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State of Food and Agriculture (SOFA) Report 2023

Why is it in the news?

  • Food and Agriculture Organization (FAO) released State of Food and Agriculture (SOFA) Report 2023.
  • For the first time, FAO dedicates two consecutive editions of SOFA to the same theme.
  • The 2023 report presents national-level True Cost Accounting (TCA) assessments to uncover hidden impacts of agrifood systems. The 2024 report will focus on in-depth targeted assessments to identify ways to mitigate these impacts.


Key Findings

  • Global quantified Hidden Costs (HCs) of agrifood systems amount to 10 trillion dollars or more.
  • HCs arising from dietary patterns lead to diseases and lower labour productivity, particularly in high- and middle-income countries.
  • Environmental HCs constitute over 20% of quantified HCs and are equivalent to almost one-third of agricultural value added.
  • HCs, estimated at 27% of Low-income Countries’ GDP, are associated with poverty and undernourishment.


Need for True Cost Accounting (TCA) Estimation

  • Measure the actual impact of complex Agri-systems.
  • Make responsible decisions and improve sustainability.
  • Improve the performance and resilience of Agri-systems.


Factors Affecting Current Functioning of Agri-food Systems

  • Institutional policy and distribution lapses.
  • Free riding.

Challenges in Calculating True Cost

  • Lack of political will.
  • Resistance to change.
  • Data availability and its quality.

About FAO

·       FAO (Headquarters: Rome) is a specialized agency of the United Nations that leads international efforts to defeat hunger.

·       India is a member of FAO.


Definitions of Terms

·       TCA: Holistic and systemic approach to measuring and valuing environmental, social, health, and economic costs and benefits generated by agrifood systems to facilitate improved decisions by policymakers, businesses, farmers, investors, and consumers.

·       Hidden Cost (HC): Any cost to individuals or society that is not reflected in the market price of a product or service.

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