OECD–FAO

Agricultural Outlook
2017–2026
The Agricultural Outlook 2017-2026 is a collaborative effort of the OECD and FAO prepared with input from the experts of
their member governments and from specialist commodity organisations. It provides a consensus assessment of the medium
term (ten year) prospects for agricultural and fish commodity markets at national, regional and global levels. This year’s edition
contains a special focus on the agriculture and fish sectors of Southeast Asia.

Executive Summary
The context for this year’s Outlook is record production and abundant stocks of most commodities in 2016, keeping prices well

Agricultural
below the peaks experienced in the last decade. Average prices of cereals, meats and dairy products continued to decline,
while oilseeds, vegetable oils, and sugar saw a slight rebound in 2016.

Consumption
China and biofuel no Over the Outlook period, demand growth is projected to slow considerably. The primary

7‑2026
longer global demand sources of growth in the last decade were first the People’s Republic of China, where rising
growth leaders meat and fish demand caused the consumption of feed to grow by almost 6% per year, and
second the global biofuel sector, where the use of feedstock inputs grew by almost 8% per year.
The replenishment of cereal stocks by 230 Mt over the last decade also augmented demand.
These recent drivers are not anticipated to support markets in the same way over the medium
term, and no other sources to replace them are foreseen.

Figure 1.  Annual growth in consumption for key commodity groups, 2007–16 and 2017–26

%
Due to per capita consumption growth or non-food consumption growth Due to population growth
5.0
4.5
4.0
3.5
3.0

EASt ASiA2.5
2.0
1.5
1.0
0.5
0.0
2007-16 2017-26 2007-16 2017-26 2007-16 2017-26 2007-16 2017-26 2007-16 2017-26 2007-16 2017-26 2007-16 2017-26
Cereals Meat Fish Fresh dairy Roots and tubers Sugar Vegetable oil

Note: The population growth component is calculated assuming per capita demand remains constant at the level of the year preceding the decade. Growth rates
refer to total demand (for food, feed and other uses).
Vegetable oil, sugar and Growth in food demand for virtually all commodities in the Outlook is anticipated to be less
dairy products becoming than in the previous decade. Globally, per capita food demand for cereals is anticipated to be
more important in largely flat, with growth only expected in least developed countries. Meat demand is projected
human diets to grow steadily, although dietary preferences and limited access will curb consumption in
many countries. Additional calories and protein are expected to come mainly from vegetable
oil, sugar and dairy products. Overall, “convergence” towards western diets appears limited.

Access to proper nutrition By 2026, calorie availability is projected to reach 2 450 kcal per day on average in least
remains uneven developed countries and exceed 3 000 kcal per day in other developing countries. Still, food
insecurity will remain a critical global concern, and the co–existence of malnutrition in all its
forms poses new challenges in many countries.

Biofuel sector controlled The demand growth for ethanol and biodiesel has weakened due to lower fossil fuel prices
by national policies and fewer incentives from government policies. Even though energy prices are projected to
increase, the derived demand for biofuel feedstocks, especially maize and sugarcane for
ethanol and vegetable oil for biodiesel, will grow slowly, except in key developing countries
where demand increases are driven by more pro-active domestic policies.

Production
Future growth in crop production will be attained mostly by increasing yields. Yield growth
Additional crop production is projected to decrease slightly, but output could be raised by closing large yield gaps that
will be attained mostly by continue to persist, especially in Sub–Saharan Africa. The global cereal area will only increase
increasing yields, whereas marginally, while a further expansion of soybean area is projected to satisfy the demand for
production gains in dairy animal feed and vegetable oil.
and meat are expected Growth in meat and dairy production will be achieved from both larger herds and higher output
to rely on both herd size per animal, with large differences in the intensity of production continuing to persist. Growth
expansions and higher in poultry production accounts for almost half of total meat production expansion over the
output per animal. decade. Milk production growth is expected to accelerate compared to the previous decade,
most notably in India and Pakistan.

Figure 2.  Relative growth shares of area and yield Figure 3.  Aquaculture and capture fisheries

Aquaculture Total capture Capture for human

Area Yield consumption
120

25 100
Growth 2014–16 to 2026 (%)

20 80
Thousands

15 60

10 40

5 20

0 0
Wheat Maize Rice Soybean 1990 1996 2002 2008 2014 2020 2026
 Aquaculture dominates growth in the fish sector, as capture fish production is determined by
the current level of stocks and governed by policies to limit over–fishing. China will maintain
a share above 60% of global fish production. Farmed fish production is the fastest growing
protein source among the commodities in the Outlook.

Trade
The growth in agriculture and fish trade is projected to slow to about half the previous decade’s
growth rate. However, trade will represent a broadly constant share of the sector’s output
over the coming decade. Generally, agricultural trade has proven to be more resilient to
macroeconomic fluctuations, than trade in other goods. Given relatively high protection in the
farm sector, agricultural trade growth could be boosted by further market liberalisation.

