Most African countries are highly dependent on the exports of a few primary commodities. Historically this dependency has rendered them extremely vulnerable to volatility in world prices, but increasingly erratic weather patterns caused by climate change are exacerbating the problem.
A good example is the recent surge in wheat prices caused by the drought in Russia, the world’s largest wheat exporter. The price rise – as much as 92% since the beginning of June – is the result not just of a Russian ban on wheat exports, but also speculators’ purchase of as much as 400% of available supplies. While US consumers may see a modest rise in the price of wheat-based products, consumers are protected from sharper increases because US farmers sold their wheat in advance of the harvest at a guaranteed price considerably lower than the current price. A price spike in Africa, which does not have access to global exchanges and similar risk-mitigating tools, could generate a food crisis similar to the one experienced in 2008 when wheat futures reached record prices.
Climate change is expected to disproportionately affect Africa’s farmers because poverty and underdevelopment make it harder for them to adapt quickly to changing weather patterns. These challenges are compounded by the fact that unlike American or European farmers, Africa’s farmers have only limited access to effective commodities exchanges, which can provide the kinds of contracts necessary to offset risks and help plan for the future. These limitations expose farmers to unreasonable risk, severely hampering their competitiveness in the global market and rendering Africa highly vulnerable to food shortages.
