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COVID-19 and the Food and
Agriculture Sector: Issues and
Policy Responses
29 April 2020
The COVID-19 pandemic is a global health crisis that is already having
devastating impacts on the world economy – both directly and through
necessary measures to contain the spread of the disease. These impacts
are also being felt by the food and agriculture sector. While the supply of
food has held up well to date, in many countries, the measures put in place
to contain the spread of the virus are starting to disrupt the supply of agro-
food products to markets and consumers, both within and across borders.
The sector is also experiencing a substantial shift in the composition and –
for some commodities – the level of demand.
How damaging these impacts turn out to be for food security, nutrition and
the livelihoods of farmers, fishers and others working along the food supply
chain will depend in large part on policy responses over the short, medium
and long term. In the short term, governments must manage multiple
demands – responding to the health crisis, managing the consequences of
the shock to the economy, and ensuring the smooth functioning of the food
system. While the pandemic poses some serious challenges for the food
system in the short term, it is also an opportunity to accelerate
transformations in the food and agriculture sector to build its resilience in
the face of a range of challenges, including climate change.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Enough food is available globally, but COVID-19 is disrupting supply and
demand in complex ways
Currently, there is no reason for the health crisis to develop into a global food crisis. Supplies of staple
crops are large, production prospects are favourable, and cereal stocks are expected to reach their third
highest level on record.1
Moreover, most countries have designated the agriculture and agro-food sector
as essential and exempt from business closure and restrictions on movement. For many countries, the
direct impacts of the pandemic on primary agriculture should be limited, as the disease does not affect the
natural resources upon which production is based. However, the virus poses a serious threat to food
security and livelihoods in the poorest countries, where agricultural production systems are more labour-
intensive and there is less capacity to withstand a severe macroeconomic shock.
Because food is a basic necessity, the level of food demand should be affected less by the crisis than the
demand for other goods and services. However, there has been a major shift in the structure of demand,
with a collapse in demand from restaurants, hotels and catering, the closure of open markets, and a surge
in demand from supermarkets. There are signs that businesses along the food chain are already adapting
to shifts in demand, for example by switching production lines and increasing their capacity to manage
larger inventories; moving to on-line platforms and direct delivery to households; and hiring temporary staff.
In all but the poorest countries,2
the biggest challenges for the sector come from the measures needed to
contain COVID-19; the necessary adjustments within the sector to comply with those measures (which
may increase costs); and the need to find alternative markets for products affected as people change their
consumption habits in response to COVID-19.
How are these disruptions being manifested across the food system?
Impacts on agricultural production and incomes
Limits on the mobility of people across borders and lockdowns are contributing to labour shortages for
agricultural sectors in many countries, particularly those characterised by periods of peak seasonal labour
demand or labour-intensive production. For example, newly implemented travel bans within the European
Union, as well as the closure of the Schengen Area, have significantly reduced the available workforce for
the fruit and vegetable sector in a number of European countries.3 4
Harvesting season is imminent for
many products in the northern hemisphere, and a shortage of labour could lead to production losses and
shortages in the market. In many countries, this comes on top of existing difficulties in sourcing seasonal
labour.
1
AMIS Market Monitor, April 2020.
2
In the poorest countries, a high incidence of sickness among famers and farm workers could have substantial effects
on agricultural production itself, even leading to land abandonment.
3
Information provided by delegates from the OECD Fruit and Vegetables Scheme, including Austria, Belgium, France,
Ireland, Italy, Kenya, Poland and Switzerland, as well as the European Fresh Fruit and Vegetables Association
(Freshfel Europe, Observer Organisation at the OECD Fruit and Vegetables Scheme).
4
OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation
of the Impact of the Coronavirus (COVID-19) on Fruit and Vegetables Trade, 31 March 2020,
TAD/CA/FVS/WD(2020)1.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
On the other hand, disruptions downstream from the farm gate are in some cases causing surpluses to
accumulate, putting a strain on storage facilities and, for highly perishables, increasing food losses. For
some products, supply side disruptions are being compounded by demand side reductions (in particular
foods typically eaten away from home, and luxury items – see below). In combination, these effects are
putting a strain on farm incomes. Moreover, those farm household income losses may be compounded
by reduced off-farm income.
The COVID-19 pandemic may also affect the availability of key intermediate inputs for farmers. For the
moment, there do not seem to be shortages in producing regions of developed countries, although farmers
may face extra difficulties in sourcing inputs due to additional restrictions on the movement of people and
goods.5
However, in the People’s Republic of China (hereafter “China”), for example, the production of
pesticides declined sharply and only resumed gradually after production plants were shut down following
the outbreak. Low availability and/or high prices of inputs such as pesticides could weigh on yields and
crop production in 2020 and 2021, particularly in developing countries.6
Closing borders or slowing down
the transboundary movement of seeds could potentially hamper seed supply chains and on-time delivery
of seed with negative impacts on agriculture, feed and food production over the next season and further
into the future.
Shifts in consumer demand
Most major economies are expected to enter recession as a result of the COVID-19 pandemic, and the
OECD has estimated that for each month the necessary containment measures continue the drop in output
is equivalent to a decline in annual GDP growth of up to 2 percentage points.7
In developed countries, the
macroeconomic shock to consumer demand and employment will reduce overall food demand only slightly,
but is expected to have a stronger impact on demand for higher value premium products and those with
more service addition. Moreover, lower oil prices – a result of forecast lower GDP due to COVID 19 and
an oil price war8
– are reducing demand for crops for biofuels.
The collapse in consumption of food away from home will have a particularly large impact in developed
countries. The closure of restaurants and food service providers in schools, hotels and catering businesses
has shrunk the market for some commodities – for example, potatoes for French fries, seafood, and dairy
products – with some of those losses compensated for by increased demand from supermarkets.9
Demand
also appears to have shifted away from higher value items and towards staple and ready-to-eat foods that
can be stored. There has also been a strong increase in e-commerce.
This significant change in the composition – and for some commodities, the level – of demand will put
whole value chains under pressure. Manufacturers are adjusting production and distribution, for example,
to shift from producing bulk items for food service to smaller packages for home use. However, some will
5
Farm Policy News, 6 April 2020 https://farmpolicynews.illinois.edu/2020/04/covid-19-impacting-food-purchasing-
dynamics-as-ag-labor-concerns-persist/.
6
Schmidhuber, Pound and Qiao (2020), COVID-19: Channels of Transmission to Food and Agriculture, FAO, Rome.
https://doi.org/10.4060/ca8430en.
7
Evaluating the Initial Impact of COVID-19 Containment Measures on Economic Activity (14 April 2020),
https://www.oecd.org/coronavirus/policy-responses/evaluating-the-initial-impact-of-covid-19-containment-measures-
on-economic-activity/.
