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No.6  December 2007 | ||
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Crop Prospects and Food Situation | |
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Regional reviews
Planting of the 2008 winter wheat and coarse grains is underway throughout the subregion. In northeastern growing areas, adequate rainfall combined with cool temperatures has been favourable for planting. In Morocco, however, where soil moisture reserves are seriously depleted after drought in the past season, precipitation has not been sufficient so far, and conditions still remain too dry for widespread sowing. The subregion’s 2007 wheat crop is estimated at 13.5 million tonnes, 28 percent down from the good crop of 2006 and below average, largely due drought. In Morocco, worst hit by the dry conditions, wheat output was sharply reduced by 76 percent from the previous year, to the lowest level of the past five years. In Egypt, the largest producer in the subregion, where most of the wheat is irrigated, production returned to an average level of about 7.4 million tonnes, after a bumper crop in 2006. Also reflecting the drought, the subregion’s 2007 coarse grains crop is estimated at 10.8 million tonnes, about 8 percent below the five-year average.
North African countries rely heavily on wheat imports from the international market to cover their consumption needs. Over the past 5 years, Algeria, Egypt and Morocco imported about 66 percent, 50 percent and 36 percent of their total wheat utilization respectively. Soaring international prices have increased imports bills and pushed up domestic prices of bread and other basic food causing social unrest in most countries of the subregion. The problem was compounded in Morocco by the extremely low level of domestic production in 2007. Governments have implemented a series of measures aimed at offsetting the sharp increase in world prices, including the waiving of tariffs, price controls and subsidies. Morocco recently cut wheat import tariffs to the lowest level ever, while Egypt has significantly increased food subsidies. The impact of these measures on household food security is yet to be assessed.
Joint CILSS/FewsNet Crop Assessment Missions to the nine Sahelian countries (Burkina-Faso, Cape Verde, Chad, The Gambia, Guinea-Bissau, Mali, Mauritania, Niger and Senegal) have recently been completed. The Missions reviewed the evolution of the 2007 cropping season and preliminary cereal production estimates prepared by the national agricultural statistics services. This year, the exercise was extended to three coastal countries - Benin, Ghana and Nigeria. FAO participated in some of these missions.
According to preliminary findings, a relatively good crop is being gathered in the Sahel in spite of this year’s erratic rains. The 2007 aggregate cereal production in the nine countries is provisionally estimated at about 14.9 millions tonnes, mostly millet and sorghum (see Figure 2), which is slightly lower than last year’s bumper output, but still some 12 percent above the average of the last five years. At national level, above-average harvests are forecast in all Sahelian countries with the exception of Cape Verde and Senegal, where, compared to the average of the past five years, output is expected to decline by 46 percent and 11 percent respectively (see box). In the countries along the Gulf of Guinea, generally less favourable harvest outcomes are expected, notably in northern Nigeria, where coarse grain production is anticipated to decline significantly due to late and poorly distributed rains, and in Ghana where a long dry spell was followed by floods negatively affecting crops during the season. Nigeria is the largest producer in Western Africa and given the high level of market integration in the subregion, a reduction in this country’s cereal production can push up cereal prices in some other poorer and more vulnerable of the Western African nations. There are already reports of rising food prices in northern Nigeria and GIEWS will continue to monitor closely price trends in neighbouring countries. Another important trade flow in the subregion is that between Burkina Faso and Ghana, thus, the reduced production in the northern Ghana is expected to be offset with inflows from Burkina Faso.
In Cameroon and the Central African Republic, harvesting of the second 2007 maize crop (planted from March-April) is about to start in the south and overall prospects are favourable reflecting adequate rains throughout the cropping season. In the north, characterized by only one rainy season, harvesting of millet and sorghum is underway and output is forecast to be about average. While the overall food supply situation is expected to be satisfactory in Cameroon, any improvement in the food security situation in the Central African Republic continues to be hampered by persistent insecurity and inadequate availability of agricultural inputs, notably in northern parts.
