Managing the Stranded Assets and Protecting the Food value Chains from Natural Disasters

Stranded assets are those that have suffered unanticipated or premature write downs and lose value or turn into liabilities due to external shocks. Environmental risk factors such as natural disasters, climate change, water scarcity etc. that could cause asset stranding of agriculture are poorly understood in the context of food value chain (FVC). The value at risk (VaR) globally is significant in agriculture due to over-exposure to stranded assets throughout our financial and economic systems. Our objective is to discuss the issue of stranded assets and the environmental risks involved with food value chains. This paper provides an overview of the environmental risk disasters and climate change as agriculture asset stranding in FVC. We present the impact of disasters triggered by natural hazards on the economic losses of the agricultural value chain and loss of value added growth with further discussion on the principles of effective disaster risk reduction in FVC. Disaster when combined with climate change poses challenges by creating fluctuations in yields, supply shortfalls, subsequent global trading patterns, and substantial effects on FVC. Finally, we present strategies for building resilient FVCs in partnership with communities.