COMMITTEE ON WORLD FOOD SECURITY

Twenty-fourth Session

Rome, 2 - 5 June 1998

ASSESSMENT OF THE WORLD FOOD SECURITY SITUATION



I. INTRODUCTION

1. In response to previous requests by the Committee on World Food Security (CFS), this document presents a first attempt to broaden the assessment of the world food security situation by providing better coverage of non-cereal staples and food security status at household and individual levels.

2. Current information and trends for selected indicators for different groups of developing countries, categorised according to the estimated percentage of undernourished in 1990-92 (the base period used by the World Food Summit), are discussed in Chapter II of the document. Information is reported with respect to developments in the food security situation up to 1995 (the latest year for which information is available for most indicators), and attention is drawn to some issues that may be of interest for more in-depth investigation.

3. Chapter III presents the assessment of the current world food security situation for
1996-97, focusing mainly on developments in the production and marketing of staple foods during the reporting period. It also highlights noteworthy developments in 1998 that have had, or are expected to have, a significant impact on the food security situation in 1997-98 and beyond.

II. PRESENTATION OF RECENT AND TREND DATA FOR SELECTED INDICATORS OF HOUSEHOLD AND INDIVIDUAL FOOD SECURITY STATUS
IN DEVELOPING COUNTRIES

4. Pending the outcome of the work of the Inter-Agency Working Group on Food Insecurity and Vulnerability Mapping Systems (IAWG-FIVIMS), in the form of a commonly agreed set of indicators, the FAO Secretariat is presenting to CFS some information about a few readily available indicators deemed relevant for monitoring progress in reducing the number of undernourished and achieving food security for all. The results presented here should be viewed as an intermediate report of work in progress. Although the Aggregate Household Food Security Index is being maintained for operational purposes, its relevance for future monitoring by CFS is currently under review by the IAWG-FIVIMS.

5. When organising the data [/ The data cover 98 developing countries, comprising 96 percent of the population of developing countries.] / for presentation in this document, it was decided that two types of data should be presented - status data (Table 1) that characterise the present situation (generally two years old at the time of the assessment), and trend data (Table 2) that indicate the direction of change. Each of these indicators is briefly commented upon, and insights are provided in interpreting certain aspects of the situation and trends in household food security in countries at different levels of prevalence of undernutrition.

6. The first three indicators recall the proportion of undernourished, which together with population figures lead to the estimate of numbers of undernourished in 1990-92. The 98 [/ Data for the other indicators reported in this document are not always available for all of the 98 countries .] / developing countries for which this estimate is available have been grouped into six classes with the proportion of undernourished declining from more than 50 percent in Class One to less than 10 percent in Class Six

7. Per caput GNP: Classes having a high proportion of undernourished are composed essentially of low-income countries: of the 37 countries in Classes One to Three, only three are above the low-income threshold of US$ 765 per annum, 1995; conversely, of the 31 countries in Classes Five and Six only three are below the low-income threshold. However, in addition to the exceptions mentioned, each class contains countries distributed over a very broad range of the national average per caput Gross National Product (GNP). Class Four is most heterogeneous, with several countries below US$ 300 per caput GNP, and several others are above US$ 3000 per annum. This reflects the importance that income distribution, ease of access to food and other non-income factors can have on the situation of food insecurity in a country regardless of the average level of income.

8. A structural characteristic relevant to food security policies is the dependence of the economy on agriculture, measured in the table by the proportion of rural population and the share of agriculture in Gross Domestic Product (GDP). Such dependence is generally very high, particularly for classes with a high prevalence of undernutrition. All of Classes One to Five contain countries where 70 percent or more of the population is rural but countries having a smaller rural population are more frequent in classes with a lower proportion of undernourished. The same observation applies to the share of agriculture in GDP. The data demonstrate however, that the relationship between the prevalence of undernourishment and the agricultural/rural character of an economy is complex. In all classes, a fairly broad range of degrees of dependence on agriculture prevails, as measured by either indicator, although the upper and lower ends of the range regularly decline together with the proportion of undernourished.

9. The indicator of per caput GNP growth over 1985-95 shows positive growth in 40 countries, negligible change in 26 and a decrease over the period in 21 cases. This indicator, illustrative of the economic conditions that have been prevailing in the period leading up to the assessed situation, is clearly related to the country classification based on the 1990-92 proportion of undernourished. All countries in Class One had negligible or negative per caput income growth in the decade considered; two-thirds of countries in Classes Two and Three had negligible or negative growth; in Class Four, one-half of the countries already showed positive growth; and Classes Five and Six contain predominantly countries with positive growth in per caput GNP. The hypothesis that a high proportion of undernourished can itself be a handicap for economic development may be supported by this observation and deserves further investigation.

