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Global food commodity prices are projected to remain lower over the next decade compared to previous peaks, with demand growth in a number of emerging economies expected to slow down and biofuel policies having a diminished impact on markets, a report said on Monday.
The replenishment of cereal stocks by 230 million tonnes over the past decade, combined with abundant stocks of most other commodities, should also help limit growth in world prices, which are now almost back to their levels before the 2007-08 food price crisis, according to the 10-year agricultural outlook published by the Organisation for Economic Co-operation and Development (OECD) and the Food and Agricultural Organisation (FAO) of the United Nations.
The report titled ‘OECD-FAO Agricultural Outlook 2017-26’ foresees per capita demand for food staples remaining flat, except in least-developed countries. Additional calories and protein consumption over the outlook period are expected to come mainly from vegetable oil, sugar and dairy products, it says.
Growth in demand for meat is expected to slow down, with no new sources of demand projected to maintain the momentum previously generated by China.
By 2026, average calorie availability is projected to reach 2,450 kcal per person per day in least-developed countries, and to exceed 3,000 kcal in other developing countries. Food insecurity and malnutrition in all its forms will nonetheless remain a persistent global problem, requiring a coordinated international approach, according to the report.
Future growth in crop production is projected to be principally attained through higher yields — 90 per cent of the increase in maize production is expected to come from increased yields and just 10 per cent from area expansion.
Growth in meat and dairy production, by contrast, is expected to come from both larger herds and higher output per animal. Milk production growth will accelerate when compared to the previous decade, most notably in India and Pakistan. It is foreseen that aquaculture would dominate growth in the fish sector and farmed fish production will be the fastest-growing protein source among all commodities analysed in the Outlook.
For nearly all commodities, exports are projected to remain concentrated in a few supplying countries, which may imply a greater susceptibility of world markets to supply shocks. "Real prices of most agricultural and fish commodities are expected to decline slightly over the ten-year Outlook period," OECD Secretary-General Angel Gurría said at the launch event in Paris.
“As we have seen in the past, unexpected events can easily take markets away from these central trends, so it is essential that governments continue joint efforts to provide stability to world food markets,” said FAO Director-General José Graziano da Silva.