8
Farm Policy News, 30 March 2020 https://farmpolicynews.illinois.edu/2020/03/covid-19-and-oil-prices-taking-toll-on-
ethanol-plants/.
9
Some countries are endeavouring to keep school lunch programmes going, in particular for disadvantaged students,
via alternative distribution systems.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
have difficulties keeping their businesses viable. There is also a need to adapt and deliver food through
different channels (for example, via supermarkets or direct home delivery, as opposed to open markets or
direct to restaurants and catering businesses). This will be particularly challenging for smaller and
specialised farmers – who are more likely to rely on open markets, restaurants and catering – and who
may struggle to identify new outlets and buyers.
These demand shifts are a direct result of containment measures to control the disease. Some of these
shifts could also have the potential to re-shape dietary habits and consumer behaviour over the longer
term, in particular should confinement measures prove long-lasting. The uncertainty associated with how
consumption will evolve after the pandemic is likely to affect investment decisions by some firms, which
could also affect the future development of food chains. For some, however, these changes could present
new business opportunities.
Disruptions to food supply chains
Measures put in place to prevent or slow the spread of COVID-19 are also disrupting the functioning of
food supply chains. The impacts on labour are of particular concern. The food sector will be vulnerable to
the negative impacts on the workforce from the spread of COVID-19 (workers being sick or in isolation),
and will face additional production and distribution costs as a result of health and safety measures
introduced to reduce the exposure of their workforce. While the virus transmission mechanisms are not
fully understood, two clear mechanisms are: (i) people working in close proximity; and (ii) people touching
contaminated surfaces. Managing these risks will require immediate changes to the way food is processed
and distributed. Many of those changes are already underway, but may be difficult to implement in the
short term due to challenges related to sourcing masks and protective equipment for workers.
The markets for perishables are likely to be affected more than those for cereals and prepared foods. Close
working conditions in packing and processing facilities put the workforce at risk of contracting COVID-19.
The need to meet social distancing requirements, for example, in packing and grading fruit and
vegetables10
and in processing livestock products, in addition to absenteeism, is increasing costs and
reducing production capacity even as consumer demand in supermarkets increases. The available
workforce has also been reduced due to rising infection rates and absenteeism, and in response to
lockdowns, even in critical sectors. In addition to disrupting supply, infections in processing facilities have
in turn led to reductions in demand at the farm level.
Lockdowns and limits on the mobility of people are also affecting the provision of key food safety, quality
and certification checks, including those that are required to facilitate trade, such as physical inspections
of goods to certify compliance with sanitary and phytosanitary requirements (SPS). Moreover, additional
checks may be required in response to new biosecurity arrangements for the sector, implemented in
response to COVID 19. In some cases, the relaxation of standards in order to meet domestic food needs
calls into question the objective of such measures in terms of health and safety versus protection of
domestic industries.
10
OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report:
Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020,
TAD/CA/FVS/WD(2020)1.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Measures to contain the spread of the COVID-19 are causing delays and disruptions to transport and
logistics services. Border closures and additional procedures and checks have led to congestion and
delays, affecting the transit of perishable products. For example, social distancing requirements have
reduced the numbers of import and export inspectors at borders, increasing the time needed for customs
clearance.11
The grounding of airlines, and the increasing cost of international freight as a result of lower trade volumes
and a lack of commercial passenger flights, are causing significant problems for the export of higher value
perishable food products, including seafood, fruit and vegetables.12
There are reports that following travel
bans, air freight costs have risen by about 30% between China and North America and by over 60% on
some important Europe-North America routes).13
Delivery times have also increased.14
Port closures pose a problem too when product has to be diverted from one port to another or to a different
importing country altogether. At the time the virus struck, large numbers of shipping containers were in
Chinese ports, and restrictions on their movement have led to a shortage that has seen the price of
containers rise (in some cases considerably). This too has had flow-on effects for the price of cargo,
including for food products, and the volume of traffic. For example, in March, dockworkers at China’s
Shenzhen port, the fourth-largest in the world by container volume, reported that business had fallen off
by an estimated 50-75% since the COVID-19 outbreak began.15
Diverting cargo may also require
additional documentation for border clearance.
Transport restrictions and quarantine measures are also likely to impede access to inputs needed by
businesses in the food sector. For example, there are reports that interruptions to fertiliser production by
some suppliers – due to a lack of workers – have created difficulties for the manufacturers of CO2 and, by
extension, the food industry. CO2 is used for different food applications (freezing, carbonation of drinks,
and to conserve products in a controlled atmosphere, such as packaged meats, allowing consumption
deadlines to be postponed). This poses a challenge for food manufacturers, in particular carbonated drinks
manufacturers and large dairy groups.16
The COVID-19 pandemic may have implications over the short and long term for food loss and waste.
Supply chain losses may increase in the short-term because of logistical bottlenecks and a contraction in
the demand for perishables that are often consumed away from home (e.g. milk, eggs and fresh fish).
Consumer waste may be increased by hoarding and panic buying, although most of these purchases have
11
OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report:
Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020,
TAD/CA/FVS/WD(2020)1.
12
OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report:
Evaluation of the Impact of the Coronavirus (COVID-19) on Fruit and Vegetables Trade, 31 March 2020,
TAD/CA/FVS/WD(2020)1; Schmidhuber, Pound and Qiao (2020), COVID-19: Channels of Transmission to Food and
Agriculture, FAO, Rome, https://doi.org/10.4060/ca8430en.
13
Curran, E. (2020), “Urgent Demand for Medical Equipment is Making Air Cargo Fees “Absolutely Crazy””,
Bloomberg, https://www.bloomberg.com/news/articles/2020-03-30/-absolutely-crazy-air-cargo-fees-highlight-supply-
chain-squeeze (accessed 6 April 2020).
14
COVID-19 and International Trade: Issues and Actions, https://read.oecd-ilibrary.org/view/?ref=128_128542-
3ijg8kfswh&title=COVID-19-and-international-trade-issues-and-actions.
15
Financial Times, 18 March 2020, https://www.ft.com/content/1071ae50-6394-11ea-b3f3-fe4680ea68b5.
16
OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report:
Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020,
TAD/CA/FVS/WD(2020)1.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
been for longer life items, such as flour and pasta. Conversely, restaurant waste, e.g. from the need to
offer menu choices, will have been eliminated. Over the longer term the food sector may identify better
ways to manage inventories, and consumers may also reassess their shopping and consumption habits,
with a view to reducing waste.
Strong, flexible supply chains – from farm to fork – are essential to keep the food
system functioning; what can policymakers do?
