directorate for food, agriculture and fisheries organisation for economic co-operation and...

Directorate for Food, Agriculture and Fisheries

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT

ORGANISATION DE COOPÉRATION ET DE DEVELOPMENT ÉCONOMIQUES

OECD OCDE

Perspectivas del mercado mundial de agroalimentos

Buenos Aires, ArgentinaOECD

Gregoire Tallard

OECD OCDEDirectorate for Food, Agriculture and Fisheries

2

The OECD provides:

Economic analysis with a policy focus

Information on countries’ experience

A forum for policy discussion and coordination

A global outreachA global outreach

OECD Member CountriesCountries/Economies Engaged in Working Relationships with the OECD


4

OECD Work on Food and Agriculture

Providing economic and policy information and advice that supports government efforts to improve the domestic and international performance of their policies

http://www.oecd.org/agr/


5

Current market situation

• Record harvests 2004/05 in grains, oilseeds resulted in price reductions

• Lower sugar stocks despite larger 2004/05 harvests lead to higher prices

• Bad weather in major exporting regions pushed up dairy prices

• Animal diseases continue to disrupt meat trade

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


6

Agricultural World Market Context: The

Evolving Economic Environment

• Changing consumer demand

• Growing civil society voice

• Changing market structures

• Increasing globalisation

• Shifting competition focus

• Growing role of standards

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


7

Main assumptions- macroeconomic -

• Rapid global expansion slowed by oil prices in 2004

• Sustained, broad-based growth in the medium to longer term

• US dollar to remain strong relative to most Latin American currencies

• Inflation to remain relatively low

• Slowing population growth

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


8

Main assumptions- unchanged policies -

• Provisions of US 2002 FSRI Act to continue

• EU 2003 CAP reform and EBA

• Enlarged EU of 25 countries

• URAA commitments to continue– No new WTO agreement– No new WTO accessions

• Existing regional agreements (NAFTA, MERCOSUR)

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


9

OECD-FAO Outlook 2005-14:Main trends

• Increasing competition in world markets

• Population, income growth stimulate consumption and imports in developing countries

• … and South-South trade

• Renewed export subsidy use in EU (weak USD)

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


10

OECD-FAO Outlook 2005-14:Main trends

• Meat, sugar, cotton, oilseeds from South America

• Continued productivity growth in agriculture

• Downward pressure continues on real commodity prices

• Changes in food chain affect trade

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


11

Production growth in developing countries outpaces

OECD

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

An

nu

al

pro

du

cti

on

gro

wth

a

ve

rag

e 2

00

0/0

4 t

o 2

01

4

Cereals Oilseeds Sugar Meat Milk

OE

CD

No

n-O

EC

D

Wo

rld


12

Consumption growth in developing countries outpaces

OECD

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

-0.5%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

An

nu

al

co

ns

um

pti

on

gro

wth

a

ve

rag

e 2

00

0/0

4 t

o 2

01

4

Cereals Oilseeds Sugar Meat Butter

OE

CD

No

n-O

EC

D

Wo

rld


13

Brazil and Argentina become leading oilseed exporters

1996 vs. 2005 vs. 2014

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

0

5

10

15

20

25

30

35

40

USA Brazil Argentina Canada

Mill

ion

tonn

es


14

OECD countries continue to dominate coarse grain exports

1996 vs. 2005 vs. 2014

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

0

10

20

30

40

50

60

70

80

USA EU25 Australia Argentina Ukraine

Mill

ion

tonn

es


15

Growth in coarse grain imports concentrated outside OECD

1996 vs. 2005 vs. 2014

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

0

5

10

15

20

25

Japan Mexico Korea SaudiArabia

China Egypt

Mil

lio

n t

on

nes


16

Growing Competition in Meat and Grains Net Trade Markets

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

-150

-100

-50

0

50

100

150

200

Beef Pigmeat Poultry Oilseeds Coarsegrains

Pe

rce

nt

ch

an

ge

OECD Net trade South America Net trade

2014 compared to 1999-2003 average

-0.1

2.5

0.8

0.8

1.8

3.3

-2.3

56 40

10


17

Market trends and developments- world prices -

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

80

110

140

170

200

1994 1998 2002 2006 2010 2014

US

D/to

nne

(whe

at, m

aize

)

150

200

250

300

350

US

D/to

nne

(ric

e)

Wheat

Maize

Rice

Rice prices to increase more significantly than wheat and maize


18


Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

100

150

200

250

300

350

1994 1998 2002 2006 2010 2014

US

D/to

nne

(see

ds, m

eals

)

200

300

400

500

600

700

US

D/to

nne

(oil)

Oilseeds

Oilseed meal

Veg. Oils

Nominal oilseed prices increase, but real prices flat or declining


19


Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

100

150

200

250

300

350

1994 1998 2002 2006 2010 2014

US

D/1

00kg

cw

e (b

eef)

50

75

100

125

150

175

US

D/1

00kg

cw

e (p

ork,

pou

ltry)

Beef Pork

Poultry

Meat prices to decline from their relatively high 2004 levels


20


100

150

200

250

300

1994 1998 2002 2006 2010 2014

US

D/1

00

kg

Butter

Cheese

SMP

WMP

Dairy prices remain stable after dropping from their 2004 peaks

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


21

World prices remain low in real terms

0

50

100

150

200

250

300

350

400

450

1986 2000 2014

US

D/t

Wheat Coarse grainsOilseeds Sugar

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

0

50

100

150

200

250

300

350

400

1986 2000 2014U

SD

/10

0 k

g

Beef Pork Butter


22

Some issues and uncertainties (1)

• Trade affected by changing diets– Share of cereal imports declines as imports of

higher-value products increase– Increased importance of non-OECD exporters– South-south trade flows dominate in rice,

vegetable oil, sugar

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


23

Some issues and uncertainties (2)

• Numbers that are likely to be wrong:

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

CEREALS

• China’s imports– How much will they

allow?

OILSEEDS

• China’s demand– How much is

enough?

MEAT

• BSE – related import bans

affects beef trade


24

China’s grain imports???

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

02468

101214161820

1999

2001

2003

2005

2007

2009

2011

2013

Mill

ion

tonn

es

Coarse grains Wheat Total cereals


25

China’s oilseed needs???

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

-10

0

10

20

30

40

50

60

70

80M

illio

n to

nnes

Consumption Imports


26

How will BSE affect trade in Canada and USA ????

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues

-1500

-1000

-500

0

500

1000

1500

2000K

T (c

.w.)

Canada + USA Net trade Canada exports Usa exports


27

Risks:What is not in the numbers

• Biofuels– Embedded in the outlook but independent of

oil price or of policy incentives

• Accession beyond EU 25– Bulgaria and Romania

• Macroeconomic factors & yields– Trend growth rate and normal weather are

never observed

Sit

uat

ion

Ass

um

pti

on

sO

utl

oo

kIs

sues


28

What are we doing

• We do not produce “predictions”

• We do “projections” by bringing together experts knowledge of Member countries to develop a consensual baseline

directorate for food, agriculture and fisheries organisation for economic co-operation and...

Documents

oecd slide

food chain

oecdfao outlook

fisheries organisation

coordination slide

agriculture downward

oecd work

developing countries