Global change and an increasingly interconnecting society are inducing unprecedented hazards that are likely to prove disastrous for many of the world’s most vulnerable populations (UN Office for Disaster Risk Reduction 2019). Food systems are at the heart of this challenge and need to become more resilient to ensure access to food while also providing livelihoods for a large share of the world’s poorest households (Hertel et al. 2021). A resilient food system must be financially equitable (economic resilience), supportive of the entire community (social resilience), and it must minimize harmful impacts on the natural environment (ecological resilience). Towards this end, the UN Food Systems Summit 2021 designated resilience as one of five ‘Action Tracks’. Reviewing this subject for the summit (Hertel et al. 2021), one central theme has emerged: the importance of diversification. Diversification of the food system can occur across the entire food supply chain and at different levels of organization (Fig. 1). Here we focus on the diversification of production and markets, and household responses, to illustrate the growing importance of diversification. We also highlight research gaps and challenges for its adoption.

Fig. 1
A flowchart represents the diversity of the food system with different organizational levels, some quantified examples, the food chain, food waste, households, production, consumers, and supply chain, as well as marketplaces and trade.

The importance of food system diversification across levels of organization with selected example measures to enhance food systems’ resilience. Note that diversification of processing and diets are not addressed in this comment but are closely related to diversification of production, household livelihoods and trade

Full size image

1 Diversification of Production

Diversification of production, particularly for crops and cropping systems, has received increasing attention in recent years (Hufnagel et al. 2020) as a means of building resilience to climate change and increasing extreme weather events and also to improve the ecological performance of crops, reducing their harmful impacts on the climate and the environment (Tamburini et al. 2020). Increasing evidence also shows that bio-diverse ecosystems are capable of delivering additional ecosystem services without compromising crop yields (Tamburini et al. 2020) or even with benefits for crop production (Dainese et al. 2019).

Importantly, diversification of production should encompass different levels of the organisation (Fig. 1). Agroecology, an approach receiving increasing attention in research and agricultural practice (Wezel et al. 2014), attempts to explicitly leverage the benefits of agroecological relationships. Agroecological practices including diversification refer to the field, farm, landscape and regional scale and up to the broader food system (Wezel et al. 2014). However, while diversification of crops and cropping systems have frequently been investigated (Hufnagel et al. 2020), diversification of agricultural landscapes and regions also deserves consideration as it has many beneficial effects on biodiversity and ecosystem services (Tscharntke et al. 2021).

Any attempt to integrate approaches to diversify production across organizational levels will need to go beyond the land-based production sub-sector encompassing other sub-sectors such as aquaculture as well as vertical and urban farming. The importance of aquaculture as an integrated part of the global food system has been highlighted (Naylor et al. 2021) and in some world regions (e.g., Asia), food contributions from inland-aquaculture is critically important (Naylor et al. 2021). However, despite progress in recent years, issues remain regarding the sustainability of production and the development of markets (Naylor et al. 2021) jointly with other production sectors to improve food systems resilience.

The photograph represents a family of a man, a lady, and two sons. Grass, a house, papaya trees, and other plants are illustrated.

The concrete solutions for diversification of production will depend on the local and regional natural (e.g., soils, climate and geography) but also socio-economic and cultural conditions determining present farming systems. Understanding the ecological-economic trade-offs of diversified farming systems (Rosa-Schleich et al. 2019) is crucial for successful diversification strategies. Positive outcomes of crop diversity for agricultural employment worldwide have been reported but the economic costs of diversifying farming systems often outweigh the ecological benefits (Rosa-Schleich et al. 2019) suggesting the need for adequate policies to support the development of diverse and sustainable (ecological, economic and social) production and farming systems and households (FAO et al. 2021).

2 Diversification at the Household Level

A key goal of the food system is to enhance the well-being of individuals, and the households to which they belong. This requires a household-centric view of diversification and resilience. Given the prominent role of income in ensuring household well-being, diversification of income sources is critical. Three important sources of income diversification are: risk management, safety nets and labor market diversification.

Diversification across states of nature: With extreme weather events expected to become more frequent in the future (IPCC 2021), new forms of risk management will be needed. Traditional methods of community-based risk sharing are no longer viable when entire communities face common risks from drought, flooding and heat stress. Weather index insurance has been developed specifically for such circumstances (Hazell et al. 2010). Households enroll at the beginning of the season and payouts for all farmers in the disaster-affected region are made when an index for (e.g.) rainfall in the region drops below a pre-determined trigger level. This allows households to diversify their incomes across different ‘states of nature’, paying out money when the weather is normal and receiving money when drought or flooding disasters strike. This form of diversification has great potential to stabilize rural agricultural household incomes.

Since its inception, weather index insurance has faced challenges in reaching the poorest households – as they typically confront severe credit constraints. However, recent technological innovations like remote sensing and e-banking are permitting index insurance to thrive across the developing world. India and China, where 80% of all farms have some form of insurance, have led the way (GIZ 2021). In Africa, where 70% of the programs are private sector led – albeit often in partnership with the public sector – this market penetration is still very small. One of the most successful programs is the Agriculture and Climate Risk Enterprise (ACRE) program which has reached more than 1.7 million farmers in East Africa. ACRE works with local institutions such as cooperatives and agricultural finance providers to reach individual farmers (GIZ 2021). ACRE weather index insurance has allowed three-quarters of participants to access credit that would otherwise have not been available to them due to the risk of catastrophic losses. While promising, reaching its full potential will require education about the benefits of insurance as well as also improved historical weather information which is still scarce in much of the region (GIZ 2021).