In Eastern Africa, harvesting of the 2007 main season cereal crops has ended or is about to be completed in all countries of the subregion. Notwithstanding floods earlier in the season in some areas of Sudan, Eritrea, Ethiopia and Uganda, which resulted in casualties and serious localized food shortages, crop prospects in most countries are favourable and above-average crops have been gathered, or are being gathered, in most countries. The subregion’s aggregate cereal production in 2007 is provisionally estimated at 34 million tonnes, slightly lower than the record 2006 output but about 17 percent higher than the average of the previous five years. The main exception to the otherwise generally satisfactory food outlook in the subregion is Somalia, where output from the main “Gu” crop, harvested earlier in the season, was estimated at about 49 000 tonnes, only one-third of the post-war average 1995-2006, and the worst in thirteen years. The reduction is largely the result of drought conditions, coupled with conflict and intense insecurity since the beginning of 2007. These combined factors have led to the worst humanitarian crises in Africa at present. Currently, a total 1.5 million people in the country need urgent humanitarian assistance. The humanitarian situation is further aggravated by continued increases in staple food prices that limit food access for displaced and poor families who have lost income-earning opportunities and have limited food stocks. This rising prices mainly reflect disruption of markets and depreciation of the Somali shilling against the US dollar which in the Shabelle Valley - the centre of the current humanitarian crisis – has depreciated by 50 percent since January. Prospects for the “deyr” secondary cereal crop to be harvested from February 2008 are favourable. After a late start, rainfall in southern Somalia has been increasing benefiting developing crops. A successful “deyr” harvest is needed to improve food security in the region. Cereal import requirement in the current marketing year (ending July 2008) is estimated to increase by some 10 percent to 480 000 tonnes. In Sudan, the outlook for the 2007 coarse grain harvest, currently underway, is good reflecting favourable growing conditions. Rainfall was above-normal and availability of agricultural inputs is reported to have been normal to above normal. However, after a bumper crop in the previous year, plantings returned to more normal levels this season and output is expected to decrease slightly, although remaining well above the average for the previous five years. The targeted area for the wheat crop, now being sown and for harvest from March 2008, has been increased by about 13 percent to 347 000 hectares. As a result of continuing violence in Darfur, insecurity, displacement and loss of livelihoods are expected to continue over the next months and, concomitant with this, malnutrition rates are likely to deteriorate due to lack of access to food. An FAO/WFP Post-Harvest Assessment Mission is scheduled to visit northern Sudan early next year to review the estimates of the 2007 coarse grains harvest, the 2008 wheat crop and review the cereal supply/demand situation in 2008.
An FAO/WFP Crop and Food Security Assessment Mission which visited south Sudan recently, has estimated cereal production in 2007 in the south to be fractionally higher than last year with higher than normal yields. However, since the anticipated increase in output will not entirely meet the requirement of the spontaneous and organized returnees, the 2007/08 food supply position in southern Sudan is expected to show a generally negative balance. Moreover, lack of infrastructure and of a developed trade network, will limit the movement of large quantities of cereals from some of the surplus areas to the deficit ones in Upper Nile, Jonglei, Unity, East Equatoria and Bahr el Ghazal. In Ethiopia, the prospects for the 2007 main “meher” crop now being harvested remain favourable. Output is estimated somewhat lower than last year but about 20 percent higher than the five-year average. Notwithstanding an easing of restrictions on trade in the Somali Region, households in vast areas of this region will remain food insecure due to civil conflict. In most of the rest of the country the anticipated good harvest is expected to improve food security. However, the food security of the poorer households continue to be affected by high food prices which have increased in the last two years despite three consecutive years of good harvests. In Uganda, the outlook for the secondary season coarse grain crops now being harvested is favourable. The aggregate cereal output in 2007 is estimated to remain similar to last year’s crop and marginally above the average of the past five years. Good main crop harvests earlier in the year have generally increased food supply to markets and prices remain within the reach of most households. However, in eastern parts, where heavy rains earlier in the year caused damage and displacement of hundreds of families, the affected population, especially in Teso Region, will face moderate food insecurity in early 2008. The population at risk, including internally displaced people, is estimated at some 1.4 million, continue to remain highly food insecure and largely dependant on humanitarian support . In Kenya, the harvesting of the 2007 long-rains season grain crops is completed. Reflecting favourable weather conditions and increased plantings production is expected to increase by about 200 000 tonnes, to 2.6 million tonnes. Prospects for the short rains season crop, which normally accounts for about 20 percent of total cereal output and is due for harvest from February next year, are also favourable. As a result of expected above-average cereal crops the national food supply situation is good and maize prices are expected to decline in early 2008. The food security of drought-affected pastoralists has improved in several areas and it is expected to get better as long as seasonal rainfall continues. However, food assistance continues to be assured to a large number of people in the pastoral areas affected by previous drought and continued pastoral conflicts. In the United Republic of Tanzania, the output from the 2007 main coarse grains crop harvested earlier in the year was estimated similar to last year’s crop of some 4 million tonnes and above average. The sowing of the secondary crop due for harvest early next year has been completed under overall favourable weather conditions and pasture and water availability remains above normal. The food supply situation is therefore generally satisfactory. Markets are well supplied and on-farm stocks in rural areas are adequate except in localized areas of the 22 districts that were affected by floods or an early end of rains. However, despite the overall good availability, wholesale market prices for many foodstuffs are higher than last year reflecting rising transport costs following fuel price increases and government campaigns to buy crops using standardized weight methods at the farm gate. These high prices are likely to limit food access for low-income households in urban areas. In Eritrea, the prospects for the main cereal crop, now being harvested, are good reflecting one of the best growing conditions in the last eight seasons. The output is estimated to reach the level of last year’s crop of some 230 000 tonnes, sharply higher than the average for the previous five years. However, the country depends largely on imports - mostly commercial - to cover its total cereal consumption requirements of about 550 000 tonnes. Despite good domestic production, cereal prices remain high affecting food security of large sections of the population.
