WorldWatch:

[Mustang Sally Farm]

FAO Food Price Index Continued to Fall
06 September 2013

GLOBAL - The FAO Food Price Index averaged 201.8 points in August 2013, nearly four points (1.9 per cent) below its July value and 11 points (or 5.1 per cent) less than in August 2012.

Last month’s decline, the fourth in a row, was driven by continued falls in the international prices of cereals and oils, as dairy, meat and sugar prices rose slightly.

The FAO Cereal Price Index averaged 210.9 points in August, down 16.4 points (7.2 per cent) from July and 49.4 points (or 19 per cent) from August 2012. This steep decline follows an already sizeable drop in July, is consistent with expectations for strong growth in world cereal production this year and, especially, a sharp recovery in maize supplies.

While prices of wheat and rice were down by two to three per cent, the fall reached 14 per cent in the case of maize in spite of some late-month gains on concerns over drought and heat stress conditions in the United States.

The FAO Oils/Fats Price Index averaged 185.5 points in August, 5.7 points (or 3.0 per cent) below the July value and the third consecutive monthly decline. The slide in the index continued to be driven by palm oil, as ample inventories in Southeast Asia kept prices under pressure.

Soy oil values first eased on abundant export availabilities from Argentina and generally good crop prospects for 2013/14, only to regain strength when the United States lowered the forecast for its own forthcoming soy harvest.

Overall, however, the prospect of expanding total vegetable oil supplies in 2013/14 is pointing towards a general decline in vegetable oil prices.

The FAO Dairy Price Index averaged 239.1 points in August, 2.8 points (1.2 per cent) more than in July and 37 per cent above its level in August last year. Prices increased last month for all the dairy products that make up the index, except butter, as export supplies remain limited in major trading countries.

Furthermore, with milk production declining seasonally in the northern-hemisphere and the new production season only just starting in Oceania and South America, availabilities for the remainder of 2013 are uncertain. This has lent support to prices, as importers seek to cover commitments for coming months.

Strongest growth was recorded for skimmed milk powder, which rose by 2.7 per cent, following a similar change in July; whole milk powder prices also increased.

The FAO Meat Price Index averaged 175.0 points in August, an increase of 2.2 points (1.3 per cent). The rise mainly reflected stronger prices for pig meat, which rose by 4.5 per cent, as those of other types of meat changed little.

An important element sustaining pig meat prices was the strengthening of the Euro relative to the US Dollar.

Poultry prices registered a fourth consecutive monthly decline, dropping by 1.3 per cent, partly as a result of lower feed costs.

The FAO Sugar Price Index averaged 241.7 points in August, up 2.7 points (1.1 per cent) from July. The small rebound in sugar prices after three months of consecutive declines was mostly due to estimates showing that Brazil, the world’s largest sugar producer and exporter, was using more sugarcane for ethanol production at the expense of sugar.

Overall, sugar prices displayed large volatility during the month, amid uncertainties regarding the size of the anticipated production surplus in the major producing areas.

[Mustang Sally Farm]

Agricultural Sectors to be Shaped by Global Food Demand
04 October 2013


ANALYSIS - In the future, food demand will define the shape of the livestock, agriculture and farming sectors and their support industries, writes Chris Harris.

While billions of Euros and dollars are being spent on research to improve crop, livestock and food production, the supply of food as populations grow in size and wealth will largely be determined by the climate and land availability.

However, while the demand for food is growing and people are getting wealthier, the proportion of household incomes that is being spent on food is now less than it was 30 or 40 years ago.

A changing global population, with an emerging growing middle class and changing eating habits has seen a switch to a more meat based diet.

According to Mario Pezzini, the director of the OECD Development Centre the global middle class is expected to grow from 1.8 billion in 2009 to 3.2 billion by 2020.

In the last 20 to 30 years red meat consumption globally has doubled and is expected to continue to accelerate.

As meat consumption grows, farming methods are also likely to change from the extensive grazing production of red meat to more feed lots that will use more wheat and grains for feed, according to Gordon Rennick from the pesticide control division of the Irish Department of Agriculture.

Speaking at the British Crop Production Council congress in Brighton this week, Mr Rennick said that this in turn will bring into question land availability and also the availability of water to irrigate the land and provide water for livestock.

At present, agriculture accounts for 70 per cent of the water used in the world with about 20 per cent of the global crop land being irrigated. The use of water for the production of grain and meat will become more critical as the demand for food increases and as it takes between 1,000 and 3,000 litres of water to produce a kilogramme of rice and 13,000 to 15,000 litres of water to produce a kilo of grain fed beef and 1,500 litres to produce a kilo of grain.

“There is an increase in the number of hectares of land that need irrigating, so water availability will become more and more important,” said Mr Rennick.

Not only will there be a need to conserve water and for more water and irrigation, but there will also be a need for more land and the growing population requires more grain both for human and livestock consumption.

In all it is estimated that there will be a need for an additional 300 million hectares of land to grow an additional 255 million tonnes of wheat, 48 million tonnes of barley, 322 million tonnes of maize, 95 million tonnes of soybeans, 263 million tonnes of rice sand 22 million tonnes of rapeseed to feed the extra 2.5 billion people that will populate the world between now and 2050.

The extra 300 million hectares is an area the size of India, Mr Rennick told the delegates at the BCPC congress.

