São Paulo – Brazil is the second leading exporter of agricultural products in the world, but will be the main country responsible to meet the additional food demand in the next ten years, according to the Agricultural Outlook 2015-2024 report released this Wednesday (1st) by the Organisation for Economic Co-operation and Development (OECD) and by the Food and Agriculture Organization of the United Nations (FAO). The study devotes a special chapter to the country.
“We expect Brazil to be the biggest supplier in meeting the world’s additional demand for food”, said OECD secretary-general Angel Gurría in a press conference at the organization’s central office in Paris. As an example, he pointed out that China’s demand for oilseed should increase 80% in the period, with half of this consumption being supplied by Brazil.
He emphasized that the increase in production to meet the market’s growth will come more from productivity gains than area increase. According to the report, the cultivated area in Brazil should reach 69.4 million hectares up until 2024, a 20% increase over the average of the period from 2012 to 2014.
Oilseeds, especially soybean, will continue to dominate the field and could come to occupy almost half of this additional area. The average growth of production for these grains is estimated in 2.5% per year until it reaches 108 million tons.
The report also estimates that more pastures will be converted into cropland in the period and that livestock will be more of the intensive type.
The forecasts reflect the gains that the country had in agriculture in the last decades. Gurría pointed out that the Brazilian agricultural production doubled since 1990, and that livestock tripled.
The estimations point to a small number of countries to concentrate even more the global agricultural production.
Prices
In general, the study estimates an increase of the world production in the next ten years, but a slower increase of demand than observed in the last few years, which should cause a gradual decline of international prices. The prices, however, should not go back to the lower levels previous to 2007 and 2008, when they had a strong increase.
Price behavior, however, should vary a lot among different products, according to the FAO’s director-general, José Graziano da Silva. According to him, human consumption of cereals has a limit, whereas the demand for animal protein tends to increase along with families’ income growth. This way, Graziano believes that the prices of certain grains will drop, but meats, dairies and grains used for animal feeding will go up.
The cheaper oil will also contribute to keep food prices under control, since it means a cost decline with power and fertilizers. On the other hand, this discourages the production of biofuels.
*Translated by Sérgio Kakitani