Getting food to where it is needed will require strong and flexible supply chains that can respond to shifts
in consumer demand and adjust in response to supply constraints arising from measures implemented in
response to COVID-19. While there are many uncertainties and the situation continues to evolve,
experience with past crises (notably the food price crisis of 2007-8) provides insights into some actions
that governments can take to mitigate the impacts of COVID-19 on the food system.
Keep international markets in agriculture and food products open, transparent and
predictable
The COVID-19 pandemic has not so far caused a supply shock for staple grains. Nevertheless, several
large exporters have restricted exports, while some countries that rely on imported grains to feed their
populations have ramped up purchases to ensure they have sufficient stockpiles to see out the pandemic.
 Ensure market transparency via the provision of timely market information. A lesson from the
2007/08 food price crisis is that transparency and information sharing are important. This can help
mitigate panic buying and generate trust in markets. It can also improve trust among countries,
thereby encouraging co-operative solutions. Countries can also benefit from peer learning in terms
of what kinds of policy approaches are proving effective (Box 1).
 Provide clear and transparent communication at the domestic level. A number of governments
have taken steps to deter panic buying and hoarding by ensuring the release of timely information
about the availability and safety of food stocks.
 Avoid trade restrictions. Export restrictions increase instability in global markets and undermine
supply, particularly for countries that are more exposed to price fluctuations. OECD analysis has
shown that export restrictions and the breakdown of international trade pose a significant threat to
food security by reducing the availability of food, which can result in a significant increase in
undernourishment in the case of an economic crisis.17
 Keep domestic, regional and international markets open. Well-functioning domestic markets,
regional co-operation and an open international trading system are all important to connect
producers to market opportunities, and help food get to where it is needed. Open borders and well-
connected internal markets can help to contain supply disruptions. This is especially important in
the case of net food importing countries.
17
OECD (2017), Building Food Security and Managing Risk in Southeast Asia, OECD Publishing, Paris,
https://doi.org/10.1787/9789264272392-en.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Box 1. The Agricultural Market Information System (AMIS
The Agricultural Market Information System (AMIS) is an inter-agency platform to enhance food market
transparency and policy response for food security. It was launched in 2011 by the G20 Ministers of
Agriculture following the global food price hikes in 2007/08 and 2010. Bringing together the principal
trading countries of agricultural commodities, AMIS assesses global food supplies (focusing on wheat,
maize, rice and soybeans) and provides a platform to co-ordinate policy action in times of market
uncertainty.
The value of AMIS was tested when drought struck southern Europe and North America in the summer
of 2012. Analysis provided by AMIS and close discussions among AMIS members helped increase
transparency about policy actions and intentions, and allay concerns about a return to price volatility.
Prices rose to record (nominal) levels, but markets performed efficiently without the levels of price
volatility seen in 2007 and 2010. AMIS played a valuable role in helping persuade policymakers and
market participants to avoid the mistakes – in particular, the counter-productive policy actions – that
aggravated the price spikes of 2007/08.
Minimise the avoidable trade costs of measures to prevent the spread of COVID-19
New non-tariff measures (SPS and TBT measures) are already being put in place that could have
disruptive impacts on global food value chains. While such measures can be necessary to manage sanitary
risks, they could also significantly increase costs for food exporters, particularly if requirements differ
between markets. There is thus a need to reduce unnecessary costs associated with such measures, with
a view to keeping safe and affordable food available globally. Indeed, some WTO Members have notified
that they are implementing measures to facilitate trade through, for example, the use of expedited
submission of electronic documentation.
 Ensure that SPS and TBT measures implemented in response to the risk of COVID-19 are science-
based, transparent, non-discriminatory and do not unnecessarily disrupt trade or increase trade
costs. The need for such measures should also be re-evaluated as evidence about risks becomes
available.
 Ensure sharing of best practices and, to the extent possible, harmonisation of measures between
countries to smooth processes at the border. Regionally coordinated strategies that allow flexibility
within existing regulatory frameworks and build trust among trading partners can also help ensure
that food is able to move to where it is needed.
Address labour constraints in the food supply chain
 Designate food sector workers as critical. In addition to farm workers and workers in food
businesses, this designation should include public and private providers of critical services for the
sector, such as food safety inspectors.
 Ease (non-health and safety related) regulatory requirements for farmers to access seasonal
labour through migration programmes.
 Look for opportunities to facilitate farmers’ access to an alternative workforce, including by
attracting workers laid off in other sectors (for example, services and the gig economy). Students
may also be able to replace some of the shortfalls.
 Take measures to ensure the health and safety of workers, given that close working conditions in
fields, packing and processing facilities put them at a heightened risk for contracting COVID-19.
8 
COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Ensure health and food safety throughout the food chain
 Establish appropriate biosecurity arrangements for the sector, and collect and communicate the
scientific evidence on safe biosecurity practices as swiftly as possible.
 Enforce strict regulations governing the humane slaughter, handling, sale, preparation and
consumption of meat from wild animals.
Facilitate the movement of food products – including through alternative channels
 Enhance trade facilitation and logistics. Facilitating the movement of perishable products across
borders would reduce food loss and waste related to handling difficulties, while facilitating border
checks could ease access to essential agricultural inputs such as pesticides and veterinary
medicines. Digital tools may help to facilitate border procedures, for example, by allowing electronic
copies of sanitary and phytosanitary certificates.
 Explore ways to maintain transport links, to the extent possible, in order to facilitate the movement
of food products and ensure farmers’ access to input and output markets.
 Co-operate with private stakeholders to identify and address bottlenecks to the smooth functioning
of food supply chains.
 Work with the private sector to find alternative supply channels to handle potential surpluses (or
potential food loss and waste) that have resulted from the closure of restaurants, schools, hotels
and catering businesses. This would benefit both consumers and smaller farmers, who are more
likely to be dependent on those outlets and buyers.
 Where appropriate, provide flexibility around regulatory requirements (e.g. packaging and labelling
requirements) in order to facilitate the movement of food products to alternative outlets.
Ensure the food and nutrition needs of vulnerable populations are met – now and in the
future
Most major economies are expected to enter into recession as a result of measures implemented to combat
COVID-19, and considerable job losses have already occurred. This may have a significant impact on food
insecure populations in both developing and developed countries.
In developed countries, some groups, like the elderly, chronically ill and poorer households, may be
particularly vulnerable to short-term shortages of food as a result of the closure of school meal
programmes; closure of, or increased demands upon, food banks; and panic buying that reduces essential
supplies and low cost options in supermarkets. Ensuring the food security and nutrition needs of vulnerable
populations is essential, including through ensuring access to appropriate social safety nets. Many
countries have swiftly implemented policy responses in this area mostly by expanding funding for pre-
existing food assistance programmes and in some cases implementing new measures. Governments are
also working with non-governmental organisations to enable the provision of emergency food via food
banks. Governments can co-ordinate with private stakeholders to restore and communicate trust in local
food chains.