Social safety nets: While weather index insurance provides an important source of income diversification for agricultural producers, it does not directly benefit non-farm households and fails to shield net buyers of food from food price spikes in the wake of extreme weather events. For these households, other social safety nets can play an important role. While widespread throughout much of the world, social protection programs have only recently emerged on the scene in Africa where they are rapidly expanding (Correa et al. 2021). This trend has been further accelerated in the context of the COVID-19 pandemic.

While social assistance and social insurance can be viewed as sources of income diversification in their own right, recent research suggests that such programs can also have important impacts on households’ livelihood strategies. By providing an assured source of income, social protection can reduce the risk associated with investments in new activities, including increased participation in commercial agricultural markets and increased farm productivity, as well as increased engagement in non-farm activities (Correa et al. 2021). In a recent study of the Harmonized Social Cash Transfer program targeting ultra-poor, labor constrained households in remote, rural Zimbabwe, Pace et al. (2021) find significant impacts on income diversification over the medium run (four years). Specifically, they identify a shift from survival-led diversification, driven by seasonality, climatic uncertainty, land constraints and limited market access, to opportunity-led diversification, including higher paying non-farm activities, with attendant increases in food and non-food consumption.

Rural-Urban Migration and Income Diversification: While rural off-farm work can provide important income diversification opportunities, many rural households also choose to send one or more family members to work in urban areas. Rural-urban migration has been a long-standing means of diversifying and raising household income, with remittances from migrants to their communities of origin helping to ensure food security, reduce poverty, support children's education, ease credit constraints in farming, pay for farm inputs and repay debts (Deshingkar 2006). Furthermore, when an urban disaster arises, such as the East Asian financial crisis of 1997, the rural household connection can provide an important safety net.

The importance of migrants’ remittances to rural household well-being has been underscored during the COVID-19 pandemic. Border closures and lockdown restrictions have resulted in significant loss of jobs and economic activities throughout much of the developing world. Consequently, these remittances, a vital source of income for the rural villagers, have been largely lost (World Bank 2020). Thus, not only has the pandemic worsened poverty and inequality, it is also likely to leave long-lasting scars on labor markets, reversing progress on poverty and income inequality in many economies and reducing resilience.

3 Diversification Through the Global, Regional and Local Trading Systems

Weather index insurance, safety nets and household income diversification are necessary to ensure households’ food security, but they are not sufficient in the face of widespread weather disasters such as droughts and flooding which may jeopardize local and regional food availability. Here, robust markets and trade play a critical role in ensuring food security. There is perhaps no better illustration than that provided by pre-colonial India, where weather-induced famines were common, resulting in tens of millions of deaths. However, with the introduction of railroads in colonial India, large-scale interstate trade became possible and there was a dramatic reduction in the number of deaths associated with extreme weather events; improved market integration greatly enhanced food security by allowing for timely imports from food surplus regions (Burgess and Donaldson 2010).

A photograph represents a ship with a load of soybeans that drops from a machine.

Trade amongst nations can play the same role – mediating between food surplus and food deficit regions in the face of scarcity. However, this is only possible if government and private actors operate under a rules-based system with adequate information provided to everyone engaged in agricultural markets. The potential for markets to be destabilized by panic and misinformation was on dramatic display during the 2006–2008 food crisis when cascading export bans and panic greatly exacerbated the price rises for rice and wheat (Martin and Anderson 2012). These price spikes were particularly severe for consumers in the poorest countries. In the wake of that experience, the G-20 Ministers of Agriculture initiated a multinational, multiagency effort to provide improved market information. Nicknamed AMIS, this information system documents in detail government interventions – their scope, duration and modification, on a real time basis, along with up to date information on commodity stocks and production. As a consequence, over-reactions on the part of governments and markets to the disruptions posed by the COVID-19 pandemic were avoided (Jansen 2020). However, merely documenting these interventions is insufficient. It is important to reach a new multilateral agreement in agriculture that will prevent countries from intervening in markets during these crisis periods.

Of course, it is not enough to integrate national markets into the global economy. Many of the world’s smallholder farmers and rural households are poorly integrated into local and regional markets, thus limiting their ability to benefit from intra- and international trade. In Ethiopia, a pilot effort dubbed P4P: Purchase for Progress, run by the World Food Program, works through farmer organizations in order to better integrate farm households into regional markets. This involves reducing transactions costs and improving information flows. A recent study of the P4P pilot project in Ethiopia finds that these interventions have boosted spending by participating households by 25% – as well as sharply increased investment in children’s education (Gelo et al. 2020). This effort has benefited not only short-term resilience, but also long-term development and poverty reduction objectives.

4 Conclusions

While there are many different avenues to obtain greater food system resilience, we believe that the most fundamental of these is diversification, which can occur at many different levels and across components of the food system. This comment has focused on diversification of agricultural production and trade and on household-related responses. However, equally important for food system resilience will be diversification along the entire value chain as well as in consumption. Diversity in diets is a critical element for ensuring healthy consumer outcomes, while also carrying important implications for patterns of production and trade.

In closing, it should also be noted that many of the elements discussed in this comment interact in important ways. For example, while increased production risk will encourage farmers to diversify, greater market integration encourages specialization in production in order to increase expected household income (Keenan et al. 2021). Clearly, the relationships among diversification of production and other parts of the food system, particularly diversification of diets and markets including market access, are not straightforward and need more attention (Keenan et al. 2021). Food system modeling frameworks to assess resilience are at an early stage of development (Müller et al. 2020) but can be helpful in integrating the complex interactions between food, ecology, economy and society, thereby providing advice on critical trade-offs when diversifying food systems to improve their resilience.