In Kenya the price of maize (Figure 3), which had remained stable in recent months, fluctuated in the Nairobi market between US$199 per tonne and US$202 per tonne in the period May to September, increased in October and November to US$210 per tonne and US$ 211 per tonne, respectively. Prices reacted to the Government’s announcement of a purchase price of US$215 per tonne for the crop recently harvested. Spillover effects of higher import prices also influenced the market. However, prices have started to drop in the main maize producing areas and are expected to decline also in Nairobi reflecting the favourable supply situation. In the United Republic of Tanzania, wholesale maize prices in Dar-es-Salam - quite low since the beginning of the year averaging US$123 per tonne - began to increase sharply since August, to reach US$ 237 per tonne in November. This increase is explained by high demand from neighbouring countries and increased transportation costs attributed to the rising international fuel prices. Moreover, the decision of the Government of the United Republic of Tanzania to buy a targeted 30 000 tonnes of food-grains for state reserves from farmers in the remote surplus production area, also gave support to prices. However, prices have dropped in the markets of southern highlands maize production areas and are expected to fall in the capital city in the coming months reflecting the good harvest this year. In Uganda, that had been declining since the beginning of the year and at low levels in September, increased sharply in October despite abundant supplies. This has been attributed to reduced maize purchases from humanitarian agencies.
In Ethiopia, prices of cereals and other commodities have been unusually high since early 2004 despite consecutive seasons of bumper harvests. Notwithstanding the measures taken by the Government in March 2006 to stabilize prices, including sales at subsidized prices to the needy in selected urban areas, ban on grain exports and various financial measures, prices have continued to increase. The rate of increase has been extraordinarily high prior to the harvest of the 2007 main season crop from November when the wholesale maize and wheat prices in the capital reached a record US$248 per tonne and US$326 per tonne, respectively (see Figure 4). Possible reasons for the recent price trend include: rise in earnings - being helped by the rapid increase in government expenditure - commercial credits, export receipts and transfers in the form of remittances, withholding of cereal supplies by smallholder farmers and the decline of food aid distributed in the country. In contrast to 2006, when no significant post-harvest reduction of prices were observed, this year maize wholesale price in Addis Ababa in the first weeks of November has shown a reduction of about 20 percent compared to the previous three-month average of US$243 per tonne .
Planting of the 2007/08 main season cereal crops, mainly maize, is underway. Rains in the last dekad of October and November have been generally favourable for planting operations, with heavy precipitation in Angola and localized areas of South Africa and Zimbabwe. Maize and other cereals planting in the subregion will continue till end of December. The long-range rainfall forecast for the 2008 main crop growing season is overall positive for Southern Africa. While it is still too early to estimate the sub-region’s area planted this year, in South Africa, a farmer’s planting intentions survey indicates that the maize area could expand from last year’s below average level of 2.55 million hectares to some 2.67 million hectares, encouraged by current high domestic and international prices.
