I World review
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I. Current agricultural situation - facts and
1. Crop and livestock production in 1993
- At the global level, 1993 was an unfavourable
agricultural year. Global agricultural production
declined by 1.2 percent, following the 2.8 percent
expansion recorded in 1992. Performance, however, was
uneven among regions and between developing and developed
- The global contraction was largely accounted for by a
significant drop in developed country production, which
declined by 5.2 percent after the expansion of 2.9
percent recorded in 1992.
- Agricultural output declined in 1993 in most developed
country regions, but particularly so in North America,
where production dropped by no less than 10 percent. Crop
production in the United States fell by almost 17
percent, as adverse weather conditions sharply reduced
major crops. A reduction of 3.3 percent was recorded in
the EC, while in Oceania the estimated contraction was of
- In Eastern Europe, agricultural production increased for
the first time since 1989, by 2.1 percent, as crop
production in major producing countries picked up after
the drought-affected 1992 crop. Reliable aggregate
indices of overall agricultural production in the former
Soviet republics do not exist at present, but
agricultural production appears to have declined in 1993
in most of the republics.
- Developing country production in 1993 expanded by an
estimated 1.7 percent, slightly below population growth,
representing a further deceleration from the rates of 2.7
percent recorded in 1992, 3 percent in 1991 and 4.1
percent in 1990.
- Among the developing country regions, the most favourable
performance in 1993 was recorded by sub-Saharan Africa
with an estimated expansion of 3.4 percent. This increase
was, however, only marginally above the rate of
population growth of 3.2 percent and followed a virtual
stagnation in production the previous year, characterized
by severe drought in southern Africa.
- An increase in agricultural production of about 2.4
percent was recorded in the Far East (0.5 percent per
caput), which nevertheless constituted a slow-down from
the production growth of the previous three years.
- After three years of mediocre agricultural performances,
when output barely kept pace with population growth,
Latin America and the Caribbean experienced a severe
production shortfall in 1993. The 1990-93 average growth
in agricultural production - 1.2 percent - was about half
the already low average growth rate of the 1980s.
- The Near East and North Africa saw a marked deceleration
in agricultural output growth after the bumper 1990 crop
year. In 1993 regional output declined slightly, largely
as a result of damaging droughts in Morocco, for the
second consecutive year, as well as in Algeria.
Changes in agricultural production, 1990-1993 (Percentage change
over preceding year) Source:
Per caput food production
- The period 1988-1993 saw a decline in per caput food
production levels in approximately 60 percent of the
total number of developing countries. Nevertheless,
regional differences were significant. In sub-Saharan
Africa about three-quarters of all countries recorded
stagnating or falling levels of per caput food
production. By contrast, in Latin America and the
Caribbean, the Near East and North Africa and continental
Asia, roughly the same number of countries recorded gains
- A more positive picture emerges when considering the
populations involved. Several of the largest and most
densely populated countries in each region achieved gains
in per caput food production: Nigeria and Zaire in
sub-Saharan Africa; China, India, Pakistan, Indonesia and
Bangladesh in Asia; Brazil, Mexico and Colombia in Latin
America; and Egypt and Algeria in North Africa.
- Exhibit 2 clearly points to a grave domestic food supply
problem in much of sub-Saharan Africa. No less than 33
countries have seen their production lag behind
population growth - in several cases dramatically so.
Problems of supply instability have compounded the
gravity of the situation. In many cases, favourable
performances overall conceal wide year-to-year
fluctuations. For instance, behind the average positive
growth in Zimbabwe, Mali, Uganda, Zambia and Togo were
very high rates of increase in 1993, a year of recovery
from the severe shortfall the previous year.
- All countries in transition in Eastern Europe and the
former USSR except Poland suffered a dramatic contraction
in per caput food production. The year 1993 saw a
continuation of negative trends for the former Soviet
republics, former Yugoslavia, SFR, former Czechoslovakia,
Bulgaria and Hungary. For Romania and Poland, however,
1993 saw a recovery in food production following the
drought-reduced harvest of 1992.
