Weather conditions such as El Niño or La Niña in various countries, coupled with political tensions in the Black Sea region or the Turkish area, have made food markets more volatile, the United Nations’s Food and Agriculture organizations (FAO) said over the weekend.
Cereal production will be at 2,458 million tons, including milled rice, down some 2.4 percent from the 2013 record, though global output is still expected to be the second largest ever, FAO said in its first major forecast for 2014 and 2015.
Based on the Food Outlook, a biannual report of global food market, released last week, the UN agriculture body forecasts the decline is likely to be more pronounced for coarse grains but added that current inventory levels remain fairly good.
FAO analysts said that assuming trade flows are not negatively affected by tensions in the Black Sea region, there would be no major concern for food supply at this early stage.
The biannual publication predicts that lower pricing and El Niño weather conditions may keep world rice production lower in 2014, especially in Asia, citing the case of Thailand, where a softening of producer prices could [occur], and [would] be the main factor leading to a contraction in rice planting and production.
FAO also said that while production may be lower, international trade could expand to record levels in 2014, with enough supplies in exporting countries and increased purchases by traditional importers like Bangladesh, Indonesia and the Philippines.
Last month, Vietnam’s state-run grain agency, Vinafood, was awarded by the Philippines government with the entire contract of 800,000 metric tons (MT) of rice to the country this year.
Southern Food Corp. (Vinafood II) will supply the National Food Authority with 600,000 MT of rice between $436.50 and $439.25 per MT, which is composed of three lots, with one lot equivalent to 200,000 MT.
FAO said meat and milk production are both expected to grow in 2014, with global meat production growing at 311.8 million tons, an increase of 1.1 percent over 2013, reflecting growth in the developing countries, which are mainly behind the rising global demand.
Milk trade is forecast to rise 1.8 percent, reaching 69 million tons, and driven primarily by increasing demand from Asia.
The Philippines dairy supply situation for 2013 is characterized by increasing local milk production and imports and decreasing exports of milk and dairy products, the National Dairy Authority (NDA) reported early this year.
For 2014, the net supply stood at 321.64 million kilogram [kg] and 5 percent higher than the previous year’s net supply of 305.80 million kg, the NDA said, noting that local production and imports grew by 5 percent and 1 percent, respectively, while exports declined by 62 percent.
Milk powder constitutes the bulk of imports contributing more than 65 percent to the total milk and dairy products imports, while skimmed milk powder that comprised 36 percent and whey powder at 14 percent of milk imports showed an uptrend of more than 6 percent and 4 percent, respectively, of total milk imports for 2013, the NDA said, adding whole milk powder and buttermilk powder posted a decrease of 18 percent and 10 percent, respectively.
For fisheries, the economic recovery in traditional markets such as the United States and the European Union is boosting overall demand for fish and fishery products, along with the already firm interest of emerging economies like Brazil and Mexico, FAO said.
This demand, said the UN body, coupled with supply shortages for a number of farmed and wild species, has already boosted overall price levels, and added weather may come into play as El Niño weather patterns could reduce some catches in South America.
Based on the previous global trade reports, the most popular species include salmon, shrimp, pangasius and tilapia from acquaculture, with shrimp, squid, octopus and herring from capture fisheries, while prices for tuna, mackerel and cod have relaxed.
The Philippines fisheries situationer for 2013 released by the Bureau of Agricultural Statistics (BAS) said the fisheries sector recovered from its negative growth in 2012, and came up with a 1.23-percent production gain last year.
The increase was attributed to the positive growths in the first to third quarters of 2013 which offset the slide in production in the fourth quarter of the year, mainly affected by the onslaught of Supertyphoon Yolanda.
Gainers were milkfish and yellow-fin tuna whose annual output grew by 3.7 percent, with tilapia, tiger prawn and skipjack sustaining upward trends in production, BAS said, while noting that seaweed continued to experience a drop in output setting at 11 percent lower than the 2012 level, the biggest decline of 18.46 percent recorded during the fourth quarter of 2013.
2014 BusinessMirror