Just one week ago, on July 14, 2021 (Wednesday), the “Launch Event of the OECD-FAO Agricultural Outlook”, organized by the Food and Agriculture Organization of the United Nations (FAO) Liaison Office in Japan in cooperation with JIRCAS, was held online. At this event, the experts involved in writing the report OECD-FAO Agricultural Outlook 2021-2030 released on July 5 gave lectures on its contents and exchanged opinions with Japanese experts.

First, Ms. Eriko HIBI, Director of the FAO Liaison Office in Japan, explained the nature of the Agricultural Outlook as a global public good available to all, and expressed her expectations for the exchange of opinions with a view to the World Food Systems Summit in September and the Tokyo Nutrition Summit in December. Next, Mr. Mitsuhiro HONDA, Director, International Strategy Division, Export and International Affairs Bureau, Ministry of Agriculture, Forestry and Fisheries (MAFF), presented the significance of the outlook from the viewpoint of increasing uncertainty of global food supply and demand, and expressed his expectation for deepening the understanding toward the establishment of a sustainable food system. Then JIRCAS President Osamu KOYAMA, explained Japan's international contribution to the field of food supply and demand outlook. He also explained the limitations and advantages of the long-term agricultural outlook and the significance of the outlook in finding problems and solutions for the food system with verifiable statistical evidence.

The outlook report was presented by two experts after an overview video. First, Mr. Holger MATTHEY, Senior Economist at FAO, explained the background of the methodology, macroeconomic and policy assumptions, and the outlook for consumption and production. Although no major changes are expected in the consumption of major food items other than a gradual trend increase until 2030, he indicated that there are characteristics of each item, use, and region, such as a shift in food demand from red meat to poultry meat in high-income countries. On the other hand, crop production value is expected to increase substantially during the same period, much of which can be attributed to the growth in yields based on continued investment in research and development and the use of agricultural inputs. The value of livestock and fisheries production is also projected to increase substantially, but this is expected to be largely attributable to improved productivity of dairy products per livestock in particular. Although greenhouse gas emissions directly from the agricultural sector, to which livestock production contributes significantly, are expected to increase by 4% over the next 10 years, the growth in agricultural production is expected to exceed this increase.

Dr. Hubertus GAY, Senior Agricultural Policy Analyst at the Organization for Economic Cooperation and Development (OECD), reported on the trade and price outlook as well as the uncertainty of the outlook. The importance of imports for ensuring food security was confirmed, as the share of imports (in calorie terms) in the food supply of each region is 20% on average worldwide, and more than 60% in the Near East and North Africa region. In addition, while net imports are expected to increase in certain regions, including the Asia-Pacific, net exports are expected to increase substantially in other areas, particularly Latin America and the Caribbean, and each region is expected to specialize in imports or exports. In terms of future food prices (real prices), the outlook is for a gradual decline in many commodities, reflecting a slowdown in consumption and strong growth in production. He also noted that the outlook and its assumptions are subject to market and policy uncertainties.

Two Japanese experts commented on the report. First, Dr. Gen FURUHASHI, Senior Economist at the Policy Research Institute, Ministry of Agriculture, Forestry and Fisheries (PRIMAFF), raised topics such as how to incorporate the short-term impact of the COVID-19 pandemic into the medium- to long-term outlook, post-corona consumption behavior, and agricultural investment that will affect digital transformation. Next, Dr. Jun FURUYA, Director of the Social Sciences Division at JIRCAS, organized the main messages of the report by subject, such as the impact of the pandemic and trade liberalization. He further mentioned some features of the report, such as analyzing the rice market in detail that is often overlooked in developed countries. 

In the Q&A session, experts from FAO and OECD responded to four major questions. First, in response to a question about the impact of climate change on suitable agricultural land, Mr. Matthey explained that although the outlook does not use data for such assessment, he had obtained relevant information through discussions with experts and hope to reflect the results where there is consensus. Next, in response to a question on whether the outlook reflects technologies that may arise in the future, such as AI, breeding and cultivation technologies, Dr. Gay responded that while slow trend changes are taken into account, rapid changes such as structural changes are not assumed. Next, there was a question about the impact of the increase in vegetarianism on greenhouse gas emissions, to which Mr. Matthey explained that the impact could not be confirmed from global statistics because the number of vegetarians is limited and the increase is slow. Finally, in response to a question about the reasons for the high percentage of imported food in the calorie supply in the Near East and North Africa, and solutions to this problem, Dr. Gay pointed out that the amount of food that can be produced in each region is limited due to the natural environment and weather conditions. He also pointed out the importance of considering food security within the international trade system.

Finally, Ms. Hibi introduced the concept of "true cost of food" and pointed out the importance of visualizing the external economy and thanked the participants for their important role in reforming the food system. Dr. Miyuki IIYAMA, Director of the Information Program of JIRCAS, emphasized the significance of this event from the perspective of knowing the medium- and long-term trends in food supply and demand, and contributing to the stability of the international community.

The answers to the Q&A session will be posted on our website as soon as we have the comments from the speakers.

Contributor: KUSANO Eiichi (Social Sciences Division)