OECD-FAO published the Agricultural Outlook report for 2012-2021 last July which focused on achieving sustainable agricultural productivity growth. The Outlook provides the projections for the coming decade on global agricultural production and commodity prices taking into account projected economic growth, population growth, inflation, energy prices and policy implications. Even though there is a high agricultural product as an output, the report expects the price to come down in parallel. But it is expected to remain higher with an increase in costs of some inputs and high demand in food markets.

As compared to 2008, though the food price inflation (at retail level) has fallen considerably, it was remained to be high in many developing countries.  Food price inflation is determined by the demand side of the markets. Thus, according to the report, the demand side pressure of food market is highly influenced by population growth, high per capita incomes, urban migration, changing diets in developing countries and rising requirements for biofuel feedstocks.

As the report shows, global agricultural production is projected to continue growing at a slower pace over the coming decade at an average 1.7 per cent per year, down from an average 2.6 per cent. Furthermore, the report emphasized that although it is slower than the previous decade, this projected growth rate is anticipated to be greater than the forecast population growth.

On the report, higher demand for commodities will be met by higher cost of the supplies that come to the market. The report has also highlighted in the coming decade the farmland in developing countries is expected to expand only slightly. Indeed, in order to get more production, increased productivity is needed to fill the created gaps. Developing countries will play great role in the projected growth of production of most agricultural outputs and also taking a vital role in the trade.

The OECD Secretary-General Angel Gurria stated “Increased productivity, green growth and more open markets will be essential if the food and nutrition requirements of future generations are to be met.” He further suggested that governments to renounce trade-distorting practices and create conducive environment for a thriving and sustainable agriculture strengthened by improved productivity.

Similarly, FAO Director-General Jose Graziano da Slova also stated "For consumers, especially for the millions of people living in extreme poverty, high food prices have caused considerable hardship. We need to redouble our efforts to bring down the number of hungry people. We must focus on increasing sustainable productivity growth, especially in developing countries, and especially for small producers."

According the Outlook, in 2021 developing countries will be the main source of growth based on the ability to devote their land for agriculture and to improve productivity. The Outlook also noted that with more 680 million people inhabiting our world by 2021 with fastest growth in India and Africa, urbanization and rising incomes will lead to changes by shifting consumers to be users of processed food, animal protein and fats. This will influence high value dairy products, meat and indirect demand for oilseeds for livestock’s feed and grains. In addition, in 2021 majority of exports of vegetables, rice, protein meals, beef, sugar, fish and fish products will be accounted from developing countries.

In conclusion, the Outlook clearly puts that both ‘increasing productivity’ and ‘improving sustainability of agriculture’ are not mutually exclusive rather complementary. The degrading of agricultural land (25% of the total) and scarcity of water are mentioned as obstacles for the sustainability. Hence, ensuring sustainability and increasing sustainable agricultural productivity growth needs to have more efficient use of irrigation water through better timing and reliability and harvesting runoff; better plant nutrient management and crop protection; and breeding resistant crops to potential weather hazards.

The Outlook has put also the following important points in its overview:

A time for change

‘‘Agricultural production needs to increase by 60% over the next 40 years to meet rising demand for food. Additional production will also be necessary to provide feedstock for expanding biofuel production. Increasing agricultural productivity will be central to containing food prices in a context of rising resource constraints and will be a key factor in reducing global food insecurity.

‘’At the same time, there is a growing need to improve the sustainable use of available land, water, marine ecosystems, fish stocks, forests, and biodiversity. Some 25% of all agricultural land is highly degraded. Critical water scarcity in agriculture is a fact for many countries. Several fish stocks are over-exploited or at risk. There is a growing consensus that extreme weather events are becoming more frequent and climatic patterns are changing in many parts of the world.

‘’Encouraging better agronomic practices, creating the right commercial, technical and regulatory environment, and strengthening agricultural innovation systems are essential policy challenges identified in this report.’’

 Click the link to view the OECD-FAO Agricultural Outlook report for 2012-2021: http://www.oecd.org/site/oecd-faoagriculturaloutlook/