Embed Size (px)
Citation preview
FOOD A
THE oTATE OFji cucruiri,
REVIEW AND OUTLOOK
1952
0
FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONSROME, ITALY OCTOBER 1952
FAO STATISTICAL YEARBOOKS
Yr:P=3,7=3 OF FOOD AND AGRICULTURAL STATISTICS, 1947, 1948, 1949, 1950, 1951I - PRODUCTION II - TRADE
These two-volume yearbooks continue the statistical series begun by the International Institute of Agriculture whichwas absorbed into FAO in 1946. The volumes on Production contain statistical data on crops and livestock numbersand the Trade volumes (publication started in 1948) present statistical information on international trade in the majoragricultural products of the world. Production 1947 covers the years 1940/41 to 1945/46, as well as prewar averages forcrops and livestock products ; Production 1948 covers 1946/47 and adds figures on total population by countries and onpersons engaged in agricultural occupations ; Trade 1950 contains statistics and notes covering the years 1946, 19471948 and 1949, compared with an average for earlier years. The volume on Trade 1951 contains new figures for 1950and the latest revised data for the years 1947, 1948 and 1949, compared with the prewar (1934-38) average. The 1952volumes are now in preparation.Bilingual English/French, with notes and glossary in Spanish. Per volume $3.50 17/6
YEARBOOKS OF FISHERIES STATISTICS, 1947, 1948-49
The statistical coverage begins with 1938 and ends with 1949. For identification of species a nomenclature section listsscientific and common names by country. 1948-49, the second yearbook, continues and expands the data publishedin 1947, which were supplemented throughout 1948 and 1949 by statistics published in FAO Fisheries Bulletin. In
addition to the above, the 1950-51 volume is now in preparation.Bilingual English/French, with Spanish supplement. Per volume $3.50 17/6
YrikEGOOKS OF FOREST PRODUCTS STATISTICS, 1947, 1948, 1949, 1950, 1951
Yearbooks of international forest products statistics including notes on the present salient features of the currentworld situation. 1948 contains information on world output, imports, exports, and consumption of forest productsfor the years 1946 and 1947 reported by over 100 countries and territories ; 1950 covers the years 1948 and 1949.The 1952 volume is now in preparation.Bilingual English/French, with Spanish supplement. Per volume $2.50 12/6
REPORT ON THE ACTIVITIES OF FAOu Dam THE EXPANDED TECHIALCAL ASSISTANCE PROGRAM
for the First Financial Period, 1950-1951 and Outline of Activities for 1952
This report contains chapters on selected projects, a statistical summary of ETAP activities, regional activities andactivities in various countries, policies and plans and a statistical summary for 1952. With photographs.In English, French and Spanish. $1.00 5/-
THE STATEOF
FOOD AND AGRICULTUREREVIEW AND OUTLOOK - 1952
CL 16/2
FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONSROME - 1952
NOTE
The statistical material in this publication has been
prepared from such information as has been available
to FAO staff not later than 30 July 1952
Printed in Italy
Advance Printing September 1952
Final Printing October 1952
CONTENTS
FOREWORD 1
Chapter I. Summary . . ..... . . . . 5
Chapter II. World Review and OutlookAgricultural Production, Trade and Consumption in 1951/52 . ....... 13
The Demand Situation in 1951/52. . ..... . . . 18Production and Supply Prospects for 1952/53 30The Demand Outlook 1952-54 31
The Long-Term Food Situation 34Ag ricu ltural I nvestment 37
Chapter IIL Regional Review and OutlookEurope (excluding Eastern Europe and the U.S.S R ) 45Eastern Europe and the U.S.S.R. ...... 50
North America (U.S.A. and Canada) 52
Latin America 58
Africa 63
The Near East. . 66
The Far East. . 70Oceania (Australia and New Zealand) 75
Chapter IV. Review and Outlook by CommoditiesWheat 81
Coarse Grains 85
Rice 86Sugar 88Livestock Products 90
Fisheries Products 93
Fats, Oils and Oilseeds 97
Fruit (Citrus) 99
Fruit (Dried) 101
Coffee. 102Tea 103Cocoa 104
Tobacco 105Cotton . ....... 107Wool 110Jute. . 113Rubber 115
Forest Products (Roundwood) 116Forest Products (Sawn Wood) 117Forest Products (Wood Pulp) 118
Fertilizers 120
Pesticides 123
Farm Machinery 123
Fisheries Equipment 126
In
Charts
Recent Increases in Food Production above Prewar. . 12
II Postwar Increase in Food Production . 14
III Per Caput Food Consumption Prewar . 20
IV Per Caput Food Consumption Postwar (1950/51) 21
V Industrial Production in Selected Countries . 22
VI, VII Agricultural Wholesale Prices in Selected Countries. . 24
VIII, IX General Wholesale Prices in Selected Countries 25
X, XI Wholesale Price Indices : Ratio of Agricultural Prices to all Prices inSelected Countries 27
XII - XX Population and Food or Agricultural Production, Prewar and Postwar
Europe 46
United States . 53
Canada . 54
Latin America . 58,59
Africa 63
Near East. 68
Far East. . 70
Oceania. 76
XXI Cotton Prices, Postwar. . 109
XXII Wool Prices at Auctions, Postwar 112
XXIII Prices of Various Forest Products (1949-52) . 119
iv
FOREWORD
Inputting this latest review of the State of Food and Agriculture before our -.Member Gov-
ernments and the general public, I feel it my duty to recall once more the unanimous reso-lution of FAO Member Governments, adopted at the Sixth Session of the Conference, to try
by every means for "a well-balanced increase of one or two percent per annum in world productionof basic food and other essential agricultural products in excess of the rate of population growth".
Looking over the past year's results, there is some reason for satisfaction, as total agriculturalproduction has increased by about two percent over the previous year. However, the greater partof the gain was made in products other than food, notably fibers and rubber, and food productionalone increased by only one percent. Gratifying as these increases may be, they reveal the need forgovernment planning to take full account of the possible interferences from changing world-market con-ditions which, if uncountered by adequate incentive policies and other measures, may divert productiveresources from the most essential to the most profitable. The expansion of world food productionby one percent from 1950/51 to 1951/52 has only barely kept abreast with the rate of population growthand we are thus still far below the rate of increase required for essential improvements in the dietof the large majority of the world population. In addition, beca,use of the uneven regional distribu-tion of productive achievements, the need for more rapid expansion in some regions is even muchgreater than the global figures reveal.
On the technical side, it is encouraging to note that the generosity of the economically more ad-vanced countries has enabled the community of nations to undertake a co-operative effort of sharingtheir technical skill and knowledge for the benefit of all, in the Expanded Technical Assistance Pro-gram of the United Nations. Recognizing the basic necessity of first developing the agricultural resour-ces of the more backward areas of the world, the largest single share of the available funds has beenallocated to FAO, and our work in this field is reported in another document *.
But technical assistance is only the first step towards higher production. While there are manyinstances in which countries have put to good use the newly acquired technical knowledge withoutconsiderable capital expenditure, the fullest advantage from this new program can only be achievedif international co-operation in the financial field is stepped up simultaneously with the expanded tech-nical assistance. Within the framework of its charter and resources, the International Bank for Recon-struction and Development is helping the financing of agricultural development programs. Yet, notall such programs can be financed at the cost of a regular bank credit. Low-cost credit and interna-tional grants-in-aid could contribute immensely to implementing some of the major agricultural devel-opment projects. I am following with interest the current attempts in the United Nations to findways of providing these, and thus of giving the -Member Governments of FAO increased and betteropportunities in their endeavor to increase the output of agriculture.
Moreover, technical help may easily be frustrated if we do not succeed in securing permanent stablemarkets at adequate prices for the increased production, while at the same time maintaining the flexi-bility required or meeting major changes in the general price level, in production techniques and inthe conditions of demand. The need for such flexibility, no doubt, complicates the adoption of nationaland international stabilization measures. None the less, our efforts must be directed toward overcom-ing these difficulties and toward developing an adequate groundwork of carefully planned stabilization,to provide the needed security.
* Activities of FAO under the Expanded Technical Assistance Program 1950-1952, Rome, May 1952.
The picture of world trade in agricultural products remains clouded with difficulties. The exchangeand trading difficulties mentioned in my report last year have increased and once again the dollar short-age is putting obstacles in the flow of international trade. It will require the concerted effort and goodwill of all nations for finding ways and means to prevent the recurrence of these difficulties, which im-pede so greatly the task of expanding the world's food supply.
Again this year, I am submitting the review and outlook of agriculture against the background ofthe more general trends in world economy. The great expansion of production and trade has continuedin the past year and the most careful analysis of today's operating economic forces indicates anotheryear of high economic activity. Agriculture is called upon to contribute to as well as benefit fromexisting favorable economic conditions. Governments, in laying their plans and in advising farmers,should keep in mind that demand for the products of agriculture, fisheries and forestry is likely toremain high. But they also should look farther ahead. Within the limits inherent in any long-termforecast, we have also attempted to project economic trends farther ahead and to indicate some ofthe problenis agriculture may have to face once the present economic expansion comes to a standstill.If this report helps governments to make the necessary provisions for future contingencies, it will havefulfilled its purpose.
NORRIS E. DODDDirector-General
Ch I
SUMMARY
Total agricultural production in 1951/52increased two percent. However, most of thisincrease was in non-food products ; total foodproduction was at the 1950/51 level and per caputfood production Wa S lower than this and stillbelow the prewar level in some areas. While thevolume of total world trade expanded, the vol-ume of international trade in agricultural prod-ucts remained unchanged.
Changes in price relationships and greatereffort by some governments to expand productionof foodstuffs promise some improvement in 1952/53.If weather conditions continue favorable, totalagricultural output in 1952/53 will equal and per-haps exceed that of 1051/52, with increa.sed foodproduction. The trend towards expanded agri-cultural production is likely to continue into1953/54.
While some slight improvements in calorielevels have occurred in the past two years, the dietin the poorest-fed regions of the world is still in-adequate, particularly in the rice-consuming areas.Prospects for a marked improvement in the longrun are rather discouraging. A more efficientutilization of the world's limited food resourcesis, therefore, one of the paramount tasks of inter-national co-operation in agriculture.
Efforts to expand agricultural and primarilyfood production will be facilitated by a high de-mand for the products of agriculture. In the pastcrop year, world industrial production and employ-ment continued generally at high_ levels, generat-ing increasing consumer incomes which werereflected in a slowly-expanding demand for food-stuffs. On the other hand, industrial demand foragricultural raw materials receded from the highlevels following the Korean outbreak, affectingparticularly the textile industry throughout 1951/52. Sinailarly, prices of most agricultural rawmaterials entering world trade declined sharply
Chapter I S U M A R Y
5
in 1951/52, but the general level of raw materialprices in mid-1952 was still above the level oftwo years ago. Also, prices of most foodstuffs,with the exception of some vegetable oils and tea,were still higher than in June 1950. The ratioof costs to prices received, however, is movingunfavorably for farmers in a number of coun-tries.
Increasing defence production and plantexpansion in most of the industrialized countriesmakes a continuation of the high level of economicactivities in 1952/53 very likely. In the lessdeveloped areas, economic development programs,supported by expanding technical assistance andby international, bilateral and regional financialaid, will continue to increase employment andthe demand for agricultural products. In the longerrun, completion of defence programs may causea decline in economic activities, but present indi-cations are that economic conditions will remainfavorable probably until mid-1954, as many govern-ments have large-scale projects in reserve to " takeup th.e slack " in the decline in defence expendi-ture.
The full impact of the high level of economicactivities on the demand for agricultural productshas been reduced by difficulties arising in inter-national trade. After the interlude due to thepost-Korean price rises, the problem of the dollarshortage became accentuated and consequentlythe trend towards liberalization of foreign tradehas been reversed. In 1951/52, restrictions oninternational trade grew at an alarming rate,affecting the demand for many of the non-basicfoodstuffs and forcing a continuation of austerityin many parts of the world. While some alle-viation of the difficulties was evident at the begin-ning of 1952/53, balance-of-payments difficultieswill continue to affect unfavorably the demandfor agricultural products in 1952/53.
7. The lack of dollars in most parts of the worldis an incentive for efforts to reduce the dependenceof food-importing countries on .North America.This requires considerable investment for expand-ing agricultural production in the deficit regions.Private domestic investment in agriculture in theunderdeveloped areas remains very low, but gov-ernments and public institutions are increasingtheir activities in this field. Agriculture is assigneda major share in most of the plans for economicdevelopment but there is great need for steppingup the flow of international capital funds forfinancing agricultural development. In addition,discussions within the United Nations are underway to find ways and means of financing non-self-liquidating agricultural development projectsthrough international grants.
REGIONAL SUMMARY
Europe (excluding Eastern Europe andthe U.S.S.R.)The recovery of agriculture continued, but West-
ern Europe's dependence on imports from over-seas did not diminish, and imports from the dollararea increased as availabilities elsewhere declinedIntra-European trade remained at high levels,although trade between Eastern and WesternEurope was much less than before the war. Pricesreceived by farmers improved, but net farm in-come increased less since costs advanced morethan prices. Crop production in 1952/53 can beexpected to exceed the previous year's level andlivestock production is also likely to increase.Demand for farm products will probably remaingenerally strong in 1952/53 and the greater avail-ability of coal, steel and - other raw materialsshould encourage high industrial activity.
Eastern Europe and the U.S.S.R.Collectivization in Eastern Europe has slowed
down but the transfer of land and livestock tocollective ownership continued in Poland andEastern Germany. Yugoslavia is moving awayfrom the Soviet type of agricultural organization.Agricultural production of the area is still belowprewar, although showing marked improvementin recent years. The crop situation improvedbut livestock numbers showed little change in1951/52. Trade appears to have increased consid-erably within the region. Russian grain exportsto Western Europe were higher but total exportsfrom the region declined somewhat.
6
North AmericaIncreasing rates of government expenditure and
of business investment were decisive factors con-tributing to enlarged output and the maintenanceof full employment in North America.
Favorable weather and the high domestic andforeign demand accounted once more for an increasein a,gricultural production in 1951/52. Similarlyoutput of wood pulp improved, while lumberproduction declined slightly. Fish landings weresmaller than in the preceding year. Farm cashincomes increased, reaching record levels inCallada and one of the highest in the UnitedStates.
Crop prospects for the current season are goodand great gains in production are expected, par-ticularly in the United States' wheat and maize.Livestock output in the United States is alsolikely to be higher, but the Canadian livestockindustry has been severely affected by the out-break of foot-and-mouth disease. Demand forthe products of agriculture, fishery and forestryis likely to remain high in 1953/54, providingthe incentive for maintaining or if possible increas-ing agricultural producti.on.
Latin AmericaUnfavorable -weather conditions and the after-
effects of the emphasis on industrialization reducedArgentina's agricultural production considerablyin 1951/52, and thereby reduced total productionin the region in spite of larger plantings and betterharvests elsewhere. This primarily affected LatinAmerica's exp' orts of breadgrains, meat and oil-seeds, while per caput food supplies remainedalmost unchanged. Large capital investmentsand technological progress improved the output offisheries, and forestry production expanded also.With rising production costs, net farm incomesappear to have increased less than gross farmincomes. New policies in Argentina may bringsubstantial recovery in crop production, but farmlabor is likely to continue to be a major problem.Further improvements in 1953/54 may, however,increase export availabilities in livestock products.Exchange difficulties may slow down further in-creases in food imports of the region. The supplysituation of forestry products is expected to im-prove and to reduce the region's dependence onimports from abroad.
The Far EastRice production in 1951/52 was again below
prewar levels but other grain production in 1951/
52 was higher. Output of non-food crops, withthe exception of jute and rubber, as well as live-stock, is still below 1934-38 production. The rapidpopulation growth has changed the region froma net exporter to a net importer of food, parti-cularly of grain. Fisheries increased their produc-tion in many countries and exports of forestryproducts continued at high levels. The highprices of the area's main agricultural export pro-ducts declined sharply, particularly reducingdollar earnings and depleting foreign exchangereserves in many countries of the region. Newprice relationships between non-food and foodcrops will encourage efforts for increasing foodproduction, but it is likely that available exportsurpluses, particularly of rice, will still be insuf-ficient for the food-deficit countries in the region.Economic development projects are progressingbut reduced export earnings may slow clown therate of development.
The Near EastThe cultivated area expanded considerably
and trade increased. Most of the expansion was,however, concentrated on non-food crops andsevere droughts in the area held agricultural pro-duction lower than expected, although bumpercrops were harvested in Turkey. Per caputconsumption levels have shown little improve-ment since before the war, and in most parts ofthe area food supplies are inadequate. Netexports from the region fell. The immediateoutlook for the region indicates a possible declinein food production with particular danger arisingfrom the threat of desert locust outbreaks and,in some areas, from the extension of cotton acre-age at the expense of food crops. Economicdevelopment plans throughout the Near Eaststressing agricultural expansion, however, promiseimprovement over present conditions.
Africa
Despite a record production of oil-bearingcrops, African agricultural production did notshow any appreciable increase over last season's.The demand for imports, influenced by risingdomestic consumption, consequently remainedhigh, and there is a gradual shift from subsistencefarming to a market economy. Production andexports of forestry products increased but adeclining foreign demand may hamper furtherexpansion.
The outlook for agricultural production does not
7
promise great improvement in the immediatefuture. Trends since the war indicate that ad-ditional food supplies for export are to come main-ly from tropical Africa, since increasing domesticconsumption is absorbing most of the additionaloutput elsewhere in the region. Difficulties inspeeding up development projects may ariserom the shortage of soft-currency capital goods,higher prices and lack of financial means.
OceaniaThe decline in wheat production in Australia
and the drop in export revenues, particularly fromfalling wool prices in both Australia and NewZealand, have led to strenuous efforts to encour-age greater output of exportable products througha variety of means. Inflationary forces due tothe previous year's high export earnings are stilloperative and, with the declining export values,import restrictions were introduced in Australiato counter a mounting deficit in the balance oftrade.
