How much funding is the Food Security sector forecast to receive in 2023?
Funding to the Food Security sector is forecast to be between $9.4bn and $15.9bn in 2023. For reference, the sector received $12.2bn last year.
This forecast is based on our 95% probability range. In other words, we are 95% sure that funding will be between $9.4bn and $15.9bn. Below are the other forecast ranges for the Food Security sector. As we become less sure about our forecast, the range narrows. So for example, we think there’s a 50% probability that funding will be between $11.2bn and $13.4bn.
But we need to put this into context. What does the forecast mean in terms of reaching the funding that is required for the sector (also known as the funding requirement)? The total funding requirement globally is determined by how much is needed in each context. If you hover over the donut below you’ll be able to see the chances of reaching 25%, 50%, 75%, and 100% of the funding that is required.
As the most well funded sector in absolute terms, Food Security is highly likely to reach 50% of its funding requirement. However we think there’s a remote chance that Food Security will receive 75% of what is required.
How does the 2023 forecast compare to previous years?
Our forecast for 2023 is that Food Security could surpass last year’s figure, but this is not certain. Food Security is forecast to receive somewhere between 45% and 76% of the current funding requirement.
Funding to the sector has gradually increased over time. In 2016, the Food Security sector received $2.8bn, which rose to $6.3bn by 2021, before amazingly almost doubling in 2022 to $11.7bn.
The amount of funding required for Food Security has also increased year-on-year since 2016. The funding requirement in 2016 was $4.8bn. By 2023, this has now increased to $20.8bn. That’s a yearly increase of 23%, or put another way, an increase of 333% in just 7 years. The current funding requirement is a huge funding ask, and this is almost certainly unreachable in the short and medium term.
For the period of 2016 to 2019, the funding gap was actually closing. The sector achieved 58% of the funding requirement in 2016, rising to 67% in 2019. The funding gap, whilst absolutely huge in real terms, was relatively stable at between $2bn and $2.7bn. But the explosion in funding required has caused the funding gap to increase to 54% in 2021, before narrowing to 41% in 2022.
However, we need to put this graph into context. If there’s one thing you should know about the Food Security sector, it’s that it’s the largest sector of all, by some margin. In terms of the amount of funding that is required to meet humanitarian needs, it’s the largest. The 2022 funding ask ($19.7bn) was some way ahead of the next largest, Health, at $4.6bn. In terms of the amount of funding that is received, it is also the largest. $11.7bn of funding went to Food Security in 2022, which again is some way ahead of the next largest, Health, at $2.1bn.
In fact, funding to Food Security in 2022 was more than funding to all other sectors combined (excluding Multi-sector, as we don’t particularly know what this really is). As of July 2023, funding to Food Security was $11.7bn in 2022, whilst the combined funding to all other sectors was $9.8bn. Indeed, this also happened in 2018 and 2019 as well.
Food Security closed the funding gap in 2022, and so there’s no risk that Food Security will go into a humanitarian recession. We’ve come up with a way of defining what a ‘real humanitarian recession’ is, and we’ve defined it in this story as two consecutive years of a growing funding gap. So what is expected to happen in 2023?
We think that it’s unlikely that Food Security will close the funding gap this year. In other words, it will experience one year of a growing funding gap, putting the sector on the cusp of going into recession in 2025.
How does the 2023 forecast compare to other sectors?
Given the sheer scale of the Food Security sector, we think that it’s almost certain that it will rank 1st out of all humanitarian sectors in 2023 (and likely 2024, 2025, and so on).
The current state of things
By the end of September 2023, the Food Security sector had received $6.1bn – essentially the same amount it had received in 2022 at the same point ($6.0bn). This points towards the sector posting another excellent year in absolute terms, and it is plausible that the 2023 line could rise above the 2022 line.
One feature of the graph above that is striking is the equilibrium of the sector between 2018 and 2021, and the divergence of the 2022 line which rises above the other years. And it looks like 2022 set a new standard for the sector.
Features of the Food Security Sector in 2022
The average Food Security response was 57% funded in 2022. In isolation, this doesn’t sound great. But when we compare this to other sectors, this is the third highest average of any sector. This may not be that surprising given the high absolute amounts of Food Security funding compared to other sectors.
The biggest success story from the Food Security sector is that 25 Food Security responses received over 50% of what was required in 2021, with four responses (CAR, South Sudan, the Rohingya JRP, and Somalia) receiving even more than their funding ask. Other positive news also includes only three plans that received less than 25%.
When writing this section for other sectors, we’ve often posed the question: what drives this inequity between contexts? Could it be the size of the funding requirement, underreporting, year-on-year variation, donor preferences, or something else?
The most striking feature of the donor landscape for Food Security is the scale of funding from the US Government as a donor, and the scale of WFP as a recipient. The US government are responsible for 54% of all funding to the sector. And 54% of a $6bn+ sector translates into a lot of money: $6.9bn to be precise. The next largest donor to the sector is the German Government (13%), ECHO (3%), the UK Government (3%), the European Commission (3%). These five donors contribute 75% of all Food Security funding.
Despite the large number of donors, the sector is not very diverse at all, mainly due to the dominance of the United States. One way to measure how diverse the sector is in terms of funding sources is to use the Herfindahl Hirschman Index. On a scale of 0 to 10,000, a sector is highly concentrated with a score over 2,500. The Food Security sector has a score of 3,092 indicating a highly concentrated sector.
There are potentially two implications to this. Firstly, the domination of one actor suggests that the sector may not be resilient to shocks. If one donor (in this case the US government) suffers a short term shock to funding, then there may not be enough other sources of funding for the sector not to suffer. The second implication is that the lack of diversity of perspectives concentrates power with one actor, and in theory does not enable a diversity of thought or action. This is more of a normative statement than a financial one, but it is important when we think about where power lies in the sector.
This is reflected in who receives funding. WFP receives 76% of all Food Security funding. In the commercial world this would be called a monopoly. This is then followed by ‘Other’ (5%), FAO (4%), and Red Cross/Red Crescent (3%). Together these three organisations receive 88% of all Food Security funding. A further 245 organisations receive the other 12% of all funding. It should be noted that WFP will have partners and there will be ‘second-tier’ partners downstream.
The usual health warning: FTS doesn’t capture everything. It is a platform that relies on voluntary reporting by organisations. But it is the most comprehensive source of data for humanitarian funding.
To find out methodology and sources for other things on this page which aren’t the forecast, click here.
Note: Numbers in ‘The current state of things’ graph may differ from elsewhere on the page as the data was extracted on a different date (8th July 2023) than other numbers that also show how much was received (i.e. the column chart).