The alternatives available to meet the needs of this growing population are also to maximise crop production from existing land resources and also to reduce crop spoilage.

These alternatives will all require extra research and development in cultivar enhancement, crop protection, water usage, agricultural machinery and even laboratory production of food.

The other alternatives are to encourage people in developing countries to have smaller families or to accept that more people will suffer from starvation.

With a need for improved yields in crops and increased production Mr Rennick said that the future is looking bright for those not only producing food but also in the sector producing products to help enhance production.

In particular, companies producing plant protection products and the chemical pesticide industry should have a bright future if the sector can overcome concerns over its image and regulatory constraints – and he said that in the EU the chemical pesticide industry is more constrained than in any other developed country.

[Mustang Sally Farm]

Weekly Overview: Adverse Weather and Animal Disease Increase the Challenge of Feeding the World
21 October 2013


Adverse weather in Argentina has hit the wheat harvest, creating a shortage of grains there and underlining the precarious nature of the global food supply. Meanwhile, pig diseases in Russian and the US only add to the challenge of feeding the growing human population.

World Food Day was held last week, on 16 October. Diversity of food and food production methods are crucial in the solution to under-nutrition and micronutrient deficiencies affecting the world’s human population, according to the United Nations Food and Agriculture Organization (FAO).

As more grains are needed for animal feed to increase meat and protein production to feed a growing and wealthier global population, wheat is becoming a major driver in the world grain market, according to Jack Watts, senior analyst for cereals and oilseeds at the UK's Agriculture and Horticulture Development Board (AHDB). He was speaking at the Home Grown Cereals Authority's Grain Market Outlook Conference in London last week.

He added that there is currently more risk to the world's cereal markets and in particular, more weather risk.

Highlighting this point, in the last few days, it has been revealed that maize and wheat are in short supply in Argentina. Wheat prices are reported to be sky-rocketing and livestock farmers say there is not enough maize (corn) to go around.

The difficult corn situation has been blamed on a shortfall of up to four million tonnes between the forecast and actual harvest figures, while poor weather has hit the country's wheat crop. Prices for the new harvest, which starts in November, are at US$500 per ton for immediate delivery while in Chicago, the price is US$250 a ton.

Continuing on the theme of feed grains, a judge in Mexico has ordered the government to stop issuing permits to multinational companies for planting genetically modified (GMO) corn at an experimental or commercial scale.

Mexico banned the planting of GMOs back in 1998 but that law was modified in 2005 to allow the planting of test plots. The judge cited the risk of imminent harm to the environment as the basis for the latest decision. There are fears that the many native corn varieties in Mexico could become contaminated if GMO corn is planted. Corn is the country's main food staple.

Livestock diseases also threaten the global food supply, not least or pig meat. The last week has brought reports of more than 30 outbreaks of African Swine Fever in Russia, in both domestic pigs and wild boar across several regions. The country has also announced an outbreak of Classical Swine Fever in September in Amur oblast in the south-east of the country.

The US, meanwhile, seems to be struggling to contain Porcine Epidemic Diarrhoea. Kentucky has reported its first positive result, bringing the number of affected states to 18. The total number of swine samples testing positive exceeded 2,000 at the last count and the weekly increase has been accelerating over the last month. North Carolina now holds the unfortunate privilege of being the most affected state.



Jackie Linden, Senior Editor

[Mustang Sally Farm]

Cassava as Animal Feed in Ghana: Past, Present and Future
Tuesday, October 29, 2013


The use of cassava as a feed for ruminants and non-ruminants (poultry and pigs) in Ghana could reduce the high cost of feed, increase livestock production and create job opportunities, according to a new report from UN Food and Agriculture Organization (FAO).



The study on the use of cassava as animal feed in Ghana was commissioned as part of FAO’s initiative supporting poverty reduction in northern part of the country.

It is covered in the new report, Cassava as Animal Feed in Ghana: Past, Present and Future, by K. Oppong-Apane for the FAO.

The report includes the following chapters:
•Introduction to Ghana (location, population, agriculture)
•Livestock in Ghana
•Cassava (description, importance and uses
•Cassava production (global, in sub-Saharan Africa, in western Africa and in Ghana)
•Cassava supply and consumption as food (global and in Ghana)
•Use of cassava in animal feed globally
•Use of cassava as animal feed in Ghana
•Limitations/challenges to the use of cassava for livestock
•Detoxification of hydrocyanic acid for livestock feeding
•Response to cassava products and by-products by ruminants and non-ruminants in sub-Saharan Africa
•Research on cassava for animal feed in Ghana
•Evaluation of practical advantages and disadvantages of using cassava and its different fractions and preparations compared with other feed components in Ghana.
•Steps needed to realise sustainable and successful use of cassava-based feed resources in Ghana and future successful use of cassava-based feed resources in Ghana and future research needs
•SWOT analysis
•Conclusions and references

The summary of the report explains that cassava (Manihot esculenta) is one of the main staple food crops grown by almost all farming families in Ghana, contributing to large proportion of daily calorie intake of the population. It is used to prepare fufu, the local popular dish, and considered as the poor man’s food.

Ghana is the fourth largest cassava grower in Africa, after Nigeria, Democratic Republic of Congo and Angola. In 2010, Ghana produced 13.5 million tons of cassava. Available information suggests that, cassava is cultivated by over 90 per cent of the farming population and contributes to 22 per cent to the agricultural GDP, making it the right target for the fight against poverty in the country.

