There has been an increase in agri-food market volatility since 2006. Subsequently, many researchers examined such volatility and offered prescriptive “remedies” for it, often involving supplanting market forces. However, such volatility is a symptom of changes “elsewhere”, arising from diverse causes. To suppress it without understanding its underlying causes could inadvertently cause much greater damage to ecosystems, value chains and well-being.
An over-preoccupation with volatility can also distract and draw resources from constructive effort elsewhere. The wider challenge is to reduce households’ vulnerability while concurrently increasing the resilience of agri-food systems in the face of shocks. Given this, we explore how one might pursue greater resilience in face of such volatility, at all levels within the agri-food system: primary production; transportation and logistics; processing; local and international markets.
Objectives. Our objectives are three-fold: 1) to illustrate how a preoccupation with market volatility can lead to misdiagnosis and prescriptions that are inefficient and damaging to food security in the longer term; 2) to “reboot” the conversation around resilience for both households and agri-food systems; 3) to explore how the resilience approach might be applied, using a few examples.
Data / Methods. To meet objective 1), we review the theoretical and empirical literature as it relates to assessments of various policies’ and interventions’ impacts and efficacy. We draw upon applied work for OECD economies, gleaning insights regarding transfer efficiency and the degree of decoupling of certain interventions, then extending the discussion to include recent policies and behaviours embraced by developing economies. This discussion illustrates how an over-preoccupation with volatility – a symptom of events elsewhere – can lead to behaviours that have outcomes that in many instances run counter to their original intent.
Objective 2) will be addressed largely by drawing on heuristic examples from the existing literature in a discrete number of natural science disciplines, illustrating the underlying shocks which ultimately contribute to market disturbance. These examples are then used to illustrate how addressing the symptoms rather than the causes of such disturbances can mask and even exacerbate problems over time because market participants do not receive signals that are timely or that accurately reflect shocks to the system or conditions of scarcity.
For objective 3), abbreviated case studies from a selection of disciplines will be used to: a) illustrate with greater clarity how a “resilience” focus is superior to a “volatility” focus; b) to use specific “for instances” to encourage a broader application of the approach.
Expected / Results. Our hope is to change the analytical framework and focus of recent discussion as it relates to commodity markets and food security, focusing on “fostering resilience” instead of “managing volatility” in agri-food systems. This will emphasize “getting diagnostics right” and avoiding prescriptions based on symptoms rather than causes, shifting efforts away from measures that mask the true nature of shocks, have low transfer efficiency and large distorting impacts to measures that have superior agronomic, ecological and economic outcomes in the longer term.