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Press Release 98/14

UN FOOD AND AGRICULTURE ORGANIZATION (FAO) SAYS WORLD CEREAL STOCKS REMAIN BELOW SAFE LEVELS FOR THIRD CONSECUTIVE YEAR AND URGES CONTINUED CLOSE MONITORING OF SITUATION

Paris, March 4 -- Despite reports of better than expected cereal harvests at the end of last year, world food security in the coming 1998/99 season will again depend on a good and above-trend cereal crop in 1998 for the third consecutive year, an unusual occurrence in the last 20 years,"said the UN Food and Agriculture Organization (FAO) in a special Food Update released today at the Salon de l'Agriculture in Paris.

"Overall crop conditions are satisfactory so far, but the area sown to winter wheat in the United States and the Commonwealth of Independent States (CIS) is lower than last year. In the northern hemisphere, good wheat crops are anticipated in western Europe, North Africa and India," according to the Update, "but conditions are unfavorable in China, Pakistan and parts of eastern Europe."

Rice plantings and yields in southeast Asia have been reduced by El Niño. A severe drought considered to be the worst in half a century, reduced food production and exacerbated forest fires in Indonesia and devastated crops in Papua New Guinea resulting in severe food supply problems in the country, said the Update, adding: "Fortunately, the threat of El Niño-related drought appears to be receding in southern Africa while the negative effect on coarse grains output in Latin America has been less than anticipated."

The Food Update called for continued "close monitoring, because any deterioration in prospects for 1998 crops could result in price rises with serious consequences for the food security of many Low-Income Food-Deficit countries, particularly those which depend on imports to meet a large part of their food requirements."

Total aggregate carryover stocks of cereals stood at 290 million tonnes in 1997 and FAO projections for 1998 anticipate stocks to reach only 295 million tonnes, representing 15.7 percent of world cereal consumption against the minimum safe level of 17-18 percent.

On meat production, the Update said, "production in 1998 is expected to expand vigorously, driven by continued low feed prices which should boost the poultry and pork sectors." While sheep meat production is expected to rise in line with increased herds, the Update said little growth in bovine meat output is forecast, as many important producers will enter a phase of herd rebuilding that will limit slaughtering.

FAO estimates a record production of oilseeds for 1997/98, but expects international prices of oilseed products to remain at relatively high levels compared to the early 1990s.

According to the Update, Asia's financial turmoil will have relatively small consequences for global food markets with some exceptions. Imports of meat products in the region are likely to be most affected with bovine meat topping the list. The region's financial crisis could also contribute to aggravating the food situation through reduced import capacity and domestic price rises due to currency devaluations in some countries in the region.

"With cereal production in developing countries estimated to have fallen by 17 million tonnes in 1997 from the previous year, the number of countries facing food emergencies have increased to a near record number" said Abdur Rashid, Head of FAO's Global Information and Early Warning System. The Food Update concludes that the current El Niño phenomenon pushed the number of countries facing food supply problems to 37, up from 31 a year ago, listed below:

Afghanistan, Angola, Armenia, Azerbaijan, Bosnia-Herzegovina, Burkina Faso, Burundi, Republic of Congo, Democratic Republic of Congo, El Salvador, Eritrea, Ethiopia, The Gambia, Georgia, Guatemala, Haiti, Honduras, Iraq, Kenya, Korea, D.P.R. (North Korea), Laos, Liberia, Mauritania, Mongolia, Mozambique, Nicaragua, Niger, Panama, Papua New Guinea, Rwanda, Senegal, Sierra Leone, Somalia, Sudan, Tajikistan, Tanzania and Uganda.

 

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For further information, please contact:

At Salon de l'Agriculture

Mr. Gilles Hirzel/Ms. Lilliane Kambirigi

Tel.: (Cellular) 00 33 6 80 75 45 43

In Rome:

Pierre Antonios

Tel.: (396) 5705-3473

Fax: (396) 5705-3699

For additional information on the world food situation, please visit FAO's home page on the Internet at: "http://www.fao.org"

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