Global prices seen staying low

An expected slow down in demand for food commodities in emerging economies as well as the easing impact of biofuel policies may keep global prices low over the next decade.

In their new 10-year Agricultural Outlook report, the Food and Agriculture Organization (FAO) and the Organization for Economic Cooperation and Development (OECD) also said vegetable oils, sugar and dairy products were expected to be main providers of additional calories over the next years toward 2026.

“Real prices of most agricultural and fish commodities are expected to decline slightly over the 10-year outlook period,” OECD Secretary General Angel Gurría said in a statement. “As we have seen in the past, unexpected events can easily take markets away from these central trends, so it is essential that governments continue joint efforts to provide stability to world food markets,” Gurria said.

José Graziano da Silva, FAO director general, said the average calorie availability per person per day would increase in least developed countries and in most emerging economies.

“But we also know that more food alone is not enough to eliminate undernourishment and other forms of malnutrition,” Graziano da Silva said. “Access to the additional calories is extremely important. More challenging is the fight against malnutrition [which] requires a diversified, safe and nutritious diet, ideally produced with a lower environmental footprint.”

Further, the reports shows that in Southeast Asia, rapid development of the agriculture and fisheries sectors has enabled the region to significantly reduce undernourishment in recent years.

However, the growth of agriculture and fisheries, in particular in the export-oriented fish and palm oil sectors, has led to rising pressure on natural resources.