In developing countries, particularly those already affected by conflict or humanitarian crises, COVID-19 is
likely to have much more serious impacts on livelihoods and food security. The experience of Ebola
provides evidence of how livelihoods can be decimated, as fear of contagion and movement restrictions
kept some farmers from producing, affecting both cash and food crop production, disrupting agricultural
supply chains, and causing acute agricultural labour shortages in the region. The Ebola outbreak also had
a strong negative effect on the purchasing power of the most vulnerable households, and consequently on
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
their access to food.18
For developing countries – where food systems are more labour-intensive, many
farmers are net buyers of food staples, supply chains are less well developed, and where the
macroeconomic shock risks plunging large numbers of people into poverty – international assistance may
be needed.
Moreover, the effects of COVID-19 are taking place against the backdrop of a climate emergency. Supply
shocks associated with extreme weather events, combined with demand shocks in a depressed economy
could create food security tensions.
 Address the immediate needs of the vulnerable populations, for example, by means of emergency
food assistance or targeted transfers.
 Further develop social protection systems. Cash transfers – both conditional payments, through
systems such as adaptive safety nets, and unconditional transfers – provide a more efficient and
effective response to food security concerns than market interventions, including those operated
through public distribution systems.
 Explore co-operative global solutions to address the needs of the poorest countries and ensure
that COVID-19 does not result in a food crisis in these countries.
Looking ahead, COVID-19 offers an opportunity to enhance the resilience,
sustainability, and productivity of the agriculture and food sector
In light of COVID-19, ensuring that the food system is more sustainable and resilient is now an even more
urgent priority. The COVID-19 pandemic provides an opportunity to learn more about chokepoints and
vulnerabilities in the food system, in order to identify necessary investments and reforms that would further
strengthen the resilience of the sector to a range of future shocks and challenges. It will be crucial to
engage stakeholders in the process of understanding the full impacts of the pandemic on various
population groups and the lessons to be learned. In particular, it will be important to examine the current
resilience toolkit in the food system, with a view to identifying which policy measures have proven most
effective and what new measures may be needed to respond to system-wide shocks. It will be particularly
important to understand the factors that enable some food and farming businesses to adapt their business
models quickly enough to avoid the most negative consequences.
Lessons from the COVID-19 pandemic will need to be integrated into wider responses to challenges
confronting the global food system. Those challenges include: (i) the ongoing emergency of climate
change, and the need for the food system to be resilient to a range of extreme weather events; (ii) the
need to ensure sustainable productivity growth to feed a growing world population in a changing climate,
while simultaneously reducing the sector’s greenhouse gas emissions; (iii) maintaining biodiversity, against
the background of land use change related to agriculture, the management of new varieties and disease
risks from monocultures; and (iv) a range of animal and plant diseases, including those which affect human
health directly, via food borne disease (as with the BSE crisis), human-to-human transmission (as with
zoonotic coronaviruses), and by inducing human antimicrobial resistance (when antimicrobials are applied
inappropriately in the livestock sector), as well those which impact food security by reducing animal and
crop production (as with African Swine Fever and Fall Armyworm).
18
http://www.fao.org/news/story/en/item/270716/icode/; FAO (2020), Anticipating the Impacts of COVID-19 in
Humanitarian and Food Crisis Contexts, Rome, https://doi.org/10.4060/ca8464en.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Learn from the crisis to increase preparedness for future shocks
 Work with stakeholders and international organisations to identify weaknesses, choke points and
vulnerabilities in agriculture and food systems, and critical services that need to be strengthened
in order to increase preparedness for systemic risks and identify opportunities to strengthen
networks between public and private stakeholders to make these investments.
 Accelerate investments and reforms that would further strengthen the resilience of the food system
to a range of risks, for example:
o Invest in data systems at the local, national and global levels so that real time information can
be made available for decision makers, and help to increase confidence in supply during crises.
o Invest in national and international efforts to increase adequate biosecurity arrangements to
enhance countries’ capacity to manage emergent sanitary and phytosanitary risks.
o Strengthen government communication strategies to improve consumer trust in the safety and
reliability of the agro-food system.
Support the transition to a more resilient agricultural sector and food system
 Ensure that support measures intended to provide temporary relief to farmers and other food
system stakeholders are consistent with wider socio-economic policies, reach vulnerable socio-
economic groups and contain clear exit strategies.
 Consider wider opportunities to repurpose agricultural support in ways that provide clear public
goods, in particular in the form of climate change mitigation and improved environmental outcomes.
 Secure and build on positive trade facilitation steps that have been taken to reduce distortions at
the border, to reinforce the role that global markets can play in ensuring securing and stable food
supplies.
 Continue efforts to build and maintain mechanisms to ensure transparency and policy dialogue on
food systems, such as AMIS, to build confidence in global markets and co-operation.
 In moving forward, consider how adopting an integrated approach can help ensure the resilience
of the global food system. With enhanced resilience the food system will be better able to deliver
on the triple challenge: providing safe, affordable food for a growing world population and
livelihoods for the many people involved in food around the world (including the majority of the
world’s poor who live in rural areas), while ensuring environmental sustainability in the face of
complex environmental challenges and a climate emergency.
Conclusion
There is an opportunity today to not just respond effectively to the current crisis, but to roll back distortive,
inefficient and environmentally harmful support, thereby freeing up financial resources for investments in
a more productive, sustainable and resilient food system able to meet new challenges. This, together with
accompanying regulatory reforms, can help build an enabling environment for the entire food system that
is aligned with natural resource limits, a changing climate, market demand, technological developments,
and “low probability, high impact” catastrophic risks. The unanticipated shock of COVID-19 underscores
the need for a shift from “business as usual” policies to a more forward looking policy package that invests
in the productivity, sustainability, and the resilience of the global food system.
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COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
Forthcoming Policy Briefs
This is the first in a series of Policy Briefs on issues related to COVID-19 and food and agriculture. Look out for
other Policy Briefs in this series that will look more deeply into specific issues. Forthcoming Briefs include:
 COVID-19 and the food system
 Impacts on specific supply chains (e.g. seeds, fruit and vegetables)
 Transparency
A framework paper, COVID-19 and International Trade: Issues and Actions, is also available, along with in-depth
Policy Briefs on specific sectors and issues.
Other Policy Briefs on wider issues are available on oecd.org/coronavirus.
12 
COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020
This Policy Brief is published under the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein
do not necessarily reflect the official views of OECD member countries.