The 2007 aggregate production of cereals in the subregion was estimated only somewhat higher than the about-average level of the previous year. This reflects a second consecutive poor crop in South Africa, by far the largest producer, and a good aggregate output of the rest of countries. However, while bumper crops were gathered in several countries, particularly in Malawi, production was reduced in net-importing countries, namely Zimbabwe, Namibia, Lesotho, Swaziland and Botswana. As a result, in spite of the increase in the aggregate production of cereals this year (excluding South Africa), the total cereal import requirement for the 2007/08 marketing year (April/March in most cases) has been estimated to be some 15 percent higher than in the previous year at 4.36 million tonnes, which includes some 614 000 tonnes of food aid (Figure 5). Zimbabwe accounts for almost a quarter of the anticipated aggregate imports, following a sharp decline in cereal output this year. Against total food aid cereal import requirements for 2007/08 (April/March), pledges or deliveries until early November are estimated at 394 000 tonnes or some 64 percent of the requirement. The total cereal food aid need, calculated at 614 000 tonnes, is lower than the average annual food aid of the previous five years of about 708 000 tonnes.
Overall, maize supply in Southern Africa this marketing year is quite satisfactory. A sizeable exportable surplus is estimated from Malawi (around 1 million tonnes), South Africa (around 1 million tonnes), Zambia (about 250 000 tonnes) and Mozambique (about 150 000 tonnes). This compares with the subregion’s aggregate maize import requirements (commercial and food aid for both white and yellow) of 2.6 million tonnes. Hence local and regional purchases of food aid, direct or through triangular arrangements are highly recommended. Reflecting high international prices, a reduced harvest in the major producer South Africa and below-average harvests in several countries, quotations of maize prices are above their levels of a year earlier in most countries of the subregion, with the exception of Malawi, (Figure 6) and continuing the general upward trend started during the post-harvest months of April-May. In South Africa the Randfontein spot price of white maize, has risen from R 1 652/tonne (US$ 235/tonne) in May 2007 to a high of R 1 862/tonne (US$253/t) in September 2007 showing a slight, and most likely a temporary, decline in October at R 1 820. SAFEX future’s prices show continuation of this positive trend until March 2008. High prices in South Africa, the region’s main exporting country, have affected domestic prices in other importing countries in the region, especially Swaziland, Lesotho and Zimbabwe. By contrast, in Malawi, a bumper maize harvest has resulted in post-harvest prices being considerably lower than in the past two years.
In Madagascar prices of rice, the main staple food, need watching carefully as the current levels have remained much higher than the year before, despite an increase in the 2007 production, and are potentially heading upwards to the levels which caused serious crisis last year. Increased rice importation would be required to avoid further escalation of this price.
Harvesting of the main rice and coarse grains crops is complete or drawing to a close. Based on latest information, the 2007 aggregate output of paddy is forecast at a record 580 million tonnes, slightly above the previous year’s high. The aggregate maize output is forecast at 198.1 million tonnes, marginally up from last year’s already bumper crop. Harvesting of the 2007 secondary spring/summer wheat crop has just been completed, while the main winter crop was gathered earlier in the year. The 2007 aggregate wheat output of the subregion is estimated at 207 million tonnes, 4 percent up from last year’s high production and 10 percent above the average of the previous five years. Most of the increase comes from India. Planting of the 2008 winter wheat crops is underway or complete in the major wheat producing countries of the subregion under favourable conditions so far, and a larger overall area is expected in response to high prices. In China (Mainland), harvesting of the late rice and coarse grains has been complete. The estimate of the 2007 aggregate paddy production remains unchanged at 184 million tonnes, about 1 percent up from last year’s level. Harvesting of maize is complete and the 2007 maize output is estimated at 148 million tonnes, some 2.5 million tonnes above the record high of 2006, reflecting an increase in area planted, due to relative higher profit, and favorable weather. The aggregated 2007 wheat output was estimated at a record 106 million tonnes. Overall, China’s 2007 cereal output is estimated at some 449 million tonnes, an increase of about 1.2 percent from last year and 9 percent compared to the five-year average. As a result, the country is expected to increase its net cereal export in 2007, while closing stocks are expected to increase in 2007/08. Planting of the 2008 winter wheat crop is complete in the major wheat producing regions of China. The area is estimated marginally above last year’s already large area due to the incentive of high wheat prices and continued government support for grain production. The growing condition in the major wheat producing provinces is close to normal and the soil moisture is adequate. In India, the 2007 paddy production is forecast at about 140 million tonnes, close to last year’s good harvest, while the 2007 maize is forecast at 15.5 million tonnes, some 2 million tonnes above last year’s reduced output. Based on the latest information, the 2007 wheat output is estimated at 75 million tonnes which is some 5 million tonnes higher than in 2006 and the five-year average. As a result of this good outturn, the country’s wheat imports in 2007/08 (April/March) has been revised down from 3 million tonnes to 2 million tonnes. The country imported some 6.7 million tonnes of wheat in 2006/07. Planting of the 2008 winter wheat crops is underway in India. Agro-meteorological conditions were favourable for winter crop sowing in most rain-fed wheat growing regions. The area is expected to be marginally above last year’s, reflecting the Government’s early announcement of a significant increase in the support price for the 2008 wheat crop. Harvesting of paddy crop in Pakistan is underway and the prospects for this year’s output are satisfactory. The 2007 wheat output, gathered earlier in the year, was estimated at a record 22.5 million tonnes. Total cereal exports in 2007/08 are forecast at some 4 million tonnes, of which 3 million tonnes of rice. Following government support to increase use of the hybrid rice technology, a bumper 2007 paddy crop is expected in Indonesia, which is expected to lead to a reduction in rice imports to less than 1 million tonnes, next year. In Cambodia, the 2007 rice output is officially forecast at 6 million tonnes, 4 percent below the previous season’s level. The country is expected to export some 1 million tonnes in 2008.