10. The net agricultural trade surplus is of significance mainly for countries with a higher dependence on agriculture. Overall, two out of five of the countries reviewed show approximately balanced agricultural trade over the period 1985-95; one country out of five had a positive surplus, and two out of five a negative one. These proportions do not change significantly in relation to the country classes considered here.

11. Food import dependence is measured as net food imports in terms of calories per head per day. Only one-quarter of countries have either a surplus or an approximate balance. Balance is defined to mean a surplus or deficit of less than 100 calories per day, i.e. 5 percent or less of per caput food availability. For the food-deficit countries, which are the large majority, it is worth observing that a greater prevalence of high food deficits is found in classes with lower proportions of undernourished; indeed, large food imports are generally associated with higher per caput GNP and purchasing power.

12. Staple food production has been growing over 1985-95 in the majority of countries in all Classes, and declining in less than a quarter of them. However, trends in staple food production do not show any strong relationship with the undernourishment classes. The majority of countries in Classes One to Three, with the greatest prevalence of undernutrition, have increased their staple food production during the decade considered; it is of interest to recall that the same group of countries experienced generally negligible or negative growth in per caput GNP during the same period.

13. Food price inflation, measured as the differential between food price changes and overall inflation, over the period 1985-95, has also been examined. It shows that there has been no general drift in real domestic food prices, with very few cases of either positive or negative real food price trends. It should be noted however that a trend analysis conceals short-term price fluctuations and provides no basis for understanding the difficulties resulting from price instability.

14. Food availability in 1993-95 is an estimate of the average food supply measured in calories per caput per day. Food availability in 1993-95 generally bears a close relation to the Class of undernourishment in 1990-92, but cases of divergence are important as they reflect essentially the effect of differences in access to food, or of changes that occurred between
1990-92 and 1993-95. The latter is illustrated by the change in per caput food availability measured as the ratio of 1993-95 over 1990-92. In 1993-95, 58 countries had a higher average food supply than in 1990-92 (of which five increased by more than 10 percent, 32 between 2 and 10 percent, and 21 by less than 2 percent); ten countries showed no change; and 30 countries had a lower average food supply than in 1990-92 (of which 8 by less than 2 percent, 17 between 2 and 10 percent, and five by more than 10 percent). The cases of increased food availability are relatively more frequent in Classes Four to Six (two-thirds of the countries have increased food availability) and in Class Two (eight countries out of ten) than in Classes One and Three (only seven countries out of 27 have increased food availability).

15. This brief examination of a series of structural and trend indicators in relation to the prevalence of undernutrition can only give partial insights into the household food security situation. It illustrates the high variability of conditions under which more or less severe situations of food insecurity can develop. It also suggests some directions for further research into the relationship between poverty and economic development, and particularly into the mechanisms by which chronic undernutrition can become an economic handicap at the individual level and, when meeting basic needs becomes the major obligation for large segments of the population, for the economic system as a whole. Finally, it underlines the necessity of further developments of more specific indicators of food insecurity and vulnerability and their determinants, as is being undertaken in the inter-agency framework for the development of FIVIMS.

III. CURRENT WORLD FOOD SITUATION AND SHORT-TERM OUTLOOK

A. GLOBAL FOOD OUTLOOK

Cereals

16. The global food outlook presented below covers staple foods (cereals, roots and tubers), oils and fats, meat and dairy produce. Summary data on world production, utilization, trade and stock changes for these commodities is shown in Table 3.

17. In 1997 global cereal production, estimated at 1 908 million tons, rose above the long-term trend for the second consecutive year, although at a slower pace compared to the sharp recovery in the previous season. Record wheat and rice harvests accounted for the favourable cereal crop in 1997, although coarse grain output fell sharply. Cereal utilization in 1997/98 is expected to reach 1 889 million tons, remaining above the long-term trend but below production.

18. Early production prospects for 1998 are mixed. The condition of crops already in the ground has been average during the first quarter of the year; but the area sown to winter wheat in the United States and the Commonwealth of Independent States (CIS) was lower than last year and wheat production is expected to decline in China. At the same time, damage to coarse grain production in southern Africa due to the El Niño phenomenon has been less than feared and output is expected to recover in North Africa. Rice production in 1998 is likely to show a decrease due to weather problems, in part attributable to the El Niño phenomenon, which delayed planting in some countries in the Southern Hemisphere and around the equatorial belt. In addition, the rice area in some countries in the Northern Hemisphere is forecast to decline due to limited supplies of water for irrigation.

