Reforming agricultural markets to support emissions reductions

Authors: Kevin Burns, Ly Cao, Jared Greenville

Overview

Agriculture produces the food used to feed the world’s population, fibre to clothe people and material for housing, but it accounts for around 11% of the world’s greenhouse gas (GHG) emissions and up to around 31% of GHG emissions across the agrifood chain.

Agricultural and food markets also remain some of the most distorted markets in the world – average agricultural tariffs remain around 75% higher than trade in industrial goods, and countries spend around $611 billion a year in trade and production distorting agricultural support.

The role that support policies play in either increasing or decreasing global agricultural GHG emissions is attracting greater scrutiny, with several studies pointing to contrasting impacts. However, agriculture is only one part of a broader food system. Not only do agricultural subsidies and tariff protections matter, but so do the trade distortions that impact downstream food production and trade.

Key findings

• The study finds that reforming agricultural and food market distortions globally can reduce global agricultural emissions and improve global food security, if sufficient constraints to agricultural land expansion are in place.

• These benefits arise through improvements in the efficiency of agrifood value chains, by allowing production and trade to shift to more efficient regions, products and production systems.

• The study highlights the importance of a multilateral approach to reforming agricultural support, finding that partial reform of agricultural support can have adverse outcomes for emissions or food security.