Under normal weather conditions and withthe progress of the Australian program to increaseoutput now under way, partly financed by a con-siderable share of the $150 million World BankLoans, total agricultural production in 1952/53and 1953/51 is likely to surpass present levels.Net farm income, which decreased in 1951/52,may recover again as prices paid to farmershave been increased and subsidies have beenintroduced.
SUMMARY BY COMMODITIES
WheatExports of wheat and wheat flour were larger
in 1951/52 than in the preceding year, shipmentsfrom Canada and the United States increasingconsiderably, but those from Argentina and Aus-tralia contracted. Carry-over stocks in these fourcountries were lower on July 1, 1952, all countriesexcept Callada showing a decline from the pre-vious year. Prices tended upwards in the firsthalf of the year but were slightly lower at theclose than at the beginning. Over half the totalshipments, however, were traded under the In-ternational Wheat Agreement. Supplies will belarger in 1952/53 owing to increased crops inmost parts of the northern hemisphere. Pros-pects for improvement in exportable supplies inArgentina and Australia in 1952/53, however, arenot good.
Coarse grains
Total shipments of coarse grains, at about thesame level as in 1950/51, were still short of theprewar average. Over half the total was againsupplied by the dollar exporters and the ina,bilityof Argentina to ship substantial quantities ofmaize is a serious feature. Supplies in NorthAmerica in 1952/53 are likely to be large withanticipated good crops of maize in the UnitedStates and of barley and oats in Canada, and ala,rge carry-over also in Canada. Barley cropsin the Near East and North Africa are reportedto be very good. Increased prices to growersin Argentina may result in better maize suppliesin 1953.
Rice
World production failed to expand in 1951/52and the frrowth in world trade, which marked1951, was checked in 1952. Uncontrolled pricesof rice have risen, in contrast to those of most othercommodities, but national policies will determinethe extent to which this disparity is allowed toa,ct as a,n increased incentive to producers. Insome important areas, production will also dependon the course of political unrest. Demand forrice may suffer some reduction owing to the di-minished purchasing power of other South-EastAsian countries and the increased relative attrac-tiveness of alternative foods.
Livestock products
Production of milk and meat increased in 1951.Butter output declined while production of cheeseand preserved milk rose substantially. The utili-zation of milk for fluid consumption generallycontinued to expand. Also, production of pig-meat expanded, mainly owing to continued recov-ery in Europe, while shortage occurred in beefand mutton supplies. World trade in butter andmeat fell but trade in cheese and preserved milkexpanded. Prices of livestock products generallyrose considerably in 1951 under the impetus ofhigh consumer incomes. The outlook for 1952/53is that production in the livestock industries gen-erally will expand, but that world trade, especiallyin butter and beef, may continue to be adverselyaffected by small exportable supplies from Argen-tina and Australia, while hard currency stringen-cies ma,y continue to limit feed imports, andconsequently the exportable surpluses, of theWestern European exporters.
8
Fats and oilsPrices of fats, oils and oilseeds declined during
1951/52. In contra,st to 1950/51, there wa,swidespread desire to reduce stocks accumulatedthe preceding year. Also, total world productionand e,xport supplies of oils and fats increased in1951/52. The principal increases were in coconut,groundnut, cottonseed and olive oils. In 1952/53,inventory demand for fats and oils will probablybe somewhat stronger than a year earlier. Worldproduction of fats and oils, particularly of lardand olive oil, is also likely to decline but worldexport surpluses may be as large as a year earlierbecause stocks of oils and oilseeds increased dur-ing 1951/52 in several producing countries. Nota-ble instances were edible vegetable oils in theUnited States, groundnuts in Nigeria, and oliveoil in some of the Mediterranean countries.
Sugar
The increase in world production by 1.7 millionmetric tons in 1951/52 as compared with theprevious year was due entirely to larger crops inCentral and South America. Since the largestincreaSe in production occurred in exporting coun-tries requiring payment in dollars, marketingproblems have emerged which will probably resultin addition to carry- over stocks of over 1.5 milliontons.
The outlook is for further increase in productionin 1.952/53 in all areas except Cuba, where the1953 crop may be restricted by administrativemeasures. World consumption is expanding, andth.e rise in production in 1951/52 did not resultin a substa,ntial decline in wholesale prices. In-deed, retail prices were higher in most countriesthan during the previous year A lowering ofretail prices would encourage additional consump-tion in most countries.
Citrus fruitProduction of oranges and mandarines increas-
ed in 1.951/52 and international trade in citrusfruit reached a new high level. Though OEECtrade liberalization did not apply to Europeanimports from Spain, that country increased exportssubstantially. The United States continued togrant export premiums and succeeded in market-ing larger quantities in Europe. The UnitedKingdom still takes less citrus fruit than prewarwherea,s most countries have inerea,sed their im-ports. New plantings of trees are very large and,
though there is no immediate fear of a surplus,some concern has been voiced over the rapidexpansion of citrus groves.
Dried fruitThe output of the major varieties of dried fruit
in 1951/52 was larger than in 1950/51. Raisinproduction in the United States increased about50 percent while elsewhere smaller yields wereobtained. The pack of currants did not changeappreciably. Production of prunes almost doubledwhereas fig, production decreased approximately20 percent. In spite of the absence of carry-overs of raisins from the previous season, buyerswere rather cautious for most of the season andthe sale of the United States' surplus raisin poolof 30,000 tons to the United Kingdom weakenedother markets until it became clear that stocksin other exporting countries were lower than as-sumed earlier in the season. The 1952/53 packmay be slightly lower for raisins and prunes butlarger for figs.
Coffee
The world coffee economy was probably moreprosperous in 1951/52 than ever before. Produc-tion increased as compared with 1950/51 ; importsrose by close to 10 percent ; prices remained remark-ably stable at very high levels. Production out-look for 1952/53 is less favorable, clue to thesevere drought in Brazil. On the other hand,demand is likely to continue strong and thereis little indication of production exceeding demandfor some years to come.
TeaSupplies in 1951/52 were larger than imports
for current consuniption for the first time sincethe end of the war. Prices of lower quality teaconsequently declined by more than 30 percentbut 1952 prices were sti11150 to 200 percent above'prewar.
Production in 1952/53 is promising, but theincrease in the United Kingdom ration is likelyto absorb the probable increase in production.No serious surplus problems are anticipated forthe immediate future.
Cocoa
Cocoa production in 1951/52 at 679,000 tonswas lower than at any time since the a,bandon-ment of international allocations in 1949. As aresult, prices rose to the "ceiling" level in theU.S. (38.37 cents per lb.) and were 2 to 4 cents
9
higher in soft currency countries. The produc-tion outlook appears more favorable in 1952/53,but the upward trend in world demand seemslikely to continue and it appears probable thatthe world will absorb at relatively high pricesall the cocoa that is likely to be produced duringthe next few years.
TobaccoWorld tobacco output in 1951/52 increased ap-
proximately 3 percent above 1950/51. There wasa substantial increase in the major cigarette types,in particular the flue-cured Virginia, but produc-tion of other tobaccoes decreased. Total exportsincreased slightly and United States exports werethe highest since the record of 1946 ; shipmentsto the United Kingdom rose considerably in spiteof reduced ECA ccrants. Exports of oriental leafalso increased but there are still substantialcarry-overs from previous crops, mainly in Greece.Total supplies in 1952/53 are likely to increasefurther but exports from the United States andCanada are expected to decline as a result of thecut in the United Kingdom's dollar spending ontobacco in 1952/53.
RubberThe ivorld output of natural rubber in 1951
was no larger than in the previous year, havingdeclined from April onwards as prices fell. For1952 a reduction of 11 percent is estimated.World consumption in 1951 was 12 percent lessthan in 1950, as a result, of the restrictions inforce in the United States, consumption elsewherehaving increased by about 5 percent. Both pro-duction and consumption of synthetic rubber inthe United States increased, offsetting most of thedecrease in its natural rubber consumption. Pri-ces of natural rubber, which had receded almostcontinuously during 1951, declined more steeplyin the early months of 19.52, but became morestable towards the middle of the year, when theceiling on natural rubber consumption in the Unit-ed States had been removed, and private importa-tion liad been fully restored. In view of the priceadvantage which synthetic rubber enjoys, the re-moval of these restrictions is not, however, expect-ed to have any appreciable effect on the relativelylow level of natural rubber consumption there.
Cotton
In contrast to the acute shortage and extremelyhigh prices of cotton in the preceding season, the1951/52 season has been characterized by an
increased supply, falling prices, and a contractingdemand. Total production, the second largest onrecord, was 25 percent greater though, with themuch depleted carry-over at the beginning of theseason, the increase in total supply was of about4 percent. Consumption, which had been at arecord level during 1950/51, declined as a world-wide recession overtook the textile trade and in-dustries. Cotton prices which, at the beginningof the season, had adjusted themselves in accord-ance with the enlarged volume of supply, con-tinued falling throughout the season in face ofthe textile recession. The decline still leaves cot-ton prices high in relation to those obtainingbefore the outbreak of the Korean war, but ap-pears to have discouraged expansion in acreagefor the same 1952/53 crop. Available evidenceindicates that production is unlikely to be as muchas in 1951/52.
Consumption recovery awaits a trade revivalin textile industries, but meanwhile, excessive tex-tile stocks are being, reduced. The revival incotton textiles is likely to be postponed untilcotton prices show more signs of stability, possiblyafter the new season's supply becomes available,but in view of the continued expansion of rayoncapacity and the comparative cheapness of rayon,cotton is not likely to enjoy the full fruits of arecovery in textile industries.
Wool
In common with other branches of the textileindustry, the woollen and worsted industry WELSaffected by a marked recession in 1951/52. Woolconsumption in 1951 was 16 percent lower thanin the previous year. The lower price of woolprovides a better basis for a more active consumerinterest in wool textiles, and reduction in stocksat various stages of manufacture and distributionpromises a resumption in mill activity in the nextfew months. Whilst it is too early to form anestimate of the weight of the 1951/52 clip, littleif any increase in production is to be expectedfollowing on the adverse pastoral conditions lastseason in Australia and South Africa. Govern-ment stocks are now limited to relatively smallquantities held as strategic reserves, and tradestocks in consuming countries are generally low,but there is a substantial accumulation of cross-breds in South America.
JutePlanting in Pakistan for the 1952/53 crop is
believed to have been about the same as, and in
10
India slightly less than, in the previous season.The crop is expected to be adequate to meet therequirements of the industry, which last seasonfor the first time since the war was sufficientlywell supplied to achieve a greater output thanthe market was prepared to absorb. A decidedreduction in the Indian export duty on jute goodsand the lower level of statutory minimum prices,as well as export duties, in Pakistan should easethe industry's task of disposing of its productsin the current season.
Fisheries products
Production of all fisheries commodities increasedabout 4 percent in 1951, largely because of thesuccessful reconstruction of war-damaged fleetsand the introduction of technical improvements.While output for most edible fish productsdeclined, oil and meal and frozen fish productioncontinued to increase.
Where pressures of risina demand were felt,indigenous production increased, 'out in WesternEurope and North America, rising costs tendedto limit production, although there was an overallincrease in fish prices.
The coming year will probably be marked byimproved fisheries resources in underdevelopedareas, while demand in the developed areas maybe less stable. Demand for frozen fish should in-crease but more competition will probably devel-op in marketing of fish meal and fats and oils.Commercialized fishing industries will face discrim-ination in demand which may raise difficulties,particularly where markets are protected byimport regulations.
Forestry products
Demand for forest products was very strongduring 1951. As a result production increasedand trade expanded even more, especially in sawnsoftwood and pulpwood. Unprecedented pricerises took place mostly in Europe but price ceil-ings were in effect in the United States.
Towards the end of 1951 and during the firsthalf of 1952, a pronounced fall in demand andin prices occurred as the result of balance-of-payments problems and a growing consumer re-sistance to high prices.
With a continued strong demand in the mostimportant countries, however, a new rush on sup-plies is not to be excluded.
Chapter II
D REVIEW ANII OUTLOOK
CH
AR
T I
- I
NC
RE
ASE
IN
FO
OD
PR
OD
UC
TIO
N A
BO
VE
PR
EW
AR
. AV
ER
AG
E O
F 19
49 A
ND
195
0C
OM
PAR
ED
WIT
H 1
934-
38
I7
UN
KN
OV
4 N
LLJ
DE
CR
EA
SE
0 9%
10 1
9%
2029
%
30%
AN
D O
VE
R
-c\,.
.o.
»tA
.\':,
"..,
\\ \\:
,,\,; \N
,,''\-
'-'1
. \ \,
,-
-.17
E7
()
Chapter II - WORLD REVIEW AND OL TLOOK
AGRICULTURAL PRODUCTION ,
TRADE AND CONSUMPTION IN1951/52 1
Production
Despite unsettled world conditions and poorweather in such widely scattered areas as Australia,India and Argentina, farmers produced nearly 2percent2 more than in the previous year and 11percent more than in the immediate prewar years(Table 1 and Charts I and II). This increasekept pace with the gain in population during thepast year, but not over the longer period as popu-lation growth has been 15 percent since beforethe war. Production per caput thus remainedat a level below that of the immediate prewarperiod.
The overall increase in production was distributed unevenly among commodities and regions.Prices during the previous two crop years hadfavored non-food crops as compared to food, andfood production in 1951/52 showed only a slightchange over the previous year, although fiberproduction increased by 13 percent. The produc-tion of rubber, cotton, jute and sunflower seedincreased 10 to 60 percent in 1951/52 over 1949/50,while the production of eight major food crops 3increased only 2 percent and 1 percent over 1949/50and 1950/51 respectively and was still below thepostwar peak reached in 1948/49. Meat andmilk production was slightly higher than in thepreceding year. On the other hand, sugar produc-tion in 1951/52 was the highest in histoly and
Excluding the U.S.S.R.2 These estimates have a downward bias, especially
for Europe, as no adjustments have been made forincreased efficiency in feeding livestock.
Wheat, rye, barley-, oats, maize, rice, sugar,potatoes.
13
was 5 percent above the preceding year's. Fishproduction in 1951 continued the postwar increasewith the total catch 4 percent above 1950. Theworld output of forest products as a whole increas-ed substantially in 1951, although this was distrib-uted unevenly among commodities and regions.The output of woodpulp and pulp products ex-panded by 10 percent in North America, whilethat of sawn wood increased most in Europe,with about 5 percent. The world output of fiberbuilding boards in 1951 was 36 percent above the1950 level, the increase being greatest in Europe
some 85 percent.In most regions agricultural production,
response to the earlier changes in prices and/orto government policies, shifted somewhat in fa-vor of agricultural non-food items, while foodproduction remained at the same level or showeda smaller increase. In the Far East productionof fibers and rubber increased 7 percent over 1951and 32 percent over 1949/50, and food output incr-eased slightly and only equalled the immediateprewar average despite a rise in population. Thus,in Pakistan and India jute acreage expanded bytwo fifths between 1950/51 and 1951/52, whereasthe rice area declined slightly, and the wheatarea remained virtually unchanged. In Indo-nesia rubber production increased by 16 percentand rice only about 7 percent. However, fiberand rubber output in the Far East was only16 percent above prewar, whereas in LatinAmerica, the Near East and Africa, the increaseabove that level ranged from 38 to 23 percent.North America continued to maintain its highlevel of food production and is the only regionwhere the increase in food production since beforethe war is well above the rise in populationnumbers.
By a more intensive use of agricultural resour-ces and labor, nearly all regions were able to main-tain food production and increase that of raw
CH
AR
T I
I -
POST
WA
R I
NC
RE
ASE
IN
FO
OD
PR
OD
UC
TIO
N. A
VE
RA
GE
OF
1949
AN
D 1
950
CO
MPA
RE
D W
ITH
AV
ER
AG
E O
F 19
46 A
ND
194
7
materials. This is especially important in theunderdeveloped regions where farm productsprovide the main source of export, income.
International trade in foodstuffs and fibers
Total volume of' world exports of agriculturalproducts was somewhat lower in 1951 than in1950, with a substantial reduction in the exportof fibers although total food exports remainedabout the same (Table 2). Nevertheless, sub-stantial gains in quantities exported in 1951 OVer1950 ranging from 5 to 45 percent are shown forfish, bread grain, rice, sugar, fats and oils, coffee,tea and tobacco.
The lower exports of cotton and wool are mainlyan effect of the reduced activity of the textileindustQT in Europe, Japan and North America.
Europe's slowly increasing food production madepossible a further slight reduction of net importsin 1051/52 (Table 3). But the heavy- depend-ence of Europe on overseas food imports has be-come a greater burden on her balance of payments,since North America's preponderance as the world'sgreatest supplier of foodstuffs has grown stillfurther in 1951/52.
As the .North American share in world tradeincreased, that of the two other major food export-ing regions Latin America and Oceaniadeclined. As indicated in more detail in ChapterIII, the main reason for the change in LatinAmerica and Oceania in 1951/52 was the sharpdecline of grain exports and to a lesser extent ofmeat exports. In particular, the heavy declineof Latin America's role as a major source ofagricultural exports is due to a decline in exportsof coarse grains". to a-bout 20 percent of the prewarvolume ; maize, which_ used to provide the bulkof these exports, fell to less than 10 percent of thequantities exported in 1934-38. The growingsisare in world imports of the Far East -- a netexporter before the war is mainly due tohigher import requirements of bread grains anda net deficit of rice in 1951/52.