Food imports are becoming increasingly important for food security, particularly in Sub-Saharan
Food importers to face few Africa, North Africa, and the Middle East. While for some countries this may reflect greater
suppliers for most products demand but insufficient natural resources for growing food domestically, in other cases it may
indicate agricultural development problems which need attention.

Net exports are projected to increase from the Americas, Eastern Europe and Central Asia,
while net imports are expected to increase across other Asian and African countries. Exports
remain concentrated in a few supplying countries contrasting with widely dispersed imports.
This may imply a greater susceptibility of world markets to supply shocks, stemming from
natural and policy factors, rather than demand shocks.

Prices
Under the Outlook’s expected fundamental supply and demand conditions, real prices of most
Real prices are expected agricultural and fish commodities are anticipated to follow a slightly declining trend, keeping
to remain at, or below, them below previous peaks over the next ten years. Prices of agricultural commodities are
current levels subject to considerable volatility and may show large deviations from their long-term trends
for an extended period of time.

Figure 5.  Medium–term evolution of commodity prices

Figure 4.  Regional net trade in agricultural products in real terms

Americas Sub–Saharan Africa Index (2014-16=100) Cereals Dairy

Meat Oilseeds
South and East Asia North Africa/Middle East
180
Other
150 160
Billion constant USD (2004-6 base)

100 140

120
50
100
0
80
-50
60

-100 40
2006 2011 2016 2021 2026 1996 2002 2008 2014 2020 2026

Note: Price indices for commodity groups calculated using a constant

weighting of commodities within each aggregate, using the average 2014–16
production value as weights.
 Southeast Asia
The special chapter of the Outlook focusses on the countries of Southeast Asia, where
economic growth has been strong and the agriculture and fish sectors have developed
Broad–based growth rapidly. Broad based growth has enabled the region to significantly reduce undernourishment
has allowed for a in recent years.
significant reduction in
undernourishment in However, the growth of agriculture and fisheries in the region has led to rising pressure on
South East Asia. Improved natural resources, affecting the export-oriented fish and palm oil sectors in particular. The
resource management, Outlook projects palm oil production growth to slow considerably as the main producer
R&D and investment will countries focus on sustainable development.
be needed to achieve

OECD‑FAO A
Improved resource management and increased R&D will be needed to achieve sustainable
sustainable agricultural
productivity growth. Policies in support of rice production could also be reoriented to facilitate
development.
the diversification of agriculture. Given the region’s sensitivity to climate change, investments
to facilitate adaptation are required.

Outlook 2017
Figure 6.  Changes in major production activities in Southeast Asia

% 2002-16 2017-26
9
8
7
6
5
4
3
2
1
0
Vegetable Rice Meat & Maize Coconut Sugar Roots and Milk Aquaculture Capture
oil eggs oil & meal tubers fishery

SpECiAl FOCuS: SOuthE

Figures’ source: OECD/FAO (2017), “OECD-FAO Agricultural Outlook”, OECD Agriculture statistics (database), http://dx.doi.org/10.1787/agr-data-en.

OECD‑FAO Agricultural Outlook 2017‑2026

The OECD-FAO Agricultural Outlook 2017-2026 provides an assessment of prospects for the coming decade
of the national, regional and global agricultural commodity markets across 41 countries and 12 regions,

For enquiries or further information contact:

including OECD countries (European Union as a region) and other key agricultural producers, such as India,
China, Brazil, the Russian Federation and Argentina among others. This year's special feature focuses
on the prospects and challenges of the agricultural sector in Southeast Asia. This edition marks the thirteenth
year of partnership between the two organisations. Over the ten year Outlook period, agricultural markets are OECD‑FAO Agricultural
Outlook 2017‑2026
projected to remain weak, with growth in China weakening and biofuel policies having less impact on markets
than in the past. Future growth in crop production will be attained mostly by increasing yields, and growth
in meat and dairy production from both higher animal stocks and improved yields. Real prices are expected
to remain flat or decline for most commodities. Agricultural trade is expected to grow more slowly, but remain
less sensitive to weak economic conditions than other sectors.

SpECiAl FOCuS: SOuthEASt ASiA

Holger Matthey Hubertus Gay

© OECD/FAO, 2017

([email protected]) ([email protected])
I7549EN/1/07.17
OECD‑FAO Agricultural Outlook 2017‑2026

Trade and Markets Division Trade and Agriculture Directorate

Food and Agriculture Organization Organisation for Economic
of the United Nations Co-operation and Development
Consult this publication on line at http://dx.doi.org/10.1787/agr_outlook-2017-en.
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