The multi-purpose use of cassava as food for humans and animals, making various industrial products, including its use as input for breweries, attracted many projects and programmes working on its value chain in Ghana. These projects, particularly the IFAD funded Root and Tuber Improvement Programme, introduced improved varieties for better yield, reduced post-harvest losses, improved agro-processing and better access to markets, etc. The various interventions enhanced production and marketing of cassava in the country improving income of producers and other actors involved in the value chain and generating more employment for women and youth, contributing in this way to poverty reduction.

FAO, with its comparative advantage of promoting agricultural and food production and rural development, is supporting poverty reduction initiatives in Ghana. In particular, FAO through its Strategic Objective three is implementing an initiative targeting reduction of rural poverty in Northern Ghana. One of the expected outputs of this initiative is to better equip beneficiaries create viable markets through agro-related livelihood activities linked to the cassava value chain. Among the activities contributing to this output, the livestock team has targeted linking livestock to the cassava value chain for poverty reduction, on which this study is based.

Cassava, in its different forms, has been used as animal feed in many parts of the world. Cassava foliage (leaves and stem), peels and particularly the root; fresh, dried or in silage form; alone or mixed with other feed is used in feeding different species of animals. Dried cassava roots are processed into pellets, chips and meal, mainly for poultry and pig industries.

Several studies conducted in West Africa showed that cassava in its different forms has large potential as animal feed. In countries like Ghana where livestock production is largely constrained by lack of good quality feed, the availability of alternative source of feed like cassava is important.

The main ingredient for producing feed for non-ruminant animals raised in intensive production is maize. Ghana produces maize but as the quantity is not adequate to cope with the year-round demand, from time to time, the country is obliged to import it. The fact that animal feed is produced with high cost, mainly due to the elevated cost of maize, makes poultry and pig production very expensive, constituting between 60 and 75 per cent of the total cost of production.

Because of high cost, many farmers, particularly pig producers, are shifting towards using agro-industrial by-products. Although cassava is an ideal partial substitute of maize as source of energy, livestock producers have not yet exploited this potential to the fullest. This can be attributed to the high moisture content of the cassava tuber, which makes handling, transportation and storage difficult. The poor content of cassava in protein, vitamin and some minerals could be another factor, which might have contributed to its low usage as animal feed in Ghana.

The high moisture levels of cassava which reduce its shelf-life and the high content of cyanogenic glycoside which releases toxic hydrocyanic acid, detrimental to the health and productivity of livestock as well as its low protein content are challenges which need to be addressed for the efficient use of the crop as animal feed in Ghana.


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 "The use of cassava as animal feed in Ghana can reduce the current high cost of feed, increase livestock production and create job opportunities"

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Cassava roots can be sliced to appropriate thickness and dried using solar dryers, reducing in this way the moisture levels responsible for mould infestation and mycotoxin production. Slicing and drying cassava, in addition to extending its shelf life, reduces also the level of hydrocyanic acid to safe levels for animal feeding.

Lessons learned from projects implemented in the country in the past assist in setting up easy and affordable methods of slicing and drying cassava, according to the FAO report. The limitation of cassava due to its low content of protein, some vitamins and minerals, leading to rating it inferior to maize can also be corrected through proper balancing.

In order to enhance the demand and supply of cassava based feed in Ghana, it is necessary to develop viable intermediaries acting as secondary processors or bulking agents in the value chain and ensuring a consistent supply of raw and processed materials. The private sector can and should participate actively in this regard. Therefore, effective sensitisation of the actors involved in the cassava value chain on its potential and policy measures enabling its use as animal feed is required.

The use of cassava as animal feed in Ghana can reduce the current high cost of feed, increase livestock production and create job opportunities, concludes the FAO report.

The report's author adds that key to enhancing the demand and supply of cassava-based feed in Ghana is to develop viable intermediaries acting as secondary processors or bulking agents in the value chain and ensuring a consistent supply of raw and processed materials.

Reference

Oppong-Apane, K. 2013. Cassava as animal feed in Ghana: Past, present and future. Edited by Berhanu Bedane, Cheikh Ly and Harinder P.S. Makkar, FAO, Accra, Ghana

[Mustang Sally Farm]

Nutritional Value of Fermented Soybean Meal in Pig Diets
Wednesday, November 06, 2013





New research at the University of Illinois sheds light on the nutritional value of fermented soybean meal in pig diets, which was found to be a suitable substitute for fish meal in starter diets without adversely affecting the energy or digestible amino acid content of the diet.

Soybean meal contains anti-nutritional factors, such as oligosaccharides and antigens, that restrict its use in diets fed to weanling pigs.

Fermentation of soybean meal eliminates some of these antinutritional factors, making fermented soybean meal a potential lower-cost substitute for animal protein in starter diets. Soybean meal fermented in the presence of Aspergillus oryzae and Lactobacillus subtilis has recently become available on the United States market. To aid in the formulation of diets containing fermented soybean meal, researchers at the University of Illinois have determined the digestibility of energy and amino acids in this ingredient.

"Fermented soybean meal contains fewer antinutritional factors and is well tolerated by weanling pigs," said Hans Stein, professor of animal sciences. "But there is a lack of data on the digestibility of energy and amino acids. So our goal was to determine those values."