19. FAO's forecast of cereal stocks for the crop years ending in 1998 is currently about 302 million tons, or 3.4 percent above their opening levels. The increase is entirely due to larger than anticipated carryovers in wheat; those of coarse grains are expected to remain virtually unchanged, and those for rice to fall by about 5 percent. Although wheat inventories are forecast to increase for the second consecutive year, mostly among the importing countries, they would remain well below the levels of the early 1990s. While down from the previous year, forecasts of coarse grain stocks have been rising in recent months due to limited domestic utilisation in several exporting countries coupled with weaker import demand in Asia. Global rice stocks at the end of the marketing seasons in 1998 are tentatively forecast to decline from their opening levels, based on expectations of lower production in some countries in 1998 and the assumption of continued growth in consumption.

20. The forecast for global trade in cereals in 1997/98 is 202 million tons, some 2 million tons, or 0.7 percent, above the previous year's reduced volume, is due entirely to an increase in rice trade, which is now forecast to increase to more than 22 million tons in 1998, compared to 18.4 million tons in 1997. This reflects lower opening stocks in several of the major importing countries, including Indonesia [/ A n FAO/WFP Crop and Food Supply Assessment Mission, visiting Indonesia during the latter part of March 1998, estimated Indonesia’s import requirements of rice at 3.5 million tons, even assuming a normal secondary rice crop for harvest in August this year. This would represent over 16 percent of global rice trade.] / , the Philippines and Brazil, and the expectation of reduced yields in some Southern Hemisphere producing countries. Global coarse grain imports in 1997/98 are forecast at 88 million tons, slightly below the previous year’s volume, reflecting a decrease in the forecast of coarse grain purchases by some Asian countries due to demand weakened by the effects of the Asian financial crisis. The forecast for global wheat imports in 1997/98 at 92.5 million tons, is down by 1.2 million tons from the previous season as a result of lower imports by China and several countries in eastern Europe.

21. International export prices of all major cereals, except rice, have weakened considerably since October 1997. While the improved global supply prospects are mainly responsible for the fall in wheat prices in recent months, the impact of the financial crisis in Asia has put downward pressure on international maize prices. By contrast, rice prices have been supported by strong import demand in Asia resulting from decreased domestic production in some of the major importing countries. Accordingly, international rice prices in 1998 are anticipated to be stronger than in 1997.

Roots and Tubers

22. World production of roots and tubers, the second most important staple after cereals, is estimated to fall in 1997/98 to 157.8 million tons (in grain equivalent), a decline of 1.1 percent from the previous year. The contraction reflects mainly reduced output of cassava, potatoes and sweet potatoes. Global output of other roots and tubers, such as yams, taro and minor roots and tubers, is likely to remain virtually unchanged from the previous year’s level. The overall decline in the production of roots and tubers in 1998 is expected to occur mostly in the developing countries, especially in the low-income food-deficit countries (LIFDCs) which account for 58 percent of world production. As a result of the reduced supplies of roots and tubers, food consumption is expected to be lower in 1998, in particular in the LIFDCs. World trade in 1998 is also expected to be below the previous year’s level due to the reduced supplies.

23. World cassava output, the most important root crop in developing countries, is estimated to decline in 1998 by nearly 4 percent to 160 million tons in fresh root equivalent, partly associated with El Niño-created weather patterns in major producing countries on three continents. In most parts of eastern Africa exceptionally heavy rains and recurrent problems of mealy-bug and mosaic-virus outbreak are likely to reduce production. In most countries of Latin America and the Caribbean persistent dry weather at the end of 1997 and in the first months of 1998 could jeopardize sowings of the first season crop in 1998. Similarly, in Asia total output is estimated to fall, reflecting smaller crops in China, India, Indonesia, Thailand and Vietnam. Overall, more limited supplies of cassava and products could lead to upward pressure on international prices and to reduced export volumes during 1998. Smaller outputs of potatoes and sweet potatoes are expected in 1998 due to reduced plantings in the EC and lower yields due to drought in many Latin American, Caribbean and Asian countries.

Oils and Fats

24. Global production of the seven major oil crops [/ Soybeans, cottonseed, groundnuts, sunflower seed, rapeseed, palm kernels and copra.] / is forecast to reach a record of almost 283 million tons in 1997/98. The expected 8 percent rise in output would be due mainly to the increase in soybean crops in Argentina, Brazil and the United States. Based on this, world production of oils and fats [/ Includes all major edible oils and fats irrespective of whether they are used for human consumption or industrial purposes. ] / for the same period is forecast to surpass last season’s level by some 4-5 percent, exceeding 102 million tons. However, growth in the production of palm oil and lauric oils is expected to be below average due to the adverse climatic effects of El Niño in Asia.