This Policy Brief is without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to
the name of any territory, city or area.
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COVID-19 and the Food and Agriculture Sector: Issues and Policy Responses

  • 1. COVID-19 and the Food and Agriculture Sector: Issues and Policy Responses 29 April 2020 The COVID-19 pandemic is a global health crisis that is already having devastating impacts on the world economy – both directly and through necessary measures to contain the spread of the disease. These impacts are also being felt by the food and agriculture sector. While the supply of food has held up well to date, in many countries, the measures put in place to contain the spread of the virus are starting to disrupt the supply of agro- food products to markets and consumers, both within and across borders. The sector is also experiencing a substantial shift in the composition and – for some commodities – the level of demand. How damaging these impacts turn out to be for food security, nutrition and the livelihoods of farmers, fishers and others working along the food supply chain will depend in large part on policy responses over the short, medium and long term. In the short term, governments must manage multiple demands – responding to the health crisis, managing the consequences of the shock to the economy, and ensuring the smooth functioning of the food system. While the pandemic poses some serious challenges for the food system in the short term, it is also an opportunity to accelerate transformations in the food and agriculture sector to build its resilience in the face of a range of challenges, including climate change.
  • 2. 2  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Enough food is available globally, but COVID-19 is disrupting supply and demand in complex ways Currently, there is no reason for the health crisis to develop into a global food crisis. Supplies of staple crops are large, production prospects are favourable, and cereal stocks are expected to reach their third highest level on record.1 Moreover, most countries have designated the agriculture and agro-food sector as essential and exempt from business closure and restrictions on movement. For many countries, the direct impacts of the pandemic on primary agriculture should be limited, as the disease does not affect the natural resources upon which production is based. However, the virus poses a serious threat to food security and livelihoods in the poorest countries, where agricultural production systems are more labour- intensive and there is less capacity to withstand a severe macroeconomic shock. Because food is a basic necessity, the level of food demand should be affected less by the crisis than the demand for other goods and services. However, there has been a major shift in the structure of demand, with a collapse in demand from restaurants, hotels and catering, the closure of open markets, and a surge in demand from supermarkets. There are signs that businesses along the food chain are already adapting to shifts in demand, for example by switching production lines and increasing their capacity to manage larger inventories; moving to on-line platforms and direct delivery to households; and hiring temporary staff. In all but the poorest countries,2 the biggest challenges for the sector come from the measures needed to contain COVID-19; the necessary adjustments within the sector to comply with those measures (which may increase costs); and the need to find alternative markets for products affected as people change their consumption habits in response to COVID-19. How are these disruptions being manifested across the food system? Impacts on agricultural production and incomes Limits on the mobility of people across borders and lockdowns are contributing to labour shortages for agricultural sectors in many countries, particularly those characterised by periods of peak seasonal labour demand or labour-intensive production. For example, newly implemented travel bans within the European Union, as well as the closure of the Schengen Area, have significantly reduced the available workforce for the fruit and vegetable sector in a number of European countries.3 4 Harvesting season is imminent for many products in the northern hemisphere, and a shortage of labour could lead to production losses and shortages in the market. In many countries, this comes on top of existing difficulties in sourcing seasonal labour. 1 AMIS Market Monitor, April 2020. 2 In the poorest countries, a high incidence of sickness among famers and farm workers could have substantial effects on agricultural production itself, even leading to land abandonment. 3 Information provided by delegates from the OECD Fruit and Vegetables Scheme, including Austria, Belgium, France, Ireland, Italy, Kenya, Poland and Switzerland, as well as the European Fresh Fruit and Vegetables Association (Freshfel Europe, Observer Organisation at the OECD Fruit and Vegetables Scheme). 4 OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation of the Impact of the Coronavirus (COVID-19) on Fruit and Vegetables Trade, 31 March 2020, TAD/CA/FVS/WD(2020)1.
  • 3.  3 COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 On the other hand, disruptions downstream from the farm gate are in some cases causing surpluses to accumulate, putting a strain on storage facilities and, for highly perishables, increasing food losses. For some products, supply side disruptions are being compounded by demand side reductions (in particular foods typically eaten away from home, and luxury items – see below). In combination, these effects are putting a strain on farm incomes. Moreover, those farm household income losses may be compounded by reduced off-farm income. The COVID-19 pandemic may also affect the availability of key intermediate inputs for farmers. For the moment, there do not seem to be shortages in producing regions of developed countries, although farmers may face extra difficulties in sourcing inputs due to additional restrictions on the movement of people and goods.5 However, in the People’s Republic of China (hereafter “China”), for example, the production of pesticides declined sharply and only resumed gradually after production plants were shut down following the outbreak. Low availability and/or high prices of inputs such as pesticides could weigh on yields and crop production in 2020 and 2021, particularly in developing countries.6 Closing borders or slowing down the transboundary movement of seeds could potentially hamper seed supply chains and on-time delivery of seed with negative impacts on agriculture, feed and food production over the next season and further into the future. Shifts in consumer demand Most major economies are expected to enter recession as a result of the COVID-19 pandemic, and the OECD has estimated that for each month the necessary containment measures continue the drop in output is equivalent to a decline in annual GDP growth of up to 2 percentage points.7 In developed countries, the macroeconomic shock to consumer demand and employment will reduce overall food demand only slightly, but is expected to have a stronger impact on demand for higher value premium products and those with more service addition. Moreover, lower oil prices – a result of forecast lower GDP due to COVID 19 and an oil price war8 – are reducing demand for crops for biofuels. The collapse in consumption of food away from home will have a particularly large impact in developed countries. The closure of restaurants and food service providers in schools, hotels and catering businesses has shrunk the market for some commodities – for example, potatoes for French fries, seafood, and dairy products – with some of those losses compensated for by increased demand from supermarkets.9 Demand also appears to have shifted away from higher value items and towards staple and ready-to-eat foods that can be stored. There has also been a strong increase in e-commerce. This significant change in the composition – and for some commodities, the level – of demand will put whole value chains under pressure. Manufacturers are adjusting production and distribution, for example, to shift from producing bulk items for food service to smaller packages for home use. However, some will 5 Farm Policy News, 6 April 2020 https://farmpolicynews.illinois.edu/2020/04/covid-19-impacting-food-purchasing- dynamics-as-ag-labor-concerns-persist/. 6 Schmidhuber, Pound and Qiao (2020), COVID-19: Channels of Transmission to Food and Agriculture, FAO, Rome. https://doi.org/10.4060/ca8430en. 7 Evaluating the Initial Impact of COVID-19 Containment Measures on Economic Activity (14 April 2020), https://www.oecd.org/coronavirus/policy-responses/evaluating-the-initial-impact-of-covid-19-containment-measures- on-economic-activity/. 8 Farm Policy News, 30 March 2020 https://farmpolicynews.illinois.edu/2020/03/covid-19-and-oil-prices-taking-toll-on- ethanol-plants/. 9 Some countries are endeavouring to keep school lunch programmes going, in particular for disadvantaged students, via alternative distribution systems.
