European Union’s Farm to Fork initiative to reduce use of agricultural inputs may increase food prices and further global food insecurity

Researchers at USDA’s Economic Research Service (ERS) recently evaluated the potential impacts of the European Commission (EC)’s Farm to Fork and Biodiversity Strategies initiative that calls for restrictions in the use of agricultural inputs such as land, antimicrobials, fertilizers, and pesticides in European Union (EU) agricultural production. The proposal pledges to use EC trade policies and other international efforts to promote a vision of sustainability in agriculture, suggesting intentions to extend the reach of the policy beyond the EU. A mandated reduction in these inputs impacts food prices in three ways: production costs could increase as farmers substitute labor for other inputs; production could decrease as a result of fewer inputs being used; and prices on the international market could increase due to tightening of available supplies. Depending on how broadly these measures to reduce the use of agricultural inputs would be adopted globally, U.S. food prices could rise by 1 to 62 percent, and worldwide food prices could grow by 9 to 89 percent. These rising costs could affect consumer budgets and ultimately reduce worldwide gross domestic product (GDP) by $94 billion to $1.1 trillion, and consequentially, increase the number of food-insecure people in the world’s most vulnerable regions by 22 million to 185 million. This chart is drawn from the ERS report, Economic and Food Security Impacts of Agricultural Input Reduction Under the European Union Green Deal’s Farm to Fork and Biodiversity Strategies.

Download higher resolution chart (2084 pixels by 2186, 300 dpi)