FAO/GIEWS - Food Outlook No.5 - November 2000 p. 10

Cassava

Cassava Production Up In 2000

Global cassava production in 2000 is forecast to rise further to 175 million tonnes, by nearly 2 percent compared to 1999 reflecting increases in Africa, Latin America and the Caribbean. Little change is currently foreseen in Asia. The estimate of world cassava output in 1999 has been revised upward since the last report in April 2000 and now stands at 172 million tonnes of fresh roots, 6 percent above 1998.

In Africa, cassava production is forecast to reach 93 million tonnes this year, 1 percent more than in 1999. This modest increase reflects larger outputs expected in Nigeria, Angola, and Malawi that should more than offset reduced production in a number of other countries. In Nigeria, cassava output is estimated to increase to about 34 million tonnes, up from 32.7 million tonnes in 1999, sustained by government policies directed to expand food availability. In Malawi, the cassava sector has also benefited from a number of programmes that have been launched to promote the cultivation of drought-tolerant crops. By contrast, poor cassava crops are expected in Madagascar, Mozambique, the Democratic Republic of Congo, the Republic of Congo, Burundi, Sierra Leone, Uganda and Zimbabwe, where population displacements and civil strife have disrupted agricultural activities. In addition, a prolonged drought seriously affected cassava crops in Burundi and Madagascar, while severe floods are estimated to have caused a 15 percent drop in production in Mozambique.

In Latin America and the Caribbean, cassava output is forecast at 30.9 million tonnes, 1.5 million tonnes higher than in 1999. In Brazil, the region's largest producer, cassava output is currently forecast to rise by 6 percent to 22.2 million tonnes, lifted by relatively large crops in the centre-south and north-east states. However, despite the increase, production will still be 15 percent below the record of 25.6 million tonnes achieved in 1996. Substantial growth in production (10 percent) is also anticipated in Colombia. In this country, producers have been responding positively to the incentives provided by the Government, which, in collaboration with the International Centre for Tropical Agriculture (CIAT) and the private sector, has started implementing the Strategy Plan "PROAGRO". This Plan, which aims at identifying development opportunities for different crops, has set as one of its objective the promotion of cassava as a basic ingredient in poultry and pig feed compounds in substitution for imported feedstuffs. Increases in cassava production are also expected in the Dominican Republic, El Salvador and Peru. Little change is anticipated in the rest of the region.

World Cassava Production 1/

Source: FAO
1/ In fresh roots.

In Asia, overall cassava production in 2000 is forecast to remain at about 51 million tonnes. Thailand and Indonesia, the two major producers in the region, have reported no change from the previous year. In Thailand, domestic prices have been extremely weak since last year, which has induced the Government to intervene through the granting of interest-free loans on purchase and storage of cassava pellets and flour. In the rest of the region, some increase is anticipated for India, the Philippines, Viet Nam and Cambodia. In India, cassava area and production are estimated to have risen in Andhra Pradesh and Tamil Nadu, the two major producing states, following generally favourable weather, but to have fallen in Kerala, where farmers have been shifting to more profitable crops. In the Philippines, cassava output is forecast to be only slightly above the 1999 level, notwithstanding the emphasis placed by the Government on the development of the crop. Cassava is one of the priority commodities covered by the High-Value Commercial Crops Programme. In Viet Nam, cassava production is forecast to rise by 5 percent in 2000, reflecting the wider use of high yielding cassava strains, which are now estimated to account for one quarter of cultivated area. Cambodia reported a substantial increase in cassava output. Little change is forecast elsewhere in the region.

Cassava Utilization Rises in 2000

Global food utilization of cassava in 2000 is forecast to reach 100 million tonnes, in fresh root equivalent, 2 percent up from 1999. Of the total, 63 million tonnes is expected to be consumed in Africa, in the form of fresh roots and processed products (gari, foufou, attieké, kokonte, kondowole, etc.). World utilization of Cassava as feed is forecast to remain close to the previous year's level at 32 million tonnes, most of which is concentrated in Latin America and the Caribbean and in the developed countries, mainly the EC. In Africa, reduced production in those countries affected by civil strife and unfavourable climatic conditions will lead to a decline in food consumption. The contraction will mainly affect the rural population, which relies to a larger extent on the crop for subsistence. However, consumption is likely to fall also in the urban areas of several countries where sharp rises in retail prices for cassava products have been reported. In Ghana, for instance, retail prices of cassava and gari were respectively 15 and 20 percent higher than last year. In Nigeria, the price increases for those products were respectively 4 and 21 percent. In Latin America and the Caribbean, the expansion in production in 2000 should help sustain increased cassava use as food and feed, especially in Brazil and Colombia. In a number of countries, industrial utilization of cassava is also reportedly growing, confirming the changing role of cassava from subsistence to a market-oriented crop. In Asia, cassava utilization is estimated to have stagnated, reflecting little change in production and trade compared with last year. In particular, consumption in Indonesia (mainly food) and in Thailand (mainly industrial utilization) is expected to remain similar to last year. By contrast, cassava utilization is forecast to rise in the Republic of Korea, the Philippines, Japan, Israel and Turkey, following increased imports. It is noteworthy that novel cassava-based products are gaining popularity in the region as new processing technologies have been developed to turn the root into flour, starch and alcohol. Even treated cassava waste has been found to be suitable for animal feed, while leaves are increasingly being used in raising silkworms, in aquaculture and in mushroom nurseries.

