FAO: Developing nations key to feeding world

FRANCE: Developing countries such as Brazil, China and India hold the answer to providing food and fuel for growing global consumption in the next decade, a study said.

Trade barriers must also be dismantled to boost output, the Organisation for Economic Cooperation and Development (OECD) and the UN Food and Agriculture Organization (FAO) said in a joint report.

Referring to struggling World Trade Organisation (WTO) talks, the two groups said that if a deal was finally struck to free up global exchanges, the result would be "higher world prices for a number of agricultural commodities and increased trade".

Meanwhile, world farming would depend on growing output from developing nations to meet increasing demand for food and fuel.

And even if barriers remained in place, trade in wheat, coarse grains, and rice in particular was forecast to expand by 2015.

Demand for dairy and meat products would also strengthen owing to rising incomes and growing trade.

"Developing countries are now increasingly determining the contours of the world agricultural landscape" with Brazil, China and India in particular "becoming the new epicentre of forces shaping world agricultural production and trade", the report said.

But "projected growth in agricultural commodity trade to 2015 will continue to under perform due in large part to the persistence of higher trade barriers for agricultural products", it added.

The study was released a few days after WTO members had failed again to overcome obstacles in the Doha Round of negotiations aimed at freeing up trade to boost the economies of poorer nations.

The OECD and the FAO identified the talks as a "major uncertainty" hanging over their outlook, and warned that the least-developed countries would increase net imports of basic commodities in the next 10 years.

That would lead to "greater reliance on world markets for their food security, and greater exposure to international market price fluctuations", the report said.

The world's population was projected to reach about 7.2 billion people, with more than one-half living in cities.

"The question of how to adequately feed the growing numbers of urban consumers, many of whom in developing countries are currently and will in the future be living in poverty, remains a key challenge to policy makers."

While increased local production and more efficient distribution systems would help keep costs down, rice prices in particular could rise owing to pressure "in the form of rural labour shortages, growing competition for land and water and high fuel costs".

High fuel costs would also boost development of bio-fuels, with the study forecasting "very strong growth in ethanol production in the US, Canada and Brazil" along with the likely development of bio diesel fuel in the Europe.

Among global uncertainties, moreover, "is how the increased investment in biofuel production that is taking place will impact on agricultural markets, and particularly those for cereals, oilseeds and sugar crops".

Other factors that could alter the OECD and FAO forecast were weather-related production shocks, global outbreaks of animal diseases and weaker macroeconomic performances.

"The prospects for world agricultural markets are highly dependent on economic developments in Brazil, China and India, thee of the world's agricultural giants," the study said. Paris, Wednesday, AFP