25. Total consumption of oils and fats is expected to increase, possibly exceeding 101 million tons in 1997/98. The main factors supporting demand are the growth in world income and population. The economic crisis affecting some Asian countries is not expected to dampen their level of oil consumption in a notable manner, given that oils and fats are staple food products. With respect to the composition of global consumption, the share of soybean, rapeseed and sunflower oils is likely to increase, as world supplies of palm oil and lauric oils are reduced. Stocks of oils and fats at the end of the season are likely to recover from the below-average levels recorded in recent years.

26. Global exports of oils and fats are estimated to exceed 35 million tons, rising some 3 percent above last season's level. The main exporters of oils will be Argentina, Brazil and the United States for soybeans, sunflower seed and their oils; Indonesia [/ In mid-April, no final decisions on the country’s export ban on palm oil, introduced at the beginning of 1998, had been taken as to its continuation, lifting or conversion into an export tax scheme .] / and Malaysia for palm and palm kernel oil; the Philippines for copra and coconut oil; and Canada for rapeseed and its oil. The shares of soybean oil and palm oil in total shipments of oils and fats are estimated at 32 and 28 percent respectively - basically the reverse of last season. A sharp rise in imports of fats and oils is expected in China. From being a net exporter in 1993/94, this country has became one of the largest importers of oilseed products. Purchases of oils and fats are also expected to rise further in other major importing countries, e.g.the EC, India, Japan, Mexico, Pakistan and the Republic of Korea.

Meat

27. Global meat supplies are forecast to grow in 1998, particularly poultry and pig meat. Although most of the growth will originate in the developing countries, the pace of expansion is likely to slowdown substantially this year, mainly reflecting developments in China, where excess meat supplies have recently resulted in large declines in producer prices. The financial turmoil in several Asian countries has led to falling demand and increased feed costs. This is fostering above-normal slaughter of livestock, thus temporarily boosting meat supplies, especially of bovine and pig meat. Little output expansion is anticipated in the developed countries, as strong increases in North America should first compensate a further contraction in the CIS countries. Trade in meat products is forecast to rise by 4-5 percent this year, boosted by larger flows in poultry and pig meat. Purchases by the CIS are forecast to show a further sharp increase to compensate for the decline in output and to meet rising demand. By contrast, currency devaluations in major importing markets in the Far East are expected to depress beef imports, which are likely to be diverted, at lower world prices, to other markets in the CIS, the Near East and North America. In general, large meat supplies in exporting countries relative to import demand are forecast to dampen international prices in 1998.

Dairy

28. Global output of milk is expected to increase by 2 percent in 1998 confirming a phase of expansion after several years of stagnation. Amongst the major milk producing countries, higher output is anticipated in Argentina, Australia, Brazil, India, New Zealand, Poland and the United States. In the EC, milk quotas limit any increase in production, while in the Russian Federation milk output is expected to continue to decline. In many countries, and especially the developing countries, increased milk output is linked to rising domestic demand; in other countries, in particular Argentina, Australia and New Zealand, it will be destined for processing into dairy products for sale on the international market. At the same time, some exporters which subsidize exports of dairy products, including the EC and the United States, will have to comply with limitations on such sales agreed under the Uruguay Round Agreement. On the demand side, several countries in Asia are expected to reduce their imports of dairy products in 1998, following the drastic devaluation of their currencies against the United States dollar.

B. REVIEW OF GLOBAL FOOD SECURITY INDICATORS

29. To measure the global food security situation, the Committee customarily reviews a set of indicators which, while confined to cereals, taken together are believed to shed some light on the present and future global food situation, due to the weight of cereals in the global food basket. Table 4 shows seven individual food security indicators. The analysis of changes in these in 1997/98 compared with the previous year and their implications are discussed below.

30. The first indicator provides the ratio of world cereal stocks to world cereal utilization. The FAO Secretariat considers 17-18 percent as the minimum necessary to safeguard world food security, the total consisting of 12 percent working stocks and a 5-6 percent reserve stock element. The ratio of global carryovers in 1997/98 to trend utilization in 1998/99 is forecast to rise to 15.9 percent. Despite the relatively low ratio of stocks to utilization compared to the past, world grain market prices are under downward pressure due to weak global demand and adequate supplies in 1997/98.