The total volume of world exports of forestproducts in 1951, consisting almost entirely ofexports by North America and Europe, increasedby 7 percent over 1950. The exports of sawnand round wood rose by 10 percent, and those ofwood pulp and pulp products by 6 percent. Theincreased demand for sawn and round wood inEurope led to an increase in this continent's netimports, while the favorable marketing conditionselsewhere rfor wood pulp and pulp products
15
TA13LE 1. INDEX NUINIBERSa OF VOLUME OFCULTURAL PRODUCTION 1949-51
(1934-38 100)
a These quantity indices are preliminar- revisions of pre-vious FAO production indices. A general revision will becompleted and new revised series established before the nextedition of this report.
b Indox numbers of agricultural production are basedgross production data applying uniform prewar price weights.There is double noun! :Ng in the indic,, since no allowa me,were maim for ion of Teed. For example. grainsmay wpco :c4 production of grains ", and again inthe form of ock. Agricultural products comprise time comodities ol below in the three aggregates.
Food comprises wheat, rye, barley, oats, maize, milletand sorghum, rice, dry beans, dry peas, broad beans, chickpeas, lentils, un6pecified pulses, sugar, potatoes, sweet po-tatoes, vegetable oils, animal and marine fats and oils, andmeat.
cl Aromatic crops comprise cocoa, coffee, tea and tobacco.e Fibers and rubber comprise cotton, wool, jute, hard
fibers, hemp, flax and rubber.
REGION 1949/50 1950/51 951/52
7'utal );.oductionb
Europe (excluding U.S.S.R ) 90 97 101North America 142 1:17 141Latin America 114 118 115Far East 95 99 101Near East 111 12,4 124Africa 120 122 122Oceania 119 114World (-excluding U.S.S.R )i 106 109
Food Pro(' lone
Europe (excludin 89 96 100North America 145 145 144Latin America 116 120 116Far East 96 99 100Near East 109 118 123Africa 118 118 118Oceania 120 114 110World (excluding U.S.S.R.) 106 110
Aroma( lc Cropsd
Europe (excluding U.S.S.R ) 125 131 138North America 155 158 178Latin America 99 96 98Far East . 86 89 88Near East 164 155 147Africa 142 154 154Oceania 98 103 106World (excluding U.S.S.R.) 106 107 110
Natural 1bers andRubbere
Europe (excluding U.S.S.R ) 106 106 113North America 119 76 114Latin America 120 129 134Far East 88 108 116Near East 115 127 123Africa 123 131 138Oceania 116 113 114World (excluding U.S.S.E, 107 104 118
TABLE 2. INDEX NUMBERS OF VOLUME OF TRADE IN AGRICULTURAL PRODUCTS, 1949 - 51a
(1934-38 = 100)
a In bmsio r1:::;, for trade indices the same commodities are included as forexisted. and imy have been weighted by corre,ponding r appli,,sP1 e uniform
b Trade data relate to calendar years, with the exception os wheat, rye,season July-June beginning in the year stated han e hem: Use C.
qttU ,Nports sud imports include trade bet tt...:1 E:1 'IC 31! Europethe Eastern European countries and the U.S.rt.ii. and bativemi them-elves f.estimates 1w V'' been made of intra Eastern European trad, This :1 :trade ill 9-1 1151. partially estimated in the same way, may also aifeet thefull trade coverage.
d Mi-t; of the inter trade between non-reporting countries is ex.Iui1,- ,i
16
production indiees as far as internatioprice weights ts,:at footnotes to Table lj.barley, maize and oats where the data for tradeand Western Europe but exclude trade betweeng the most part. For some major commoditiesy bins the European index. Unreported ChinaI'm' Eastern index. All other regions present a,footnote c).
1949/50 1950/51 1951/52 1949/50 1950/51 1951/52
A gricultural Product sb
Europec 56 68 65 90 91 89North America,Latin America
171 18396
20084
126152
143181
139159
Far East 68 82 84 74 89 101Near Ea t 111 129 107 216 234 241Africa 192 197 125 125 131 1450 ceattia 132 128 110 140 166 191
Worldd 97 105 102 96 103 103
Food
Europec 55 70 71 88 S9 SO
North Amer ica 268 982 335 99 100 98Lat in America 84 83 74 144 174 158Far East 37 42 78 79 96Near East,. 121 103 86 247 291 201Africa 110 112 101 109 113 128Oceania 116 118 95 143 163 140
Wor I dd 90 96 91 91 95 91
Aromatic Crops
Europec 1 58 50 54 86 83 91North America 116 117 128 154 138 144Latin America 125 105 110 140 130 146Far East 94 88 100 68 SI 86Year East 217 156 160 161 146 155Africa 147 158 166 130 145 147Oceania . 90 100 74 119 131 142
Worldd 115 112 110 112
Natural 1' ibcrs and Rubber
Europec 56 64 53 03 96 88North Amer ica 92 10:5 91 146 199 184Litt in America 88 125 81 101 236 173Far East 97 130 129 68 102 108Near East ....... . 96 135 108 350 351 454Africa, 124 129 137 419 423 484Oceania 148 138 124 173 238 365
Worldd 100 119 104 98 115 108
Exports ImportsREGION
resulted in a slight increase in net European ex-ports. In North America, on the other hand,increased domestic production of wood pulpand pulp products resulted in a slight reductionin net imports.
Food consumption and nutritionDuring the past two years food consumption
in most countries in nearly all regions showed somefurther improvement. However, gains of animpressive character have been too few to suggestthat any change of fundamental importance is
occurring in the world food situation (Table 4and Charts III and IV).
The improvement in food consumption levelsin 1951/52 appears to have been smaller and lesswidespread than in the previous year. Slightgains were recorded in a number of countries inthe Far East and Near East and some setbacksin other countries in these regions, especiallyPakistan and Israel. There was some recoveryin India following the conditions of acute foodstringency that prevailed in parts of the countryin the preceding y-ear; serious shortages are, how-ever, still reported from some areas in India. InEurope, except for Spain and Portugal, the pastyear has witnessed no significant change in foodconsumption levels. For many years, due largelyto a succession of droughts, Spain and Portugalwere outstanding exceptions to the general post-war recovery in Europe's food situation. Aidedby better weather conditions, the per caput foodsupply in these two countries substantially in-creased in 1950/51 and there was a further im-provement in 1951/52. For the first time inpostwar years, food rationing has been almostcompletely abolished in Spain but low incomeprevents large numbers of people both in Spainand Portugal from obtaining adequate supplies.Elsewhere in Europe changes appear to havebeen mostly of a minor character. Difficultiesin procurement, however, have led to some dete-rioration in the food supply in the United King-dom, especially in livestock products. The rap-idly expanding populations of the food surplusregions of North America, Oceania and Argentinacontinue to enjoy high per caput food suppliesand record levels of consumption of animal prod-ucts. Apart from one or two countries, notablyBrazil, there is no evidence of any further upwardmovement in consumption levels in Latin Amer-ica in 1951/52.
For the world as a whole, trends of the pastfew years suggest that the gradual postwar re-
17
TABLE 3. INDEX NITAIBERS OF NET TRADE INAGRICITLTITRAL PRODUCTS, 1949-51a
(1934-38 = 100)
Net Exports-F = Net Imports
a In basic data for net trade indices the same commod-ities are included as for production indices as far as interna-tional trade existed, a.nd they liase been weighted by cor-responding or applicable uniform price weights (see foot-notes to 'rabio 1).
b Owing to the abnormally low exports of grains from theUnited States in the 1934-33 period the North American re-gion was a net importer of agricultural products in the baseperiod. This also explains the very large percentage changein food exports from North America.
c Changed from a net ex-porting region to a net importingregion between 1934-38 and the postwar period.
Remo x 1949/50 1950/51 1951/52
Europe-1\Torth America b
100±
Agricultural
98±
Products
96
Latin America . 86 83 73Far East 60 74 63Near East 69 88 54Africa 122 126 119Ocean.ia 132 126 104
Food
Europe 101 + 97 + 96North America b 8 991 9 259 12 058Latin America . 72 65 57Far PasteNear East eAfrica 86Oceania 115 116 93
Aromatic Crops
Europe 90 87 96North A_merica . . 172 147 151Latin. America . . 124 104 109
90Far East. . . 99 102Near East . ... 52 125 146Africa 153 162 172Oceania + 121 132 144
Natural Fibers and Rubber
Europe 101± 103 95North ..4merica .Latin America . 73 109 68Far East 143 173 163Near East . 93 132 104Africa 115 120 126Oceania 148 136 117
covery in the food situation may, for the timebeing, be drawing to a close. Average per caputfood supplies in the different regions appear tobe becoming stabilized at lower levels than inprewar years, both in quantity and quality inmany countries in the Far East as well as in somecountries in the Near East and Africa, with lessanimal products except milk in Europe, and moreand a greater variety of supplies in most of thefood surplus countries. Despite increased moneyincome generated by higher industrial productionin the past few years, expansion in the effectivedemand for the more costly foods now also ap-pears to have slowed down, especially in Europe.Food prices, particularly at the retail level, havenot fluctuated as sharply in the past year as rawmaterial prices. Apart from minor pauses, thetrend in retail food prices in most countries ap-pears to move steadily upwards. In a numberof countries this tendency has been strengthenedby a reduction in food subsidies to the consumeror by the raising of prices paid to farmers.Poorer sections of the population consequentlyfind it difficult to buy the more nutritious foodssince these are often also more expensive. Forexample, in many parts of Europe meat consump-tion has failed to reach the prewar level.
In the underdeveloped areas of the world,cereals and starchy roots still constitute the bulkof a quantitatively inadequate food supply. Forinstance, a recent survey in Ceylon shows that thediet is often deficient in calories and that under-nourishment is common among the population.In an appreciable number of families surveyedrecently in India, the average daily calorie in-takes were below 2000 and, in a few, below 1500.Even in countries in which calorie levels are ade-quate the diet often does not contain enoughprotective foods. Such unbalanced diets havedeleterious effects on the health of the peopleand are responsible for the prevalence of variousdeficiency diseases. In Egypt, for example, certaindeficiency diseases such as pellagra prevail bothamong rural and urban populations although theobserved calorie intakes correspond reasonably wellwith their estimated requirements. However, themost serious state of deficiency now prevailingin many parts of the world is a sy-ndrome whichis associated with low protein consumption. Thissyndrome is known to be largely responsible forhigh mortality among children from six monthsto five years of age in Africa, Central America,and possibly in some other areas, includingAsia.
18
THE DEMAND SITUATION IN 1951152
Although world industrial production and em-ployment continued generally at high levels in1951/52, the sharp upward movement in prices,production, and market demand which had char-acterized the preceding year was no longer evi-dent, and demands for farm products reflectedthese changed conditions in varying degrees,especially in export markets. While productionof military goods continued to expand, that ofcivilian goods contracted somewhat, demand ofpurchasers was generally less strong for both con-sumption and stockpiling, and inflationary pres-sures were reduced and even gave way to deflation-ary tendencies in some countries. Prices ofraw materials in the second half of 1951 and inearly 1952 generally declined relative to prices offinished products. This, combined with lowerexports, reduced the dollar earnings of raw materialexporting countries from shipments to dollarcountries and thus contributed to renewed dollarshortages.
Industrial production
In North America, despite a recession in someconsumer goods industries, industrial output in1951 as a whole averaged some 10 percent above1950. In the first quarter of 1952 the generallevel of industrial production was slightly belowthat of the first quarter of 1951, while in thesecond quarter production was seriously affectedby the steel strike in the United States.
However, manufacturing capacity in the UnitedStates at the end of 1952 will be 50 percent higherthan at the end of World War II. Incomesremained high as wage controls gave way to thecontinued pressure for wage increases, reflect-ing high consumer prices.
The high industrial production and employ-mentreflected the impact of expanding rearmament anddomestic investment. While actual spending onarmaments is behind the original schedule, in-vestment in industrial plant continued at recordlevels. In the United States and Canada initialdifficulties in raw materials supply were short-lived and controls and allocations were relaxed.Civilian production, except of automobiles andprivate building, continued almost unrestricted.The reduced output of many consumer goods suchas refrigerators and textiles was caused by aslackening of demand rather than by a shortageof supplies.
TABLE 4. ESTIMATED ENERGY AND PR,OTEIN CONTENT OF NATIONAL AVERAGE FOOD SUPPLIES PER CAPUTIN 1951/52 COMPARED WITH 1950/51, 1949/50 AND PREWAR
COUNTRY
NORTH AMERICACanada* . . .
U.S.A.* . .
SOUTH AMERICA aArgmtinaBrazilChileColombia. . .
HondurasUruguayVenezuela .
EUROPEAustria . .
Belgium/Lux.Denmark.* . .
Finland . . .
France* . . .
Germany (Fed.Rep).* . .
Greece* . .
Ireland .
Iceland .
Italy*Nether] ands*Norway* .
Sweden* . .
Switzerland* .U. K. . . .
Portugal (cont.
FAR EASTCoy] on . *China bIndia e *.Indonesia*Japa,n* .
Pa.kistan* .
Philippines*
NEAR EASTEgypt* .
Turkey*Israel
AFRICAUnion S. Af.*
OCEANIAAustralia* . .
New Zealand.
Prewar
Number per lay )1 . Grams per day . .) % ( . Grams per day . . )
3 070 3 140 3240]3 150 3 170 3 210
2 7302 1502 2401 860
2
2 9902 8203 4203 0002 830
3 0702 6003 4003 1609 5102 9203 2003 1203 1403 120
2 1402 2301 9702 0402 180
1 920
2 4502 560
2 300
3 3103 260
CALORIES
19-1./50
3 1702 4402 3402 3301 9802 9002 210
2 6002 8903 2303 0202 -.50
2 7002 4903 450
22 9703 1503 2103 1803 0802 230
2 0102 0301 6201 8802 0002 2401 960
2 3002 6702 680
2 570
3 2103 400
1950/51
1951/5'2as per-centage
of1950/51
3 1402 4902 4402 2402 03012 93012150E
2 7402 8903 130 + 2321O2 790 + 2
2 8102 5103 5003 2402 400 + 33 090 53 180 1
3 240 23 250 + 1
3 100 52
2 4002 7102 520
2 640
3 290 33470E
19
85 93 9589 91 92 +
9868C947
90
8884919593
848499
111828090959683
2060E 482 120 + 2 711 570 + 2 561 950 + 1 462 100 + 2 642 16020501 1 45
TOTAL PROTEIN
103657057549165
7585
1039692
787796
74Si
10495989063
624242526044
668581
72
98101
10267731551571921641
7918497 +
10091+76 I +77 E
9711376 +82]104]95]97E+8867
48 E +65 +42 +44535847
68 I +88 j +Si
73
98 E104
ANIMAL PRO
a Figures refer to calendar year of the earlier year mentioned. h Excluding Manchuria and Taiwan. c India andPakistan in the case of prewar figures.
*REMARKS ON 1951/52 changes : CANADA, slightly less beef + butter more pork + milk. U.S.A., slight increase in meatmilk slight decline in butter + sugar. DENMARK, more meat, cheese + fats, less potatoes sugar + milk. FRANCE,
more meat, eggs + milk, slightly more fats, less potatoes. GERMANY (FED. REP.), more sugar, meat + milk, less cerealspotatoes. GREECE, more potatoes. slightly more sugar, pulses, fish, milk + cheese, less cereals. ITALY, more cerealspotatoes, slightly more sugar, pulses., meat, milk + fats, slightly less cheese. NETHERLANDS, less potatoes + fats,
slightly less sugar -4-- meat. NORWAY, slightly more sugar + cheese, less cereals, potatoes, meat + milk. SWEDEN,less milk, slightly less potatoes, sugar + butter. SWITZERLAND, slightly more meat, cheese + fats. LTNITED KINGDOM, lesspotatoes, slightly less cereals, sugar, meat, eggs, milk, cheese butter. CEYLON., slightly more meat. CHINA, more riceand wheat. INDIA, more rice and sugar. INDONESIA, slightly more cereals, more starchy roots. .TAPAN more sugar, lessfish. PAKISTAN little significant changes. PHILIPPINES, slightly less rice and corn. EGYPT, more wheat, less rice.TURKEY, more cereals, meat and butter. UNION OF SOUTH AFRICA, insignificant changes. AUSTRALIA., less wheat, meat
fats.
48 56 571 50 61 61 1
62 67 6832 25 2621 22 2320 26 26
19 1861 59 60
29 28
E39 29 3334 41 40
3j 57 59 57.44 51 48
2 39 41 41 2
42 33 3623 19 1748 47 4974 79
3 20 18 202 41 39 392 49 58 571 59 61 60 21 52 51 24 46 46 46 6
20 20
9 11 12 + 1
6 5 56 6
5 5 510 9 10 5
11 1111 10 11
9 13 1412 17 19 = 3
32 30
23 27 26
67 66 66 9
64 66 70
7478
68
10396
1951/52as per-centage
of195 0/5 1
Prewar 1949/50 1950/51
1951/52as per-centage
of1950/51
Prewar 1949/50 1950/51
CH
AR
T I
II -
PE
R C
APU
T F
OO
D C
ON
SUM
PTIO
N P
RE
WA
R
UN
KN
OW
N
BE
LOW
220
0 C
ALO
RIE
S
2200
-270
0 C
ALO
RIE
S
OV
ER
270
0 C
ALO
RIE
S
a
,4
,
'`d
CH
AR
T I
V -
PE
R C
APU
T F
OO
D C
ON
SUM
PTIO
N, P
OST
WA
R (
1950
151)
UN
KN
OW
N
BE
LOW
220
0 C
ALO
RIE
S
2200
-270
0 C
ALO
RIE
S
OV
ER
270
0 C
ALO
RIE
S
I 1
F
In Western Europe total industrial activityremained high and shortages of coal and steelare slowly disappearing. Beginning in the secondhalf of 1951, however, industrial expansion didslow down considerably. In some countries, e.g.Belgium, Germany and especially Italy there isserious unemployment. An increase of indus-trial production was reported in Eastern Europein 1951. For Europe as a whole (excludingU.S.S.R.) industrial production in 1951 averaged12 percent above the 1950 level.
Industrial activity in India and Japan continuedto rise in 1951/52 although at a reduced rate.
