Brussels, 31/08/2012 (Agence Europe) - Over the past weeks, the drought in several regions of the world has led to dramatic price increases for certain commodities, mainly maize and soya which risk destabilising certain sectors of European agriculture, Agriculture Commissioner Dacian Ciolos acknowledged on Friday 31 August, the day after cereal harvest forecasts, which despite everything are satisfactory, had been presented to the EU management committee.
Dacian Ciolos takes the view that this excessive market volatility clearly shows that world agriculture requires investments, public management policies and predictability. In the context of climate change and increasing food demand, “it is crucial to valorise in a sustainable way all the diversity of agricultural potential in the EU”, he said. It is also crucial, he added, to help other parts of the world, especially developing countries, to have their own, ambitious agricultural policies in order to increase global food security. Ciolos went on to conclude: “The recent developments on the agricultural and food markets have demonstrated once again the need for a strong CAP”.
Despite this difficult context of high prices and great volatility, the Commission considers that forecasts for cereal production are satisfactory. At European level, despite the drought in some member states, current Commission forecasts for agricultural products show 2012/2013 production of 279 million tonnes of cereals, i.e. only 2% less than the average over the past five years. This is nonetheless still 25 million tonnes above figures for 2007/08, which proved to be a particularly bad year. As regards soft wheat, current forecasts are at 127 million tonnes, which is unchanged compared to the average over the past five years. For maize, current forecasts are 60 million tonnes, which is 2% higher than the average over the past five years. The EU is currently in a net exporter situation (around 10 million tonnes), instead of a net importer situation for 2007/08 (around 8 million tonnes).
At world level, due to the drought in the United States leading to a reduction for maize, the forecast of world grain production in 2012/13 is reduced compared to last month's forecast. Supported by tightening world supplies, maize prices remained close to record highs during August while wheat prices continued to respond to movements in maize. World carryover stocks are forecast to contract by 33 million tonnes to 338 million tonnes. World ratio (stocks/consumption) is only reduced from 20% at the same time of the year in 2011 to 19%. This is likely to keep prices at high levels and remaining relatively volatile. (LC/transl.jl)