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The State of Agricultural Commodity Markets 2022

The geography of food and agricultural trade: Policy approaches for sustainable development

Year of publication 2022

Place of publication Rome, Italy ;

Pages 128 p.

Author FAO

Publisher FAO ;

Product type Book (series)

ISBN 978-92-5-136373-7

Series title The State of Agricultural Commodity Markets (SOCO)

Series number 2022

Synopsis (short abstract) The State of Agricultural Commodity Markets 2022 (SOCO 2022) discusses how trade policies, based on both multilateral and regional approaches, can address today’s challenges for sustainable development. Trade policies in food and agriculture should aim to safeguard global food security, address the trade-offs between economic and environmental objectives, and strengthen the resilience of the global agrifood system to shocks, such as conflicts, pandemics and extreme weather. The report discusses the geography of trade, analysing food and agricultural trade and its patterns across countries and regions, its drivers and the trade policy environment. Comparative advantage, trade policies and trade costs shape the patterns of trade in food and agriculture. When comparative advantage plays out in the global market, trade benefits all countries. Lowering tariff barriers and reducing trade costs can promote trade and economic growth. Both multilateral and regional trade agreements can facilitate the process of making trade an avenue for growth but the gains of trade are distributed unevenly. When global environmental impacts, such as climate change, are considered, a multilateral approach to trade can help expand the reach of mitigation measures.

The following complementary information is also available:

  • Read the Background paper: International food trade and natural resources
  • Read the Background paper: The impact of changes in the fundamental drivers of trade – Productivity, trade costs, and trade policies
  • Read the Background paper: The evolution of the global structure of food and agricultural trade – Evidence from network analysis
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    Cite this content as:

    FAO. 2022. The State of Agricultural Commodity Markets 2022. The geography of food and agricultural trade:Policy approaches for sustainable development. Rome, FAO.

    https://doi.org/10.4060/cc0471en

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    Language English

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      Book (stand-alone)
      The State of Agricultural Commodity Markets 2018
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      Global agricultural trade has increased significantly in value terms since 2000. Its pattern has also changed – emerging economies and developing countries play a bigger role in international markets, and South–South agricultural trade has expanded significantly. Climate change is expected to affect agriculture, food security and nutrition unevenly across countries and regions. Changes in comparative advantage in agriculture around the world will also affect international trade. This edition of The State of Agricultural Commodity Markets focuses on the complex and underexplored intersection between agricultural trade, climate change and food security. The report makes an important contribution to the policy debates on climate change adaptation and mitigation under the Paris Agreement and the multilateral agricultural trade rules. The report discusses policies – both domestic support and trade measures – that can promote food security, adaptation and mitigation, and improve the livelihoods of family farmers around the world. Given both the slow- and rapid-onset impacts of climate change, policies that can significantly promote climate change adaptation and mitigation would benefit from deeper discussions in international fora on how to strengthen the mutually supportive role of trade rules and climate interventions.
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      Book (stand-alone)
      The impact of changes in the fundamental drivers of trade – Productivity, trade costs, and trade policies
      Background paper for The State of Agricultural Commodity Markets (SOCO) 2022
      2022
      Also available in:
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      Countries’ varying natural resource endowments are vital in explaining international trade. Traditional trade theory suggests that differences in technology and factor endowments lead countries to specialize and export certain goods or services in which they have a comparative advantage. The computable general equilibrium (CGE) model simulations used in this paper aim to explain agricultural trade patterns and show how agricultural trade would change in response to productivity, infrastructure and institutions improvements and trade cost changes from regional and global trade liberalization. A set of nine scenarios is used to explore the effects of productivity, transport costs, non-tariff barriers (NTB), and border measures changes on agricultural and food trade and related welfare implications. Policies driving agricultural productivity growth such as investments in research and development, economic reforms that strengthen incentives for farmers, rural education and extension, and improved infrastructure are shown to reduce the yield gap and improve productivity. Lower trade costs help comparative advantage play out, resulting in gains from trade. Measures taken to increase trade integration in Africa and Asia will be important for economic growth and development in these regions.
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