The Democratic Peoples Republic of Korea continues to suffer chronic food shortages due to the economic difficulties and natural disasters. Harvesting of the 2007 main season cereal crops was completed in November and the 2007 cereal output is tentatively estimated at 3.8 million tonnes (including rice in milled terms), some 7 percent below the flood-affected level of last year and 10 percent below the good harvest in 2005 caused by heavy floods in August and September. Given this production, the cereal import requirement in 2007/08 marketing year (November/October), to maintain per caput cereal consumption close to the status quo at some 160 kg per caput, is estimated at more then 1 million tones. Despite political and economic difficulties, the country imported an estimated 556 000 tonnes of cereals in 2006/07 (November/October), of which 353 000 as food aid for vulnerable and flood-affected population. In Timor-Leste, food security has recently deteriorated due to the high cereal world market prices, which is having a significant negative impact on food security of the vulnerable population in urban and rural areas. The country is dependent on rice imports which account for more than 50 percent of total consumption in a normal year. Following the increase in prices, the major private rice importers have left the market due to the low purchase power of consumers. The private rice stock is reportedly at very low level. The 2007 food production, including cereals, cassava and other tubers, has been severely affected by adverse weather conditions and an outbreak of locusts. In Sri Lanka, the resurgence of civil conflict and the deterioration of security situation is having a severely negative impact on the country’s economy and food security, particularly in northern and eastern parts of the country. The revenue from tourism in the first 10 months of 2007 reportedly fell by 20 percent due to insecurity. The reduction in this year’s cereal production and rising cereals import prices are also negatively impacting the vulnerable population’s access to food. The cost of basic commodities, including bread, rice, and cooking gas has reportedly risen exponentially. In Mongolia, lack of rain and drought during the critical summer months has adversely affected grain and fodder production. The 2007 wheat output, normally planted in May-June for harvest in October, is estimated at 109 000 tonnes, a decrease of 15 percent and 12 percent compared to the previous and the five-year average respectively. Even in good years, the country imports some two-thirds of its wheat consumption needs.
In Afghanistan winter wheat plantings for the 2008 harvest are reported to be underway using high quality wheat seed supplied with financial and technical assistance by the EU and FAO. The 2007 cereal harvest, provisionally estimated at over 4.6 million tonnes, was well above the relatively poor harvest of 2006 (3.9 million tonnes) and above average. Wheat production reached an estimated 3.8 million tonnes but, nevertheless, the import requirement of cereals in 2007/08 (July/June) is estimated at nearly 700 000 tonnes, including 550 000 tonnes of wheat. High cereal prices are likely to cause hardship for vulnerable populations. At this stage, the food aid requirement for the marketing year is put at 100 000 tonnes.
