OECD-FAO Agricultural Outlook 2019-2028

This report highlights the role of diets, urbanization, emissions and trade in outlook for next decade. Thus, agricultural output growth is likely to keep food prices low over the coming decade, but many uncertainties remain.

This years edition of the OECD-FAO Agricultural Outlook was published by the Organisation for Economic Co-operation and Development (OECD) and the Food and Agriculture Organization of the United Nations (FAO) in early July 2019. It provides a consensus assessment of the 10-year prospects for agricultural and fish commodity markets at national, regional and global levels and features a special chapter on Latin American and the Caribbean.

According to the report, global demand for agricultural products is projected to grow by 15 per cent over the coming decade, while agricultural productivity growth is expected to increase slightly faster, causing inflation-adjusted prices of the major agricultural commodities to remain at or below their current levels.

The outlook projects that yield improvements and higher production intensity, driven by technological innovation, will result in higher output even as global agricultural land use remains broadly constant. Direct greenhouse gas emissions from agriculture, meanwhile, are expected to grow by some 0.5 per cent annually over the coming decade, below the 0.7 per cent rate of the past 10 years and below the projected output growth rate - indicating declining carbon intensity.

At the same time, new uncertainties are emerging on top of the usual risks facing agriculture. These include disruptions from trade tensions, the spread of crop and animal diseases, growing resistance to antimicrobial substances, regulatory responses to new plant-breeding techniques, and increasingly extreme climatic events. Uncertainties also include evolving dietary preferences in light of health and sustainability issues and policy responses to alarming worldwide trends in obesity.

Growing consumption levels of cereals, sugar and vegetable oil

Worldwide, the use of cereals for food is projected to grow by about 150 million tonnes over the outlook period - amounting to a 13 percent increase - with rice and wheat accounting for the bulk of the expansion. The most significant factor behind the projected growth in food use of staple products is population growth, which is expected to rise fastest in Sub-Saharan Africa and South Asia.

The report finds that consumption levels of sugar and vegetable oil are projected to rise, reflecting the ongoing trend towards prepared and more processed foods, notably in many rapidly-urbanizing low and middle-income countries. Concerns about health and wellbeing, meanwhile, are likely to nudge numerous higher-income countries towards lower consumption of red meat and a shift from vegetable oils to butter.

In addition, the demand for feed crops is projected to outpace animal production growth in countries where the livestock sector is evolving from traditional to commercialised production systems, while the use of agricultural commodities as feedstock to produce biofuels is expected to grow primarily in the developing countries.  

Trade in agricultural and fisheries commodities should expand over the coming decade at around 1.3 per cent annually, slower than over the past decade (3.3 per cent average), as growth in global import demand is expected to slow. On the export side, both Latin America and Europe are projected to increase their sales to foreign markets.

(FAO/OECD/ile)

Read more and download the OECD-FAO Agricultural Outlook 2019-2028: http://www.fao.org/documents/card/en/c/ca4076en

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