31. The second indicator measures the ability of the five major exporters of wheat and coarse grains to meet the demand for imports. It relates the sum of their production, imports and opening stocks, to the sum of their domestic utilization plus exports. This ratio is also expected to improve slightly in 1997/98 due largely to bumper crops in the United States.

32. The third indicator relates the level of closing cereal stocks held by the major exporters of wheat, coarse grain and rice to total disappearance (domestic consumption plus exports) during the marketing year. Based on current forecasts, this indicator reflects an improvement in the global food supply situation in 1997/98 compared to the previous year. However, the figures are still well below the averages of earlier years and the increase in this global food security indicator is attributed mainly to improvements in the supply position of the major wheat exporters.

33. Variations in annual cereal output of the major cereal importers (the CIS, China and India) have traditionally had a significant influence on the size of world trade in cereals. However, in recent years, within this group, only China has remained a major cereal importer on the world market. The fourth indicator, measuring the change in cereal production by this group of major consumers against the trend and the preceding year, shows lower but still relatively good growth in 1997/98. Although there was a significant increase in grain output in the CIS, coarse grain production in China and India was lower compared to the previous season.

34. Changes in aggregate cereal production in the LIFDCs, shown by the fifth indicator, provide another way of measuring food security. However, since production in China and India heavily influences that of LIFDCs in total, the sixth indicator excludes these two countries. In fact, the remaining LIFDCs include a significant proportion of the world's most vulnerable countries.

35. Both indicators show a decline for 1997/98; reduced grain production in China, as mentioned above, and drought-affected harvests in Northern Africa and weather-related reductions in output in southern Africa, account for the declines in the indicators. It should be noted, however, that the fall in production in several of these countries is measured in relation to record and/or bumper crops registered during the previous season.

36. A comparison of export prices for the major cereals is provided by the seventh indicator. International cereal prices continued their downward trend, with global supplies expected to exceed world cereal utilization in 1997/98, allowing for a small build-up in carryover stocks. As a result, cereal importing countries in general are expected to pay less for their purchases in 1997/98 compared to the previous season. In fact, the cereal import bill for the developing countries is expected to decline by 6 percent in 1997/98 to US$ 26 500 million, while the LIFDCs will see no change at US$ 12 500 million, after falling 26 percent in the previous year. However, for the Least Developed and Net Food-Importing Developing Countries (LDC-NFIDCs), the group covered by the Uruguay Round Ministerial Decision, the forecast for the cereal import bill in 1997/98 is for an increase of 1.2 percent to US$ 7 200, due to a 14 percent expansion in their combined volume of imports.

37. In general, the seven indicators confirm an overall improvement in the cereal supply situation in 1997/98 compared to the preceding year. However, weather-related problems already noted, and relatively low stock levels leave the outlook for world food security in a delicate balance. Of some concern are the low, and in some cases falling, cereal prices which could dampen producers’ incentives to increase plantings in 1998. This apparently has already occurred in Canada and the United States where the areas sown to winter wheat and spring wheat, respectively, have been reduced from last season.

Emergencies and Food Aid

38. Although cereal production in developing countries in 1997 is estimated to have declined only slightly from the relatively healthy levels of the previous year, the number of countries facing food emergencies has increased to 37 compared to 31 towards the end of 1997, mainly due to the effects of El Niño.

39. In Africa, earlier concerns of a serious drought developing in southern Africa as a consequence of El Niño have so far not materialized, but problems have arisen in other parts of the continent: in the greater Horn of Africa severe weather anomalies have resulted in heavy, unseasonable rainfall and floods; food supply difficulties have been caused mainly by alternating droughts and floods in most of eastern Africa; the combined effects of persistent insecurity, shortages of inputs and adverse weather have affected the Great Lakes region; and in western Africa harvests have been reduced due to mid-season dry spells in 1997.

40. In Asia, a severe drought in the Democratic People’s Republic of Korea in 1997, coupled with a destructive typhoon, both occurring after two successive years of floods, resulted in a most desperate food situation. Food supply problems persist in Mongolia and in Iraq, despite the easing of the food supply situation following the implementation of the oil-for-food deal in the latter, malnutrition remains a serious problem throughout that country. Elsewhere in Asia, El Niño-related droughts have affected cereal production in China, Indonesia, the Philippines, and Thailand as well as Papua New Guinea in the Pacific Rim. Furthermore, there is mounting evidence that the economic downturn in Southeast Asia is having significant adverse impacts on the food security situation of vulnerable groups.