Pending receipt of the official 2007 cereal production data, ( which may not be available until well into 2008) FAO estimates the subregion’s aggregate 2007 cereal production at 33.6 million tonnes (including rice in paddy equivalent), 11 percent up from last year’s and 16 above the average of the past five years. Aggregate production of wheat, which is the main cereal crop and principal foodcrop in the subregion, is estimated at 27.7 million tonnes, 3 million tonnes more than in 2006. The bulk of the increase is accounted for by Kazakhstan, the largest producer in the subregion, where better than expected yields in the northern producing areas (adjoining the Siberian region of the Russian Federation) resulted in a 3.3 million tonnes jump in the wheat harvest to an estimated 17 million tonnes. Given the high international cereal prices and the recurrent import needs in many CIS countries, this increase in production has been a welcome development. The subregion’s coarse grain output is provisionally estimated at 5.2 million tonnes, up from 4.6 million tonnes in the preceding year, reflecting a recovery from last year’s drought-reduced crops in Armenia and Georgia and somewhat higher output in Kazakhstan. The paddy harvest in the subregion is estimated at 697 000 tonnes, marginally less than last year, as the provisional estimate for output in Uzbekistan is slightly down.
The subregion’s cereal import requirement in 2007/08 (July-June) is estimated at 3.1 million tonnes, including 2.8 million tonnes of wheat. In most countries in the subregion, commercial wheat imports are likely to be less than last year, reflecting significantly higher prices, which will translate into less availability of wheat for human consumption and particularly feed. Commercial wheat imports in 2006/07 were 3.3 million tonnes. In Azerbaijan and Georgia wheat imports are expected to decline reflecting better harvests and higher prices. Elsewhere, the reduction is mainly due to the high prices. Wheat is a basic staple in the subregion and cereals account for up to 70 percent of the daily calorie intake of the poor and vulnerable populations. Coupled with higher fuel prices, food and consumer price inflation is rising in most countries, which will undermine the ability of the poorest to access adequate food and heating during the cold winter months.
The 2007 aggregate cereal output of the subregion (including rice in milled terms) is forecast by FAO at record 39.3 million tonnes, about 2.2 million tonnes above the previous year’s level and 3.3 million tonnes above the average of the last five years. Harvesting of the 2007 main rain-fed summer coarse grain crops just started in the main producing areas of Mexico and early official forecasts point a record output of more than 30 million tonnes, 7.4 percent up from the previous year’s already good level, mainly due to an expansion in the areas planted. Elsewhere in the sub-region, good cereal crops have been obtained despite severe localized losses to floods.
Exceptionally high rainfall throughout most of October in many parts of the subregion has caused serious damage to agriculture and infrastructure. In Nicaragua, some 220 000 people have been affected in several Atlantic and Pacific northern departments by the passage of Hurricane Felix in September. Losses of 2007 second season maize and bean crops are provisionally estimated by official sources at 4 and 14 percent of the annual production, respectively. Emergency food assistance is been provided by the international community to the most vulnerable population of the Northern Autonomous Atlantic Region (RAAN). In Costa Rica, the North Pacific, Central Pacific and Central Valley regions suffered extensive flooding and mudslides, with serious damage to road infrastructure and some localized damage to sugar cane plantations and melon crops. Floods and landslides have also been reported in eastern El Salvador, southern Honduras and western Guatemala as well as in the Mexican state of Chiapas, with localized damage to food (maize and beans) and cash (banana and vegetables) crops.
At the beginning of November, strong winds and torrential rain associated with Tropical Storm Noel resulted in major flooding and mudslides in the Dominican Republic, Haiti, Cuba and southern Mexico. Severe losses of important cash crops have been reported in the Dominican Republic and Haiti, especially in banana, coffee and cocoa plantations as well as tubers and vegetables. However, having almost completed harvesting of the 2007 second season maize and paddy crops in the whole Hispaniola Island, production losses of these important staple crops have been limited and localized. In Mexico, the south-eastern state of Tabasco has suffered the worst floods in more than 50 years, with severe losses of paddy, maize, beans, plantains, cocoa, coffee and pineapple as well as 300 000 head of cattle lost and some 200 000 hectares of grazing land affected. Flooding has also affected the northeastern part of the Mexican state of Chiapas, causing damage to summer season maize and bean crops that were expected to be harvested soon. Localized losses of second season maize and bean crops as well as banana and coffee plantations are reported in the eastern provinces of Guantanamo, Holguin, Las Tunas, Santiago and Granma in Cuba. In addition, harvesting of sugar cane in Cuba has been postponed from late November to December-January, because of damage to plantations and infrastructure by excessive recent rainfall.
The rising trend in international cereal prices is fuelling domestic inflation rates in several countries, with serious consequences in terms of food security of the most vulnerable groups whose access to important staple foods, such as bread or tortillas, has been dramatically reduced in the last few months. Coupled with the increase in transport costs due to hikes in oil price, the increased international prices of maize and soybean are also affecting the poultry, swine and dairy sectors.
