This annual report monitors and evaluates agricultural policies in 54 countries, including the 38 OECD countries, the five non-OECD EU Member States, and 11 emerging economies. The report includes country specific analysis based on up-to-date estimates of support to agriculture that are compiled using a comprehensive system of measurement and classification – the Producer and Consumer Support Estimates (PSE and CSE) and related indicators. This year’s report focuses on policy responses to the COVID-19 pandemic and analyses the implications of agricultural support policies for the performance of food systems.

The report concludes that three specific actions could enable agricultural policies to better support sustainable productivity growth and increased resilience, and accelerate progress in addressing the “triple challenge” faced by food systems:

1. Phase out price interventions and market distorting producer support. The removal of positive market price support and associated trade protection for producers may need to be offset by transitional assistance and the extension of social safety nets. Conversely, the removal of policies that suppress domestic prices may reduce poorer households’ access to food, calling for targeted income transfers;
2. Target income support to farm households most in need and where possible incorporate into economy-wide social policies and safety-nets. This would require better information on the incomes and assets of farm households, with a specific role for agricultural policy that would involve underwriting those aspects of agricultural risk management that cannot be covered by farmers themselves or by risk markets;
3. Re-orient public expenditures towards investments in public goods –in particular innovation systems. Investment in innovation systems, covering both knowledge generation and its transfer to the sector, should be made central to agricultural support policies. The share of payments going to essential public goods, including ecosystem services, could be almost doubled by a redirection of market distorting payments, and raised further still by a reallocation of income support to farmers whose incomes from farm and off-farm sources would be above average even without support.

Global agriculture continues to meet the core challenge of feeding a rising world population. Yet food systems overall are characterised by rising GHG emissions, declining biodiversity; the persistence of hunger concomitant with rising rates of obesity; pressures on land and water resources; and an inability to generate sustainable livelihoods for many poor farmers. Agricultural policy reforms alone cannot solve all these issues, but more sustainability and innovation-centred policies have an important role to play. More widely,a “food systems approach” requires that agricultural policymakers take a holistic view of the performance of policies related to multiple objectives, and co-ordinate to avoid incoherent policies.Three major events in 2021 can help build international momentum for policy change and accelerate progress towards the Sustainable Development Goals: the COP-26 UN Climate Change Conference, the COP-15 meeting of the Conference of the Parties to the Convention on Biological Diversity, and the UN Food Systems Summit. Countries should seize the opportunity to translate international awareness into specific national actions.