Professor Stein's lab conducted two experiments. In the first, they determined the concentration of digestible, metabolisable and net energy in fermented soybean meal. In the second, they determined the standardised ileal digestibility of crude protein and amino acids. Both studies included conventional soybean meal and fish meal for comparison.

On a dry matter basis, fermented soybean meal contained 4,296kcal per kg digestible energy (DE), 3,781kcal per kg metabolisable energy (ME), and 2,710kcal per kg net energy (NE). These values compared favourably to those in fish meal, which contained 3,827kcal per kg DE, 3,412kcal per kg ME and 2,450kcal per kg NE. DE, ME and NE were decreased in fermented soybean meal compared with conventional soybean meal, which contained DE, ME and NE of 4,553kcal per kg, 4,137kcal per kg, and 2,972kcal per kg, respectively.

Professor Stein explained: "Fermentation of soybean meal removes sugars and oligosaccharides. Sucrose is easily digested by pigs and oligosaccharides are almost completely fermented. When these are removed, the remaining meal contains a greater percentage of fibre, which reduces the digestibility of energy in the diets."

Digestibility of crude protein and amino acids in fermented soybean meal was the same as or greater than that of soybean meal. Digestibility values for most amino acids were greater in fermented soybean meal than in fish meal.

Professor Stein said the results indicated that fermented soybean meal could replace fish meal in starter diets without negatively affecting the energy content or digestible amino acid content of the diets.

"With this new product on the market in the United States, producers have another option for providing protein in weanling pig diets," he said.

The study, entitled 'Concentration of digestible, metabolizable, and net energy and digestibility of energy and nutrients in fermented soybean meal, conventional soybean meal, and fish meal fed to weanling pigs', was recently published in the Journal of Animal Science and was co-authored with Oscar Rojas, a PhD candidate in the Stein Monogastric Nutrition Laboratory at Illinois. It is available online [click here].

November 2013

[Mustang Sally Farm]

New Law Needed for Insects to Contribute to Livestock Sustainability
15 November 2013

EU - The EU-funded project PROteINSECT co-ordinated in the UK by FERA (The Food and Environment Research Agency) with partners in China and Africa as well as mainland Europe is working to drive changes to current legislation.

There is growing global interest in the use of insects as an alternative source of protein in animal feed. However, current European legislation represents a barrier to the development of large-scale production processes.

Food security concerns have highlighted a need to find more sustainable sources of protein for use in animal feed. Insects are increasingly being recognised as an excellent alternative. Many species are highly nutritious and the production of insects has less environmental impact compared with traditional sources of animal feed protein.

Additional major advantages of insects as a protein source are that they can be reared successfully and quickly on a range of organic waste materials, such as vegetable, domestic and organic waste, reducing the volume of that waste in the process by up to 60 per cent. The residue can also be recycled as fertilizer.

At present, EU law prohibits the inclusion of protein derived from insects in animal feed, with the exception of feed intended for fish or shellfish. As evidence of efficacy and safety of insect protein increases, through research delivered by the EU-funded PROteINSECT and other research projects, it is hoped that insect protein will also be permitted in pig and poultry feed in the future, particularly as these animals already consume insects as part of their natural diet.

Elaine Fitches, Co-ordinator of the PROteINSECT project at FERA, said: "To enable protein from insects to become a significant component of animal feed, European legislation must be changed if we want to allow it to be fed to pigs and poultry as well as fish. Our work in PROteINSECT is establishing the evidence base that this is a sustainable, safe and economic source of protein, delivering quality food for human consumption as well as significant environmental benefits."

Attention will also need to be paid to legislation covering the safe use of substrates, such as vegetable and domestic waste and manure, on which insects can be reared most economically.

Ms Fitches continued: "The views of the public about the production and use of insect protein for animal feed are of great interest to our project. A short survey is available now on our website and I do urge everyone to please complete it."

[Mustang Sally Farm]

Philippines Acts to Help Farmers and Fishermen after Typhoon
19 November 2013

PHILIPPINES - Following the impact of the typhoon Haiyan, the Philippine Department of Agriculture has set up interventions intended to stabilise markets, provide seeds for early recovery of crops and support the municipal fishery sector of the Eastern Visayas Region.

Agriculture Secretary Proceso J. Alcala has instructed Department of Agriculture officials to immediately transport frozen chicken, potatoes and other vegetables from Manila and Baguio to Tacloban using three refrigerated vans from the Bureau of Fisheries and Aquatic Resources (BFAR), the department reported on Monday.

Three more vans, from the Philippine Fisheries and Development Authority will load and deliver food items from Albay in Region V to Tacloban and neighbouring areas.

“We will be also utilising all available closed vans of the Department and its attached agencies to deliver eggs and other dry food items,” he said.

The agriculture chief has also instructed BFAR Director Asis Perez to deploy a 1,200-tonne vessel, currently anchored in Cagayan de Oro (CDO), to deliver food items to the Region.

Smaller ships will ferry food items to smaller islands.

The department is set to implement market mechanisms to move food items from the production areas to affected communities via the Barangay Food Terminal and local government food trading centres.

Functional food warehouses will also be used for stocking food.

“We will engage big market players such as the San Miguel Corporation in CDO to supply poultry products to affected areas,” Alcala said.
The National Food Authority in Region VII will begin to supply rice to parts of the region in an effort to augment rice stocks in areas severely damaged by the super typhoon.