1948 .100300
280
260
240
220
200
180
160
140
120
100
90
80
70
China (excluding Taiwan) reported increasedactivity. The pace of industrialization of someLatin American countries slowed down.
Industrial production is the basic factor behindeffective purchasing power for farm production.The slowing down of industrial expansion meantthat effective demand for farm produce alsostopped growing in 1951/52. The ensuing ef-fects were most noticeable in industries based onagricultural raw materials, where slackening inprices produces exaggerated contractions in man-ufacturers' purchases. In the leather and shoeindustry and the paper and printing and textile
CHART V - INDUSTRIAL PRODUCTION IN SELECTED COUNTRIES
SEMI-LOGARITHMIC SCALE
JFMAMJJASONDJFMAMJJASONDJFMAMJJASONDJFM19 49 1950 1951 1952
Notes : United Kingdom: including construction.United States : excluding electricity and manufactured gas.Belgium : adjusted for seasonal variation and number of working days.Chile : including building, excluding mining.
22
France : adjusted for number of working days.Mexico : quarterly averages.Western Germany : adjusted for number of working days.
IIIMMEMMNIIMMMEIMIION=ME
MI MINM ME MMEmi NI=___EMEEEMEEMEE E MEE MMfflEMEMUMMMIIMMIM
EMEMM ME MEE=MEE EMEEEEEEEEEEE E MIME. MEEMEEME
MEE. ME ME =ME MEE= EMEMEEMEEMEMEE
MIME=MOMMOMMO
MMEMMEME
=ILIMMEMEM
MIME/--.
11111MMUMM=ME
EMENEEMEMEEMPAMMFEEMMEEMEEEMIEMINEMEE-----._/imms
/MM.ME
,.
ME MEMEMEMOMM
OEM
E MEEu
ME E
MEWuuuuuuuuu
O ME
III MI MOOMM OMt MO= MOMI1111.111111..'
........ .
ME
..
JAPAN - FRANCE
........ Ill.,Ill.CANADA
UNITED KINGDOM
lp,"AI.
.
MEXICO
.-
.
-:--lx--
--- ---
4.......-
.
->
61/4.
\\,/
-/v
Ic
>,?i
V I
. - .
-Th\-
AN
's
:1
UNITED
.,I
I
iNDIAI II
IISTATES BELGIUM I II I I
III II I II 11111111111 II 11111
industries in many countries, stocks yore reducedand consumers were reluctant to buy, althoughsupplies were ample and prices declining. Thetrend became especially marked after the thirdquarter of 1951. Reduction of production andincreased unemployment in the textile industrywas widespread, affecting major producers inNorth .America, Western Europe and in the FarEast (Chart V).
Real national income showed the same risingtrend as industrial production in Western Europeand in North A.merica. In the former highergross national production in all countries forwhich data are available was offset by the ef-fects of the developments of the terms of trade(and invisible items of the balance of payments)resulting in an average increase of less than 5percent (except in Germany) in real national in-come in 1951 above 1950. Countries which im-proved their terms of trade throughout the year,e. g. the pulp exporting Scandinavian countriesand Belgium as a steel exporter, increased theirreal national income around 7-8 percent (exceptFinland, with 14 percent). In Canada and theUnited States, relatively less dependent on foreigntrade, real national income continued to increasein 1951 by 5 and 7 percent respectively.
PricesPrice movements were varied as between com-
modity groups. Armament demands and gen-erally high industrial activity caused further
TABLE 5. -- WHOLESALE PRICES OF MAJOR VVO
SOURCE :International Monetary Fund, International Financial Statistics; am* : Provisional.a 1934-35 average.b July 1937 - June71938.e U.S. Government -fixed price.
23
increases in prices of metal products and of somefoodstuffs. Reduction of stocks by private in-dustry and governments, the easing of the supplysituation, the strengthening of anti-inflationaryprograms and the reluctance of consumers to buy,resulted in niarkecl price declines on internationalcommodity markets of rubber, wool, most fatsand oils, sugar, hides, jute and textiles and theirproducts (Table 5).
Domestic wholesale prices on the AN'hole con-tinued to rise during the first half of 1951 butstarted levelling off or declining in the secondor third quarter. During the first half of 1952prices stopped advancing in most primary produ-cing countries, and declined slightly in themajority of West European countries. Canada.,the United States and Italy had continuous thoughgradual declines in wholesale prices since rnid-1951. In Australia the general wholesale pricelevel continued to increase, though at a decreas-ing rate since September 1951.
In most countries for which data are available,the cost of living continued to increase in thefirst half of 1951/52 although at a much reducedrate. In the first months of 1952, the increaseslowed down still more and in a number of casesturned into a slight decline. The 1951 increaseswere mostly around or below 5 percent. Howeverin parts of South-East Asia, in Australia, Japanand in Latin America, where the effects of thehigh_ export earnings of 1951 were still in force,and in Austria and France, where the repressed
D TR,ADE COMMODITIES IN SELECTED iNTARKETS
+'AO food and agricultural sta is ics.
COMMODITY
Average price Peak price 1951 Most recent price 1952
1937 1938 1,Tan. 1917-Aug. 1919 'June
Jan.-1950 Mouth Price Month Price
U.S. Dollars per lb. unless otherwise indicated
Wheat (-U.S.) $/bushel. . 1.20 0.78 2.37 2.25 Nov. 2.53 June 2.31Rice (-U.S.) 3.60 3.30 10.86 8.10 March 10.54 May 10.55Sugar, raw (Cuba) . . . 1.72 1.40 4.35 4.39 June 7.41 May 4.46Coconut oil (Philippines) 5.93 2.95 18.26 14.82 March 21.09 June *9.50Copra (U.S.) 3.70 1.95 10.94 9.52 Feb. 13.78 June *7.00Coffee (U.S.)Cocoa (U.S.)
11.108.40
7.805.30
26.7731.83
47.7326.41
Feb.March
55. 5038.38
(Tune-May 38.37
*53.60
Tea (Ceylon) . 29.80 26.50 61.20 50.50 March 64.90 May 40.30Wool (U.K.) " 116 . 90 - 139.80 155.40 March 366.30 June 151.70Cotton (U.S.)Cotton (Karnak) (Egypt)
11.80- 9.00- 33.5060.00
32.4045.20
MayMarch
45.20102.90
JuneJune
4*620..3400
Jute (U.K.) . . . . . . 14.10 1 4.10 16.70 14.50 May 28.80 May 15.00Rubber (natural U.S.) . 19.40 14.60 20.30 23.50 Jan. 73.50 Tune c3800Rubber (Malaya). . 18.60 13.70 17.90 21.00 Feb. 73.50 May 28.80
CHART VI AGRICULTURAL WHOLESALE PRICES IN SELECTED COUNTRIES(Devaluing in 1949 /50)
24
SEMI-LOGARITHMIC SCALE
J F M AM J J A SON D J FM AM J J A SO N D JE M A M J J A SON D J F M A M J JASO1949 1950 1951 952
300290280
250240
ZIO
180
°
ISO
40
30
120
IO
00°.
90
80
I948I0O SEMI-LOGARITHMIC SCALE
L ¡
¡i
--L I I
JAPAN /.\T¡
I
O_.._.e_/
I,,._:
j,
AUSTRALIA I
.._\\/.\\III.....ii
i,.---*
// '
I60_ j
/NETHERLANDS
UNITEDiJlIllll
./
KINGDOM
/11111
I
1I
1..:tJ
FRANCEt
eç
ii,-
/SWEDEN---
JE M AM J JASO ND JE M A M J JASO NOUE M AM J JASO ND J F MA M J JASO949 1950 1951 1952
CANADA-
ITALY
jI., ......
UNITED
ilSTATES
I I
Notes: Australia: July 1947 - June 1948 = 100. United Kingdom Prices paid to farmers.
CHART VII AGRICULTURAL WHOLESALE PRICES IN SELECTED COUNTRIES(Not devaluing or devaluing slightly in 1949/50)
CHART VIII - GENERAL WHOLESALE PRICES IN SELECTED COUNTRIES(Devaluing in 1949750)
Note : France : 1949 = 100.
CHART IX - GENERAL WHOLESALE PRICES IN SELECTED COUNTRIES(Not devaluing or devaluing slightly in 1949150)
25
3C°290280
27026°
24°23°
2 I °
25°E..
948 .100
ininomm
MINEMEMINEEMINIE...Elmo=MEINIEMEMEN1
MIMMEMIIIIMME111...1.11.111..111111
MIIMMIMMEIMIIMMIIMMIMMIIIMMWIIIMMIM.......11..1.1..M.11111.11.1.
mmulimmimnuimminmMUM=
MMEININNIMMMMMIIIIIIIMI
/
,.=. -.....*"'''.".
IMIMIIMIUMMIIIIIIIIISEMI-LOGARITHMIC SCALE
MIMIIIMIIMININ''.'"--.- .111..1
rilmENINEIMMEMEIMMIMINomiNMEN11MMINEINSEIMillMIMINNE
INN
..*--".."' ''''...-
./---I
4_JAPAN
El NoI
22,1MM=ENMIMI MIMEffiNNIIIMMIN ./..r.''
i ME=1 MIN EMIMIIIMIIIIMEIBMINI
.11111..111.1111.I200
118900
170
160
50
140
130
120
, 10
90
80
......111111. .I*...,U AUSTRALIA Elum..11111111
mumMIMI DENMARK
//
/i
- ,... '- /..... i1 '
1 I
1111UNITED
:
KINGDOM. .-./.
ll 1 I unIll1111
a
i
NETHERLANDS
.../1 ..
"
FRANCE1
I111111_III
.--........""
III , ,.......
SWEDEN
........f
..INDIA
.../.,,,!....
.... - - 1e
MIMIHill
'" 7 '' '' i I
'
H [
1
Pill.111111111111r 111111111111111111111111111
ASO1952
11111111
1949JFMAMJJASONDJFMAMJJASONDJFMAMJJASONDJFMAMJJ1=111111 11111111111
1950 1951
150
130
120
Ho
oo
9 o
80
94800.i i
SEMI-LOGARITHMIC1
SCALE
M.i4°MUIIIIIIIMIEmi
umllilli
--nr.-1-............
1
r
CANADA
UNITED
1
k.,:i
1
1
4,
.0#0 ''''
i
STATES
I
. 1
...........
-- ...°...... .........
,
s' ..........
'--.n7:.....1
,.. ..... ,,,A,, __,,,,,...-
.-0
.1...: .... :71,
i
I
I....=--.--,,1...: 1. ...
'.. ..... 1-- ------:'..eITALY
..i II
...... ... .. .... *1
''........................... ... SWilZE AND
J M111111111A
1949ONDJFMAM ONDJF AI ASO DJ F AMJ A SO
950 1951 1952
inflationary pressures broke loose, the rise hasbeen 10 percent or more. Consumer prices forfood generally kept pace with the overall cost ofliving in 1951/52.
The slowing down of rises in retail prices waspartly due to a more general and more vigorousapplication of governmental anti-inflationary meas-ures in addition to the price declines on inter-national commodity markets. Such measures in-clude increases in bank rates (Austria, France,India, United Kingdom) a general tightening ofcredit at all levels and reduction of public expend-itures. Measures to facilitate imports, levy ofspecial export taxes, and to a minor extent, directcontrols, were also employed in various countries.As inflationary pressures receded curtailment ofcredit was relaxed in some countries while foreigntrade difficulties forced reductions of export taxes(India, Egypt) and the re-imposition of importrestrictions (United Kingdom, Australia).
The recent divergent movement of domesticprices as between countries appears to be a contin-uation of an adjustment process that began withthe devaluation of a number of currencies inSeptember 1949. In the countries concerned whole-sale prices, including those of agricultural prod-ucts, have since risen much faster than in coun-tries that did not devalue their currency (orthose that devalued only slightly), generally suf-ficiently to offset any premium gained by thedollar immediately after the devaluation. Be-tween September 1949 and April 1952 the whole-sale price level rose by only 8 to 15 percent in theUnited States, Canada, Switzerland and Italy,while in the United Kingdom, Australia, the Neth-erlands, Denmark and South Africa, it rose by36 to 60 percent (Charts VI to IX).
During 1951/52 wholesale prices of agricultural
a July 1947 - June 1948 100b 1040 100.
food products generally remained firm, but weak-ened considerably for other agricultural productsand fats and oils, continuing the downwardmovement which started in March 1951. Cottonprices have receded in all markets since December1951 and most markedly in the case of non-dollarcottons which previously had advanced abovethe price of United States cotton. However, afterthe sharp decline in March and .April 1952,prices showed a slight recovery. Wool pricesfell sharply through most of 1951 and by May1952 were one third of the peak prices of a yearbefore and about 20 percent below the priceprevailing before the Korean conflict. But al-though by June 1952, wool prices had risen be-tween 15 and 20 percent over the March 1952 level,there were still no definite indications of a per-manent upward movement. Jute prices droppedrapidly with increased supply at the beginning ofthe season, then receded further during the firstthree months of 1952. Rubber prices in June1952 were at their lowest level since the outbreakof the Korean hostilities, a decline of about 50percent from the peak in February 1951 but stillfar above the pre-Korean levels. World marketprices of most oils and oilseeds have declinedmaterially from the high levels reached aroundMarch 1951, although by May and June 1952,prices began to move upward. Throughout mostof 1951/52, prices of wheat, rice, sugar, meats anddairy products were generally steady or haveincreased somewhat, but recently most grainprices have declined on account of larger cropprospects in the United States.
Current price relationships are tending to favorfoodstuff production. Furthermore, upward farmprice adjustments were announced in early 1952by the Governments of the United Kingdom,
TABLE 6. IN.DEX OF THE RATIO OF AGRICULTURAL WFIOLESALE PRICES TO GENERALWHOLESALE PRICES, SELECTED COUNTRIES
(1048 =.- 100)
LOUNTRYs half
I
Second First It IfhalfSed
half Jan. Feb. Mar. Apr. May
Australia a 106 123 133 96 91 87 84 84 87Belgium 92 88 82 82 83 t3 84 84Canada. 94 93 92 90 91 90 90 91 91France b 101 92 85 88 89 82 88 88Italy 115 113 106 108 110 Ill 110 110Japan 110 102 92 101 102 102 103 103Mexico 90 91 95 100 97 97 99 102Sweden 100 96 87 86 5 85 87 90U. S. A 91 94 97 95 95 95 93 94 94
1 950 1951 1952
CHART X - WHOLESALE PRICE INDICES: RATIO OF AGRICULTURAL PRICESTO ALL PRICES IN SELECTED COUNTRIES
CHART XI - WHOLESALE PRICE INDICES: RATIO OF AGRICULTURAL PRICESTO ALL PRICES IN SELECTED COUNTRIES
27
160
150
140
130
120
110
100
90
80
70
1948 lOO
IITALY
I
- - ------ -----,'--- --_-..
,,...
_-1. -- ----
...
U ITED STATES .....,.....
..."...
..impial.Alkup.i'llMillli
-
1
L MEXICO ' CANADANEEIIIIIIIIJF MAMJJ ASONOJFMAMJJ A 5 0 N 0 J FMA M JJA S ONDJFMAM
1949 1950 1951 1952
i 60
150
i40
130
1 0
110
100
90
80
70
19 4 8.100
ili IIIFRANCE
IIIAUSTRALIA
11111
iiIII-
_lair
..^ \s_ ______ I
---.
11111
'''' ------1'
..'
.. '
\- SWEDEN
___ 7-_ ---
JAPAN
-./
/'
/ ..._--' --- _ _____ ..
,.:
G'"---
ir" BELGIUMi''''.1.-/
,
\\
---'
1 i
,-----'...-1
.-----
'----.!___:-,-12 N.,/
. /---- -- - -----,I/
- i
1111
iF M
,,
.
7
AM J SONDJF19j A49
A MJJ ASON 0 A JJ ASOND F
1950 1951 1952
Notes: Australia : July 1947 - June 1948 = 100. France : 1949 100.
Sweden, Norway, and Austria. In Australia dur-ing 1951/52 upward farm price adjustments havealso occurred for all agricultural products ex-cept wool, and Argentina has sharply increasedprice incentives to producers for export.
During 1951, prices of fish increased, importantexceptions being canned tuna and some fish oils.The upward movement for nearly all fisheriescommodities was somewhat reduced by the rela-tively abundant supply.
Prices of forest products such as sawn soft-wood, pulpwood and pitprops which had risenvery substantially during 1951, especially out-side North America, levelled off toward the endof the calendar year and by April 1952 haddropped sharply below the top 1951 levels.
The prices farmers received for their productsrelative to those they paid for goods and servicesduring the past year, as measured by the ratiobetween agricultural wholesale prices and gen-eral wholesale prices (Table 6 and Charts X andXI) indicate that the relative position of farm-ers in 1951/52 as compared with the previousyear has improved somewhat in many of thecountries of Western Europe and Latin America.In the Far East, :Japan and India were the onlymajor countries to show some improvement. Theprice ratio deteriorated in most of the other coun-tries of the Far East, in Australia (due to woolonly) and to a considerably lesser degree in Canadaand the United States. In the regions where im-provements occurred they were due in part toan upward adjustment of maximum or supportedprices. Where a deterioration occurred, it wasin the main due to a sharp drop in prices of agri-cultural raw materials, whereas prices of othergoods, in many cases wholly imported, continuedto climb, or at least showed a slower decline.In North America, the lower value of the ratioin Callada was in part caused by the outbreakof the foot-adill-mouth disease in early 1952,the resulting restrictions of movement of livestock,and a sharp break in livestock and livestockproduct prices. In the United States the p1-icechanges reflected to a large extent changes in thesupply situation for individual farm products,e.g. .meat, poultry and dairy products and oil-bearing crops. In addition to the supply in-fluence, there apparently was some weakening inconsumer demand for fats and oils and for textileproducts which contributed to the drop in wool,cotton and oil-bearing crop prices. Demand forstockpiling and speculative buying in general in thefirst half of 1952 did not ha-ve the same price-making influence as in the first quarter of 1951.
