5.9 The Global System of Agriculture

Look at a typical grocery store in the United States. Bananas may come from Ecuador or Guatemala, coffee from Brazil or Colombia, grapes in January from Chile, and shrimp from India or Ecuador. Refrigerated container ships, air freight and global companies link farms on every continent to consumers far away.

Some of this trade is counterseasonal. When it's winter in North America, it's summer in Chile and Peru, so fresh fruit flows north. Other trade follows climate: cacao, coffee and bananas grow in the tropics but are mostly eaten in wealthier countries outside them.

Many lower-income countries earn much of their export income from one or two farm products. This is commodity dependence (also in 7.5). Côte d'Ivoire and Ghana together grow about half or more of the world's cacao in most years, and coffee has long been Ethiopia's most valuable farm export.

Dependence is risky. When a crop's world price falls, the whole country's income falls. When prices rise, farmers don't always benefit. In 2024 world cocoa prices hit record highs after poor harvests in West Africa, but because Côte d'Ivoire and Ghana set the price paid to their farmers in advance, many farmers received only a fraction of the increase.

These patterns often trace back to colonialism, when European powers set up plantations to grow export crops like sugar, rubber, cacao and tea. After independence, many countries kept the same export-focused farm economies.

• Subsidies: governments pay or support their own farmers. The U.S. farm bill and the European Union's Common Agricultural Policy, which takes about a third of the EU budget, are major examples. Subsidies can lower world prices and make it hard for unsubsidized farmers elsewhere to compete. Brazil won a World Trade Organization case against U.S. cotton subsidies in the 2000s.
• Tariffs and quotas: taxes and limits on imports protect domestic farmers but raise prices for consumers.
• Export bans: in 2023 India banned exports of most non-basmati white rice to keep domestic prices down, which raised rice prices in importing countries until the ban was lifted in 2024.
• Food aid: shipments of food help in emergencies but can undercut local farmers if they continue for too long.

Because the system is connected, events in one place affect food prices everywhere. Ukraine and Russia are both major wheat exporters. After Russia's full-scale invasion of Ukraine in February 2022, Black Sea shipping was disrupted and world grain prices jumped, which hit import-dependent countries in North Africa and Southwest Asia hardest. This is a good example of how an event at one scale has effects at another.