The Philippine Coconut Authority has committed 300 chainsaws to be used for clearing operations.

A portable saw-mill will also be moved to the PCA yard in Tacloban.

Apart from the action to address the immediate needs of the local residents, the Philippine department of agriculture is also distributing rice, corn and vegetable seeds such as pechay, mustasa, upland kangkong, and okra seeds under the Early Recovery Programme of the government to enable farmers to start replanting and build for the future.

Mr Alcala announced the immediate suspension of the closed season in the Visayas and Palawan until 1 December to enable fishermen to catch various marine species for consumption and even to sell.

A total of 1,300 fishing boats, equipped with 5-horse power engine, 4000 fishing nets will be constructed and divided among the affected families.

The department is also set to position a total of 200 payaos amounting to P40 million, to aid affected municipal fishermen. Payao, a floating artificial reef, is a fishing device used for catching high value fish species.

[Mustang Sally Farm]

Post Typhoon Message for Dairy Workers21 November 2013 NEW ZEALAND – A message of support and sympathy has been broadcast by Dairy New Zealand to the typhoon struck Filipino community, in recognition of their plight and contribution to farming.Chair of the industry group, John Luxton, voiced farmer concerns for Filipino morale this week, stating that support will be necessary to help worker stress level following a ‘hectic spring’. Filipino’s are essential to the sector, making up eight per cent of the New Zealand workforce, explained Mr Luxton. "They are working on farms all around the country but many are based in Canterbury and Southland. This is a busy time on farms so we are conscious that this may be adding to their stress levels.” He added: “I'd urge any workers who have been affected to talk to their employers as they will want to help them as much as they can. I know a lot of support has already been shown by farmers.” Dairy New Zealand has been in contact with the Filipino Dairy Workers in New Zealand group to assist in support. Farmers are welcome to seek advice on how to manage workers at this time

[Mustang Sally Farm]

China Reports Slight Drop in Farm Produce Prices
28 November 2013

CHINA - According to monitoring by MOFCOM in 36 medium and large sized cities, price of agro-foodstuff saw a rise by small margin and the price of material for production fell slightly last week (11-17 November).

Wholesale price of meat rose slightly, of which the wholesale price of pork was up by 0.4 per cent, while beef and lamb rose by 0.5 per cent and 0.9 per cent respectively.

The average wholesale prices of aquatic products were up by 0.3 per cent as compared with that of the previous week, and top price rise that of small yellow croaker, grass carp and big yellow croaker, up by 1 per cent, 0.6 per cent and 0.5 per centrespectively.

The retail prices of chicken and egg remained basically stable with a slight increase, of which the price of chicken was up by 0.1 per cent as compared with that of the previous week, and eggs remained unchanged.

Retail prices of edible oil and cereals fluctuated slightly, of which small package of rice, small package of flour and rapeseed oil rose by 0.2 per cent, 0.2 per cent and 0.1 per cent respectively as compared with that of previous week, soybean oil fell by 0.1 per cent, while peanut oil remained unchanged.

The average wholesale price of 18 vegetables fell by 0.5 per cent as compared with that of the previous week, of which tomatoes, cabbage and lettuce fell by 11 per cent, 2.8 per cent and 2.8 per cent respectively.

[Mustang Sally Farm]

China's Farm Produce Prices Slightly Higher
11 December 2013

CHINA - Farm produce prices in 36 major Chinese cities rose slightly in the week ending 8 December compared with the previous week, according to a Ministry of Commerce statement.

The wholesale price of pork went up 0.3 per cent, while the cost of beef and mutton rose 0.5 per cent and 0.2 per cent, respectively.

The average wholesale price of aquatic products gained 0.6 per cent and the cost of rice and peanut oil went up 0.2 per cent and 0.1 per cent, respectively.

The price of vegetables and eggs dropped slightly last week. The average wholesale price of 18 kinds of vegetables dipped 2.3 per cent from a week earlier and that of eggs down 0.2 per cent.

Food accounts for about one third of China's consumer price index (CPI), a main gauge of inflation.

The CPI grew three per cent year on year in November, down from 3.2 per cent in October, the National Bureau of Statistics (NBS) said on Monday.

[Mustang Sally Farm]

What Was Achieved at WTO Agriculture Trade Talks on Bali?
13 December 2013


ANALYSIS - The World Trade Organisation’s Bali Ministerial Conference ended last week in a fanfare of triumph, writes Chris Harris.

Agreement had been reached on a package of issues designed to streamline trade, allow developing countries more options for providing food security, boost least developed countries’ trade and help development more generally.

Indonesia’s Trade Minister Gita Wirjawan, who chaired the conference, said: ““We did it! We achieved what many said could not be done.”

WTO Director-General Roberto Azevêdo said: “For the first time in our history: the WTO has truly delivered.

“I challenged you all, here in Bali, to show the political will we needed to take us across the finish line. You did that. And I thank you for it.”

The Bali Package is ostensibly a selection of issues from the broader Doha Round negotiations.

“With the Bali package you have reaffirmed not just your commitment to the WTO — but also to the delivery of the Doha Development Agenda,” Mr Azevêdo said.

“The decisions we have taken here are an important stepping stone towards the completion of the Doha round.

“And it is very welcome that you have instructed us to prepare, within the next 12 months, a clearly defined work program to this end.”