28
Terms of trade
While volume of world trade increased appre-ciably in 1951, the change in price relationshipsbetween raw materials and manufactured goods,already discussed, resulted in a change in theterms of trade. The terms of trade of the indus-trialized countries improved without reaching thepre-Korean level while those of the raw materialexporting countries deteriorated although stillremaining more favorable than before the Koreanconflict.
International tradeDuring the past year, the division of the world
into two trading groups has become more marked,the first consisting of the major trading areaoutside the Soviet Bloc, and the second of theEastern European countries, the Union of SovietSocialist Republics, and China. Although in 1951trade within the two groups of countries continuedto rise, trade between them in 1951 was less thanone half of the prewar volume, and judging frompresent trends, difficulties are likely to be stillgreater in the near future.
However, total value of world exports increasedby about one-third in 19.51 over 1950, althoughquantity increased only between 10 and 1:5 per-cent. The most marked expansion occurred inthe United States, as Western Europe, LatinAmerica and the Par East increased their pur-chases, especially during the first half of 1951.World export values declined sligh tly in the firstquarter of 1952.
Balance of payments
The continuing fall in raw material prices andthe somewhat lower level of United States con-sumption in 1951/52 reduced U. S. import valueswhile expanded demand for its exports rapidlyincreased the positive net balance of trade andservices in 1951/52. On the basis of eleven monthsthis balance in 1951/52 would be about four timesas large as in 1950/51. The United States' foreigneconomic aid and other transfers also declined andare insufficient to cover the world's dollar deficitin 1951/52. Many European and some LatinAmerican countries had, therefore, to draw ontheir gold and dollar reserves. While the restof the world had acquired from the United Statesgold and dollar assets of more than 3,600 milliondollars in 1950 and of more than 1,000 milliondollars in the first half of 1951, the United
States again became a net recipient of over 650million dollars in the second half of this year andof over 550 million dollars in the first quarterof 1952.
The fall in raw material prices, as well as theUnited States reduction in imports, were greatestfor the three main sterling commodities, rubber,tin and wool, and the Sterling Area was thereforethe heaviest loser in gold and dollar assets. Itsfavorable balance with the United States of 324million dollars on current accounts during 1950changed into an unfavorable one of 764 milliondollars for the first 9 months of 1951/52. TheSterling Area deficit with Western Europe couldnot be eliminated, requiring gold payments ofabout 485 million dollars up to the end of June1952. Since then, with her total quota exhausted,the United Kingdom has had to pay all her deficitin gold as well as that of the rest of the SterlingArea arising from transactions with the OEECcountries. The total losses of gold and dollars to theSterling Area in the second half of 1951 amountedto over 1,500 million dollars and in the firstquarter of 1952 to over 600 million dollars, reduc-ing the combined holdings to 1,700 million dollarsat the end of the latter period. However, onlysmall losses occurred in the second quarter of1952, thanks to reduction of current deficit and tosome acceleration in United States aid payments.
While the Sterling Area lost 50 percent of itsgold reserves in only nine months, Latin Americalost much less and still had over 3,300 milliondollars reserves at the end of 1951. The low level ofthe Sterling Area's reserves, coupled with the highrate of gold and dollar losses, explains the strongmeasures taken by countries of this area to slowor to stop the drain on their assets.
The effects on other regions were less marked.The dollar shortage has, however, slowed im-ports of manufactured consumers' goods intoLatin America in 1951/52. Brazil had to utilizethe International Monetary Fund for dollarsneeded to import wheat. Japan's trade withChina and Korea has fallen still further and isnow only a fraction of its prewar volume.tempts to compensate this loss by higher exportsto non-Communist countries in the Far Easthave led to the accumulation of considerablesterling balances in Japan.
The growth of restriction in internationaltrade
By April 1952, the United Kingdom, Australia,New Zealand, th.e Union of South Africa and a
29
number of smaller countries of the Sterling Areahad announced quantitative trade restrictions.Outside this area severe measures were also takenby France and other countries including Argentina,Brazil, Chile, Indonesia, Israel, Syria and Uruguay.Among the agricultural commodities directly af-fected are fresh and dried fruits and processedfoods. These restrictions may be severe enoughto create new problems in the balance-of-paymentsposition of Denmark, Italy and the Netherlands.On the other hand Belgium, Germany and Italywere able to extend still further the liberalizationof imports.
Besides quantitative restrictions, a number offinancial measures such as changes in exchangerates, and increase of interest rates and of customsduties were applied. Other means adopted forredressing the balance of trade included the re-duction of contractual prices for imports (woodpulp), and encouraging exports by either loweringexport taxes (Ceylon, India) or by granting ex-port subsidies (France).
Some United States foreign trade practices alsocontributed to disturbances in trade. Amongthese are the import quotas on dairy products,the " Buy American " provision, the threat ofaction under the escape clause in reciprocal tradeagreements, and the export embargo on a widevariety of goods believed to contribute to poten-tial armaments, with corresponding restrictionson exports by many Western European countries.
The general economic position of agri-culture, 1951/52
The farm labor supply was relatively tight,especially in the highly industrialized countriessuch as the United States, United Kingdom,Canada and, to a lesser extent, in the group ofcountries where industrialization was being stressed,as in Argentina and Australia. The impact ofthis supply situation on production was somewhatgreater in the countries where agricultural mecha-nization had not advanced to the U. S. or U. K.level. In both groups of countries, the costs ofhired labor increased as alternative opportunitiesin industry attracted larger numbers of theagricultural population.
Contrary to fears at the beginning of 1951, nogeneral shortages developed in agricultural ma-chinery, although United States availabilities tosuch countries as Australia were reduced andparticular types may not always have been readilyavailable. Earlier, serious supply difficulties in
important pesticides were remedied but the supplyof superphosphates was below the greatly- in-creased demand.
Farm income seems to have increased in mostregions ; however, specific data are available foronly a few countries. In the United States andCanada cash receipts from farming in 1951/52increased by 15 and 19 percent respectively over1950/51, (based on 10 and 9 months respectively).In Australia, the sharp fall of wool prices wasresponsible for a 22 percent decrease in grossvalue of rural production, between 1950/51 and1951/52. The other countries for which infor-mation is available showed smaller gains thanNorth America. In the semi-industrialized andunderdeveloped countries there have been finan-cial gains, but these have in many cases beenoffset by rapidly expanding inflationary forcesand or by civil and military disturbances. Further-more, the rapid rise in prices of farm productsin these regions, followed by less sharp declines,has left producers in a somewhat uncertain posi-tion.
In the fishing industry, although prices movedsomewhat upward, the rate of increase was lessthan that of costs. Prices of fuel and gearespecially showed marked increases.
PRODUCTION AND SUPPLYPROSPECTS FOR 1952/53
Agricultural production
Total agricultural production in 1952/53 willapparently equal or perhaps exceed that of 1951/52.Northern hemisphere bread grain prospects arebetter than a year ago. Both Australia andArgentina have adopted vigorous policies forincreasing wheat acreage. No major changesare expected in world meat and dairy production.Among industrial agricultural products, rubberproduction may decline with lower prices, whileproduction of wool and jute seems likely to beabout the same as last year's.
Possible catastrophes resulting from the De-sert Locust plague have so far been checked byeffective control measures. A severe plague threathas been building up during the past y-ear. Themain infestation fluctuated between eastern Africa,especially Ethiopia, British Somaliland and So-malia, and the countries of the -Near East, espe-cially south western Arabia, Jordan, Iraq andIran. Up to July 1952 there liad been little croploss in Africa. Much of the infested area was
30
non-agricultural, but agricultural areas may beinvaded later in 1952. In the Near East, springbreeding occurred mainly in desert regions andsuccessful control campaigns have prevented heavyescapes in all areas, except perhaps Iran. Theswarms that spread into Pakistan from Iran inJune and July are likely, to penetrate into Indiaand may result in extensive breeding during themonsoon period.
The future trends of the plague will depend uponeffectiveness of the campaigns and on the clim-ate, but unless the Desert Locust is checkedthere is grave danger of an intensification of theplague in all areas already infested, and a spreadto West and North Africa later in 1952 and in1953. It is impossible to estimate what lossesmight occur, but most crops in all countries fromIndia to Morocco and south Turkey to northernTanganyika would then be endangered.
Foot-and-mouth disease broke out in 1951 ina veryr serious form in Europe : since August 1951there have been tens of thousands of reported out-breaks. The disease, which appears to haveoriginated in Germany, has spread to Belgium,Denmark, France, Greece, Holland, Italy, Lux-embourg, Sweden, Switzerland and the UnitedKin,gclom, and there is grave danger to all otherEuropean countries. The effect on milk, butter,cheese and meat production has been great.
On the South American continent the diseasespread further into Colombia and is raging as anepizoblic over most of the country. Efforts arebeing continuously directed towards its control,but losses have been very heavy and at presentit has defeated efforts at limiting its spread. Amost serious outbreak of this disease occurred inCallada in early 1952. Control measures wereimmediately instituted and the disease is nowwell under control.
The world wheat supply should be rather largerin 1952/53, due to an expected increase in pro-duction of about 25 percent in the United States,a good crop in Canada, and somewhat larger cropsin Australia and Argentina if the newly announcedprograms prove to be effective.
In Western Europe the postwar trend of pro-gressively improving yields combined with favor-able weather conditions promises some increasein production. Some advance, although lessmarked, is also anticipated for coarse grains inmost regions. Total coarse grains acreage in theUnited States is the same as that planted last year,but gains in yields are expected. In fact, theforecast for maize is for an increase of about 14
percent over last year's output. In the NearEast Iraq, Syria, Lebanon and Turkey are anti-cipating good harvests, especially of barley. Themaize planting target of 3.8 million hectares inArgentina, although over 50 percent above theacreage harvested in 1950, is still well below theprewar average.
Provided that widespread crop failure is notrepeated in the major rice growing countries ofthe Far East, production in 1952/53 may showa considerable increase. The total area plantedhas increased 10 percent above the prewar leveland mayr show a further increase in the comingyear, but the yield per acre has been falling stead-ily in some major producing countries.
Oil-bearing crops are likely to show a substan-tial advance in Latin America and Eastern Eu-rope. A 10 percent increase is expected in Cuba'ssugar production ; rapidly expanding acreagesin Eastern and smaller gains in Western Europealso promise larger supplies. Tobacco produc-tion is expected to remain unchanged in the UnitedStates and Canada.
No major change is anticipated in cotton out-put in the -United States while a sharp decline isexpected in the Near East as a reaction to thedrop of world market prices for non-dollar cottonand of government measures to shift productionfrom export crops to food crops.
In so far as jute is concerned the Pakistan Gov-ernment has increased the licensed area by 10percent to 836 thousand hectares for the 1952/53season. Last year 95 percent of the licensed areawas actually cropped, but it does not appear thatas high a percentage will be achieved in 1952/53.It is likely that sowings are only about the sameas last year. In India, sowings are expected to beless than last season.
Natural rubber production will probably de-cline by about 11 percent, and the estimated ex-cess of production over consumption in 1952 isestimated to be smaller than in the previous year.
Conditions are favorable for some increase inlivestock production in Canada and the UnitedStates, while the general good prospects for a furtherexpansion in Western Europe are somewhat com-promised by foot-and-mouth disease outbreaksand by the current feed situation. The effects onproduction may become apparent only in 1953/54.A reduced output is expected in the Union ofSouth Africa as a result of this year's poor maizecrop. In Latin America the general trend to-wards expansion will be weakened by the new pol-icy adopted in Argentina designed to build upherds.
31
The general trend toward expanding productionas ndicated by national and regional gov-
ernment plans and policies is likely to con-tinue into 1953/54.
It is likely that the heavy demand for forestproducts in 1950/51 which led to a general in-crease in production in 1951/52 will result in asomewhat reduced output of many forest productsin 1952/53. Increased stocks at the beginningof 1952 will temporarily reduce the demand, par-ticularly in Europe, Australia and South Africa.In North America, however, industrial and build-ing activities are likely to maintain the highlevel of demand. The demand for sawn woodis also likely to increase from its low level in1951.
THE DEMAND OUTLOOK, 1952-54The expected generally sustained high level
of economic activity in the United States in1952/53 may have corresponding effects on therest of the world by increasing the United Statesimport demand, which lagged considerably in1951/52 as compared with the levels of internalactivity. Such an increase, plus the expectedpurchases and armament orders placed abroad,would benefit the raw material countries by in-creased dollar sales, and areas with still unusedindustrial capacity would increase employment.Such alleviation of the dollar problem woulddirectly and indirectly increase the demand foragricultural products in many parts of the world.In 1953/54, however, some slackening in demandmay occur, as plant expansion for defence pur-poses begins to decline.
Industrial production, 1952/53The projected high rate of production for de-
fence in North America and Western Europe,while diverting still more energy and material fromcivilian uses, will probably sustain high levels ofindustrial activity and of consumer buying powerfor farm products, even though possibly somewhatbelow 1951/52 levels.
The scheduled rate of defence expansion hasbeen reduced somewhat in the United Kingdomand the -United States. Projected defence ex-penditure in 1952/53, though somewhat lowerthan the goals set earlier, is still above the 1951/52levels. In the United States the rate of expendi-ture for defence goods and construction is sched-uled to advance, by the end of 1952, to aboutthree times the average of 1951. A carry-overof 90,000 million unexpended dollars from 1951
plus 46,000 million dollars new appropriations for1952/53, exceed by far all physically possible deliv-eries for the armed forces. This expenditure,combined with domestic business investments fornew plant and equipment estimated to exceedstill further those of last year, will provide theimpetus for keeping the United States economyfully employed and possibly for expanding totalindustrial output to a higher level in 1952/53,although at a slower rate of increase than thatfrom 1949/50 to 1951/52.
The outlook for the Canadian economy is
generally promising. In March 1952 the value ofdefence orders in progress was three times ashigh as twelve months earlier, the rate of spend-ing for military equipment and installations isexpected to increase greatly, after lagging behindthe original plans in 1951/52, new investment indurable physical assets in 1952 is expected torise by about 10 percent, and higher exports arealso anticipated. A high level of employmentis expected to continue.
In the United Kingdom it is estimated thatindustrial output will be maintained with employ-ment generally not falling much below the slightlyreduced level of the spring of 1952. It couldimprove should the recession in the textile industrycome to a halt, but this would require an earlytermination of the import restrictions adoptedby some of the United Kingdom's best customers,such as Australia.
The United Kingdom Government has indicatedthat it expects exports to increase during the yearbeginning April 1, 1952, by 50 million pounds interms of 1951/52 prices. The export target isto be achieved mainly by larger sales abroad ofmachinery and other capital goods which the' Gov-ernment hopes will more than offset the declinenow being experienced in exports of Britishconsumer goods.
In Western European countries, after theorganizational phase of the European DefenceCommunity has been terminated and after theinclusion of Germany in the scheme, a faster rate ofdefence production can be expected. Some easingin the recession in soft goods industries is likely asprices remain stable and stocks need replenish-ing. However, the import restrictions of Franceand the United Kingdom may adversely affectproduction for export of a number of Europeancountries, thus retarding the overall productionand demand. In some of the Scandinavian coun-tries some increases in national output are likely,in spite of an expected deterioration of the termsof trade.
32
Industrial expansion in Eastern Europe and theU.S.S.R. is scheduled to continue with rates ofgrowth widely differing in the individual countries.Defence expenditures of the U.S.S.R. in 1952 areofficially budgeted 21 percent higher (in cur-rent roubles), than in 1951.
Progress of economic development programs inAsia, the Middle East and Latin America willContinue to expand industrial employment anddomestic demand for farm products over the nexttwo years. The rate of economic developmentand industrial production has been generally quiterapid in Latin America, and seems likely to con-tinue so. In the Middle and Far East (withthe exception of Japan), industrial developmenthas generally been moving much slower, and inmost countries little if any progress is being madein absorbing surplus farm population in industrialemployment. Political instability in many ofthese countries is tending further to delay generaleconomic progress. However, the check to eco-nomic development which resulted from the suddenfall in demand and prices for raw material exportsduring 1951 seems unlikely to be repeated during1952/53, while prospects for 1953/54 are more un-certain.
Trade and international payments, 1952/53
The volume of international trade will be af-fected by the ability of nations to solve balance-of-payments problems. The drain on the goldand dollar resources of the Sterling Area was al-most stopped in the second quarter of 1952 andthe heavy debtor position of France (although notof the United Kingdom) within the EPU has beenconsiderably reduced. As is usually the case,international speculation first reinforced the trendtowards deterioration, and is presently reinforcingthe trend towards improvement as the weakenedcurrencies are regaining strength. The measuresdesigned to curtail home consumption in theUnited Kingdom, the import restrictions of theSterling and French franc Areas and some specialaid from the United States for both France andthe United Kingdom, as well as the disappearingfear of a new sterling devaluation, may very wellsustain the initial recover3r in the short run.
The -United States is continuing its postwar aidin 1952/53, although at a considerably reducedrate, as " defence support " for Europe and aseconomic and technical aid to non-European coun-tries. In addition there will be offshore purchasesand military orders. The prospective availability offoreign dollars, however, will not be sufficient to off-
set a continued United States balance of paymentsurplus on current account, as large as it was in1951/52, of close to $6,000 million (annual ratebased on eleven months). To correct the foreignexchange shortages the first necessity is a reduc-tion of this surplus, which is likely to be achievedif the contemplated cuts of imports from dollarareas are implemented. United States exportsin the first five months of 1952 still increasedby 12 percent while import value had decreased10 percent compared with the same period in1951. About one third of the increased export valuewas due to greater shipments of grains and,cottonboth of which may- decline later, and part was dueto increased shipments under the Mutual SecurityProgram.
