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OECD-FAO Agricultural Outlook 2016-2025: Highlights
Hubertus Gay (OECD)
2017 China Agricultural Outlook Conference
Beijing, 20-21 April 2017
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OECD-FAO Agricultural Outlook
• Joint OECD-FAO report published annually in June/July
• 10 year horizon
• Model based projection validated through global expert consensus
• Major commodities
• Global coverage
• Special theme chapter 2016: Sub-Saharan African Agriculture
• Special theme chapter 2017:Southeast Asia
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Production growth through intensification and efficiency gains, but regional differences
-5
0
5
10
15
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25
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South andEast Asia
Latin Americaand
Caribbean
NorthAmerica
Sub-SaharanAfrica
EasternEurope &
Central Asia
WesternEurope
Middle Eastand North
Africa
Oceania
% Yield Growth Area Growth
Change in arable production between 2013-15 and 2025, weighted by acreage; regions are sorted by overall arable acreage
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Projected consumption trends across major food groups
Note: Agriculture and fisheries products included in the Outlook
Rising exports from Latin AmericaIncreasing imports into Africa and Asia
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Bil
lio
ns
of
Co
nst
ant
$20
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Regional net trade
Americas Asia Africa Others
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USD/T (Meat & Dairy)
USD/T (Crops)
Wheat Rice Soybean WMP Beef and Veal
Market fundamentals point to flat real prices
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Whether this is a “new normal” depends on the historical perspective
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USD/tReal price Long term trend OUTLOOK LS-low LS-high
Wheat
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• Volatility from oil prices,
economic growth, exchange
rates and yield variations
• Climate change will add to
them
• Policy-induced uncertainty
not included but will
compound volatility
• A crisis more likely when the
wrong policies compound
volatility
There is a substantial risk of a major price swing in the next ten years
80% probability range for maize price
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Why price volatility might increase
• Climate change
• New production areas have less reliable agronomic conditions
• Biofuel support and mandates
• Declining demand elasticities
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Highlights of the OECD-FAO Outlook 2016-2025
• Real food prices expected to decline slightly, butremain above levels before 2007-08 food pricecrisis.
• Changing relative prices:• Consumption of staples reaching saturation in many countries• Meat and dairy prices increase relative to crops – higher incomes and animal-
protein demand• Coarse grain and oilseed prices increase relative to food staples – feed
demand
• Calmer markets but a risk of resurgent volatility
• Spread of imports across a large number ofcountries; concentration of exports among a fewkey suppliers
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www.agri-outlook.org
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