Mr Azevêdo, said members’ attention should now turn the rest of the round, known semi-officially as the Doha Development Agenda.

But how far forward has the much acclaimed Bali agreement taken world trade negotiations?

On some crucial issues, the agreement does not seem to have advanced things at all. In the agricultural negotiations, which have been the historical sticking point for any agreement, there still appears to be stalemate over some issues between the developing and the developed nations.

The agreement appears to agree to disagree and put things on hold while further negotiations are conducted.

On trade facilitation, the WTO ministerial agreement says: “The trade facilitation decision is a multilateral deal to simplify customs procedures by reducing costs and improving their speed and efficiency. It will be a legally binding agreement and is one of the biggest reforms of the WTO since its establishment in 1995 — other agreements struck since then are on financial services and telecommunications, and among a subset of WTO members, and agreement on free trade in information technology products.

“The objectives are: to speed up customs procedures; make trade easier, faster and cheaper; provide clarity, efficiency and transparency; reduce bureaucracy and corruption, and use technological advances. It also has provisions on goods in transit, an issue particularly of interest to landlocked countries seeking to trade through ports in neighbouring countries.”

The WTO said that the agreement on the agriculture part of the Bali Package required sorting out two issues.

Much of the focus was on shielding public stockholding programmes for food security in developing countries, so that they would not be challenged legally even if a country’s agreed limits for trade-distorting domestic support were breached.

The rules allow developing countries to support the farming sector by buying in stocks of up to 10 per cent of production.

The developing countries were and are concerned that if they exceed their support and help poorer farmers more, they are going to be punished by the WTO.

The Bali deal came up with an interim solution, which will exist until a permanent one is agreed, with a work programme set up aiming to produce a permanent solution in four years.



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 "On some crucial issues, the agreement does not seem to have advanced things at all."


Even before the Bali meeting, the WTO was admitting that no firm agreement was going to be reached over this issue.

“As the Bali conference approached, it became clear that amending the Agriculture Agreement on this point was too controversial to be agreed in time for the conference. Instead, chairperson John Adank, New Zealand’s ambassador, began working with members on an interim solution,” the WTO pre-Bali documents state.

The compromise that was approved at Bali means that countries will temporarily refrain from lodging a legal complaint (“due restraint”, sometimes also called a “peace clause”) if a developing country exceeded its Amber Box limits – the 10 per cent of production - as a result of stockholding for food security.

Work on finding a longer term solution is to continue after the ministerial conference.

However, disagreement still exists on the “safeguards” to ensure that the public stockholding programmes would not be misused, that the released food would not affect trade, the number of eligible products (“traditional staple food crops”), how long the restraint on disputes would last and the work to be undertaken after Bali.

Another issue - "tariff quota administration" – or how a specific type of import quota is to be handled when the quota is persistently under-filled also caused difficulties.

The WTO negotiators agreed on a combination of consultation and providing information when quotas are under-filled.

The WTO paper says: “Under the proposal, if a quota is persistently under-filled — and information-sharing and consultations prove fruitless — the importing government would have to apply one of a prescribed set of methods for administering quotas aimed at removing impediments. Either they would accept quantities within the quotas, first come first served, at the importing ports until the quota limit is reached, or they would issue import licences for every request (“automatic licence on demand”) up to the quota limit.”

The one remaining issue to be settled was which countries would reserve the right not to apply the system after six years. They will be Barbados, Dominican Republic, El Salvador, Guatemala and the US – the only developed country and one of the world’s major exporters and importers.

The third major issue that has caused political turmoil in the negotiations surrounding the Doha Agreement and the post Uruguay round of talks at the WTO is in the area of export refunds and subsidies.

At Bali, the ministers agreed to ensure export subsidies and other measures with similar effect are low.

Prior to the Bali talks, the WTO starkly admitted that this would be a stumbling block.

“It is also proving a difficult subject for the Bali meeting, with some developing countries complaining that the demands on them to make commitments in trade facilitation are not matched by developed countries’ willingness to make commitments on export subsidies. Some other countries say the two should not be linked,” the WTO said.

The outline for the Bali agreement was that WTO countries would “exercise utmost restraint” in using any form of export subsidy.

They would “ensure to the maximum extent possible” that progress will be made in eliminating all forms of export subsidies, that actual subsidies will be well below the permitted levels, and that disciplines will apply to export policies that may have the same effect as subsidies.

In May, the G–20 group of developing countries had called on developed countries to halve their ceilings on the money they spend on export subsidies by the end of 2013 and phase in a 540-day limit in the repayment period for export credit. The final target is 180 days.

The G-20 also called for a limit on the quantities of subsidised exports, at the average actually exported with subsidies for 2003–2005.

However, a number of countries opposed any legally binding decision in Bail, including lower limits on export subsidies. They said they could only do this as part of an overall agricultural package within the Doha Round.

Because of this inability to reach binding decisions, the Bali agreement is open ended and relies on good will and restraint.

In all, the agricultural package in the Bali agreement has move the stakes on very little.

With no legally binding arrangements, the good will statements are open to abuse and the disputes’ panel of the World Trade Organisation could be just as busy as it has been with countries arguing over subsidies and tariffs and quotas as much as they have over the last decade.