Slight Decline in Cassava Trade anticipated

World trade in cassava products in 2000 is tentatively forecast at 5.7 million tonnes (14.5 million tonnes in fresh root equivalent), slightly below the revised estimate for 1999. Of the total, 4.7 million tonnes are anticipated to be traded in the form of chips and pellets and about 1.0 million tonnes in the form of starch and flour for food and industrial uses.

World Trade in Cassava 1/

Source: FAO
1/ In product weight of chips and pellets. including starch and flour.
2/. Excluding trade between EC members
3/ Including Taiwan Province.

Imports by the EC in 2000 are forecast to fall by 300 000 tonnes, 7 percent down from 1999 due to a fall in domestic grain prices, higher freight rates and a weak Euro/US$ exchange rate, which have contributed to making tapioca (cassava) products less competitive in the Community. By contrast, imports of cassava chips and pellets by non-EC countries are forecast to increase by 20 percent, as traditional importers that were absent from the market in 1999 returned to the tapioca pellet market this year. For instance, in the first nine months of 2000, Israel, Turkey and Japan bought respectively 25 000 tonnes, 156 000 tonnes and 20 000 tonnes of cassava pellets, compared to none in 1999. Likewise, imports of starch by Indonesia, China, Hong Kong, Malaysia, the Philippines and Singapore are forecast to soar by about 50 percent compared with 1999.

Between January and September this year, Thailand shipped 3 million tonnes of chips and pellets and over 700 000 tonnes of starch. About 2.8 million tonnes of chips and pellets went to the EC, mainly to the Netherlands (69 percent), Belgium, Germany, Italy, Portugal (6 percent) and Spain (22 percent). Sales of cassava products from Indonesia are expected to be stagnant at 340 000 tonnes, while those from China are estimated to decline to 10 000 tonnes reflecting high domestic requirements.

World Cassava Prices Remain Under Downward Pressure in 2000

International cassava prices have continued to fall during most of 2000, since abundant supplies have coincided with a weak demand in the EC. In the first nine months of the year, the EC import price for cassava pellets averaged US$87 per tonne, or 15 percent less than the corresponding period in 1999 and the lowest level for the last ten years. Quotations of barley in the EC in the first nine months of the year averaged US$141, or 2 percent less than the corresponding period in 1999. By contrast, soybean meal prices, rose substantially to US$183 (c.i.f. Rotterdam) or 25 percent above the same period in 1999. As a result, the price of the cassava-soybean mixture has become slightly more competitive relative to barley than in 1999, which has sustained cassava usage in the Community this year, but not sufficiently to prevent imports from falling. As for pellets, international prices of cassava starch and flour, which are traded mainly within Asia, followed a downward trend for most of the year, falling to an average of US$150 in September 2000, some 7 percent less than the corresponding month last year.

Prices of Cassava, Soybean meal and Barley in the EC

Source: FAO, Oil World and Agra-Europe.
1/ F.o.b. Rotterdam (barge or rail) including 6% levy.
2/ Argentina 45/46 % proteins) c.i.f. Rotterdam up to September 1999. From October 1999 Argentina (44/45% proteins) c.i.f. Rotterdam.
3/ Consisting of 80% of cassava pellets and 20% of soybean meal.
4/ Selling price of barley in Spain.
5/ January-September average.

Cassava Production, Trade and Price Outlook for 2001 Still Uncertain

Prospects for global cassava production in 2001 are still subject to a large degree of uncertainty. In Africa, production could increase, stimulated by rising demand, especially in Nigeria. In Latin America and the Caribbean, much will depend on the outcome in Brazil, which is highly dependent on weather developments. Production may however increase in Asia, lifted mainly by gains in the Philippines, India and Viet Nam.

Results from a recent survey point to only a slight contraction in production in Thailand next season, despite the extremely low prices received by producers this year.

Preliminary prospects for cassava trade in 2001 point to a possible contraction, reflecting a likely fall in imports by the EC. Indeed, cassava pellets in that market might face greater competition from feed wheat next year, given the poor quality of the recent harvest. In addition, EC intervention prices for grains will be cut by another 7.5 percent by July 2001, as part of the second phase of Agenda 2000 policy reform, which might put cassava pellet prices under further downward pressure.

Cassava and Cassava Products Prices in Thailand

Source: Thai Tapioca Trade Association, Market Review.