Many poor, food-importing countries around the world have become desperate in recent months because global prices of rice, wheat and maize have doubled. Hundreds of millions of poor people, who already spend a large share of their daily budget on food, are being pushed to the edge. Food riots are mounting.
But many poor countries can grow more food themselves, because their farmers are producing far below what is technologically possible. In some cases, with appropriate government action, they could double or even triple food production in just a few years.
The idea is basic and well known. Traditional farming uses few inputs and gets poor yields. Poor peasants use their own seeds from the preceding season, lack fertilizer, depend on rain rather than irrigation, and have little if any mechanization beyond a traditional hoe. Their farms are small, perhaps one hectare or less.
Under traditional agricultural conditions, the yields of grain — rice, wheat, maize, sorghum or millet — are usually around one tonne per hectare for one planting season per year. For a farm family of five or six living on one hectare, this means extreme poverty, and for their country it means reliance on expensive food imports, including food aid.
The solution is to increase grain yields to at least two tonnes — and in some places to three or more tonnes — per hectare. If water can be managed through irrigation, this could be combined with multicropping (multiple harvests per year) to produce a crop during the dry season. Higher and more frequent yields mean less poverty in farm families and lower food prices for cities.
The key to increasing yields is to ensure that even the poorest farmers have access to improved seed varieties (usually “hybrid” seeds created by scientific selection of seed varieties), chemical fertilizers, organic matter to replenish soil nutrients and, where possible, small-scale irrigation methods, such as a pump to lift water from a nearby well. There is nothing magic about this combination of high-yield seeds, fertilizer and small-scale irrigation. It is the key to the worldwide increase in food production since the 1960s.
The problem is that these improved inputs have bypassed the poorest farmers and the poorest countries. When peasants lack their own saving accounts and collateral, they are unable to borrow from banks to buy seeds, fertilizer and irrigation equipment. As a result, they grow food the traditional way, often earning little or nothing from their harvest, because it’s not even enough to keep their families alive.
History has shown that government action is required to help the poorest farmers escape the low-yield poverty trap. If farmers can be helped to obtain simple technologies, income can rise, and they can accumulate bank balances and collateral. With a bit of temporary help, perhaps lasting around five years, farmers can build up enough wealth to obtain inputs on a market basis, either through direct purchases from savings or through bank loans.
Government-run agricultural banks in poor countries once not only financed inputs, but also provided agricultural advice and spread new seed technologies.
Of course, there were abuses, such as the allocation of public credits to richer farmers rather than to needy ones, or the prolonged subsidization of inputs even after farmers became credit-worthy. And, in many cases, government agricultural banks went bankrupt.