Agricultural productivity growth is and will continue to be at the core of strengthening sustainable agricultural systems.

Indeed, improved efficiency of input and natural resource use has been increasingly emphasized as the single most effective solution to simultaneously achieving production and environmental goals.  Changes in TFP also reveal how well our agricultural knowledge and innovation systems (AKIS) are reaching and supporting producers at all scales of production to improve productivity. An increase in TFP growth suggests that an increasing number of producers are adopting, at minimum, scientifically proven, contextually- and scale-appropriate tools—such as technologies, strategies, and practices—that improve the sustainable use of scarce resources, including nonrenewables.

When the GAP Report® was first published in 2010, the “GAP Index” was established to track changes in TFP growth and to illustrate the future growth necessary—holding inputs constant—to sustainably fulfill global needs for agricultural products by 2050. The GAP Index target, which was a projected rate of 1.73 percent average annual TFP growth during 2010–2050 (solid green line, Figure 2), was based on the assumption that agricultural outputs would need to double between 2010 and 2050 to support a projected population of 10 billion people.

Measured as total factor productivity (TFP), agricultural productivity growth is achieved when producers increase their output of crops, livestock, or aquaculture products, using the same amount or less land, labor, capital, fertilizer, feed, and livestock. In other words, TFP rises when producers utilize innovative agricultural technologies or labor and efficiency practices to increase output with the same amount or fewer resources (Figure 1).

Tracking changes in TFP growth reveals a bigger picture of how well agricultural production is able to contribute to pressing global issues such as poverty alleviation, food security and nutrition improvements, and environmental externality reduction (Rahman et al., 2022). For example, TFP growth can lead to increased competitiveness in the sector through lower production costs. A one percent increase in productivity growth is equivalent to a one percent decrease in the cost of producing, storing, and selling one unit of a particular product. Consumers also benefit from TFP growth since the per-unit price for producers moves through the value chain, influencing the prices consumers pay.

In 2022, the United Nations estimated that the global population could reach 9.7 billion by 2050 (United Nations, 2022).

Although this estimate is slightly lower than earlier projections, we conclude that the assumption of needing to double agricultural production from 2010 to 2050 is still valid, especially because this assumption does not explicitly account for any negative impacts of climate change—which will continue to have important impacts on agricultural production and outputs.

At 1.14 percent, the global average annual TFP growth during 2011–2021 Source: USDA Economic Research Service (2023). TFP growth rates are based on a 10-year rolling average 2023 GLOBAL AGRICULTURAL PRODUCTIVITY INDEX Figure 2: (orange line, Figure 2) fell well below the 1.73 percent annual growth GAP Index target. As a result of sluggish TFP growth during this period, it is now necessary to revise the GAP Index target upward to 1.91 percent average annual growth (dotted green line, Figure 2) to achieve sustainable production of global agricultural needs by 2050. If TFP growth continues to lag, the gap will continue to widen over time, making it increasingly difficult to close.

The implications of a widening TFP growth gap include the use of unsustainable agricultural practices, such as the conversion of wild and marginal lands to agricultural production. As a result of such practices, a portion of the gap will remain unfilled, leading to unacceptably high levels of malnutrition and rural poverty, accelerated loss of biodiversity, and detrimental system-wide inefficiencies. This gap will disproportionately impact already resource-poor communities.

Input intensification, such as the adoption of improved crop varieties, increased application of fertilizers and crop protection products, and use of mechanization, was the most important driver of increased agricultural output during the 1960s and 1970s (Figure 3). However, beginning in the 1980s, TFP growth became the leading contributor to agricultural output growth until the present day. During the 1990s, global TFP growth averaged 1.68 percent annually, which increased to 1.93 percent average annual TFP growth during the first decade of the 21st century. Unfortunately, during 2011–2021, average annual global TFP growth fell to 1.14 percent, ending two decades of robust growth and falling well below the global GAP Index target (Figure 2).

