The $9 Trillion Global Food Supply Chain and Africa’s Agricultural Potential

Your potential and the over $9 trillion Global Food Supply Chain. In a world increasingly dependent on complex food supply chains, how can you, as an African or African diaspora agribusiness entrepreneur, turn Africa’s vast agricultural resources into opportunities for economic growth and sustainable food systems? Can you help to solve the continent’s food insecurity crisis, all while creating thousands of jobs and transforming livelihoods?

Learn How to Leverage Your Story through our Story To Asset Transformation (S.A.T) Framework.

In a publication by the World Economic Forum, titled “Here’s How We Make the $9 Trillion Global Food Supply Chain Sustainable,” the report explores several key topics that we’ve been closely following at AClasses Academy: the complexities of food supply chains as interconnected networks, the reasons why sustainable practices often fail in multi-tier supply chains, and how we can improve these practices.

But what does all of this mean for African and African diaspora agribusiness entrepreneurs who are committed to addressing food insecurity and creating job opportunities, all while harnessing Africa’s immense agricultural potential?

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To delve into this, we have an exciting live event lined up for Monday, January 27, 2025, at 3:00 PM, featuring a stellar panel of experts: Dr. Ikechi Agbugba, PhD, author of Brain Re-engineering Strategy; Amaka Ifeduba, PhD, certified life coach and Senior Agriculture & Food Science Specialist; Yahsonn Tafari, Global Organic Agripreneur; and Don Hough, CEO of Enterprise Transformers, Inc. Be sure to join us!

Before the event, let’s dive deeper into the background of the current situation and explore the key insights from the World Economic Forum’s report. By examining these findings, we can better understand how they can guide African agribusiness entrepreneurs. I mean those committed to driving transformative changes in Africa’s and the south global food systems.

The $9 Trillion Global Food Supply Chain: A Gateway to Unprecedented Opportunities

Africa’s agricultural potential is vast and largely untapped, yet the continent faces significant challenges in transforming this potential into sustainable growth. Food supply chains are complex and multi-layered, sustainability practices frequently fall short, and too many smallholder farmers remain vulnerable to the whims of global market forces.

But therein lies the opportunity. To unlock Africa’s agricultural future, we must understand these challenges and tackle them head-on. The key insights offered in the 2024 World Economic Forum report show a path forward, offering you—an African or African diaspora agribusiness entrepreneur, a unique chance to turn these complexities into opportunities and shape the future of the continent’s agricultural sector.

See also Unlocking the Potential of Nigeria’s Cassava Farmers: A Pathway to Agribusiness Success for Diaspora Entrepreneurs

The global food market was expected to reach between $9 to 10 trillion last year, 2024, with a growth rate of 6.7% annually. On the surface, this colossal industry may seem dominated by global corporations and far removed from the everyday realities of African agribusiness entrepreneurs.

However, dig a little deeper, and a different narrative emerges. The very complexity of the global food supply chain offers fertile ground for entrepreneurs like you to thrive. With an increasing shift toward sustainability and resilience, the door is open for you to bring about transformative change—both for Africa and the global south.

The global food supply chain weaves together an intricate network of suppliers, manufacturers, retailers, and consumers, all tied by complex logistical, environmental, and social dependencies.

From farm to plate, countless players at every stage of the chain influence the flow of food. Yet, while African agribusinesses are part of this vast ecosystem, they often struggle to gain the visibility, trust, and sustainability necessary to effectively compete on a global scale.

This is where you, with your entrepreneurial vision and intimate understanding of local realities, come into play.

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What I mean is that you have the power to bridge this gap—leveraging your knowledge of Africa’s unique agricultural landscape and global supply chain dynamics to drive sustainable and impactful change.

In doing so, you can position yourself not only to address Africa’s food security challenges but also to help Africa take its rightful place at the forefront of global food systems.

The Complex Web of Food Supply Chains and Its Impact on Africa

Make no mistake about it, the global food supply chains are notoriously complex. The players in these chains span from smallholder farmers on the ground, to midstream distributors and processors, and all the way to multinational retailers and international food service companies.

These tiers are intertwined, meaning that decisions made at one level can ripple through the entire chain, influencing everything from prices to sustainability practices.

In Africa, where the agricultural sector is critical to both the economy and food security, these challenges are particularly pronounced. Over 60% of Africa’s population depends on agriculture for their livelihood, with smallholder farmers accounting for more than 80% of food production (World Bank, 2023).

See also How to Boost Rice Production in Africa: The Role of Smallholder Farmers

However, despite this dominance, Africa’s food systems are often fragmented and disconnected from global supply chains, leaving small-scale farmers vulnerable to price fluctuations and resource shortages.