41. In parts of Latin America, El Niño-related weather disturbances have had far reaching repercussions on national crop production and food security. In Central America, serious food problems are being experienced in El Salvador, Guatemala, Honduras, Nicaragua and Panama, where first season cereal crops were severely affected by El Niño- related dry weather, while in the Caribbean, adverse weather has caused food problems in the Dominican Republic and in Haiti.

42. In the CIS, vulnerable populations including the internally displaced, refugees and the elderly in Armenia, Azerbaijan, Georgia, and particularly Tajikistan, continue to need targeted food aid.

43. Aggregate food aid shipments in terms of cereals in 1996/97 (1 July through 30 June) under programme, project and emergency food aid fell for the fourth consecutive year to about 4.9 million tons, some 37 percent below the previous year. Estimates of total 1996/97 shipments under the Food Aid Convention including pulses and derived products, slightly exceeded the 1995 agreed minimum commitments of 5.35 million tons (in wheat equivalent). [/ " Grains" under the Food Aid Convention include wheat, barley, maize, millet, oats, rye, sorghum, rice, derived products, and also pulses. Members of the Convention can also provide cash equivalent against their minimum annual amounts. Members include Argentina, Australia, Canada, the European Community and its members, Japan, Norway, Switzerland, and the United States .] / At this level, food aid shipments were the smallest since the start of food aid programmes in the mid-1950s, some 10 million tons below the level reached in 1992/93, and less than half of the target established by the World Food Conference in 1974. The decline in food aid volume in 1996/97 was reflected in smaller shipments to all regions and to the group of LIFDCs. Total cereal shipments to LIFDCs fell to about 4 million tons, 2.6 million tons, or 39 percent, below the previous year. At this level, the proportion of cereal shipments to LIFDCs covered by food aid plunged to 6 percent. In light of the food emergencies described above, global cereal food aid shipments could increase in 1997/98. In fact, food aid to the LIFDCs that has been allocated, committed or shipped so far in 1997/98 is running ahead of last year’s levels.

C. STATUS OF MARRAKECH MINISTERIAL DECISION

44. The WTO Committee on Agriculture, which is responsible for monitoring progress in the implementation of the commitments under the Agreement on Agriculture (AoA), reviewed, at its November 1997 meeting, follow-up to the Decision on Measures Concerning the Possible Negative Effects of the Uruguay Round Agreement on Least-Developed and Net Food-Importing Developing Countries and at its March 1998 meeting, dealt with the list of eligible countries. Several donors submitted notifications on their development assistance programmes to the LDCs and NFIDCs, including food aid shipments. The Food Aid Convention, currently under review by the Food Aid Committee of the International Grains Council, was extended by one year, to June 1999, at the Committee meeting in December 1997. Donors are considering various proposals for improving the food aid system, including ways to respond to the needs of LDCs and NFIDCs under the Decision. Not much concrete progress has been made as regards the other components of possible action under the Decision.

D. DEVELOPMENTS IN CEREAL POLICIES

45. In both the developed and developing countries, reforms initiated in previous years, have continued, although the surge in international grain prices during 1995/96 as well as tight financial budgets may have slowed the pace of reform in many countries. Cereal support prices were raised in many countries to offset high input costs and the effects of drought in some instances. Reforms, focusing on the reduction in consumer and producer subsidies and trade barriers continued as part of adherence to the commitments made under the Uruguay Round Agreement and with some major legislations enacted such as the Federal Agricultural Improvement and Reform (FAIR) Act in the United States. In countries where state trading predominated, several parastatals were privatised and modifications in the functions of some state trading boards were introduced.

IV. POINTS FOR THE CONSIDERATION OF THE COMMITTEE

46. The document has presented a preliminary set of indicators to assist in monitoring food security status at the household and individual levels. These illustrated the diversity of conditions associated with the prevalence of undernutrition at the national level. In the first part of the 1990s, per caput food availability increased in a majority of developing countries, but declined in a significant number of others. Further investigation into a broader set of indicators is under way.

47. In 1997/98, global food supply improved and most indicators of the global food security situation were satisfactory; however, cereal output declined in the LIFDCs as a group. The adverse impacts of El Nino and of financial crises in Asia were observed in affected countries. The number of countries facing food emergency situations increased and there may be a reversal of the declining trend in food aid. Policy reforms consistent with the Uruguay Round Agreement continued, but at a slower pace.

48. The Committee may wish to recommend further investigation into the causal relationships associated with food insecurity (including the longer term effects of El Nino and the financial crises) and the implications of these relationships in terms of policies geared towards achieving the goals of the World Food Summit.

