FAO foresees a steady outlook for many meals commodity markets in 2024/25
Meals Outlook report expects relative calm in fundamental foodstuff and fertilizer markets, whereas meals import payments might go up
13/06/2024
Rome – Provides of a lot of the world’s main meals commodities are anticipated to be enough in 2024/25, though excessive climate, rising geopolitical tensions, sudden coverage modifications and different elements might all doubtlessly tip the fragile international demand-supply balances and affect costs and international meals safety, based on a new report from the Meals and Agriculture Group of the United Nations (FAO).
The most recent FAO Food Outlook, a biannual publication, presents up to date forecasts for the manufacturing, commerce, utilization and shares of main meals staples.
On the manufacturing aspect, world outputs of rice and oilseeds are anticipated to be at file ranges, whereas these of wheat and maize will seemingly decline modestly. The Meals Outlook supplies detailed market assessments for wheat, coarse grains, rice, oilcrops, sugar, meat, dairy merchandise and fisheries.
The Meals Outlook additionally supplies FAO’s preliminary estimate for the worldwide meals import invoice in 2024, forecast to rise by 2.5 p.c to exceed $2 trillion. These projections are pushed by comparatively beneficial macroeconomic situations, together with regular international financial development, and decrease meals commodity costs.
The brand new version of the report has a particular chapter on the dynamic results of shocks to transport prices on the meals import invoice – a topical variable given conflict-derived volatility on the Black Sea and Pink Sea routes and attributable to drought impacts on the Panama Canal. The evaluation exhibits that these shocks have a optimistic affect on the worth of the FIB within the quick time period, with a bigger impact on the group of internet food-importing growing international locations (NFIDCs).
Deal with fertilizers
The Meals Outlook additionally features a particular chapter specializing in fertilizers, providing a complete overview of worldwide fertilizer commerce between 2021 and 2023 and a short-term market outlook for 2024/25.
The chapter tracks the sequence of shocks, together with the warfare in Ukraine, that instantly or not directly had an affect on main vitamins similar to nitrogen, phosphorus and potassium. Hovering pure gasoline costs have been a significant catalyst, rendering fertilizer manufacturing uneconomic, whereas different elements, together with transport and insurance coverage prices in addition to commerce measures, additionally drove world fertilizer costs increased. The shocks led to a big contraction in fertilizer commerce in 2022 with a rebound in 2023 to comparable ranges of 2021.
The article exhibits that in April 2024, fertilizer costs as introduced by a basket of nitrogen, phosphorus and potassium costs, averaged $327 per tonne, in comparison with $815 in April 2022. With the decline in costs, fertilizer commerce volumes have rebounded with Nitrogen commerce near its 2021 stage.
General, the short-term outlook for fertilizers suggests stability over the subsequent six months, based on FAO, with improved availability and affordability throughout the three fundamental substances. Future shocks to international fertilizer markets are more likely to be decided by developments in vitality markets attributable to geopolitical or different causes.
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Christopher Emsden
FAO Information and Media (Rome)
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