One of the most significant barriers to sustainable agriculture in Africa is the lack of integration and collaboration across the different levels of the supply chain. While global companies are increasingly adopting sustainability initiatives in their operations and Western-controlled institutions, these practices often do not trickle down to the smaller, local-scale farmers who form the backbone of Africa’s food systems.

As a result, sustainable practices—such as reducing emissions, adopting organic farming methods, or improving labor conditions—often fail to gain traction.

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Here are five of the top influential players that shape and dominate the global food supply chains:

Cargill

As one of the largest privately held corporations in the world, Cargill plays a dominant role in global food supply chains.

The company operates in areas like grain trading, meat processing, and agricultural commodities, and it supplies a wide range of products to retailers, food manufacturers, and other industries.

Nestlé

Nestlé, the world’s largest food company, is a major player in the global food supply chain. The company manufactures a broad range of food and beverage products, including dairy, nutrition, packaged food, and coffee, sourcing ingredients from around the globe.

Nestlé also has a significant influence on supply chain sustainability and innovation.

Archer Daniels Midland Company (ADM)

ADM is a leading global agribusiness and food processing company, with its operations spanning grain trading, oilseed crushing, and food ingredient manufacturing.

ADM plays a critical role in the movement of agricultural commodities, such as corn, wheat, and soybeans, which are essential for both food production and animal feed.

4. Bunge Limited

Bunge is a major global player in the agribusiness and food processing industry. It specializes in the trading, processing, and distribution of agricultural commodities like oilseeds and grains.

The company’s impact extends to food products, biofuels, and fertilizers, influencing food systems worldwide.

5. Tyson Foods

Tyson Foods is one of the largest producers of meat products globally, particularly in the chicken, beef, and pork sectors. Tyson Foods is a key player in the protein supply chain, affecting everything from farm-level production to food manufacturing, processing, and retail distribution.

Here’s a further breakdown of the 5 brands in an Excel table format:

These companies and many others in the list, through their extensive global networks and operations, influence everything from agricultural production to food processing, packaging, distribution, and retail, making them critical drivers in the global food supply chain.

The Problem with Sustainability in Multi-Tier Supply Chains

Sustainability is a pressing concern in the global food industry. Yet, implementing sustainable practices within multi-tier food supply chains is no easy task, particularly in Africa.

One major issue is the lack of visibility in supply chains, making it difficult for businesses to track the environmental and social impact of their operations beyond their immediate suppliers.

African agribusinesses often face additional barriers when it comes to sustainability. Many smallholder farmers, for instance, struggle with the costs and logistical challenges of adopting organic farming practices, crop rotation, or sustainable water management techniques.

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It’s important also to mention that these farmers are often located in remote areas, with limited access to markets, capital, and technology. The lack of infrastructure and the limited capacity of local governments to enforce environmental regulations further compound the problem.

As noted by the World Economic Forum (2024), “The food industry is responsible for a major part of modern production and consumption… but its complexity often hinders the implementation of sustainability practices.”

This is especially true in regions like Africa, where smallholder farmers are often at the mercy of upstream suppliers who may not have the same standards of sustainability or ethics.

Power imbalances in these relationships—where large retailers and processors control the market—make it even more challenging for African agribusinesses to drive systemic change.

It’s important also to consider the challenges of agricultural policies. Let’s look at Nigeria, for example.

Root Causes of Policy Failures and Possible Sustainable Agribusiness Growth in Nigeria

When discussing the challenges of agribusiness in Nigeria, Dr. Olanrewaju Olaoye, a scholar from the University of Lincoln (UK), offers valuable insights in his paper titled “Why Policies Fail in Nigeria: An Evaluation of Agriculture Policies from 1972-1985.”

Olaoye examines the root causes of policy failure in Nigeria, specifically focusing on the agricultural sector during this period.

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His analysis explores how deficiencies in policy formulation, execution, and evaluation contributed to the failure of key agricultural policies.

Olaoye highlights the influence of socio-political and economic factors that shape policy decisions, often leading to inefficiencies or missed opportunities. By investigating the failures of past agricultural policies, the paper also explores potential solutions, drawing on frameworks recommended by scholars to improve policy-making processes in Nigeria.

To further this inquiry, Olaoye applies various public policy theories—such as agenda-setting theory, the inheritance-before-choice theory, the deliberative process theory, and rational policy transfer theory—to better understand how policies can be crafted, implemented, and evaluated more effectively.

The ultimate goal of his work is to propose a comprehensive framework that could help avert future policy failures, ensuring that agribusinesses in Nigeria have the support and stability they need to thrive in today’s world. Meanwhile, this can easily be expanded to other parts of Africa.

