Banking for Food: vision on global food security and the role of Rabobank
The key issues in agriculture and food supply in the decades ahead
Food security concerns us all. As a consequence of a growing and wealthier global population the demand for food is expected to rise considerably. So the food and agri value chain will have to produce more with less, ensuring sustainability and economic viability for the long term. Banking for Food is Rabobank’s vision on global food security and the role of the bank.
In 2050, the world population will have increased by 2 billion people to over 9 billion, many of whom will have twice as much income to spend. To meet the resulting increased demand for food, global food production will have to increase by at least 60%, while at the same time arable land and natural resources are nearing their limits. This presents challenges, for example environmental pressure. But it provides opportunities as well, for example new business models and innovations need to be embraced. As the leading global food and agri bank Rabobank is determined to contribute to overcoming challenges and seizing opportunities. Together with our clients , partners and colleagues worldwide, we want to contribute to the four dimensions of food security: increasing the availability of food, improving access to food, promoting balanced nutrition and increasing stability.
Increasing the availability of food
To produce 60% more food sustainably, primary producers need to increase yields with less inputs: produce more food from stable amounts of arable land, with less water spilling and fewer fertilisers. At the same time, companies throughout the food supply chain need to significantly reduce food loss, food waste and emissions. So productivity and efficiency needs to improve. This can be achieved by better leveraging existing knowledge and technologies and stimulating innovations such as genomics, precision agriculture and bio-based approaches.
Improving access to food
Raising availability of food alone is not enough. People need to have economic and physical access to it. This is determined by factors such as the level of disposable income and food prices and the availability and quality of infrastructure. Major investments are needed to improve transport, logistics and distribution, particularly in developing economies, to make sure consumers have physical access to affordable food.
Promoting balanced, healthy nutrition
It’s not even enough to increase agricultural output, affordability and distribution, food also has to be safe and nutritious. While food quality and food safety continue to improve, undernourishment and overnourishment occur alongside each other throughout the world. Diverse and balanced diets are vital to cover nutritional requirements. Education and information on healthy nutrition and the handling, preparing and storing of food are essential.
Stability is key to realise sustainable access to nutritious and safe food. Price and supply volatility of agricultural products and food can have a major impact on food security. For consumers who spend a large portion of their income on food, high food prices can lead to increased poverty and hunger. On the supply side, price fluctuations result in significant changes in revenues for producers from year to year and deferred or suboptimal investment decisions. In effect, consumers, farmers, processing businesses and food retailers all benefit from predictable stable markets.
Rabobank was founded in 1898 in the conviction that the cooperative concept of farmers working together would be of benefit to all. Food and agri was, is and always will be at the heart of our strategy. We’re not ‘just’ the bank that finances food and agribusiness, but also the bank that promotes and facilitates connections throughout the entire food and agri value chain. Working together is our heritage and our vision. We need it as much today as we ever did to contribute to overcoming the global food challenge. To realise our vision of helping to nourish the world more sustainably we offer access to finance, knowledge and networks.
Access to finance
We believe that sustainable partnerships in the food and agri value chain are key to guaranteeing food security in the future. We’ve serviced and supported our clients in these chains for many decades. And we will continue to service them, providing them with access to finance to develop and improve their businesses, enabling them to sustainably play their part in ensuring long-term food security.
Access to knowledge
Over the past 115 years we have built up a wealth of knowledge about the food chain worldwide. Knowledge we continue to expand through our frequent contacts with our clients and our dedicated in house food and agri research units, specialised bankers and our partnerships with knowledge centres worldwide. Knowledge that we share with our clients and other stakeholders to further develop their businesses and the food and agri sector.
Access to networks
Being a cooperative we firmly believe in the strength of working together, in the strength of networks. Our network extends all over the world, spans the entire food chain including influential stakeholders such as governments, knowledge centres and NGO’s. We actively bring partners and relevant stakeholders together and open up our networks whenever and wherever needed to accelerate business.
Is there any potential for production growth?
There is! Average wheat production in the Netherlands rose from 1,800 kg per hectare in 1900 to 9,000 kg in 2000. And there are also substantial differences between agricultural businesses at present. Accordingly, experts see opportunities to apply knowledge to improve productivity in Western countries as well as in Africa. Highly productive and efficient agricultural production systems use proportionately fewer scarce raw materials and emit less greenhouse gas per kg of product.
The food challenge are issues that go beyond national borders. Countries such as China and India, for instance, are currently home to 40% of the world’s global population on only 20% of its available agricultural land, and conversely there are other countries where this proportion is reversed.
Feeding nine billion people requires a vision and solutions that do not stop at the gate of a farm or the turnstiles of a supermarket. Banking for Food accordingly encompasses all links in the food chains, in and outside the Netherlands: from farmers and horticulturists and their suppliers to businesses processing agricultural products and transport businesses and supermarket chains.