Exhibit 2: Changes in per caput food
production by developing countries, 1988-1993 (Average percentage
rate of change)
||Asia and the Pacific
||Latin America and the Caribbean
||Near East and North Africa
|More than 5
||Libyan Arab Jamahiriya
|3.01 to 5
||Iran, Islamic Rep.
|1.01 to 3
|0.01 to 1
|0 to -1
||Papua New Guinea
|-1.01 to -2
||Syrian Arab Rep.
|-2.01 to -4
|-4.01 to -10
|Sao Tome and
|More than -10
Exhibit 2: Changes in per caput food
production by industrial countries and economies in transition,
1988-1993 (average percentage rate of change)
||Economies in transition
|More than 5
|3.01 to 5
|1.01 to 3
|0.01 to 1
|0 to -1
|-0.01 to -2
|-2.01 to -4
|- 4.01 to -10
|More than -10
Food shortages and emergencies
- Africa is still the continent most seriously affected by
food shortages requiring exceptional and/or emergency
assistance. The situation is most critical in East
Africa, where severe food shortages are emerging and
deaths from starvation-related causes and acute
malnutrition are increasingly reported from several
areas. Fifteen countries in the region are currently
facing exceptional food emergencies and half of these
countries are also being affected by civil strife.
- In Rwanda, the civil strife has had disastrous
consequences for national food security. The strife has
seriously disrupted farming activities. Massive
international support for the provision of relief food
and the rehabilitation of the agricultural sector will be
needed to avert suffering and further losses of lives.
- In Burundi, agricultural activities were seriously
affected by ethnic conflicts in October 1993. The food
deficit in 1994 is estimated to be 1 million tonnes. In
addition to emergency food assistance, donor support and
the implementation of a massive agricultural
rehabilitation programme are needed to restore domestic
food production to its pre-crisis levels.
- Famine conditions are emerging in several parts of the Horn
of Africa. Substantial relief assistance is required
by Ethiopia, Eritrea, Kenya, Somalia and the
Sudan. In the United Republic of Tanzania, the
food supply situation is critical for a large number of
subsistence farmers who lost their short rains crops. The
already tight food supply situation in Uganda has
been further aggravated by the influx of refugees from
Rwanda and the Sudan.
- Grave food shortages persist in Angola. The food
supply outlook for 1994 is extremely bleak owing to a
sharp reduction in the output of cereals and cassava.
There is a serious threat of widespread famine unless
arrangements for large-scale food assistance and its
distribution are made to feed the affected population.
- Despite some recovery of cereal production, the food
supply situation will remain tight in Mozambique,
as the 1994 cassava output is forecast to be down by 6
percent from last year. Some 1.5 million people will need
emergency food aid in 1994/95. A poor harvest in Malawi
points to a substantial increase in cereal import
requirements in 1994/95.
- Other African countries facing shortfalls in food
supplies and requiring exceptional or emergency
assistance include Chad, Liberia and Zaire.
- In Afghanistan, the already tight food supply
situation has deteriorated further as a result of renewed
fighting, and large numbers of returnees and internally
displaced people need international food aid. in Iraq,
the food and nutrition situation remains grave in all
parts of the country. The latest FAO Nutrition Status
Assessment Mission stressed that the food supply problems
cannot be solved by the provision of food aid alone and
that a more constructive solution should be sought for
the country to produce and/or import its food needs. In
Laos, following a reduced paddy output in 1993, some 10
percent of the total population is in need of exceptional
emergency food assistance. The food supply situation is
also tight in Cambodia and Mongolia.
- In Bosnia and Herzegovina, the tight food
situation has eased somewhat with the improved food aid
distribution to central parts, particularly Sarajevo,
following the opening of the roads from the Adriatic
coast and the increasing commercial traffic in the past
- The already difficult food supply situation in Haiti
is deteriorating rapidly owing to the tightening of the
UN embargo. Prices of basic foods and essential consumer
goods have increased sharply and conditions in all
sectors of the economy continue to worsen.