  • 4. 4  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 have difficulties keeping their businesses viable. There is also a need to adapt and deliver food through different channels (for example, via supermarkets or direct home delivery, as opposed to open markets or direct to restaurants and catering businesses). This will be particularly challenging for smaller and specialised farmers – who are more likely to rely on open markets, restaurants and catering – and who may struggle to identify new outlets and buyers. These demand shifts are a direct result of containment measures to control the disease. Some of these shifts could also have the potential to re-shape dietary habits and consumer behaviour over the longer term, in particular should confinement measures prove long-lasting. The uncertainty associated with how consumption will evolve after the pandemic is likely to affect investment decisions by some firms, which could also affect the future development of food chains. For some, however, these changes could present new business opportunities. Disruptions to food supply chains Measures put in place to prevent or slow the spread of COVID-19 are also disrupting the functioning of food supply chains. The impacts on labour are of particular concern. The food sector will be vulnerable to the negative impacts on the workforce from the spread of COVID-19 (workers being sick or in isolation), and will face additional production and distribution costs as a result of health and safety measures introduced to reduce the exposure of their workforce. While the virus transmission mechanisms are not fully understood, two clear mechanisms are: (i) people working in close proximity; and (ii) people touching contaminated surfaces. Managing these risks will require immediate changes to the way food is processed and distributed. Many of those changes are already underway, but may be difficult to implement in the short term due to challenges related to sourcing masks and protective equipment for workers. The markets for perishables are likely to be affected more than those for cereals and prepared foods. Close working conditions in packing and processing facilities put the workforce at risk of contracting COVID-19. The need to meet social distancing requirements, for example, in packing and grading fruit and vegetables10 and in processing livestock products, in addition to absenteeism, is increasing costs and reducing production capacity even as consumer demand in supermarkets increases. The available workforce has also been reduced due to rising infection rates and absenteeism, and in response to lockdowns, even in critical sectors. In addition to disrupting supply, infections in processing facilities have in turn led to reductions in demand at the farm level. Lockdowns and limits on the mobility of people are also affecting the provision of key food safety, quality and certification checks, including those that are required to facilitate trade, such as physical inspections of goods to certify compliance with sanitary and phytosanitary requirements (SPS). Moreover, additional checks may be required in response to new biosecurity arrangements for the sector, implemented in response to COVID 19. In some cases, the relaxation of standards in order to meet domestic food needs calls into question the objective of such measures in terms of health and safety versus protection of domestic industries. 10 OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020, TAD/CA/FVS/WD(2020)1.
  • 5.  5 COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Measures to contain the spread of the COVID-19 are causing delays and disruptions to transport and logistics services. Border closures and additional procedures and checks have led to congestion and delays, affecting the transit of perishable products. For example, social distancing requirements have reduced the numbers of import and export inspectors at borders, increasing the time needed for customs clearance.11 The grounding of airlines, and the increasing cost of international freight as a result of lower trade volumes and a lack of commercial passenger flights, are causing significant problems for the export of higher value perishable food products, including seafood, fruit and vegetables.12 There are reports that following travel bans, air freight costs have risen by about 30% between China and North America and by over 60% on some important Europe-North America routes).13 Delivery times have also increased.14 Port closures pose a problem too when product has to be diverted from one port to another or to a different importing country altogether. At the time the virus struck, large numbers of shipping containers were in Chinese ports, and restrictions on their movement have led to a shortage that has seen the price of containers rise (in some cases considerably). This too has had flow-on effects for the price of cargo, including for food products, and the volume of traffic. For example, in March, dockworkers at China’s Shenzhen port, the fourth-largest in the world by container volume, reported that business had fallen off by an estimated 50-75% since the COVID-19 outbreak began.15 Diverting cargo may also require additional documentation for border clearance. Transport restrictions and quarantine measures are also likely to impede access to inputs needed by businesses in the food sector. For example, there are reports that interruptions to fertiliser production by some suppliers – due to a lack of workers – have created difficulties for the manufacturers of CO2 and, by extension, the food industry. CO2 is used for different food applications (freezing, carbonation of drinks, and to conserve products in a controlled atmosphere, such as packaged meats, allowing consumption deadlines to be postponed). This poses a challenge for food manufacturers, in particular carbonated drinks manufacturers and large dairy groups.16 The COVID-19 pandemic may have implications over the short and long term for food loss and waste. Supply chain losses may increase in the short-term because of logistical bottlenecks and a contraction in the demand for perishables that are often consumed away from home (e.g. milk, eggs and fresh fish). Consumer waste may be increased by hoarding and panic buying, although most of these purchases have 11 OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020, TAD/CA/FVS/WD(2020)1. 12 OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation of the Impact of the Coronavirus (COVID-19) on Fruit and Vegetables Trade, 31 March 2020, TAD/CA/FVS/WD(2020)1; Schmidhuber, Pound and Qiao (2020), COVID-19: Channels of Transmission to Food and Agriculture, FAO, Rome, https://doi.org/10.4060/ca8430en. 13 Curran, E. (2020), “Urgent Demand for Medical Equipment is Making Air Cargo Fees “Absolutely Crazy””, Bloomberg, https://www.bloomberg.com/news/articles/2020-03-30/-absolutely-crazy-air-cargo-fees-highlight-supply- chain-squeeze (accessed 6 April 2020). 14 COVID-19 and International Trade: Issues and Actions, https://read.oecd-ilibrary.org/view/?ref=128_128542- 3ijg8kfswh&title=COVID-19-and-international-trade-issues-and-actions. 15 Financial Times, 18 March 2020, https://www.ft.com/content/1071ae50-6394-11ea-b3f3-fe4680ea68b5. 16 OECD Scheme for the Application of International Standards for Fruit and Vegetables, Preliminary Report: Evaluation of the Impact of the Coronavirus (Covid-19) on Fruit and Vegetables Trade, 31 March 2020, TAD/CA/FVS/WD(2020)1.