In South America, harvesting of the 2007 winter wheat and barley crops has just started in key growing areas of Argentina and Uruguay, while it is well advanced in central and southern states of Brazil and in eastern Paraguay. The aggregate output of wheat in the subregion is forecast at 22.1 million tonnes, about average and some 10.5 percent above the previous year’s reduced level, largely due to a recovery in Brazil’s output. In Argentina, good precipitation in September benefited yields in key growing provinces of Buenos Aires, Córdoba and Santa Fe, and official forecasts point to a record crop of 15 million tonnes this year, some 7 percent above average. Given the improvements in this year’s crop prospects, Argentina is expected to resume exports by mid-November after a government suspension of wheat and wheat flour exports since March 2007 in response to rising domestic flour and bread prices, as well as the fast pace in export declarations. In the 2007/08 marketing year (July/June), exports from Argentina are expected to decline by 2 million tonnes compared to previous year, to no more than 9 million tonnes. If favourable weather conditions persist during harvesting, record wheat crops are also expected in Uruguay and Chile, reflecting record areas planted. Regarding barley, following an expansion of about 10 percent in planted area, especially in Argentina, Brazil and Uruguay, the subregion’s aggregate production of barley is tentatively estimated at a record 2.6 million tonnes.
Recent precipitation has improved moisture conditions and favoured planting of the 2008 main season coarse grain crops in several growing areas of Argentina, Brazil, Bolivia, Chile and Uruguay. Early indications point to a continued expansion in area planted in response to the attractive price of maize, as well as the strong demand for sorghum as feed, following the gradual diversion of maize to the biofuel industry. The 2008 paddy season is also underway and planting intentions point to an increase in area to about 5 million hectares, especially in Argentina, centre-south Brazil and Uruguay, in response to good price prospects and abundant availability of water in the main reservoirs.
After the largest grass and forest fire ever recorded in Paraguay in September, a prolonged dry period has further affected the important livestock sector in El Chaco region. The very limited availability of water and pasture has already led to losses of thousands of heads of livestock, a decrease in milk and meat production and lower rates of livestock pregnancy.
In the United States, by late November, 89 percent of the area planted with winter wheat for the 2008 harvest had emerged, slightly behind last year’s progress and the average, due to dry conditions in the south-western plains. Early tentative estimates put the winter wheat area up by about 3.5 to 4 percent from the previous year, in response to high prices. However, the condition of the crop in late November was rated lower than at the same time in the previous year, with 44 percent rated good to excellent compared to 53 percent last year. Early indications point to a likely increase also in the United States spring wheat area, to be sown next year, but this will depend largely on price developments for wheat and competing crops such as barley, oats and soybeans in the coming months, as producers will make firmer decisions on there spring cropping plan nearer the time.
After some further small adjustments the latest official estimate of the United States 2007 wheat crop stands at 56.2 million tonnes, still a good level and sharply up from the previous year. The completion of the maize harvest in the past weeks has confirmed this year’s crop as the largest ever, at 334.5 million tonnes, 25 percent up from 2006. Maize plantings expanded sharply in response to exceptionally strong domestic demand for maize-based ethanol products and, moreover, favourable growing conditions led to record yields. In Canada, the bulk of the wheat is spring planted and the 2008 crop will not be planted until March-April next year. Weather conditions permitting, early indications all point to a substantial increase in area. After rotating a lot of land out of wheat in 2007, producers are well placed for a shift back into this crop next year and with the current high prices as an incentive tentative forecasts indicate an expansion in area of some 10 percent is likely. The small winter wheat crop, which normally accounts for about 10–15 percent of the total has been planted under favourable conditions and tentative estimates put the area up by about 5 percent from last year. Latest information regarding the 2007 cereal harvest mostly confirms earlier expectations: output of wheat has fallen to 20.6 million tonnes, almost 20 percent below last year’s crop and 12 percent below the five-year average, reflecting reduced plantings and lower yields because of exceptionally hot and dry summer weather. In contrast, a sharp increase in production of coarse grains (mainly barley, maize and oats) has materialized, with latest official estimates putting output at 28.1 million tonnes, 20.7 percent up on last year.