TFP growth declined sharply during 2011–2021, compared with 2001–2010, across all country income groups. Global TFP growth was a robust 1.93 percent annually during 2001– 2010, but declined by an average 43 percent during the subsequent decade (Figure 4). The robust TFP growth of middle-income countries also declined sharply and was below the new target growth rate (1.91 percent annually) during 2011–2021. TFP growth in upper-middle-income countries declined by more than 50 percent between 2001–2010 and 2011–2021.

Low-income country TFP growth continues to lag, as reported in the 2022 GAP Report (Steensland, 2022). Low TFP growth suggests that both the pace of innovation and the adoption of agricultural innovations are declining. This trend is especially alarming, considering the agricultural production challenges of the coming years. This contraction in TFP growth may exacerbate already high levels of food insecurity and malnutrition and threaten the prospects for agriculture-led economic growth in many nations.

During 2011–2021, South Asia and China were the only world regions that experienced strong TFP growth (Figure 5).

Strong TFP growth in South Asia (2.18 percent) was led by India and Pakistan (2.47 and 2.41 percent, respectively). Within the South Asia region, only Bangladesh (-1.16 percent annually) suffered from TFP contraction. Increasing productivity in South Asia has been linked mostly to technological change, including technology adoption, mechanization, labor reallocation, and adoption of information and communications technology (ICT) to disseminate information related to agriculture (Liu et al., 2020a).

TFP growth in China (1.97 percent) has been driven by mechanization (Liu et al., 2020b) and policies aimed at reversing unsustainable input intensification practices (OECD, 2018). Chinese government investments in agricultural research and development have no doubt played a role as well— China now spends more than twice as much on public agricultural research and development as the United States (Plastina and Townsend, 2023).

In the Southeast Asia and Pacific region TFP growth averaged 3.0 percent annually during 2001–2010, but fell sharply to only 1.1 percent annually during 2011–2021. Land conversion to agriculture, led by Indonesia and Laos, was the largest contributor to agricultural output growth in the region.

In sub-Saharan Africa (SSA), lagging TFP growth can be attributed to various factors, including lack of technological change, low expenditures on agricultural research and development, and climate change impacts, which appear to be most severe in warm regions (Ortiz-Bobea et al., 2021). With constrained access to productivity-enhancing tools such as mechanization, advanced seeds, fertilizer, and improved livestock breeds and feed, farmers are expanding agricultural land into wildlands at an alarming rate, with negative impacts on biodiversity (Koch et al., 2019).

TFP growth declined sharply during 2011–2021, compared with 2001–2010, across all country income groups. Global TFP growth was a robust 1.93 percent annually during 2001– 2010, but declined by an average 43 percent during the subsequent decade (Figure 4). The robust TFP growth of middle-income countries also declined sharply and was below the new target growth rate (1.91 percent annually) during 2011–2021. TFP growth in upper-middle-income countries declined by more than 50 percent between 2001–2010 and 2011–2021.

In SSA, the conversion of lands to agricultural production (Figure 5) was the highest seen since the 1980s and average TFP growth (0.18 percent annually) was the lowest observed since the 1970s. Eight countries in SSA increased agricultural land area (cropland plus permanent pasture) by more than 3 percent annually during 2011– 2021, and more than 100,000,000 hectares of land were converted to agricultural use across SSA during this period. Of the major SSA subregions, only the Sahel and Southern Africa experienced positive (0.88 and 0.72 percent annually) average TFP growth during 2011–2021. In sharp contrast, average TFP growth was -1.54 percent annually in East Africa.

Average TFP growth in the United States has dropped markedly from 1.49 percent annually during the 1990s, 1.39 percent annually during 2001–2010, to negative during 2011–2021 (Figure 5). It is noteworthy that, according to USDA-ERS, in 2019, U.S. public agriculture and food R&D expenditures in constant dollars reached its lowest level since 1970 (Nelson and Fuglie, 2022).