It’s hard to imagine what will be dished up for the future of food security and agricultural production around the world. With so many variables – changing technologies, uncertain economies and markets, climate variability – it becomes hard to predict what exactly will be on the horizon. Thankfully though, the United Nations Food and Agriculture Organisation (UNFAO) has teamed up with the Organisation for Economic Cooperation and Development (OECD) to cast some predictions on exactly that.
This week’s Development Agriculture article will count down our top 10 highlights from the UNFAO and OECD’s 2016-2025 Agricultural Outlook. The report takes a look at the outlook of global agriculture in the coming 10 years, covering 41 countries and 12 geographic regions.
Global food commodity prices are projected to remain low. Overall agricultural prices fell in 2015 (across staple crops, livestock and fish products), signalling the end of an era of high prices. Demand growth in many emerging economies is expected to continue to slow down, partly owing to the diminishing impact of biofuel policies on markets. On the supply side, the past decade has seen a replenishment of cereal stocks by 230 million metric tonnes, which has nearly restored levels to supply levels prior to the 2007-08 global food crisis (the less well known twin of the GFC).
Increased food demand is expected to be met mostly through productivity gains, with yield improvements projected to account for 80% of the increase in crop output.
Projections estimate that the global proportion of undernourished people will decline from 11% to 8% (or 788 million to below 650 million). However, Sub-Saharan Africa is not expected to see these improvements, expected to have over one-third of total undernourished people in 10 years.
Yield growth is expected to slow in key soybean producing countries as it is becoming increasingly difficult to continue shifting the technological frontier. However, many developing countries have significant potential to shift the frontier forwards and significantly increase global supplies.
Food consumption growth rates in Southeast Asia are expected to be higher than in other developing regions. However, this is given a lower baseline, with current consumption particularly low. Consumption growth for most agricultural products is also only marginally ahead of population growth (33.6% – much higher than the average growth rate across other developing countries of 10.5%).
5 main exporting countries are expected to account for at least 70% of global exports. Food important dependency is predicted to remain high for poor regions, particularly in North Africa and the Middle East.
Agricultural trade is expected to remain more resilient to economic downturns than trade in other sectors. This is despite expectations that agricultural trade will expand at about half the rate of the previous decade. Most countries aim to be self-sufficient in staple foods, which constrains agricultural trade in these products. This is accompanied by a structural shift favouring value-added products.
Additional calorie and protein consumption in the coming 10 years is expected to come from three main sources: vegetable oil, sugar and dairy products.
In developing countries, sugar consumption is expected to increase by over 15% per capita. There is great variation within this figure, however. Sugar consumption in least developed countries of Oceania is predicted at 2kg, whilst higher predictions are seen in Brazil (57kg), Thailand (56kg), and Malaysia (65kg). The largest increases are predicted in India, China and Indonesia.
Average Calorie Availability is projected to exceed 3000 kcal per person per day in developing countries, and 2450 kcal in least developed countries.
In presenting the Agricultural Outlook OECD Secretary-General Angel Gurria also made some key points. Agricultural markets are inherently volatile, but increasingly important. Gurria says,
“As we have seen, unexpected events can easily take markets away from these central trends. In the past I have talked about the ‘hikes in the spikes’; now we have to beware of the ‘bumps in the slumps’!”.
So whilst these outlooks show many positive indicators, realising these predictions demands careful management and planning of policies, economies, technologies, and scientific research.
“In 2015, we agreed on a common level of ambition through the SDGs and the Paris Agreement. Agriculture will be crucial in delivering on these commitments, ensuring food security for all, while safeguarding our planet for future generations”
To take a look at the report for yourself.