Agricultural commodity trade in the next decade...Trade Divisionand Markets 8 GDP in developing countries – some poor countries growing strongly 0% 1% 2% 3% 4% 5% 6% 7% 0 2000 4000

Agricultural commodity trade in the next decade

Trade and Markets Division

2


3


4


5


Trade Issues in the next decade

• What does the next decade look like?

– What’s going on? – drivers of high prices/ volatility

– Production/trade /consumption trends

• Is “demand” outstripping “supply”?

– Emerging markets growth, but for how long?

– Slowing agricultural productivity/yield growth?

– Environmental/water constraints/climate change, coupled with rising labor costs in many countries

• How are these forces affecting trade in commodities?

– How are trade patterns shifting?

– Is or why is primary commodity trade slowing?

6


Per capita GDP Growth – how strong?

-6

-4

-2

0

2

4

6

8

10

12

2005 2007 2009 2011 2013 2015 2017 2019

Pe

rce

nta

ge

World

OECD

BRIC

LDC

ROW

7


8

GDP in developing countries – some poor countries growing strongly

0%

1%

2%

3%

4%

5%

6%

7%

0

2000

4000

6000

8000

10000

12000

14000

16000

GDP per capita 2010 (US$) Growth in GDP per capita 2010-2018


Real exchange rates relative to US dollar: virtually all have depreciated significantly

0

5

10

15

20

25

30

35

40

45

50

0

1

2

3

4

5

6

7

8

9

10 19

96

199

7

199

8

199

9

200

0

200

1

200

2

200

3

200

4

200

5

200

6

200

7

200

8

200

9

2010

2011

Ra

io t

o C

hin

a Y

ua

n –

re

al

term

s

Brazil

Argentina

EU

China

Canada

Australia

India


Brazil/Argentina real exchange rates relative to China: competitiveness returning?

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

0.5

Ra

io t

o C

hin

a Y

ua

n –

re

al

term

s

Brazil

Argentina


Net Addition to population starting to fall quickly during the next decade and beyond

Source: UN-Statistics/population

2008

-20000

0

20000

40000

60000

80000

100000

1950

1955

196

0

196

5

1970

1975

198

0

198

5

199

0

199

5

200

0

200

5

2010

2015

2020

2025

2030

2035

204

0

204

5

2050

World

OECD

BRIC

LDC

ROW


By region the fall in net addition is highest in Asia region – SSA still rising

Source: UN-Statistics/population

2008

-10000

0

10000

20000

30000

40000

50000

60000

1950

1956

196

2

196

8

1974

198

0

198

6

199

2

199

8

200

4

2010

2016

2022

2028

2034

204

0

204

6

N.America

L.America

SSA

N.Africa&ME

W.Europe

E.Europe

Oceania&Jpn

Asia


Real crop prices on higher plateau.. mitigates demand pressure and stimulates local production?

0

100

200

300

400

500

600

700

US

D/M

T

Maize Wheat Rice Oilseeds Sugar


Shift from staple foods to value-added products continues

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Per-capita food consumption change between 2008/10 and 2020


Latin America among the strongest growing regions in food consumption/person

80

90

100

110

120

130

140

2000 2002 2004 2006 2008 2010 2012 2014 2016 2018

Ind

ex

20

04

-06

= 1

00

N.America L.America W.Europe E.Europe&C.Asia

N.Africa&M.East S.S.Africa Asia&Pacific Oceania

15


Agricultural supply increase – Latin America is growing strongly, but not traditional suppliers

75

100

125

150

Ne

t p

rod

uct

ion

in

de

x 2

00

4-0

6 =

10

0

Latin America E. Europe/C. Asia Sub-saharan Africa

North America E. Asia N. Africa & M. E.

W. Europe Oceania


Latin America is largest net exporter of primary agricultural goods – MENA largest importer

-50

-40

-30

-20

-10

0

10

20

30

40

50

60

Bil

lio

n o

f co

nst

an

t $

200

4-0

6

N.America L.America W.Europe E.Europe&C.Asia

MENA SS Africa Other Asia Oceania


Agriculture and food net exports

-150

-100

-50

0

50

100

Bil

lio

n s

of

curr

en

t d

oll

ars

Africa Northern America South America

Asia Europe Oceania


Agriculture and food imports

0

100

200

300

400

500

600

Bil

lio

n s

of

curr

en

t d

oll

ars

Africa Northern America South America

Asia Europe Oceania


Agriculture and food exports

0

100

200

300

400

500

600

Bil

lio

n s

of

curr

en

t d

oll

ars

Africa Northern America South America Asia Europe Oceania


Key exporters of wheat are changing – more from Russia, Ukraine and Kazakstan

0

5

10

15

20

25

30

35

40

Mil

lio

n T

on

ne

s

USA E27 Canada Australia

Argentina Kazakstan Ukraine Russia


Eastern Europe takes over the lead in world wheat exports

RUK

USA

CAN E27

AUS

Other

ARG

2000-2004

RUK

USA

CAN

E27

AUS

Other

ARG

2005-2009

RUK

USA CAN

E27

AUS

Other

ARG

2020

Sum of exports: 522 mt




Key exporters of coarse grain remain dominated by United States

0

10

20

30

40

50

60

70

80

Mil

lio

n T

on

ne

s

USA Argentina E27 Brazil

Ukraine Australia Canada


Key exporters of rice – growth by Vietnam and other LDC Asia

0

2

4

6

8

10

12

Mil

lio

n T

on

ne

s

Thailand Vietnam USA LDC Asia

India Pakistan China


Key exporters of oilseeds remain led by US and Brazil: Argentina exports fall with higher biodiesel production

0

10

20

30

40

50

60

Mil

lio

n T

on

ne

s

USA Brazil Argentina Paraguay

Ukraine Uruguay Australia


Brazil’s export profile – a major exporter of key agricultural commodities

0

5

10

15

20

25

30

35

40

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

Cro

p p

rod

uct

s M

t

Liv

est

ock

Mt

BRA_BV_EX BRA_PK_EX BRA_PT_EX BRA_CG_EX

BRA_OS_EX BRA_PM_EX BRA_SU_EX BRA_VL_EX


China’s import profile – mainly oilseeds products, sugar and course grain

0

10

20

30

40

50

60

70

0

2

4

6

8

10

12

14

16

Th

ou

san

ds

Coarse Grain Poultry Sugar Vegetable Oil Oilseeds (right axis) Protein meal


India’s import profile – will likely remain a minor importer of most primary commodities

0

2

4

6

8

10

12

14

0

2

4

6

8

10

12

14

16

Th

ou

san

ds

Sugar Vegetable oil Wheat


Conclusions

• Demand is firm and growing, supply is growing more slowly, with prices rising to signal need for more investment

• Commodity prices remain high in nominal and real terms- high uncertainty continues

• Global trade growth in primary commodities has slowed down recently, and may remain sluggish

• Key supplying region is Latin America, main growth in imports is MENA and Asia

29

Documents

Agricultural commodity trade in the next decade...Trade Divisionand Markets 8 GDP in developing countries – some poor countries growing strongly 0% 1% 2% 3% 4% 5% 6% 7% 0 2000 4000