- Other countries facing shortfalls in food supplies and
requiring exceptional and/or emergency assistance are Armenia,
Azerbaijan, Georgia and Tajikistan.
3: Food suply shortfalls* requiring exceptional assistance; Source:
FAO, Global Information and Early Warning System, July 1994; (*
In current marketing year)
4. Current cereal supply, utilization and
- Global cereal production fell in 1993 by 3.8 percent to
1890 million tonnes, mainly as a result of a significant
decline in maize output in the United States. With rice
converted from paddy to a milled basis, this corresponds
to 1705 million tonnes, as shown in Exhibit 4. Reflecting
this, world cereal supplies in 1993/94 dropped to 2088
million tonnes, or 33 million tonnes less than in
- As a result of smaller crops, global cereal carryover
stocks were drawn down sharply during the 1993/94 seasons
to 326 million tonnes, i.e. some 12 percent or 46 million
tonnes below their opening level. However, the ratio of
global cereal stocks at the end of the 1993/94 seasons to
the trend utilization in 1994/95 remained within the 17
to 18 percent range, which is considered by FAO to be the
minimum necessary to safeguard world food security.
- FAO's first forecast of 1994 global cereal output is 1947
million tonnes, 3 percent above the reduced crop in 1993,
but still below the trend. Most of the rise in production
in 1994 is expected to occur in the developed countries
and should be confined to coarse grains, although some
advance in rice production in developing countries may
take place, provided weather is normal. Cereal output in
the developing countries is currently forecast to rise by
0.8 percent only, partly owing to sharp production falls
anticipated for wheat in Turkey and Saudi Arabia.
Nevertheless, the 1994 cereal production increase in
other developing countries as a group will probably still
remain below population growth.
- If current production forecasts materialize, total global
cereal availabilities in 1994/95 will be sufficient to
meet the expected rise in consumption, although a
drawdown of wheat stocks is likely. In aggregate,
however, the global carryover of cereals at the close of
the national crop years ending in 1995 would remain close
to the minimum safety level as determined by FAO.
4: up - Supply/utilizations trends in cereals (Including rice on
milled basis); down - Cereal carryover stocks, 1989-1994 (Crop
year ending in the year shown); Source:
FAO; (* Estimate, ** Forecast)
External assistance to agriculture
- Available data for 1992 and 1993 indicate a continuation
of the downward trend in commitments of external
assistance to agriculture. After fluctuating around $11
billion yearly during 1980-1985, commitments in real
terms peaked at about $12 billion in 1986 and have
declined steadily since.
- For 1992, the latest year for which complete information
is available, total commitments in current prices
amounted to $11.3 billion, 6.6 percent less than in 1991.
At constant 1985 prices, commitments in 1992
reached approximately $7 billion, representing a 9
percent decline from the previous year in real terms and
a 42 percent decline in real terms from the peak levels
- The concessional component of external assistance
commitments to agriculture represented 70 percent of the
total in 1992, close to the levels of 1989 and 1990 but
above the 64 percent recorded in 1991.
- Preliminary data for 1993 indicate a further reduction in
multilateral commitments from all sources except OPEC.
The overall reduction (21 percent below 1992 levels at
constant 1985 prices) mainly reflected lower commitments
by the World Bank (-17 percent). The World Bank's
soft-lending IDA branch reduced its commitments by as
much as 60 percent, more than offsetting a 24 percent
expansion in IBRD commitments.
5: Commitments of external assistance to agriculture* (At
constant 1985 prices); Source: FAO
and OECD; (*Broad definition, ** Preliminary)
Food aid flows in 1993/94
- Shipments of food aid in cereals during 1993/94
(July/June) are estimated to be 12.2 million tonnes (21
percent below the previous year's level of 15.1 million
tonnes), mainly owing to the reduced level of budgetary
- Of the total cereal food aid in 1993/94, 7.5 million
tonnes were destined for developing countries compared
with 10.8 million tonnes in 1992/93. In fact, the level
of cereal food aid provided in 1993/94 to developing
countries was the lowest observed since 1975/76.