For example, many smallholder farmers in Africa lack access to high-quality seeds, fertilizers, and farming tools that could help them implement more sustainable practices. The use of synthetic fertilizers, while common, has long-term environmental consequences, contributing to soil degradation and water pollution.

The challenge of adopting organic farming methods is particularly pronounced. In countries like Kenya, for example, research has shown that smallholder coffee growers are unable to practice crop rotation because of strict land use regulations (Kenya Agricultural and Livestock Research Organization, 2023).

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These regulations prevent farmers from diversifying their crops, leading them to rely on environmentally harmful practices.

Moreover, the economics of sustainability are often challenging for smallholder farmers. While the upfront costs of adopting sustainable practices may seem prohibitive, the long-term benefits—such as improved soil health and higher yields—are not always immediately apparent.

Without the financial backing or incentives to make the switch, many farmers opt for cheaper, conventional practices that degrade the environment.

African Entrepreneurs: Bridging the Gap with Innovation and Sustainability

As an African agribusiness entrepreneur, you have a unique opportunity to bridge these gaps. By understanding the complexities of Africa’s food supply chains, you can craft innovative solutions that promote sustainability, increase food security, and generate job opportunities.

One of the most effective ways to drive change is through multi-tier collaboration, where businesses at different levels of the supply chain work together to implement sustainable practices.

Consider how African agribusinesses could improve sustainability by partnering with both local farmers and international suppliers. These collaborations could focus on innovations in soil management, improved irrigation systems, and sustainable land use practices.

See also Knowledge Exchange and Peer-to-Peer Learning for Cassava Farmers in Nigeria – A Guide for African Diaspora Entrepreneurs

By working directly with farmers, you can ensure that the practices you introduce are both economically viable and environmentally sustainable.

Additionally, supply chain mapping—a process that involves tracking every step of the food production and distribution process—could help identify where inefficiencies and sustainability risks lie.

This would allow you to pinpoint areas in need of improvement and implement targeted interventions. For example, if you identify that a significant portion of post-harvest losses occur due to poor storage facilities, you could invest in better storage solutions, thereby improving the efficiency of the entire supply chain.

Empowering the African Diaspora to Drive Change

The African diaspora plays an important role in the transformation of Africa’s agricultural sector. African entrepreneurs based abroad often have access to capital, technology, and expertise that can help solve some of the challenges facing Africa’s food systems.

According to the World Bank (2023), remittances from the African diaspora are a significant source of income for many families, and these funds could be channeled into agribusiness ventures that create local solutions to food insecurity.

Diaspora entrepreneurs are uniquely positioned to drive knowledge transfer between African countries and the rest of the world.

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Many diaspora entrepreneurs have already begun returning to Africa to invest in sustainable agriculture, bringing with them knowledge of cutting-edge technologies such as precision farming, digital platforms, and agri-tech innovations.

By facilitating cross-border collaborations, you can help strengthen the relationship between African agribusinesses and international markets. This partnership can unlock access to global supply chains and open doors for new investments in sustainable agricultural practices. Now, here is the fun part – Job Creation.

Creating Jobs Through Sustainable Agribusinesses

Sustainable agribusinesses are not just about addressing food security, they also offer potential for job creation. Agriculture is Africa’s largest employer, with over 60% of the workforce engaged in the sector (International Labor Organization, 2022).

However, much of this employment is informal, with many farmers working in low-wage, subsistence conditions.

By focusing on sustainability, African agribusinesses can create more formalized, higher-value jobs. For example, investing in processing and value-added agricultural products—such as organic vegetables, fruits, or coffee—can create jobs not just for farmers, but for workers in packaging, logistics, and marketing.

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As demand for sustainably sourced food increases globally, you can position your agribusiness to take advantage of this shift, creating jobs and boosting the local economy.

Conclusion – The Future of Africa’s Agribusinesses

Africa’s agricultural potential is vast, and the opportunities for entrepreneurs are abundant. As you look ahead, there is no doubt that the challenges of food insecurity and unsustainable supply chains can be overcome. The key to success lies in collaboration, innovation, and sustainability.

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To make a meaningful impact, you must leverage the African diaspora’s expertise and resources while fostering local innovation.

The upcoming live event on January 27, 2025, featuring experts like Dr. Ikechi Agbugba, PhD, and Amaka Ifeduba, PhD, is an example of how collaboration and knowledge-sharing can drive change.

By engaging in such platforms, you can gain insights that will help you build a sustainable agribusiness, ready to face the challenges and opportunities of tomorrow.

Africa’s agricultural future is in your hands. Let’s work together to create a more sustainable, food-secure, and job-rich future for the continent.

Learn How to Leverage Your Story through our Story To Asset Transformation (S.A.T) Framework.