The fact that the US has opted out of the tariff quota arrangements also forewarns of arguments and trouble and it appears that the current trend for bilateral negotiations for free trade agreements will be the route forward and the work in the WTO, on agricultural issues, could be largely ignored.



Chris Harris, Editor-in-Chief

[Mustang Sally Farm]

Phasing out Antibiotics for Growth Promotion in US: What Are the Consequences?
16 December 2013


ANALYSIS - The proposed changes to the regulations on the use of antibiotics in the US for food-producing animals will mean a reduction of around 16 per cent in antibiotic use in pigs, an increase in feed conversion ratio, higher veterinary costs and a shift in the oversight for antibiotic use from farmers to veterinarians, writes Jackie Linden.

The US Food and Drug Administration (FDA) has implemented a plan to help phase out the use of medically important antimicrobials in food animals for food production purposes, such as to enhance growth or improve feed efficiency. The plan would also phase in veterinary oversight of the remaining appropriate therapeutic uses of such drugs.

In FDA's final guidance - issued last week - the agency lays out a road map for animal pharmaceutical companies to voluntarily revise the FDA-approved use conditions on the labels of these products to remove production indications.

The news that certain antimicrobial drugs are to be phased out as growth promoters in livestock means livestock producers now have a time-frame to adjust production practices, commented professor of clinical sciences in K-State's College of Veterinary Medicine, Mike Apley.

He estimates that, for pigs, the new rule will remove about 16 per cent of the use of medically important antibiotics in feed for growing pigs. Cattle production will be less affected than pigs because cattle growth promoters are typically ionophores, which are not considered medically important, according to Professor Apley.

He added: "This news means the clock is ticking. Livestock producers and pharmaceutical companies have three months and three years to get it done," he said, referring to a three-month comment period which will be followed by a three-year period for drug companies to voluntarily revise FDA-approved labelled use conditions.

Professor Apley stressed that among the major implications of the new rule are that it removes the uses for improving performance and shifts oversight of the remaining uses to veterinarians.

In their 'Hog Outlook', market analysts, Ron Plain and Scott Brown, highlight that the new policy is likely to affect adversely decrease livestock and poultry feed conversion and thus increase feed demand. It would also drive up per-head veterinary costs, they add, especially for smaller operations.

Representing the poultry industry, the US National Chicken Council said in a statement: “We strongly support the responsible and judicious use of FDA-approved antibiotics and the involvement of veterinarians in raising healthy chickens.

“Antibiotics are not always used in raising chickens; rather, they are administered only when needed and on those occasions, they are used judiciously under the care of a veterinarian. For those antibiotics that are FDA-approved for use in raising chickens, the majority of them are not used in human medicine and therefore do not represent any threat of creating resistance in humans.

“That being said, we realise that there are strong emotions and conflicting views on the issue of antibiotic resistance – an issue that is very complex, and not black and white."

Animal health company, Zoetis, has announced that it supports the FDA’s efforts to voluntarily phase-out growth promotion indications for medically important antibiotics in food-producing animals. Zoetis has already taken action with the view to implementing Guidances #209 and #213 and has already taken action.

Professor Apley stated that Elanco has also already indicated it will comply with the guidelines.

Responding to the news that the rules are voluntary, long-time opponent of the use of antibiotics in farm animals, Congresswoman Louise Slaughter commented: “The FDA’s voluntary guidance is an inadequate response to the overuse of antibiotics on the farm with no mechanism for enforcement and no metric for success.

“Sadly, this guidance is the biggest step the FDA has taken in a generation to combat the overuse of antibiotics in corporate agriculture, and it falls woefully short of what is needed to address a public health crisis,” she added.



Jackie Linden, Senior Editor

[Mustang Sally Farm]

Global Food Security Relies on Trade
20 December 2013


GLOBAL - On a global scale food supply is sufficient to feed the entire population but its uneven distribution leaves a significant proportion of the world’s population food insecure while others live in abundance of food, writes Chris Harris.

While the global food supply could be increased by using methods such as novel technological solutions, reform of current agricultural practices and reduction of food waste, any substantial improvement in food security will require real efforts for a more equal distribution of global food supply.

According to a new report by Miina Porkka, Matti Kummu, Stefan Siebert and Olli Varis “From Food Insufficiency towards Trade Dependency: A Historical Analysis of Global Food Availability” published by PLOS, within the past 50 years, the world has moved from food insufficiency towards an increasing dependency on food trade.

This has improved food availability, but mainly in regions with a sufficiently strong economy to be a notable player in the trade markets.

The authors say that while a secure food supply has been outsourced in various parts of the globe, a large share of global population is still living with insufficient food supply.

“Food security is not merely a question of food availability but increasingly also a question of access to food,” the report says.

The research team from Aalto University in Finland looked at the development of the food chain and the progress of food supply between 2965 and 2005.

The proportion of the population, who get enough food - more than 2 500 calories a day - has nearly doubled to 61 per cent over the 40 year period.

Those living on a critically low food supply of less than 2 000 calories a day have shrunk from 51 per cent to three per cent.

The researchers found that food availability has improved especially in the Middle East and North Africa, Latin America, China, and Southeast Asia.

Although food availability has increased on the global level, food self-sufficiency has remained relatively low.

The report says: “Food availability has improved considerably while food self-sufficiency has remained relatively low during the entire study period. Trade of food products has, thus, soared in importance in securing an adequate food supply. In many parts of the world, diets are increasingly abundant in calories and animal source foods.”

