ARTICLE: Safeguarding Africa’s food systems through and beyond the crisis

5 June 2020. There is widespread concern about the potential impact of the COVID-19 pandemic on Africa’s agricultural and food systems.

In this article, McKinsey presents an analysis on the impact of the COVID-19 crisis on the continent’s agricultural and food systems, along with insights from on-the-ground discussions with agriculture value-chain players, governments, and civil-society institutions. 

They show how the crisis has disrupted regional and global trade and slowed demand for Africa’s agricultural export products, putting jobs and livelihoods at risk. But they also show that, to date, the impact on the food and agricultural system as a whole has largely been localized and muted. In addition, tailwinds—including good harvests in some African regions at the end of 2019—are helping to minimize the effects of the crisis.

Agriculture is also one of Africa’s most important economic sectors, making up 23 percent of the continent’s GDP. In sub-Saharan Africa, it provides work for nearly 60 percent of the economically active population.3 Africa’s exports of food and agricultural products are worth between $35 billion and $40 billion a year, and some $8 billion a year flows through intra-regional trade in these products (Exhibit 1). In addition, Africa’s food and agricultural imports amount to between $45 billion and $50 billion a year—along with $6 billion a year in imports of agricultural inputs.

Existing vulnerabilities in Africa’s agricultural and food systems, combined with demand and supply shocks likely to flow from COVID-19, could be heightened unless mitigating actions are taken now.

Agricultural exports have faced demand disruptions and some supply-chain issues. This has been most severe for the flower sector in Kenya, which collapsed after the lockdowns, but exported vegetables, nuts, coffee, and cocoa are all affected to some degree. In many cases, this is due to slowed demand owing to lockdowns in Europe, North America, and India, leading to closure of coffee shops and restaurants as well as processing facilities, for example for cashews in India. In some cases, this has been further exacerbated by supply-chain issues. For example, the suspension of international passenger flights has resulted in a reduction of about 75 percent in available cargo capacity and a twofold increase in cargo costs for the horticultural sector in Kenya, making it challenging to fulfill orders (see sidebar, “Export crops at risk from supply and demand disruptions”).

Watch for three potential shocks across food demand, trade flows, and production and processing:

1. Demand-side shock: Loss of jobs and livelihoods and food price volatility could amplify the crisis through increased food insecurity
2. Trade shock: Demand shocks in key markets may cause a drop in export earnings and increased price volatility for export crops
3. Production shock: COVID-19 may disrupt upcoming planting seasons and impede an effective response to the East African locust outbreak

Immediate action could safeguard Africa’s food security and speed up the recovery of the

agricultural sector

Governments and other industry players are in a unique position to consider measures that could cushion the sector and speed up recovery when the “next normal” comes.

The analysis suggests that it will be critical to minimize disruptions to Africa’s agricultural and food systems. If governments and private-sector players along the value chain act now, they can lessen the potential shocks that lie ahead. Key steps include safeguarding food security, understanding and managing the forces that shape demand, and ensuring that agricultural production is sustained. It will also be important to maintain trade flows, including keeping regional and international borders open for trade as far as possible.

In the remainder of this article McKinsey considers, in turn, the steps that governments and private-sector players can take—both to ensure continuity in African agricultural and food systems through the crisis, and to strengthen the sector’s longer-term resilience and performance.