  • 6. 6  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 been for longer life items, such as flour and pasta. Conversely, restaurant waste, e.g. from the need to offer menu choices, will have been eliminated. Over the longer term the food sector may identify better ways to manage inventories, and consumers may also reassess their shopping and consumption habits, with a view to reducing waste. Strong, flexible supply chains – from farm to fork – are essential to keep the food system functioning; what can policymakers do? Getting food to where it is needed will require strong and flexible supply chains that can respond to shifts in consumer demand and adjust in response to supply constraints arising from measures implemented in response to COVID-19. While there are many uncertainties and the situation continues to evolve, experience with past crises (notably the food price crisis of 2007-8) provides insights into some actions that governments can take to mitigate the impacts of COVID-19 on the food system. Keep international markets in agriculture and food products open, transparent and predictable The COVID-19 pandemic has not so far caused a supply shock for staple grains. Nevertheless, several large exporters have restricted exports, while some countries that rely on imported grains to feed their populations have ramped up purchases to ensure they have sufficient stockpiles to see out the pandemic.  Ensure market transparency via the provision of timely market information. A lesson from the 2007/08 food price crisis is that transparency and information sharing are important. This can help mitigate panic buying and generate trust in markets. It can also improve trust among countries, thereby encouraging co-operative solutions. Countries can also benefit from peer learning in terms of what kinds of policy approaches are proving effective (Box 1).  Provide clear and transparent communication at the domestic level. A number of governments have taken steps to deter panic buying and hoarding by ensuring the release of timely information about the availability and safety of food stocks.  Avoid trade restrictions. Export restrictions increase instability in global markets and undermine supply, particularly for countries that are more exposed to price fluctuations. OECD analysis has shown that export restrictions and the breakdown of international trade pose a significant threat to food security by reducing the availability of food, which can result in a significant increase in undernourishment in the case of an economic crisis.17  Keep domestic, regional and international markets open. Well-functioning domestic markets, regional co-operation and an open international trading system are all important to connect producers to market opportunities, and help food get to where it is needed. Open borders and well- connected internal markets can help to contain supply disruptions. This is especially important in the case of net food importing countries. 17 OECD (2017), Building Food Security and Managing Risk in Southeast Asia, OECD Publishing, Paris, https://doi.org/10.1787/9789264272392-en.
  • 7.  7 COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Box 1. The Agricultural Market Information System (AMIS The Agricultural Market Information System (AMIS) is an inter-agency platform to enhance food market transparency and policy response for food security. It was launched in 2011 by the G20 Ministers of Agriculture following the global food price hikes in 2007/08 and 2010. Bringing together the principal trading countries of agricultural commodities, AMIS assesses global food supplies (focusing on wheat, maize, rice and soybeans) and provides a platform to co-ordinate policy action in times of market uncertainty. The value of AMIS was tested when drought struck southern Europe and North America in the summer of 2012. Analysis provided by AMIS and close discussions among AMIS members helped increase transparency about policy actions and intentions, and allay concerns about a return to price volatility. Prices rose to record (nominal) levels, but markets performed efficiently without the levels of price volatility seen in 2007 and 2010. AMIS played a valuable role in helping persuade policymakers and market participants to avoid the mistakes – in particular, the counter-productive policy actions – that aggravated the price spikes of 2007/08. Minimise the avoidable trade costs of measures to prevent the spread of COVID-19 New non-tariff measures (SPS and TBT measures) are already being put in place that could have disruptive impacts on global food value chains. While such measures can be necessary to manage sanitary risks, they could also significantly increase costs for food exporters, particularly if requirements differ between markets. There is thus a need to reduce unnecessary costs associated with such measures, with a view to keeping safe and affordable food available globally. Indeed, some WTO Members have notified that they are implementing measures to facilitate trade through, for example, the use of expedited submission of electronic documentation.  Ensure that SPS and TBT measures implemented in response to the risk of COVID-19 are science- based, transparent, non-discriminatory and do not unnecessarily disrupt trade or increase trade costs. The need for such measures should also be re-evaluated as evidence about risks becomes available.  Ensure sharing of best practices and, to the extent possible, harmonisation of measures between countries to smooth processes at the border. Regionally coordinated strategies that allow flexibility within existing regulatory frameworks and build trust among trading partners can also help ensure that food is able to move to where it is needed. Address labour constraints in the food supply chain  Designate food sector workers as critical. In addition to farm workers and workers in food businesses, this designation should include public and private providers of critical services for the sector, such as food safety inspectors.  Ease (non-health and safety related) regulatory requirements for farmers to access seasonal labour through migration programmes.  Look for opportunities to facilitate farmers’ access to an alternative workforce, including by attracting workers laid off in other sectors (for example, services and the gig economy). Students may also be able to replace some of the shortfalls.  Take measures to ensure the health and safety of workers, given that close working conditions in fields, packing and processing facilities put them at a heightened risk for contracting COVID-19.
  • 8. 8  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Ensure health and food safety throughout the food chain  Establish appropriate biosecurity arrangements for the sector, and collect and communicate the scientific evidence on safe biosecurity practices as swiftly as possible.  Enforce strict regulations governing the humane slaughter, handling, sale, preparation and consumption of meat from wild animals. Facilitate the movement of food products – including through alternative channels  Enhance trade facilitation and logistics. Facilitating the movement of perishable products across borders would reduce food loss and waste related to handling difficulties, while facilitating border checks could ease access to essential agricultural inputs such as pesticides and veterinary medicines. Digital tools may help to facilitate border procedures, for example, by allowing electronic copies of sanitary and phytosanitary certificates.  Explore ways to maintain transport links, to the extent possible, in order to facilitate the movement of food products and ensure farmers’ access to input and output markets.  Co-operate with private stakeholders to identify and address bottlenecks to the smooth functioning of food supply chains.  Work with the private sector to find alternative supply channels to handle potential surpluses (or potential food loss and waste) that have resulted from the closure of restaurants, schools, hotels and catering businesses. This would benefit both consumers and smaller farmers, who are more likely to be dependent on those outlets and buyers.  Where appropriate, provide flexibility around regulatory requirements (e.g. packaging and labelling requirements) in order to facilitate the movement of food products to alternative outlets. Ensure the food and nutrition needs of vulnerable populations are met – now and in the future Most major economies are expected to enter into recession as a result of measures implemented to combat COVID-19, and considerable job losses have already occurred. This may have a significant impact on food insecure populations in both developing and developed countries. In developed countries, some groups, like the elderly, chronically ill and poorer households, may be particularly vulnerable to short-term shortages of food as a result of the closure of school meal programmes; closure of, or increased demands upon, food banks; and panic buying that reduces essential supplies and low cost options in supermarkets. Ensuring the food security and nutrition needs of vulnerable populations is essential, including through ensuring access to appropriate social safety nets. Many countries have swiftly implemented policy responses in this area mostly by expanding funding for pre- existing food assistance programmes and in some cases implementing new measures. Governments are also working with non-governmental organisations to enable the provision of emergency food via food banks. Governments can co-ordinate with private stakeholders to restore and communicate trust in local food chains. In developing countries, particularly those already affected by conflict or humanitarian crises, COVID-19 is likely to have much more serious impacts on livelihoods and food security. The experience of Ebola provides evidence of how livelihoods can be decimated, as fear of contagion and movement restrictions kept some farmers from producing, affecting both cash and food crop production, disrupting agricultural supply chains, and causing acute agricultural labour shortages in the region. The Ebola outbreak also had a strong negative effect on the purchasing power of the most vulnerable households, and consequently on