- Most of the decline is expected to occur in Africa, where
food aid is projected to fall from the 6.7 million tonnes
recorded in 1992/93 to about 3.5 million tonnes. Although
food aid requirements have declined considerably after
the southern African drought emergency, requirements of
many countries still remain unmet.
- Shipments of food aid to the CIS and East European
countries in 1993/94 are estimated to be 4.7 million
tonnes, compared with 4.4 million shipped in 1992/93.
- As of July 1994, pledges to the 1994 IEFR amounted to
808365 tonnes of food commodities, of which 635798 tonnes
were in the form of cereals and 172567 tonnes in the form
of other foodstuffs, about the same level as the previous
- In addition to IEFR contributions,. as of late July 1994,
534000 tonnes of cereals and other commodities had been
pledged under the subset of WFP regular resources for
meeting the requirements of Protracted Refugee
Operations, compared with 830000 tonnes pledged in 1993.
- As of March 1994, total pledges to WFPs regular resources
for the biennium 1993-1994 stood at $912 million,
representing 61 percent of the pledging target of $1.5
billion. In the previous biennium 1991-1992, total
contributions amounted to $1.14 billion, representing 76
percent of the pledging target of $1.5 billion.
6: Shipments of food aid in cereals (Grain equivalent); Source:
FAO; Note: Years refer to the 12-month period July/June;
International agricultural prices
- After a protracted period of steady decline, the
international prices of several major traded agricultural
commodities strengthened during the fourth quarter of
1993. The tendency continued, or even accentuated, for
some commodities in the first half of 1994.
- Most cereal prices strengthened during the fourth
quarter of 1993. The upward trend for wheat halted in
January and prices generally weakened in the first half
of 1994 as a result of slack import demand, stiff
competition for available markets among the major
exporters and mostly favourable prospects for 1994 crops
in the major producing countries. The global decline in
coarse grain production in 1993 resulted in tighter
market conditions and stronger prices for these
commodities in late 1993 and early 1994; however, with
good prospects for the 1994 crops, prices have weakened
in recent months. Prices of rice rose steeply during the
second half of 1993 following an unusually poor harvest
and strong demand for high-quality rice in Japan. Prices
weakened subsequently, reflecting expectations of
increased area in several major producing countries,
improved prospects for the second-season rice crop in
Thailand and ample supplies of lower-quality rice.
- Prices of oilseeds, oils and oilmeals increased
significantly during the second half of 1993, reflecting
expectations of supply shortfalls. A downward movement
was recorded in more recent months owing to increased
harvests in South America and depressed demand for
oilmeals. In July 1994 price increases relative to
mid-1993 were 14 percent for sunflower seeds and 35
percent for rapeseed.
- Coffee prices increased steeply in recent months
reflecting tight supplies, caused in particular by the
worst frost in Brazil since 1961 and a production decline
in Colombia. By late May, prices had increased to the
highest levels in seven years. After a second frost in
Brazil in June, coffee prices rose through July to more
than three times the levels of July 1993. Stock retention
by ACP members also contributed to tighter supplies.
- Cocoa prices also rose markedly, mainly because of
an increase in demand from the Russian Federation,
European countries and North America, and this may cause
consumption to exceed production in 1993/94 for the third
year in a row.
- World tea prices fell to record lows during the
first nine months of 1993, following a recovery in supply
in all the main tea-producing countries. Prices have
recovered somewhat since October 1993, mainly Owing to a
severe drought that reduced Kenya's output.
- Cotton prices soared during the first quarter of
1994, as a massive shortfall in world production in
1993/94 reduced exportable supplies.