The wheat area for the 2008 harvest in the EU is seen to rise by some 6 percent following the removal of the 10 percent compulsory set-aside for 2008, combined with the current high price incentive to plant wheat. Among the largest producers, preliminary estimates indicate substantial wheat area increases in France (5 percent), Germany (6 percent), Italy (13 percent) and the United Kingdom (13 percent). Among the newer member states in the east of the region, the wheat area in Hungary is estimated up by about 8 to 10 percent. In Romania, an average wheat area is reported. The EU’s aggregate cereal output in 2007 is now estimated at 259 million tonnes, well below the expectations at the start of the year and nearly 4 percent down from the aggregate output of the 27 countries in 2006. Crop yields were compromised as the season progressed in northern parts by a combination of moisture shortages followed by excessive rains, and in southeastern Europe by a heat wave and drought. Latest estimates put the aggregate wheat production at just 120 million tonnes, the lowest production since the severe drought-affected year of 2003. Regarding coarse grains, the EU’s maize crop has also been badly hit by the drought in the southeastern countries, which account for a large share of the production, but this has been partially compensated by slightly better crops of the other major coarse grains (barley, rye and oats). The latest estimate of the EU’s aggregate 2007 coarse grains production stands at 136 million tonnes, 2.5 percent down from the 27 countries’ aggregate output in 2006 and 10 percent below the average of these countries in the past five years.
As of late November, the 2008 winter grain planting (mostly winter wheat and some barley) is mostly complete in the subregion. The aggregate area sown is estimated to have increased, in response to high prices and as of late November, conditions for establishment and growing were reported to have been mostly favourable. In the Russian Federation the area sown to winter grains has increased by about 5 percent, to an estimated 14.7 million hectares, the highest level since 2001. In Ukraine, the area sown to winter grains is estimated to have reached 7.5 million hectares, 9 percent more than at the corresponding time in the preceding year. The aggregate 2007 cereal harvest (with rice in paddy equivalent) in the subregion is provisionally estimated at 114 million tonnes, nearly 5 million tonnes less than last year and about average. The reduction was due to sharply reduced coarse grain crops as a result of the severe summer drought in southern Ukraine and Moldova. Aggregate coarse grain production in the subregion fell 7 million tonnes to 50 million tonnes. Wheat production, by contrast increased by 1 percent to 63 million tonnes reflecting satisfactory growing conditions for winter crops and better than average harvests in the Siberian region of the Russian Federation, an area not affected by drought this year.
The Russian Federation and Ukraine have become significant cereal exporters, supplying international markets as well as other CIS states. However, in the 2007/08 marketing year (July/June) their combined exportable surplus is estimated to fall by more than 5 million tonnes (with wheat exports down 4 million tonnes) as a result of drought. High international wheat prices, which have caused panic and increasing food price inflation domestically, have led many countries in the CIS to impose restrictions on exports. In the Ukraine these are currently operative and likely to constrain exports until February-March, once the condition of winter crops is known. The Russian Federation has imposed an export tariff on wheat and barley and more restrictive measures are likely to become operative once the estimated exportable surplus is shipped. At the same time Moldova, usually virtually self-sufficient in cereals, needs to import over 700 000 tonnes, including 400 000 tonnes of wheat, as a consequence of severe drought. As the total cereal harvest fell by two-thirds, and the livestock industry plays an important economic role, the country is receiving donor assistance to help cushion the effects of the drought. However, many small farmers are likely to experience difficulties in mobilizing funds for planting of the 2008 crops and keeping their animals alive. In Belarus, total imports are estimated to decline by a third, in response to high prices for both wheat and coarse grains.
Widespread rains in early November in many parts of eastern Australia, arrived too late to improve the poor yield prospects of the winter crops that suffered from drought during most of the growing season. With the harvest already underway, rainfall now could do more harm than good by threatening the quality of the crop. With no let-up in the dry weather and above-average temperatures continuing through the critical September-October growing period, the latest official forecast in late October reduced the wheat crop forecast to 12.1 million tonnes. While some 2 million tonnes up from the even more severely reduced crop in 2006, this level is about half of what the country can produce in a normal year and means that three out of the last six years have seen severely reduced crops, with a significant impact on the country’s export volumes and stocks (see Figure 7). Australia normally features among the world’s largest grain exporters. Apart from wheat, the other winter crops (mostly barley) have been similarly affected by the adverse weather conditions and significantly below average outputs are expected. However, the November rainfall could prove favourable for the minor summer grain crops (mostly maize and sorghum), which are planted from September to December for harvest around from March to June next year.
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| GIEWS | global information and early warning system on food and agriculture |
