World Grain - May 2008 - 6

from the editor-in-chief

Globalization as a reality
in world grain industry

n the constant search for new frontiers
where the grain and grain processing industry has any chance of flourishing, it
is probably correct to observe that little attention has been paid to sub-Sahara Africa.
Flour mills have been built in a few countries, such as oil-rich Nigeria, but their records have been rarely successful. Venturesome entrepreneurs have offered ideas that
have not done well or failed. Yet, recent developments raise new hopes for Africa below
the Sahara Desert, hinting that this vast area
has a chance of improving its agriculture to
the point that its current standing as a minor grain producer may be significantly improved. It seems no longer foolish to believe
sub-Sahara Africa could become a force in
global grain.
Based on population alone, sub-Sahara
Africa, except for its lack of infrastructure
and resources, ought to be a market for grain
significantly larger than is the case. With a
population of nearly 800 million people,
the region consumes currently a little more
than 17 million tonnes of wheat annually,
contrasted with the 48 million tonnes used
by half as many people in North America.
Sub-Sahara Africa's population is projected
to more than double between now and 2050,
whereas the developed areas of the world are
expected to show little or no growth.
The hope that this condition is likely to
undergo significant change stems from de-

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cisions made by the World Bank and major
international foundations promising massive help for crop production. This is a sharp
reversal from the aid pattern adopted in the
1970s when the World Bank halted agricultural assistance to focus on improving rural
health and education. As a result, helping
agriculture has been relegated to a low priority for decades, even though most people
in Africa earn their living trying to produce
food. A scathing report coming from within
the bank blames this neglect on faulty assumptions such as reliance on markets that
had none of the infrastructure or governance
needed to make them work.
Robert Zoellick, the new president of the
World Bank, has declared, "We need a 21st
century Green Revolution designed for the
special and diverse needs of Africa, sparked
by greater investment in technological research and dissemination, sustainable management, agricultural supply chains and
policies that strengthen market opportunities." That is a totally fresh agenda, and it is
one taken up by such a powerful group as the
world's largest foundation, the Bill & Melinda Gates Foundation. Mr. Gates, appearing at the World Economic Forum in Davos,
Switzerland, announced agricultural development grants totaling $306 million. "If we
are serious about ending extreme hunger and
poverty, we must be serious about transforming agriculture for small farmers," he said.

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The largest of the Gates grants goes to
the Alliance for a Green Revolution in Africa (AGRA), of which Kofi A. Annan, former director-general of the United Nations,
is chairman. Annan revealed the focus will
be on revitalizing severely depleted soils to
increase fertility and sustainability of small
farms. Important to the global grain industry is the way Gates emphasizes functioning
markets to help farmers sell their expected
surplus production. "We believe this is the
only way to get long-term, sustainable results, to focus on the entire agricultural value
chain," he added.
It is ironic that this awakening to the urgent
need to help expand African crop production
coincides with terrible tribal and political
chaos in Kenya. Just as the new focus on improving agricultural productivity raises the
promise that a corner is being turned, the violent outbreaks in that nation demolish much
hope. Hugely important is recognizing that
boosting food production addresses the issue
that previous investor euphoria overlooked.
Investing in infrastructure makes little sense
when millions do not have food. Eliminating
the vulnerability caused by a failed crop system promises not just the realization of Africa's dream, but opens considerable promise
for the globe-circling grain industry.
Morton I. Sosland
Editor-in-Chief

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World Grain - May 2008

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