Table 1 - Household Level Food Security: Status Indicators












Undernourished Population

Socio-economic context

Food economy


(World Food Summit base)



Country Groupings

1992

1990-92

1992

1995

1995

1995

1993-95

1993-95

1993-95 / 1990-92


total

proportion

population

per caput

share of rural

share of agr.

net food imports

food availability per caput

change in per caput


population

undernourished

undernourished

GNP

population

in GDP



food availability


(million)

(%)

(million)

(US$)

(%)

(%)

(cal.per caput per day)

(cal. per caput per day)



class total

class average

class total

class range

class range

class range

class average

class average

index










Class 1 : More than 50% undernourished

124

65

82

100-340

61-87

33-56

239

1711

1.02
Class 2: 40-50% undernourished

126

44

56

180-800

42-87

15-42

314

2145

1.06
Class 3: 30-40% undernourished

400

36

142

120-1460

40-82

10-50

158

2205

1.00
Class 4: 20-30% undernourished

1216

22

269

240-3490

14-79

5-51

-5

2381

1.02
Class 5: 10-20% undernourished

1631

15

253

620-7040

21-73

0-26

172

2689

1.02
Class 6: Less than 10% undernourished

606

6

38

1120-17400

10-47

6-20

464

3031

1.00




















N.B.
(i) per caput GNP, share of rural population, and share of agr. in GDP are World Bank data
(ii) In "net food imports"column, negative figures indicate net food exports

Number of countries in each class
Class 1: 11 (9 Africa; 1 Asia Pacific; 1 Latin America and Caribbean; 0 Near East and North Africa)
Class 2: 10 (8Africa; 0 Asia Pacific; 2 Latin America and Caribbean; 0 Near East and North Africa)
Class 3: 16 (13 Africa; 2 Asia Pacific; 1 Latin America and Caribbean; 0 Near East and North Africa)
Class 4: 25 (7 Africa; 8 Asia Pacific; 8 Latin America and Caribbean; 2 Near East and North Africa)
Class 5: 17 (2 Africa; 5 Asia Pacific; 7 Latin America and Caribbean; 3 Near East and North Africa)
Class 6: 19 (0 Africa; 4 Asia Pacific; 5 Latin America and Caribbean; 10 Near East and North Africa)

Table 2 - Household Level Food Security: Trend Indicators





Socio-economic context

Food economy







1985-95

1985-95

1985-95

1985-96

Country Groupings

per caput GNP

net agricultural

staple food

food price


growth

trade surplus

production growth

inflation


(no. of countries)

(no. of countries)

(no. of countries)

(no. of countries)


+

0

-


+

0

-

+

0

-


+

0

-
















Class 1 : More than 50% undernourished

0

7

2


1

5

3

9

0

2


1

5

0
Class 2: 40-50% undernourished

3

5

2


2

3

3

6

1

3


0

7

1
Class 3: 30-40% undernourished

5

5

6


3

10

3

14

0

2


0

11

0
Class 4: 20-30% undernourished

10

7

4


3

9

8

19

0

6


0

18

0
Class 5: 10-20% undernourished

13

1

2


4

6

7

11

1

5


1

13

0
Class 6: Less than 10% undernourished

9

1

5


4

4

10

13

3

3


0

10

1
















Key: + positive 0 negligible - negative

Number of countries in each class
Class 1: 11 (9 Africa; 1 Asia Pacific; 1 Latin America and Caribbean; 0 Near East and North Africa)
Class 2: 10 (8Africa; 0 Asia Pacific; 2 Latin America and Caribbean; 0 Near East and North Africa)
Class 3: 16 (13 Africa; 2 Asia Pacific; 1 Latin America and Caribbean; 0 Near East and North Africa)
Class 4: 25 (7 Africa; 8 Asia Pacific; 8 Latin America and Caribbean; 2 Near East and North Africa)
Class 5: 17 (2 Africa; 5 Asia Pacific; 7 Latin America and Caribbean; 3 Near East and North Africa)
Class 6: 19 (0 Africa; 4 Asia Pacific; 5 Latin America and Caribbean; 10 Near East and North Africa)