“In the 1960s and 1970s, insufficient food production in a country amounted to food shortage, but nowadays the production deficit is increasingly balanced through food imports,” said Aalto University researcher Miina Porkka.

The proportion of people living in countries that are significant net importers of food has more than tripled during the period under examination.

The countries of North Africa and the Middle East, for instance, have become increasingly dependent on imported food. In these countries, food availability has increased from low to a very high level, even though domestic food production has remained inadequate.

Brazil, on the other hand, has become one of the world's most important producers of food for export. In the 1960s, food supply in the country was still inadequate, but in the past decades Brazilian food production has grown exponentially and food consumption is now more than sufficient.

The study also examined dietary changes that have taken place in different countries.

The proportion of people consuming large amounts (more than 15 per cent of energy intake) of animal-based nutrition has increased from 33 per cent to more than 50 per cent.

This together with over consumption of calories in many countries is putting an increased pressure on the planet’s limited natural resources. At the same time, however, over a third of the world’s population is still living with insufficient food supply.

The study was conducted by the researchers from Aalto University in Finland and University of Bonn in Germany. The research was financed by Maa- ja vesitekniikan tuki ry., the Academy of Finland and the German Federal Ministry of Education and Research.



Chris Harris, Editor-in-Chief

[Mustang Sally Farm]

Holistic Farming Approach to Meet World Food Demand Sustainably 19 December 2013 GLOBAL - A holistic long-term approach may be the key to introducing sustainability into the food and agriculture (F&A) equation, according to a new report from Rabobank.Fundamentally, this would entail a shift in farmers' focus away from yield maximisation and towards input optimisation. However, there is no one-size-fits-all solution and technological innovations tailored towards the specific issues within a farming category are pivotal to improving best practices, and impact the way farm input companies view their business models. "Without a holistic approach towards feeding the world, the global agriculture industry's capacity to keep up with demand will be stretched at the expense of the environment," said Rabobank analyst, Dirk Jan Kennes. "A strategy that includes resolving structural resource imbalances, optimising F&A supply chain efficiency and reducing waste within the global F&A complex would ease the pressure on agricultural yield improvement and would help align the interests of the different stakeholders." Rabobank has identified the over-application of fertilisers and inefficient water usage as critical to a step change shift in farmers' perception of best practice. Agriculture accounts for 70 percent of global water demand and technologies to optimise irrigation systems will be key to future water conservation. Similarly, an integrated approach is needed to optimise farm inputs to enable farmers to apply at the right time, place and rate; subsequently reducing the environmental impact and initial cost. Technological innovations in both areas are being developed as higher farm input prices incentivise farm input companies to spend more on research and development (R&D). Every year, an estimated 1 billion tonnes of produce is wasted along global F&A supply chains. In addition to reducing waste, it is crucial that all links in the supply chain work together to solve the food supply problem. However, there is no one-size-fits-all solution. Rabobank has identified four different farming groups-agro-enterprises, family farms, smallholders and agricultural adventurers-which each require a unique approach to improving best practices. Such methods include: Soil conditioning for those farms which operate with less crop rotation High-tech innovations including accurate soil-water sensors and GPS technology for variable planting density Research, education and farming recommendations through less intensive ICT-services Land transformation and infrastructure through collaborations of funders, agronomic consultants and contract farmers "The ability to gather a broad set of data on climatic conditions, soil conditions and crop conditions transfers farming into more of a science", Mr Kennes added. "Turning this data into farming practices requires intense cooperation between all partners in the agricultural production chain for which product form, application technology and farm operations need to be fully aligned.

[Mustang Sally Farm]

US Consumers Confused about GMOs
30 December 2013

US - Over half of US consumers express some level of concern about genetically-modified organisms (GMOs).

However, when asked to describe GMOs, many grocery shoppers are unclear and say that it is genetically altered sometimes in a favourable way while at other times in an unfavourable way, according to recently released food market research by global information company The NPD Group.

Genetic modification is defined by the US Department of Agriculture (USDA) as “the production of heritable improvements in plants or animals for specific uses, via either genetic engineering or other more traditional methods.”

The NPD study entitled, Gauging GMO Awareness and Impact, asked consumers to tell, in their own words, what the term GMOs means and the answers were diverse.

Common words used to describe GMOS from consumers were “genetically altered,” “not natural” and many consumers say “don’t know.”

Forty-four per cent of consumers say GMOs have some kind of benefit, yet at the same time, a higher percentage has some level of concern.

The study points out GMOs are more top-of-mind with consumers because of media coverage and various states’ legislative efforts to label genetically modified foods.

This increased awareness could also be a factor in increased levels of concerns about GMOs. In 2002, 43 per cent of consumers expressed any level of concern about genetically-modified foods and a decade later over half of US adults have some level of concern, according to NPD’s Food Safety Monitor, which continually tracks consumer awareness and concern about food safety issues and eating intentions.

As far as levels of concern, less than 10 per cent of adults were “very” or “extremely” concerned about GMOs in 2002, but now that concern level is at more than 20 percent of adults, and has steadily increased.

“GMO’s have been an issue for some time now,” said Harry Balzer, chief industry analyst and author of Eating Patterns in America.

“We are once again seeing more American adults concerned than not. I expect the market to follow these concerns.”