7: Export prices of selected commodities, 1990-1994 (S per
tonne); Source: FAO
Agricultural terms of trade
- The recent increase in international prices of several
commodities of economic importance to many developing
countries must be seen in the context of earlier trends.
The 1980s and early 1990s had seen a steady deterioration
in both the terms of trade and the purchasing capacity of
agricultural exports. By 1992 the net barter terms of
trade (or real prices) of developing countries'
agricultural exports had fallen to less than 60 percent
of the levels of the early 1980s.
- The deteriorating trend continued in 1993, as the general
commodity price increase only manifested itself by the
fourth quarter of the year. For the year as a whole, the
UN index of agricultural export dollar prices indicated a
6 percent decline from 1992 levels. For the developing
countries, the decline was 3 percent. On the other hand,
the combined price index of manufactured goods and crude
petroleum declined by 3 percent. This implies a 3 percent
deterioration in agricultural real export prices overall
and a levelling off of agricultural real export prices
for developing countries.
- The economic importance of terms of trade is best
appreciated when considering trends in both prices and
volumes of agricultural exports. The index of income
terms of trade = or purchasing capacity of agricultural
exports - takes both variables into account. The general
picture presented by the income terms of trade is also
unfavourable for the developing countries, although it is
subject to important qualifications. First, purchasing
capacity deteriorated far less than net barter terms of
trade after the early 1980s, implying that developing
countries were able to compensate for falling
agricultural real prices through larger volumes of
exports. Second, regional trends varied widely. The Far
East and the Near East and North Africa regions actually
expanded the purchasing capacity of agricultural exports
from the levels of the early 1980s despite adverse real
price. trends. The Latin America and Caribbean region was
less successful, as the expansion in export volumes was
insufficient to compensate for declining real prices. in
sub-Saharan Africa real prices and purchasing capacity of
agricultural exports deteriorated pari passu. In 1992
sub-Saharan African agricultural exports could
theoretically finance approximately 40 percent less of
manufactured goods and crude petroleum than they did in
8: Terms of trade of agricultural exports for manufactured goods
and crude petroleum (Index 1979-81 = 100); Source:
9. Fisheries: catch, disposition and trade
- Preliminary data for 1993 indicate that total world
catch and culture of fish and shellfish reached about
98 million tonnes, thus remaining at the level of 1992.
- Peru expanded its production rapidly from 6.8 million
tonnes in 1992 to 8.4 million tonnes in 1993. China's
production is also expected to have increased
substantially over the same period. Among other large
producer countries, Chile and the Russian Federation
reported declining production in 1993.
- World marine fish production in 1992 has been
confirmed at 82.5 million tonnes, about the level reached
in 1991. The decline in production of clupeoids
continued; however, they remained the largest group of
marine species, accounting for 20.4 million tonnes of
catch. As a result of decreased catches of wild salmon,
total production of salmon from catch and culture fell
back by 12 percent to 1.4 million tonnes, the level
reached in 1989 an 1990.
- World inland fish production continued to grow
rapidly in 1992, reaching a total of 15.6 million tonnes,
which represented an increase of 5.5 percent over 1991
production. Production of carps and barbels expanded by
11 percent to just more than 7 million tonnes.
- Preliminary estimates of the disposition of world
catch in 1993 indicate a 2 percent decline in fish
used for human consumption to 69.2 million tonnes,
following an increase of about twice that magnitude in
- In 1992, international trade in fishery products grew
slightly in value, as exports increased from $38.9
billion in 1991 to $40.3 billion in 1992. Volume was 17
million tonnes of processed product, a negligible
decrease compared with 1991.
- Developing country exports in 1992 represented 32 percent
of their total catch, as compared with 47 percent for
developed countries. Developing countries as a group
recorded an increasingly positive trade balance in
fishery products, which reached a surplus of $11.7
billion in 1992, as developed country imports of fish
products continued to grow strongly. Indeed, in 1992 the
value of developed country fish exports was equivalent to
only about 56 percent of their imports.
9: World fish cath, disposition and trade; Source:
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