  • 9.  9 COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 their access to food.18 For developing countries – where food systems are more labour-intensive, many farmers are net buyers of food staples, supply chains are less well developed, and where the macroeconomic shock risks plunging large numbers of people into poverty – international assistance may be needed. Moreover, the effects of COVID-19 are taking place against the backdrop of a climate emergency. Supply shocks associated with extreme weather events, combined with demand shocks in a depressed economy could create food security tensions.  Address the immediate needs of the vulnerable populations, for example, by means of emergency food assistance or targeted transfers.  Further develop social protection systems. Cash transfers – both conditional payments, through systems such as adaptive safety nets, and unconditional transfers – provide a more efficient and effective response to food security concerns than market interventions, including those operated through public distribution systems.  Explore co-operative global solutions to address the needs of the poorest countries and ensure that COVID-19 does not result in a food crisis in these countries. Looking ahead, COVID-19 offers an opportunity to enhance the resilience, sustainability, and productivity of the agriculture and food sector In light of COVID-19, ensuring that the food system is more sustainable and resilient is now an even more urgent priority. The COVID-19 pandemic provides an opportunity to learn more about chokepoints and vulnerabilities in the food system, in order to identify necessary investments and reforms that would further strengthen the resilience of the sector to a range of future shocks and challenges. It will be crucial to engage stakeholders in the process of understanding the full impacts of the pandemic on various population groups and the lessons to be learned. In particular, it will be important to examine the current resilience toolkit in the food system, with a view to identifying which policy measures have proven most effective and what new measures may be needed to respond to system-wide shocks. It will be particularly important to understand the factors that enable some food and farming businesses to adapt their business models quickly enough to avoid the most negative consequences. Lessons from the COVID-19 pandemic will need to be integrated into wider responses to challenges confronting the global food system. Those challenges include: (i) the ongoing emergency of climate change, and the need for the food system to be resilient to a range of extreme weather events; (ii) the need to ensure sustainable productivity growth to feed a growing world population in a changing climate, while simultaneously reducing the sector’s greenhouse gas emissions; (iii) maintaining biodiversity, against the background of land use change related to agriculture, the management of new varieties and disease risks from monocultures; and (iv) a range of animal and plant diseases, including those which affect human health directly, via food borne disease (as with the BSE crisis), human-to-human transmission (as with zoonotic coronaviruses), and by inducing human antimicrobial resistance (when antimicrobials are applied inappropriately in the livestock sector), as well those which impact food security by reducing animal and crop production (as with African Swine Fever and Fall Armyworm). 18 http://www.fao.org/news/story/en/item/270716/icode/; FAO (2020), Anticipating the Impacts of COVID-19 in Humanitarian and Food Crisis Contexts, Rome, https://doi.org/10.4060/ca8464en.
  • 10. 10  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Learn from the crisis to increase preparedness for future shocks  Work with stakeholders and international organisations to identify weaknesses, choke points and vulnerabilities in agriculture and food systems, and critical services that need to be strengthened in order to increase preparedness for systemic risks and identify opportunities to strengthen networks between public and private stakeholders to make these investments.  Accelerate investments and reforms that would further strengthen the resilience of the food system to a range of risks, for example: o Invest in data systems at the local, national and global levels so that real time information can be made available for decision makers, and help to increase confidence in supply during crises. o Invest in national and international efforts to increase adequate biosecurity arrangements to enhance countries’ capacity to manage emergent sanitary and phytosanitary risks. o Strengthen government communication strategies to improve consumer trust in the safety and reliability of the agro-food system. Support the transition to a more resilient agricultural sector and food system  Ensure that support measures intended to provide temporary relief to farmers and other food system stakeholders are consistent with wider socio-economic policies, reach vulnerable socio- economic groups and contain clear exit strategies.  Consider wider opportunities to repurpose agricultural support in ways that provide clear public goods, in particular in the form of climate change mitigation and improved environmental outcomes.  Secure and build on positive trade facilitation steps that have been taken to reduce distortions at the border, to reinforce the role that global markets can play in ensuring securing and stable food supplies.  Continue efforts to build and maintain mechanisms to ensure transparency and policy dialogue on food systems, such as AMIS, to build confidence in global markets and co-operation.  In moving forward, consider how adopting an integrated approach can help ensure the resilience of the global food system. With enhanced resilience the food system will be better able to deliver on the triple challenge: providing safe, affordable food for a growing world population and livelihoods for the many people involved in food around the world (including the majority of the world’s poor who live in rural areas), while ensuring environmental sustainability in the face of complex environmental challenges and a climate emergency. Conclusion There is an opportunity today to not just respond effectively to the current crisis, but to roll back distortive, inefficient and environmentally harmful support, thereby freeing up financial resources for investments in a more productive, sustainable and resilient food system able to meet new challenges. This, together with accompanying regulatory reforms, can help build an enabling environment for the entire food system that is aligned with natural resource limits, a changing climate, market demand, technological developments, and “low probability, high impact” catastrophic risks. The unanticipated shock of COVID-19 underscores the need for a shift from “business as usual” policies to a more forward looking policy package that invests in the productivity, sustainability, and the resilience of the global food system.
  • 11.  11 COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 Forthcoming Policy Briefs This is the first in a series of Policy Briefs on issues related to COVID-19 and food and agriculture. Look out for other Policy Briefs in this series that will look more deeply into specific issues. Forthcoming Briefs include:  COVID-19 and the food system  Impacts on specific supply chains (e.g. seeds, fruit and vegetables)  Transparency A framework paper, COVID-19 and International Trade: Issues and Actions, is also available, along with in-depth Policy Briefs on specific sectors and issues. Other Policy Briefs on wider issues are available on oecd.org/coronavirus.
  • 12. 12  COVID-19 AND THE FOOD AND AGRICULTURE SECTOR: ISSUES AND POLICY RESPONSES © OECD 2020 This Policy Brief is published under the responsibility of the Secretary-General of the OECD. The opinions expressed and arguments employed herein do not necessarily reflect the official views of OECD member countries. This Policy Brief is without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. The use of this work, whether digital or print, is governed by the Terms and Conditions to be found at http://www.oecd.org/termsandconditions