Agricultural demand, 1952153Economic activity generally sustained at high
levels in North America and Europe will probablymaintain the demand for exportable supplies infoodstuffs and agricultural raw materials from theFar East, Latin America and Oceania, as priceshave been brought down from their previousexcessive heights and stocks will need to be builtup again. Short of a deterioration in the poli-tical situation, no sudden developments are likelybut rather a slow reversal of the " wait-and seeattitude of buyers accompanied by an equallyslow improvement of prices.
The demand for farm products in North Amer-ica should remain high in 1952/53 even if notquite at the boom level of the past two years.In Western Europe, other than the United King-dom, the demand for farm products also seemslikely to remain about the same as in the pastyear. In the United Kingdom imports of basicfoodstuffs such as wheat, coarse grains, meat,eggs, butter and cheese, oils and fats, which areimported by the Government through bulk pur-chase schemes, seem likely to remain approxi-mately, the same, but imports of processed meatsand unrationed varieties of cheese will be curtailedsharply.
The success of attempts to shift supply sourcesof basic foodstuffs still more to the Sterling Areawill depend on the latter's ability to expand itsexports, which in the case of bread, coarse grains,and meats is likely to continue to be insufficient.
Textile prospects in the United States are some-what more promising than a y-ear ago. Inventoriesaccumulated in the hands of manufacturers andretailers are gradually being worked off and byApril 1952 were 10 percent below those of ayear before. In the United Kingdom and Western
33
Europe, however, the present depression in thetextile industry is partly due to overexpansion af-ter World War II and may therefore continueinto 1952/53, although to a lesser extent. Unlessgeneral business conditions turn sharply down-ward, consumption of cotton and wool may in-crease in 1952/53 to somewhat above the verymuch reduced levels of 1951/52.
Rubber and wool, the two most important ex-port commodities and dollar earners of the Sterl-ing Area, however, are facing particular problems.While the long term trend of the world's rubberconsumption indicates an increase of between 5and 10 percent a year, the actual market demanddepends largely on United States purchasingpolicies. As the latter return to normal and ifsynthetic rubber production expands no further,the international demand should be sufficientto absorb the output of natural rubber at itscurrent volume. Wool, too, has to compete in-creasingly with synthetic products but a growingworld demand connected with higher consumerincomes and with defence needs should providea satisfactory market for the 1953/54 wool supply,bearing in mind that it will consist essentiallyof a very slow rise in production, since the largepostwar stocks have disappeared.
The demand outlook, 1953154Over 1953/54 demand prospects are more doubt-
ful, and may be sharply influenced by politicaldevelopments. A sustained high level of econo-mic activity in the United States seems likelywith defence expenditures, other deferred publicexpenditures and housing all contributing ; thereis however some possibility of a recession begin-ning during the latter part of the 3,ear, thoughprobably less sharp than that of 1948/49. Govern-ment expenditure for national security is sched-uled to reach a peak in mid-1953 and remain atthis level through 1953/54. In spite of a veryhigh rate of private home building since 1947, thereappears still to be a backlog of demand for newhousing (mainly due to deferred replacement)which may continue into 1953/54 ; there are alsodemands for extensive public non-defence con-struction, most of which had to be postponed dur-ing the past two years. On the other hand, re-cent surveys indicate a possible 15 percent dropin domestic business investment from 1952/53 to1953/54. Some decline in economic activitiesconnected with the end of the build-up of theUnited States defence forces is generally expectednot earlier than 1954, unless political eventslead to a lessening of the existing tension. This
may be partially offset by consumers drawing ontheir heavy liquid savings. On the whole, the gen-eral levels of United States income and activityin 1953/54 are likely to remain somewhat higherthan in 1951/52, while employment and disposableincome per caput will remain about equal tothat of 1951/52.
Indications are that the Canadian boom willcontinue into 1953/54. Armament expendituremay rise somewhat further. Domestic investmenthas been steadily expanding since 1946 and reacheda record level of over 22 percent of gross nationalproduct in 1951, (excluding G overnment expendi-ture for defence but including defence construc-tion). Domestic investment expenditure mayremain at a fairly high level as expenditure forresources development and public utilities willcontinue high during 1953 and 1954. On theother hand, for light manufacturing, retail tradeand housing, capital outlays in physical termsare declining. Most of the big development pro-jects such as the iron ore mines in Labrador,construction of facilities for aluminium productionin British Columbia, non-ferrous metals in Mani-toba and the rapidly expanding oil industry inAlberta are scheduled to continue up to 1954/55and should contribute to maintaining a highlevel of employment and high demand for agri-cultural products in 1953/54. If any recessionshould occur in the United States in 1954, itwould probably be reflected in Canada, but toa reduced extent.
The economic outlook for the United Kingdomfor 1953/54 is less clear. It may benefit directlyand indirectly from the anticipated generallyhigh level of economic activity in the UnitedStates and Callada. A large part of indus-trial plant will remain employed because ofdefence production. However, the solution ofthe recurrent balance-of-payments difficulties willdepend on the success of the measures to reducedomestic demand as well as on the speed at whichcountries like Australia, NeW Zealand and SouthAfrica are able to remove trade restrictions, andthe strengthening and maintenance of the demandfor such dollar earners as wool, rubber and tin.The volume of exports in 1952/53 will be deter-mined by the scope of the armament program, therestriction of home consumption, the availabilityof raw materials and by foreign demand. Therehas been an extension of planned defence expendi-ture by one year. This may make possible someincrease in civilian output of the engineering in-dustries but there still remains the problem offinding sufficient markets at a period of increasing
34
deflationary tendencies. There is little room forfurther cuts in the volume of imports of basic food-stuffs over those planned for 1952/53 withoutan increasingly austere diet.
In Western Europe a steady increase of eco-nomic activity may be expected. In August1951 the member governments of OEEC issueda declaration in which they agreed that th ebroad objectives of their policies will be to expandtotal production in Western Europe by 25 per-cent over the next five years4. A major part ofthis intended expansion is, of course, identicalwith the increasing output for defence, but it ishoped that industrial expansion will progressivelyprovide more houses and other consumer goodsfor Western Europe as well as capital equipmentfor export to underdeveloped areas. The highemployment that should result is expected toabsorb such unemployment as still exists insome of the member countries except in cases ofstructural unemployment (Italy) where emigra-tion would have to contribute substantially.Hence, to the extent that this declaration ofintention is implemented, domestic demand foragricultural products should increase while im-port demand for foodstuffs should, under normalweather conditions, remain at present levels. AsWestern European agriculture keeps on expand-ing, it should cover increased requirements forbetter diets as well as population increase.
Any serious industrial recession in 1954 or latermight again have exaggerated effects on demandsand prices of world market products, and henceon balances of payments. Bridging the recon-version from defence activity to a more peacefulworld without severe economic disturbances thusbecomes a major goal for economic statesmanship.
The economic plans of the U.S.S.R. and the East-ern European countries for 1953/54 envisage fur-ther industrial expansion, continuing full employ-ment and a demand for agricultural products atleast as great as prospective available supplies.
THE LONG-TERM FOOD SITUAT1ONDespite the greater ease in the supply situa-
tions of some commodities, the need of the worldfor more food so strongly stressed at the lastsession of the FAO Conference has not yet begunto be met. In the least developed and mostheavily populated regions, where the mass of theworld's population lives, per caput food consump-tion levels still continue substantially below the
OEEC : A Second Survey Prepared by theOEEC for the Council of Europe, p. 25, Paris, Nov.1051.
already inadequate prewar averages. The lastyear has shown few signs of significant iraprove-ment despite all the governmental programs tothis end. This situation is most acute in much ofSouth-East Asia, where it is aggravated by chron-ic civil or military disturbances and lack of per-sonal security.
In reviewing some of the food and agricultureproblems that have to be dealt with in the nearfuture, it is useful to review the trends in foodconsuraption which indicate the task that hasto be achieved and the trends in investment whichindicate the possible rate of expansion in foodproduction.
Trends in food consumptionEven a moderate improvement in the low nu-
tritional standards prevailing in many parts ofthe world, especially the Far East, Near Eastand Africa will require a substantial increase inthe supply of food. In the regions mentioned,the rate of expansion for cereals would need tobe twice as large as the present rate of increasein their population ; for pulses, meat, fish, milk,eggs and fruit the increase must be still greater.In Latin America and Europe less expansion isneeded in field crops other than pulses, butlivestock output would have to be pushed upbeyond the estimated population increase. Sta-tistics for fruit and vegetables, though extremelyinadequate, indicate that supplies of these im-portant food groups should also be heavily ex-panded.
The 6th Session of the FAO Conference con-sidered a 1 to 2 percent increase per annum inworld production of food and agricultural prod-ucts in excess of the rate of world population yrowth(currently about one percent per annum) as aminimum necessary to achieve some improve-ment in nutritional standards. Furthermore, thedemands of this expanding population for agri-cultural products are becoming more effectivesince the end of the second World War especiallyin the industrialized nations where real income percaput is increasing, and distribution of income istending to become equalized. In Europe, forexample, it has been estimated that food require-ments will increase over the next five years by1-2 percent per annum on account of changes inincome and by an additional 1 percent on accountof population growth.5
OEEC Food and Agriculture Committee, Re-port of the Special Group on Agriculture (Ag. 51/40)Paris, Dec. 1951.
35
In many underdeveloped arcas this trend man-ifests itself more in terms of increasing require-ments than of effective demand. The people inthese regions are changing their attitude on theacceptability of a low standard of living and areexerting an ever-increasing pressure on their gov-ernments or on the governing authorities for morefood, more clothing, and more and better housing.
Yet there is little sign of the solid overall ad-vance in food production needed to achieve betterworld-wide food standards. Charts IV, XVII-XIXshow that per caput food output, though higherin nearly all countries than in 1946/47 - 1947/48,is still substantially lower than prewar in mostFar Eastern countries and in many parts ofEurope, the Near East and Africa. Because in-ternational trade in food plays an important part,although in volume only representing a fractionof the world's food production'', these facts areinevitably reflected in corresponding changes
mostly for the worse in the levels of foodconsumption compared with prewar years. Foodconsumption levels have risen markedly in LatinAmerica, although they are still inadequate insome countries ; this has been achieved chieflyby reducing the region's food export surplus(Table 3). In the great food surplus regionsof .North America and Oceania, food consumptionhas been maintained at high levels and, in soasecountries, it is even higher than before. Else-where, however, consumption levels have mostlyfallen and diets are poorer in quality. At thelowest end of the scale, the Far East has sufferedthe largest fall in per caput food consumptionand has become a net importer of food. Theproportion of the world's population not receiv-ing enough food large even before the war
has greatly increased (Table 7).Some slight improvement, mainly in calorie lev-
els, has occurred in the past two years, but notenough to alter the general picture. Indeed thediet in the poorest fed regions has become, ifanything, even more unbalanced as indicated bythe deterioration in consumption of animal foods(see also Charts III and IV).
The possibility of a recurrence of a serious worldshortage of food, particularly cereals, cannot beignored. To avert this danger will require a main-tenance and perhaps an increase in the presentproportion of the world's total resources devotedto agriculture and that a major part of existingand potential agricultural resources continue to
Exportecl quantities represented less than 9
percent of production in 1950/51 ancl 1951/52.
TABLE 7 DISTRIBUTION OF POPULATION ACCORIMS-GTO NATIONAL AVERAGE SUPPLY OP CALORIES ANDANIMAL PROTEINS
* Comprising about 50 percent of the world's population.
be utilized for the production of foods, especiallythose of high energy content.
During the postwar years, industrial productionhas risen much more rapidly than agriculturalproduction. Thus, although production of foodin 1951/52 surpassed the prewar (1934-38) levelby 11 percent, the volume of manufacturing andmilling is estimated to be by the end of 1952more than 80 percent above the prewar level(1937). These percentages are not strictly com-parable due to the different base periods, butthey do indicate the magnitude of the gap thathas developed in the postwar period between out-put in agriculture and in industry.
The steadily rising consumption of animal pro d-ucts in some parts of the world where such con-sumption is already very high poses the questionwhether resources actually devoted to food produc-tion are being used in the most effective way, inview of the low level of food supplies in other partsof the world. It has been pointed out on previousoccasions that, when crops are fed to animals,they lose 80 to 90 percent of their calorie valuebefore they re-emerge in the form of meat, milkand eggs. This of course does not mean thatfor every calorie produced in the form of livestockproducts, four or five calories could have beenproduced in other forms of human food. To aconsiderable extent animal and crop productionare supplementary rather than competitive andunder the climatic and other conditions prevail-ing in, many parts of the world, a system of mixedfarming based in part on grazing or grassproduction gives best results for both crops andlivestock products. In some parts of the world
36
animals constitute the main form of draft power,in the absence of which crop production wouldseriously suffer. Nevertheless livestock can a,nddo consume resources at the expense of humanfood, especially in the excessive feeding of grainto livestock.
In the Far East and in many other less develop-ed parts of the world, the energy value of thediet has not even recovered to prewar levels.Even if account is taken of unrecorded productionsuch as subsistence fishing, consumption of animalprotein is so low that were it doubled or trebledin the next ten years, it would still remain farbelow the present standards in the advanced coun-tries. However, livestock production can be in-creased without drawing on additional grain sup-plies, by culling herds, reducing disease, and im-proving methods of breeding and feeding. Thesecan give results only in the long run. In theyears immediately ahead it would be unwise toattempt to expand livestock output by ways whichmight diminish the supply of high energy foods.However, while avoiding competition by animalsfor the human food supply, the supply of animalproteins can be, it is conservatively estimated, atleast doubled in most countries by improved pro-duction techniques without, detriment to the out-put of food crops. All possible means shouldalso be explored for expanding fish productionfrom inland sources, especially as many of thefish resources of the region are still under-exploited.
In Europe, this problem is perhaps more sharplyocussed than in other regions. During early post-war years, plans to restore the prewar consump-tion of livestock products had to be repeatedlypostponed because of the inadequate level of thetotal food supply and because of the high costof imported feeds. The feeding of \vheat to live-stock vas forbidden in some cases, and importedcoarse grains had to be used for human consump-tion. Efforts to economize in feeding stuffs havenow resulted in many improvements in animalhusbandry in Western Europe. Livestock numbershave largely been built up again and yields per ani-mal are frequently higher than before the war, withless reliance on imported feeds. But feeding stuffsare still in short supply and prices of crops haverisen relative to those of livestock products dur-ing the past few years. Some pasture can beconverted to high yielding fodder crops and thequality of existing pastures can be raised, butfurther improvement in the still unsatisfactorylevel of consumption of animal protein will requirethe most careful husbanding of resources. As re-gards other sources of animal protein, only a small
Calories and Animal ProteinsPercent of Total
Population
Prewar Recent
Calorie LevelsOver 2700 30.6 27.82700-2200 30.8 12.7Under 2200 38.6 59.5
Animal Protein LevelsOver 30 gms. 22.1 17.230-15 gms 18.9 24.8Under 15 gms 59.0 58.0
fraction of the whale meat taken by Europeansis used for human food, thus making it necessaryto waste or grind into animal feed more than250,000 tons of meat of a quality which, as isdone in Japan, can be used extensively for food.Both in Eastern Europe and the Soviet Union,agricultural patterns are planned with greater em-phasis on livestock production than before thewar, but the need to safeguard lower and insecurelevels of calorie intake has retarded progress to-wards these aims much more than in WesternEurope.
The food surplus regions will probably continueto be heavy consumers of animal products. Inthe United States, steadily increasing effectivedemand has raised per caput meat consumption.In Australia, population in the last few years hasbeen expanding at a rate of more than 3 percentper annum, and per caput meat consumption hasbeen maintained at very high levels (Table 8).
TABLE 8 MEAT C ONSUMPTION PER CAPUT IN THEUNITED STATES AND AUSTRALIA ( K G. PER HEAD)
PERIOD UnitedStates
Prewar. 63.91948/49 74.11949/50 76.11950/51 75.2
Australia
120.4110.4112.6110.5
The proportion of average calorie intake provid-ed by livestock products is over 40 percent in theUnited States and Australia, compared with about30 percent in Western Europe and only between5 and 10 percent in the Far East. The amountof grain fed to animals to maintain the presentvolume of livestock products in the United Statesis approximately 100 million tons per annum.The raounting demand for livestock products hasalready reduced feed grain stocks in the UnitedStates in two successive years and may even forcea reduction in livestock numbers in the year ahead.Whether feed grain production and other feed sup-plies can be stepped up in the coming y-ears tomeet the further increase expected in the demandfor livestock products without a serious reductionin the volume of grain exports is open to seriousdoubt.
For the world as a whole, until the entire scaleof food production has been substantially raised,careful attention will have to be paid to the pos-sibilities of maintaining and increasing the supplyof livestock products in ways that do not competewith calorie needs. A moderate reduction in pres-
37
ent per caput consumption of livestock productsin the major food surplus regions might releasea large volume of food and fodder grains for theneedy areas. From a nutritional standpoint too,this might not be injurious. There is no indica-tion that any further increase in meat consump-tion among some sections of the population infood surplus countries would be nutritionally es-sential. In the less developed and food deficientnations, steps to increase livestock output willinvolve principally the improvement of grasslandand the reduction of losses from diseases and par-asites. Such continued improvements in animalhusbandry offer the safest hope of better dietswithout extensive use of grain for livestock feed-ing. Fish production, without encroaching uponexisting agricultural resources, can provide a val-uable increase in the world's supply of animalprotein. At present its contribution is only about10-15 percent. The possibilities for a large expansionare considerable and there is hope that, in thefutare, with improved marketing methods andgrowing consumer acceptance of the product, agreater proportion of the actual catches will beused directly for human food.