Table 3 - Food: World Production, Utilization, Trade and Stock Changes







U T I L I Z A T I O N










PRODUCTION


TOTAL


FOOD


TRADE 1/


CHANGE IN ENDING STOCKS


1995/96

1996/97

1997/98


1995/96

1996/97

1997/98


1995/96

1996/97

1997/98


1995/96

1996/97

1997/98


1995/96

1996/97

1997/98




f'cast




f'cast




f'cast




f'cast




f'cast


(... million tons ...)
BY COMMODITY


















Staples 2/

1891.6

2051.4

2065.4


1956.9

2016.2

2047.0


1006.8

1024.1

1036.3


214.5

208.7

210.1





Total Cereals 3/

1729.8

1891.8

1907.6


1795.1

1856.6

1889.2


918.3

936.5

949.8


206.0

200.3

201.8


-58.7

29.6

4.4
Wheat

547.6

590.3

612.9


563.3

578.0

598.6


396.9

402.0

412.1


92.9

93.6

92.5


-13.5

8.5

13.1
Rice (milled)

372.0

382.5

383.7


372.9

381.0

384.2


333.1

341.0

345.5


19.5

18.4

21.6


-0.6

2.4

-2.7
Coarse Grains

810.2

919.0

911.0


858.9

897.6

906.4


188.3

193.5

192.2


93.6

88.3

87.7


-44.6

18.7

-6.0
Roots and Tubers 4/

161.8

159.6

157.8


161.8

159.6

157.8


88.5

87.6

86.5


8.5

8.4

8.3

























Meat 5/

217.0

223.4

230.1


217.0

223.2

230.0


217.0

223.2

230.0


13.5

14.0

14.6





Oils and Fats 6/

95.7

97.3

101.8


96.8

98.4

101.3






31.7

34.2

35.4


-0.2

-0.7

1.5
Milk 7/

537.0

539.0

545.0





































STAPLES BY COUNTRY GROUPS



















Developed countries

820.5

917.7

951.9


764.2

791.6

816.0


185.6

185.4

187.0


56.8

57.4

52.6


-16.3

-50.1

27.7
Developing Countries

1071.1

1133.7

1113.5


1192.7

1224.6

1231.0


821.2

838.7

849.3


157.7

151.3

157.5


-42.4

79.7

-23.3
LIFDC

842.8

896.7

876.2


907.7

934.9

940.0


671.3

685.6

693.6


80.3

66.3

72.5


-0.3

11.5

-12.3
LIFDC < 8/

359.8

377.8

363.0


407.9

413.8

413.1


298.7

302.5

305.3


54.9

52.8

61.3


3.1

17.3

-20.3




















Source: FAO



















Totals computed from unrounded data
1/ Imports for cereals; exports for roots and tubers, meat and oils.

5/ Data are on a calendar year basis and refer to the second year shown.
2/ Includes cereals and roots and tubers.





6/ Trade is defined as the sum of trade in oil and the oil equivalent of oilseeds trade.
3/ Rice production is converted from paddy to milled basis


7/ Data are on a calendar year basis and refer to the first year shown.

4/ In grain equivalent. Data are on a calendar year basis and refer to the second year shown. 8/ Excluding India and China.






Table 4 - CHANGES IN GLOBAL FOOD SECURITY INDICATORS



Average

1995/96

1996/97

1997/98


1990/91-1994/95









1. Ratio of World Cereals Stocks to





World Cereal Consumption Trends

19.7

14.1

15.4

15.9





2. Ratio of Five Major Grain Exporters 2/





Supplies to Requirements

1.18

1.10

1.12

1.14





3. Closing Stocks as a percentage of





Total Disappearance of Major





Cereal Exporters





Wheat 2/

23.3

13.9

15.6

17.9
Coarse Grains 2/

18.2

8.2

12.0

14.7
Rice 3/

12.2

8.3

9.4

9.2
Total

17.9

10.1

12.3

14.0














Annual Trend
Growth Rate

Percentage Change from Previous Year
















1987-1996

1995

1996

1997 1/











4. Changes in Cereal Production in

1.42

1.24

4.69

2.99
CIS, China and India










5. Changes in Cereal Production

3.22

3.45

6.80

-2.14
in LIFDCs










6. Changes in Cereal Production in

3.82

1.81

8.82

-5.54
LIFDCs less China and India





















Percentage Change from Previous Year



















1995/96

1996/97

1997/98 5/













7. Export Price Movements 4/ Wheat

37.2

-16.3

-20.2
(Annual Averages) Rice

44.1

-12.7

-8.5

Maize

52.3

-15.0

-19.1







Source: FAO
















1/ Forecast







2/ Argentina, Australia, Canada, EC and the United States.




3/ China, Pakistan, Thailand, United States and Viet Nam.




4/ Wheat: U.S. no.2 Hard Winter; Maize: U.S. no.2 Yellow; Rice: Thai Broken (A1 Super).
5/ For 1997/98 wheat and maize prices, nine months averages only (July/March). Changes are calculated by comparing the first seven months of the season
with the corresponding period in 1996/97. Rice prices are based on the calendar year average of the first year shown.