Summary and highlights

The fifth edition of the Africa Agriculture Trade Monitor (AATM) highlights the relationships between African agricultural trade and food and nutrition security.

In particular, it analyzes continental and regional trends in African agricultural trade flows and policies, with focuses on the potential impact of the African Continental Free Trade Area (AfCFTA) and on the Economic Community of Central African States (ECCAS).

The major findings from the report’s six chapters are summarized below.

• The volatility of agricultural and food prices is linked to climate change and to political reactions to the rise in the price of oil and agricultural goods.

• Faced with this rise in world agricultural prices, African countries may fear the emergence of a food crisis, but their potential exposure to this crisis varies significantly from one country to another.

• Today, Africa’s contribution to global value chains is small, but it is growing at a significant pace.

• The backward participation of African countries in global value chains (use of foreign intermediates in national exports), while lower than in other continents, is increasing.

• In value terms, intra-African trade in agricultural products declined by 3.5 percent in 2020 compared to 2019. This poor performance is mainly explained by the COVID-19 pandemic.

• Assessment of the nutritional content of intra-African food and agricultural trade shows that, between 2003–2005 and 2018–2020, trade in calories increased by an average of 4.4 percent each year, trade in fats by 4.9 percent, and trade in proteins by 4.6 percent. Intra-African trade accounts for a larger share of African trade when expressed in terms of calories, fats, and proteins than when expressed in value. This reflects the fact that higher-value products with lower caloric content (for example, coffee, cotton, tea, and cut flowers) are typically exported outside of Africa.

• Concerning African trade in stimulants (cocoa, coffee, tea), Africa’s exports are concentrated in unprocessed cocoa and coffee and semi-processed tea.

• The African Continental Free Trade Area (AfCFTA) is a historic opportunity for the African continent.

• Many studies have assessed the potential impact of the AfCFTA on African trade and economic activity.

• Trade integration in the ECCAS region remains limited.

Focus on chapter 1 - the impact of the ongoing Russia-Ukraine war and the potential risk
of food crisis for Africa.

The analysis begins with an exploration of the supply chain disruptions induced by the war and the importance of Russia, Belarus, and Ukraine in food, energy, and fertilizer markets.

It stresses that Ukraine, Russia, and Belarus are all major players in the world’s food, energy, and fertilizer markets. It is estimated that Russia provides 5.8 percent of the world’s calories and Ukraine provides 6.0 percent — thus, the trade of about 12 percent of the world’s calories used for food and feed is at risk.

Then, it looks at price evolution for these essential goods, beginning from 2019, and considers the range of factors that may explain the observed price trends as well as the likely implications of rising world prices for Africa’s import-dependent countries.

In particular, Laborde (2022) constructed a vulnerability index of developing countries for this crisis. It is based on several indicators: the direct exposure of each country to imports from the Black Sea; food dependence on imports and therefore exposure to rising world prices; macroeconomic vulnerability, and in particular whether or not each country is able to compensate for rising import prices by increasing the price of exports; dependence on fertilizer imports; and the positive or negative dynamics of local agricultural markets. This index highlights extremely perilous food situations in Mauritania, Sudan, Republic of Congo, and Egypt, among African countries. It is crucial today to monitor the state of food security in these countries.

The first chapter concludes by stating that the Russia-Ukraine war cannot be held solely responsible for the global food crisis. Climate change plays an important role, and certain questionable economic policies, notably support for the biofuel industry and restrictions on food exports. Moreover, the situation differs among poor countries. In Africa, the continent’s 55 countries are extremely diverse in terms of their diets, local agricultural dynamics, and foreign trade structure; thus, the impact of the crisis on these countries is very heterogeneous. In addition, although many observers are focused on the cereals market, the dynamics of the vegetable oils and fertilizer markets are at least equally important. Finally, it is essential to accelerate the fight against climate change, using policies that do not jeopardize global food security