AGRICULTURAL INVESTMENT
The continued expansion of agricultural produc-tion requires an ever increasing rate of privateand public investment, particularly in the lessdeveloped, highly populated areas of the world.Where private investment is inadequate a greaterinjection of public funds into the production pro-cess becomes necessary. This is not a simplematter and the problems and ramifications havealready been dealt with in other UN reports.What is pertinent is the current amount of invest-ment and the plans for increasing the total.
Private investment in agricultureIn North Araerica, the United Kingdom and
some of the other Western European countries,private investment has expanded markedly sincethe end of the war. This expansion has been inresponse to a greater farm income and in WesternEurope also to the need to rebuild farm equip-ment destroyed during the war. In Oceania theflow of private funds into farming has also showna substantial increase.
In Canada, the United States and the UnitedKingdom the share of agriculture in total privateinvestment expenditure has corresponded in re-cent 3rears roughly to the share of agriculture in
the national income. No comparable figures areavailable for underdeveloped countries, but itappears that private investment in agricultureremained relatively small in these regions. Financ-ing the expansion of agricultural productionremained to a great extent the responsibility ofgovernments.
What are the probabilities of an increased rateof private agricultural investment in the develop-ed countries ? It is probable that the rate ofinvestment will continue high as long as farm netincome remains at the current high level, enabl-ing these countries to maintain and even toimprove their position as important producersof agricultural products. In underdeveloped coun-tries, private funds may become available in largerquantities in the future as the terms of trade movein favor of agriculture, as the differential in pro-ductivity between agriculture and industry tendsto become narrower, and to the extent that pricestabilization schemes for major export commodi-ties become a reality. Technical assistance andgovernment development projects may open upnew fields for private investment in agriculture.However, in relation to the needs, the rate ofprivate investment will continue to be inadequate.
Public financing of agricultural invest-ment
It is therefore encouraging to note that nation-al and metropolitan governments as well asinternational organizations are increasing theiractivities in agricultural investment.7
The share of agriculture (including forestry andfisheries as well as processing industries) in theschedule of public expenditures in almost all devel-opment plans in underdeveloped areas is greaterthan that of industry or public utilities 8. Simi-larly, metropolitan governments in dependent ter-ritories are investing heavily in agriculture. TheBritish Colonial Development Corporation, forexample, up to the end of 1951 had started 53
7 Unfortunately, available data on public financ-ing of economic development are not of a nature topresent a clear separation between funds going intoagriculture and those invested in other sectors ofthe economy. However, there are some indicationsproviding a rough idea of the share allocated to agri-culture in th,e developmental activities of publicbodies.
8 The trend toward greater investment in agricul-ture is also referred to in Chapter III. Preliminarydata from thirty-five countries provide the basistor this statement.
38
projects with a projected capital outlay of closeto 236 million of which 27 with a capital of
17.3 million (48.3 percent of the total) are forprojects in ag,riculture, fishery and forestry°.
The Caisse centrale de la France d'Outre-Merand the Fonds d'investissement économiqueet social des territoires d'outre-mer have inthe period from April 30, 1946 to June 30,1951 committed a total of 240,000 million frs.for the economic development of the French over-seas territories (except North Africa, Indochinaand Madagascar) of which 12 percent was fordeveloping agricultural production as against 13percent for mining and industry which, however,includes food processing and hydro-electric powergeneration. Of the 5 percent allocated to researchabout two-thirds were for research in agricultureand forestry. In addition, a great part of the120,000 million frs. (about 50 percent) for improvingcommunications has been directly benefiting agri-culture".
Under the Colombo Plan £595 million out of atotal of £1,368 million, or 32 percent, are alloca-ted to agriculture, including multipurpose projects,but agriculture is also to benefit from the devel-opment program for transportation and communi-cation (34 percent) and for housing, health andeducation (18 percent)11-. Under the United StatesPoint IV program, of the 619 personnel in thefield on Dec. 31, 1951, 253 or 41 percent wereworking in agriculture, forestry and fisheries.Among the 372 foreigners being trained in theUnited States under the Point IV program atthat date 87 were under the supervision of theUnited States Department of Agricultureu.
Also within the Expanded Technical AssistanceProgram of the United Nations which is layingthe groundwork for public and private investmentsin underdeveloped areas, the biggest share hasbeen allocated to agriculture, as shown by timeamounts of money allocated to FAO as one ofthe six international organizations" participatingin the program (Table 9).
Colonial Development Corporation, Reports andAccounts for 1951. Her Majesty's Stationery Office,London, April 1952.
" Caisse controle die la France d'Outre-Mer, 'Noteset &Ludes docurnentaires, No. 1568, Paris, Feb. 1,1952.
11 The Colombo Plan, Cmd 8080, H. M. S. O.London, 1950.
" First Report to Congress on the Mutual SecurityProgram, Washington, March 1952.
" The other organizations are the UN, ILO,UNESCO, ICAO, and \VHO.
TABLE 9. EXPENDITTJRES ON TECHNICAL ASSIST-ANCE, AND PROPORTION OF FUNDS ALLOCATEDTO FAO
sou-rick: : ETAP, Fourth Report of the Technical AssistanceBoard to the Technical Assistance CommitteeUN document E 2213 (Vol. I).
The extensive Point IV and ETAP activitiesin the field of agriculture foreshadow the necessityfor a much greater flow of public investment fundsthan heretofore. No comprehensive data are avail-able, but Tables 10 A and B showing the activi-ties of the major agencies for international lend-ing indicate the insufficiency of the present vol-ume to meet the need for a vastly expanded pro-duction 14.
Even under the anticipated improved condi-tions for investment in agriculture, a considerableincrease in the flow of foreign funds seems to berequired. Yet many of the projects contemplatedin national plans and programs or suggestedby TA experts are not suitable for financing byexisting international financial institutions. Hencethe proposal for a new International DevelopmentAuthority now being studied by an expert com-mittee appointed by ECOSOC is of particular im-portance for an adequate future level of invest-ment in agriculture.
"Whether the new IDA comes into being or not,the responsibility of channelling an ever increas-ing amount of private and public investment fundsinto agriculture will remain with national govern-ments. The Gth Session of the FAO Conferenceoutlined a number of measures governments maytake to increase funds available for agriculturalinvestment. These, if ad.opted and implemented,together with the international measures suggest-
14 An annual foreign investment of$10,000 million ofwhich $2,000 million in agriculture has been estimat-ed to be necessary in order to increase the nationalincome of underdeveloped areas by 2 percent perannum (UN, Measures for the Economic Developmentof Underdeveloped Countries, New York, May 1951).
39
ed by the Conference, may improve the presentunsatisfactory investment situation without, how-ever, giving the promise of an early solution ofthe problem.
OTHER FACTORSIn many less developed regions farmers hesitate
to produce as much as they could with theirpresent knowledge and resources because of in-secure tenure on the land, inadequate rewardsto the actual producer, lack of farm credit atreasonable rates, and lack of confidence as tomarkets for increased output at satisfactory prices.
Many of the economically advanced countrieshave developed workable methods of givingadvance marketing and price guarantees to theirfarmers. In many underdeveloped countries,however, much still remains to be done in thisdirection. These countries need to establish suchconditions for their working farmers and givethem such assurance of markets that they willexpand production substantially.
While it is generally recognized that the majorresponsibility for stabilizing action must be at thenational level, much attention is also being devot-ed in current discussions to intergovernmentalcommodity stabilization measures. The FAO Con-ference re-affirmed at its Sixth Session its faith ininternational commodity agreements and it stressedparticularly the need for looking at these agree-ments as more than emergency devices for dealingwith surpluses or shortages and for viewing themrather as basic stabilization instruments which canbe applied in good times as well as bad.
It is sonaewhat less reassuring, however, thatwhile these principles have been more or less gen-erally accepted for some time now and re-endorsedon various occasions, they have so far not led tomuch in the way of tangible results.
The present climate of economic opinion ap-pears to be very conducive to discussions oninternational commodity agreements. Consultationsare proceeding for the renewal of the InternationalWheat Agreement ; a special committee of theInternational Sugar Council has been functioningfor some time to consider an international sugaragreement; the International Cotton Advisory Com-mittee has produced a very able technical reportconsidering possible methods of drawing up aninternational cotton agreementn ; and recently the
" International Cotton Advisory Committee : Re-port of the Standing Committee to the EleventhPlenary Meeting on an International Cotton Agree-ment, Washington, May 1952.
PERIOD
Total I? A. 0
mil. of 't,3:°Jtal
1st financial period (July 1950-31 Dec. 1951)
allocated 13.46 3.82 28.8obligations inctu-red . 6.44 2.01 31.2
2nd financial period (1952)allocation (less retained
contributions account) . 19.17 5.36 28.0
3rd financial period (1953)projected or requested . . 38.16 11.17 29.3
TABLE 10-A. - AMOUI,IT OF IBRD LOANS DURING THE PERIOD I NOVEMBER 1951 TO 15 JULY 1952
(in million U.S. dollars)
SounGES : IBM) - Memorandum relating, to the Financial Statement as of March 31, 1952.IBM) - Press Releases.
a Approximate evaluation.b A part of this loan will be used for transportation and power.
TABLE 10-13. - AmouNT OF EXPORTJAIPORT BANK LOANS DURING THE PERIOD 1 JULY 1951 - 3 JULY 1952
(in, million, U.S. dollars) a
SOURCE : Export-Import Bank of Washington: Statement of Loans and Authorized Credits.Tisis table does not include 2.5 millions to Saudi Arabia from previously authorized credits.Credit in view of off-shore purchases in France.
40
' TOTALCOUNTRY I
' LoAxs
DIRECT LOAN- TO AGRICULTURE LOANS AIDI-GAGRICULTURE All
other
loans
Totaldilgrierrecti.t,ouarnasi`
Machin-cry and
sparepa rts
Irriga-tion
and floodcontrol
Timber
eQuiP-ment
Proccs.indu-strics
Multi-purposeloans
Improve-ment oftranspor_tatiou
Powerdercloll-
mcnt
Australia. 50.0Brazil 31.5Polombia 2.4Finland 20.0freland 1.0Nrexico. 29.7N-etherlands 7.0Pakistan 30.5Paraguay 5.0Peru 3.8
Rhodesia . . . 23.0Purkey 25.2
a17.0
10.51.0--3.35.01.3-
25.2
-----3.35.01.3- -3outhern
--
25.2
-1.0
--
-9.5
---
17.0---1.0
-
...12.5-
27.2-2.5--
...25.02.49.5-
29.7
28.0-
b 33 , c--7. C---
TOTAL . . 240.1 63.3 9.6 25.2 1.0 9.5 13.0 42.2 94.6 40.0
COUNTRYTotal
loans tocountry
LOANS FO P.:Agricult.machinery Transport Pol-yer Import Ind trialus
development Others
Austria 6. 0 -- - 6.0Belgium 6. 8 6.8 -Bolivia 2.6 - 2.6Brazil 66.7 5.0 15.6 41.1 - 5.0-janada 0.7 - - 0.7 --phile 11.1 - 11.1 -3olombia 23.5 - 2.6 20.0 - 0 .9Ecuador 1 . 8 1.0 - - - 0.8Prance 245.0 - - 45.0 b 200.03 ermany (Fed. Rep . ) 60.0 - - 60.0: ndonesia 4 . 5 2.6 1 . 9 - -T taly 4 . 7 - 4.7 -Tapan 40.0 - - 40.01Iexico 4 . 0 - - 4.0 -?anama 1. 5 - - 1.5'ern 0-7 - 0.7? hilippine 20. 0 - 20.0 - --ipain 12.0 - - - 12.0Thailand 1 . 0 - 1.0 - - -Jnion of South Africa . 26.5 - - - 26.5 -/enezuela,
TOTAL . .
4.0 -7.6
4.0 -543.1 24.2 63.7 183.8 54.6 209.2
International Rubber Study Group has also setup a special working group to investigate the pos-sibility of an international rubber agreement.Moreover, discussions are proceeding in variousquarters on commodity agreements generally.
Despite all these consultative activities, however,the International Wheat Agreement still remainsthe only fully inter-governmental commodity agree-ment in existence and its renewal is uncertain.Nor are there any signs of consultations for anyother commodity having reached the immediatepro-conference stage of final negotiations.
In some respects the very slowness of the pro-gress reflects a growing understanding and realismin the appraisal of problems connected with thenegotiation and operation of inter-governmentalagreements. The experience of the Wheat Agree-ment, in particular, has brought a number of thesetechnical problems into clear focus16. Apart fromproblems of technique, there are certain other dif-ficulties which result in some measure from ap-
16 Some basic aspects of international commoditystabilization techniques were reviewed in an article"Some Aspects of International Commodity Arrange-ments" in the FAO Monthly Bulletin of Agricul-tural Economics and Statistics for July 1952, and afull discussion of some of these problems is presentedin the FAO study "A Reconsideration of the Eco-nomics of the International Wheat Agreement",September, 1952.
41
preciation of the need for an adequate balance ofproducers' and consumers' interests. This principleis a highly- commendable one which should notbe departed from in any way. At the same time, itis as well to realize clearly that the postulate ofsuch a balance of interests does mean a practicalneed to achieve a balance of bargaining power be-fore an inter-governmental agreement can be con-cluded. It is often difficult to find this bargainingbalance and also to agree when that point has, infact, been reached.
Moreover, the problem may be accentuated bythe fact that the risks are not the same for gov-ernments in the sense that the disadvantageswhich may result from the conclusion of anagreement tend to be more obvious, generallyspeaking, than those which may result if no suchagreement is concluded ; it does not follow by anymeans that the less obvious risks are the lessserious ones in the long run.
Much more active and positive measures thanthose yet taken by governments will be neededbefore world food production begins to increaseat more than its recent inadequate pace. At thesame time, the arrangements for prices, markets,and marketing methods must be greatly improvedto assure confidence to producers, while maintain-ing retail prices which the mass of the world'speople can afford to pay.
Chapter III
REGIONAL REVIEW AND OUT
Chapter III - REGIONAL REVIEW AND OUTLOOK
EUROPE (excluding Eastern Europe andthe U.S.S.R.)
Current situationThe restoration of agricultural production in
Western Europe during recent y-ears has been facil-itated by the strong effective demand for food,largely due to increasing industrial activity withfull employment in most countries. Expansion ofindustrial production continued during 1951/52,but was, on the whole, slower than in the imme-diately preceding years. Industry still expandedmuch faster than agriculture ; accordingly, therelative importance of agriculture in the totaleconomy of the region has been further reduced.This trend means that the food supply has tosatisfy both the demand of a growing populationand the demand for a more diversified diet. Be-fore the war, as urban purchasing power increased,additional food and feed could be bought abroadat favorable prices. Since prices of importedagricultural products are 110W less advantageous,terms of trade less favorable and the balanceof payments situation more difficult, the prewarsolution is no longer practical.
General economic conditions. As indicated earlier,the level of economic activity remained highduring 1951/52 except in the textile and other
For the purpose of this report, Europe (exclud-ing Eastern Europe) has been divided into the follow-ing regionsWestern Europe : Belgium-Luxembourg, France,
Ireland, Netherlands, Switzer-land, Saar, United Kingdom.
.Northern Europe : Denmark, Finland, Icelan.d,-Norway, Sweden.
Central Europe : Western Germany and Austria.Mediterranean Europe : Greece, Italy, Portugal,
Spain..
45
consumer goods industries. Some slackening oc-curred early in 1952 and the aggravated balanceof payments difficulties led to increased traderestrictions. In most countries the cost of livingrose during the period and food prices generally rosemore rapidly than those of other goods and services,notably in Austria, Denmark, the Netherlands,Western Germany and the United Kingdom.
In most countries wages rose with prices from1950/51 to 1951/52, but in some, such as Austriaand the Netherlands, a decline in real wages ap-pears to have taken place.
In 1951/52, for the first time since 1948, therewas no general increase in the average per caputconsumption of food. In a number of countriesmeat consumption has not reached the prewarlevel, and in Western Europe as a whole, totalmeat supplies in 1951/52 were nearly 7 percentlower than before the war. Meat is still rationedin the United Kingdom, and elsewhere high pricesgenerally restrict purchases.
Signs of over-supply have appeared in the mar-ket for liquid milk, and the availability of mar-garine, cheap relative to butter, has reducedEuropean butter production and consumption.On the other hand, demand for cheese has gener-ally been well maintained.
Agricultural production. Agricultural production,with the United Kingdom as the major exception,has generally returned to its prewar structure witha few important changes : an increase in milkproduction, a decrease in most countries of Con-tinental Europe of the area under bread grain,and an extension of the area devoted to sugarbeets and oilseeds. Farm production net ofimported feed in the region exceeded that of 1950/51 by about two percent representing an increaseof about 12 percent above the 1934-38 averageand exceeding the population increase, with theresult that per caput production exceeded theprewar level (Table 11 and Chart XII)
CHART XII - EUROPE (EXCLUDING EASTERN EUROPE) : POPULATION ANDAGRICULTURAL PRODUCTION PREWAR AND POSTWAR
TABLE 11. INDEX NUAIBERS a OF VOLUME OF TOTALAND PER CAPUT AGRICULTURAL PRODUCTION INEUROPE (EXCLUDING- EASTERN EUROPE) 1946/47TO 1951/52
.20.0
POPULAT ON
a These index numbers are weighted by values. Theyare preliminary only. All FAO production indices willbe revised during the coming year.
b Preliminary.
The volume of crops in 1951 WaS noticeablysmaller in the western and northern part comparedwith 1950, while with more favorable weatherconditions, output increased markedly in theIberian Peninsula (Table 12).
Gross output of livestock products in 1951/52exceeded the prewar average by 7 percent andwas 3 percent above 1950/51. During the year,progress was particularly marked in WesternGermany, while some decline occurred in Scandi-navia (Table 13).
46
corn"1
CSC.
