030 would be the biggest driver of the gain, the report said.

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