TOTAL AGRICULTURAL PRODUCTION
AGRICULTURAL PRODUCTION PER CAPUT
Milk production exceeded last year's total by2 percent and the 1934-38 average by 8 percent.This was due mainly to an increase in yield ofmilk per cow by about 10 percent above the pre-war average. Total production, however, declin-ed in Denmark, the Netherlands and Sweden,compared with last year. In Sweden and theUnited Kingdom, government policy now favorsbeef rather than milk production for which effec-tive demand seems to have reached a peak. Thereduction of horse numbers by 1 1/2 million since1938 as a result of greater mechanization, hasled farmers to increase barley production anddecrease the production of oats. This in turnhas contributed to the increase in production ofpork, poultry and eggs. Pork production increasedby 6 percent in 1951/52 and exceeded the pre-war level, with the greatest increase over 1950/51in the United Kingdom and Western Germany.However, because of the general deterioration ofthe feed/livestock price ratio, pig numbers inDenmark, Ireland and the Netherlands havedecreased somewhat while in Western Germanythe stock of breeding SOWS has been reduced.
In general, the livestock output per unit offeed nutrient input has increased since before thewar. This progress, together with more efficientutilization of grassland and of such by-products
(1934-31 100)
1946/47 86 106 811947/48 84 107 791948/49 95 108 881949/50 103 109 941950/51 109 110 991951/52b 112 111 101
YEARAgricul-
turalproduc-
tionPopulation
Produe-tion percaput
PERCENTOF PREWAR SEMI-LOGARITHMIC SCALE
1946 / 47 1947 / 48 1948 / 49 i949 / 50 1950 / 51 1951 / 52
TABLE 1 2. -- AGRICULTURAL AND INDUSTRIAL PRODUCTION A.ND POPULATION,EUROPE (excluding Eastern Europe and U.S.S.R.)
(Prewar = 100)
SOURCE POR INDUSTRY INDICES : Research and Planning Di-vision, Economic Conunission for Europe.
NOTE : Major crops : includes all grains, potatoes and sugar converted to wheat equivalent.Livestock products : includes all meats, eggs and total milk production converted on basis of FAO price weights.Industry : Index numbers of industrial production cover in general manufacturing, mining, at1(1 gas, water and electricity
supply, but not building. Industrial indices are on calendar year basis 1948, 1949, 1950 and 1951.
TABLE 13. PRODUCTICEs: OF LIVESTOCK PRODUCTS, EUROPE (excluding Eastern Europe and U.S.S.R.)(1934-38 = 1 0 0)
a Including goat milk.
as sugar beet tops, has lessened the dependence oflivestock production on imported coarse grainfeeds and oil cake.
As compared with prewar (1934-38) averageproduction average 1948-51 crop yields per hectareare markedly higher in all parts of Europe ex-cept the -Mediterranean countries, with the largestimprovement in Central Europe. This improve-ment in crop yields has been largely due to theincrease in fertilizer consumption and mechaniza-tion. Application of fertilizer has increased byabout 50 percent since 1938 (Table 14). At
47
the same time, with the general restoration of theherds, the quantity of manure available is aboutthe same as before the war.
The relation of change in fertilizer use to changesin yields is indicated in Table 15.
The short-term trend has been quite different,with yields over the last 4 years showing a markeddownward trend in Northern Europe, a slightdownward trend in Western Europe, and markedupward trends in Central and MediterraneanEurope. How far these trends reflect merelyshort-term changes in weather, and how far morefundamental factors, is not yet clear.
WESTERN EUROPE NORTHERN EUROPE CENTRAL EUROPE MEDITERRANEANEtmoPP, TOTAL OF COUNTI1IEI
Agricul- Agricul- A!- Agrien!- Agrien)-ture P°V- In- titre Po p- In- re Pop- In- ture Poi)" In- ture Poi,' 1,1-(1934.38 Ida- dus- ula- dus- (1934.38 ula- dus- (1934.38 ala- dus- (1934-33 ula- dus-
YEAR 100) tion try (1113=Con try = 100) tion try = 00) tion try = 1 00) tion try
vg,,,r-- -
8
;2'"I'8-.=
II
.-,3,,,,
=
'7.,
--,'
='-'
2P .,c,
`,`,:'
II
.0 c.,,.,
v8
ra
,-, :-.
;-P ,8e
2,.",,.=' ,d
II
0,-.."..-c,.=-=,,.-
.-JD"c,-,._,
_8'
11
a)._,,-
-,8
SU
"c73
- z
1
1948/49 110 87 104 122 110 88 113 142 87 59 114 55 79 89 110 105 95 81 108 112
1949/50 105 103 105 130 107 102 114 150 97 81 115 81 84 100 111 110 97 98 109 1281950/51 109 108 106 141 104 107 116 159 111 94 116 101 91 99 112 125 103 104 110 1351951/52 101 111 107 149 101 104 117 170 113 102 117 121 98 102 113 137 102 107 111 145
REGION
Total meat Beef Pork Milk, Eggs
1949/50
1950/51
1951/52
1949/50
1950/51
1951/52
1949/50
1950/51
1951/52
1949/50
1950/51
1951/52
1949/50
1950/ 1951/51 52
VVesternlEurope . . . 100 104 107 102 109 ilL 96 99 105 106 111 113 118 123 121
N'orthern Mirope. . 95 110 108 86 101 102 109 122 112 100 104 101 121 118 11E
Central Europe. . . 79 91 102 77 86 90 77 92 110 86 95 101 73 98 112
Nlediterranean Europe . 91 90 91 88 91 93 87 80 84 102 108 110 86 93 9C
TOTAL . . . 94 99 103 93 101 103 91 98 104 100 106 108 104 112 11(
REGION
Table 14. CONSTJMPTION OF FERTILIZERS,E TYROPE (excluding Eastern Europe and U.S.S.R.)
TABLE 15. INDICES OF CROP YIELDS AND F ERT I -LIZER USE
Fertilizer use Crop yieldsper hectare ; per hectareaverage last average last
2 years 4 years
Tractor numbers on farms are about four timesgreater than in 1938. In the Mediterranean area,however, the number of tractors has increased byonly 67 percent since 1938, whereas in the UnitedKingdom it is 6 times the prewar number(Table 16).
TABLE 16. TRACTORS aN FARMS, EUROPE.(excluding Eastern Europe and U.S.S.R.)
SOURCE : ECE, The European Tractor Industry, February1952.
With regard to other sources of animal protein,the 1951 fish catches for the most important Euro-pean countries show very significant increases
48
over 1950. Norway had the largest increase,mainly due to her herring catches. There wasalso a noticeable strengthening of the fresh fishtrade which has contributed to the unrest felton the markets for certain canned fish productse. g. from herring species.
The greatly increased demand for forest prod-ucts led to record postwar output in Europe.Favorable market conditions made it possible forthe main producing countries to dispose of woodpulp and pulp products at steadily rising pricesduring 1951. Consequently, at the end of theyear exporters' stocks were reported to be verylow. Large-scale purchases by the United King-dom in the last quarter of 1950 had led to com-petition by importing countries for the availablesupplies and to an unprecedented rise in the priceof sawn wood. At the same time, efforts weremade by European coal industries to.replenish theirlow stocks of pit props. However, by the endof 1951, a general resistance developed on thepart of buyers to high prices. The United King-dom curtailed its 1952 buying program for sawnwood, and most importing countries have accu-mulated large stocks of sawn wood and wood pulp.Wood pulp prices in February 1952 declinedbetween 30 and 40 percent. By June 1952 sawnwood prices broke and shippers, embarrassed byunsold stocks, offered deliveries at prices 25 to30 percent below previous peaks. Demand, how-ever, has been show to respond. Simultaneouslywith the fall in sawn wood prices, the UnitedKingdom set price ceilings for imports of woodpulp 20 percent below ruling prices. In the sum-mer of 1951 an impending shortage of pit propsseemed to imperil European coal production pro-grams. The Timber and Coal Committee of theECE called attention to the danger. Additionalsupplies were forthcoming and this, together withadvance shipments on existing contracts and early
Western Ettrope. 780 1 080 940 162 174 152 152 161 163
Northern Europe 210 300 245 194 209 186 188 165 177
Central Europe . 410 490 725 110 118 97 116 110 118
Mediterranean Europe 280 550 80 150 154 140 153 135 152
TOTAL . 1 680 2 420 1 990 146 156 139 146 138 144
REGIO 1939 1949 1950 19511951 as
of 1939
1( .thousands of USC s . . .)
Western Europe. . I 103 415 470 523 506
Northern Europe . 31 68 86 104 334
Central Europe . 37 SO 115 155 419
Med iterranean Europe 52 66 76 86 167
TOTAL . . . 223 629 747 868 389
(1938 = 100) (1934-38=100)
Western Europe . 172 114
Northern Europe. 194 109
Central Europe 132 123
Mediterranean Europe . 150 92
REGION
AmouNT 1951/52in 1.000 nt.t. of plant nutrient RELATION TO PREWAR (1938 = 100)
N P205 ITC)P205
1950/51 1951/52 1950/51 1951/52 1950/51 1951/52
closing of new contracts, carried Europe over thedanger period. Prices of small roundwood havefallen by some 20 to 25 percent from the pricelevel of autumn 1951.
Trade. Western Europe has had to continuebeing a heavy importer of foods. Furthermore,as exportable supplies became less available innon-dollar areas, the region has had to continuemaking heavy purchases in North America. Dur-ing the past three years, the annual average per-centage food supply in 'Western Europe obtainedby imports from the rest of the world was 34percent for bread grains, 32 percent for sugar,and, (if imported grain for feed is taken into con-sideration) 21 percent for meat and eggs. Between1949 and 1951 expenditures on agriculturalimports (excluding fibers) from outside the regionby ten of the largest countries declined steadilyfrom 70 percent of their earnings from total ex-ports to 55 percent. The reduction was due inpart to increased exports from expanding indus-try, and improving ability of Europe to feeditself. Food still represented the dominant importcost, however.
In 1951/52 imports of grains were greater byabout 12 percent than in the previous year andthose of sugar by 10 percent, because of smaller do-mestic production. Many countries tried to rebuildstocks of grain from which they had drawn in1950/51, whereas some 400,000 tons of sugarwere added to stocks in both years.
While imports of bread grain and fats and oilshave been exceeding the prewar levels, imports ofsugar, coarse grain and oilcake have been consid-erably reduced. The reduction in oilcake isdue partly to the reduced demand, reflecting im-proved methods of pasture management andutilization and also lack of foreign exchange.Coarse grain purchases have been reduced, partlybecause of high prices in the markets for whichforeign exchange was available, and partly be-cause of the decrease in horse numbers whichreleased feed for other livestock.
The dependence on the dollar area for importsof essential foodstuffs and feeding stuffs increasedfurther in 1951/52, especially in grains, followingthe curtailment of supplies from the Argentineand Australia (Table 17).
Intra-European trade in agricultural productsremained at a high level during 1951/52. Totalmeat exports from Denmark have been slightlyreduced and the export of butter from Denmarkand the Netherlands was below the previousyear's, while cheese exports from those countries
49
TABLE 17. TOTAL IMPORT OF SELECTED COMMODI-TIES FROM OTHER REGIONS AND PERCENTAGE IM-PORTED FROM DOLLAR AREA., ELTROPE (excludingEastern Europe and U.S.S.R.)
a Dollar area comprises : for g,rains, U.S.A. and Canada ;for sugar, U.S.A. and Latin America, excl. :Brazil ; for fatsand oils and oileake, North America, inel. Mexico and thePhilippine Republic.
b Provisional.e In terms of refined sugar. Net of re-exports.d In oil equivalent.e From imported seeds and imported as such. Postwar
figures are for 1950 and 1951 (calendar years).f If the quantity of sugar re-exported to other regions is
added to the import, the import from the dollar area amountsto less, e.g. 77 % in 1950/51.
increased considerably. Most of these exportswent to Western European countries. the mainexception being butter exports from Denmarkand Sweden to Czechoslovakia, Eastern Germanyand the U.S.S.R.. France changed from a netexporter of bread grain in 1950/51 to a netimporter in 1951/52, and also decreased herexports of sugar and meat.
Imports of coarse grains and wheat from EasternEurope and, in particular, from the -U.S.S.R.,although very limited and still far below theprewar average, showed some increase over thepreceding year, Italy and the United Kingdom beingthe main importers from the U.S:S.R.. WesternGermany, which before the war relied on easterncountries for a substantial part of its foo'd imports,drew only 3.4 percent of its total from this regiOn.
Prices and income. Prices received by farmersfor the major crops, particularly cereals and sugarbeets, improved somewhat in 1951/52. In 1949and even after the outbreak of hostilities in Koreain 1950, these prices increased relatively little inmost countries, partly thanks to government pol-icies, while industrial prices rose considerably.Prices of livestock products were sustained during1951/52, particularly for meat, but did not keeppace with the increase in crop prices. Italy andthe Netherlands were the only countries wherelivestock prices increased more during the year
PERIOD Breadgrain
Coarsegrain Sugar
Fatsand
oils d
Oilcakeand
meal e
(...... . metric tons
Prewar 12.6 11.1 3.0 2.6 5.11949/50 12.4 8.3 2.8 2.7 ma1950/51 12.5 7.5 2.3 2.7 3.41951/52b 14.1 9.1 2.7 n.a 3.3
Percentage i.m)orted from r area
Prewar 35 40 71949/50 SO 46 75 20 n.a1950/51 SO 45 195 20 17
1951/52 n.a n.a n.a n.a 17
than did prices of the main crops. The relationremained the same in Denmark, Norway, andSwitzerland but in France, Germany and theUnited Kingdom, for instance, prices of the majorcrops increased 21 to 31 percent, while prices oflivestock products rose only S to 18 percent.
Price fixing and control programs have changedlittle. Norway, Sweden and the United Kingdomhave price agreements which aim at assuring theiragricultural industries a minimum income. Fixedor guaranteed prices for some basic productsremain in operation in Austria, Denmark, France,Italy, the Netherlands, Switzerland and WesternGermany.
Gross farm income in 1951/52 was higher thanin previous years in most countries. Net farmincome, however, increased less, owing to substan-tial increases in wages and other costs. Pricesof imported feedstuffs rose but in France, theNetherlands, Sweden and the United Kingdomthe increase was partly offset by subsidies. Somefarmers found that fertilizer prices increased morethan crop prices.
Outlook 1952/53Demand for farm products will probably remain
generally strong and the greater availability ofcoal, steel and other raw materials should encour-age high industrial activity. Unemployment,which has been increasing in some countries suchas the Netherlands and the United Kingdom, willhave little effect on the present average level ofconsumption. Structural unemployment contin-ues high in Italy and Western Germany. Pricesmay remain more stable than in recent years,largely thanks to the recent fall in prices of rawmaterials and to anti-inflationary measures takenby various governments.
Crop production can be expected to exceed1951/52 levels. The area under cereals, includingwheat, shows a slight increase, and yields aregenerally reported to be good. The area undersugar beet has been further extended by some5-7 percent, the increase being most niarked inAustria, Finland, France, Italy and Spain, withdecreases in Belgium, Ireland, Western Germanyand the United Kingdom. Livestock productionshould benefit from the good condition of pastures,but in countries depending on imports of feedstuffs,supplies and prices in foreign markets will influencethe rate of expansion of output. The after-effectsof foot-and-mouth disease on the output of live-stock products, especially milk, may become appar-ent.
50
Long-term outlook
According to a recent OEEC estimate, totaldemand for agricultural products in the OEECarea might be expected to increase by 12 to 14percent within the next five years, if total eco-nomic activity were to increase by 25 percent.Although this estimate may be on the high side,it has to be considered in relation to Europe'sability to obtain larger supplies of food andfeedstuffs necessary for a growing populationfrom other regions. As indicated in Chapter II,it is not likely that dependence on the dollararea will diminish. At the same time, prices forimports from this area are likely to remain highand exchange difficulties will not easily be over-come.
In the long run, therefore, necessary agriculturalsupplies can only be assured by increased Europeanproduction leading to the consequent reductionof imports from the dollar area of such productsas cereals, sugar and tobacco. Since there is
little scope for expanding the agricultural areathe stress has to be laid on further intensificationof production.
EASTERN EUROPE AND THE U.S.S.R. 2
Current situation
Collectivization in some of the Eastern Europeancountries has slowed down during the past year,but the area in state farms continues to expandrapidly, especially in Poland and Eastern Germanywhere land abandoned by farmers has been takenover for cultivation.
In Bulgaria, where the process of collectiviza-tion is nearest completion, about one-half of thetotal area of arable land was in collective farmsby the end of 1951. In Czechoslovakia, Hungaryand Yugoslavia the proportion accounted for bycollective and state farms appears to have reached20 to 30 percent and in Poland about 15 percent.In Romania the number of collective farms atthe beginning of 1952 was small compared withneighboring countries. In Eastern Germany, al-though the number of nationally-owned machinestations has increased, no deliberate policy ofcollectivization on the usual pattern appears tohave been introduced.
2 For purposes of this report Eastern Europe in-eludes Albania, Bulgaria, Czechoslovakia, Hungary,Poland, Romania, Yugoslavia and Ea,stern Ger-many.
In the Soviet Union, more attention has recentlybeen paid to the transfer of livestock still in pri-vate hands to collective ownership, and towardsthe amalgamation of collective farms into largerfarming units. There has been a change in thepolicy of collectivization in Yugoslavia. The typeof co-operative now being encouraged resemblesthe Western more than the Soviet model, withpeasants combining mainly for buying and sell-ing, the provision of credit and other forms ofmutual assistance. Existing co-operative farmsare changing their methods of paying workers toprovide more incentive for individual effort. Ma-chine tractor stations have been dissolved andtheir stocks transferred to co-operative pools ofthe western type or distributed among the col-lective farms. Compulsory state purchase of pro-duce (except wool) has been abolished, freer pricesprovide a new incentive for sales off farms, andearnings above a level fixed by reference to thecadastral value of the land are not now subjectto tax.
Increased agricultural mechanization is also amajor preoccupation in Eastern Europe. Apartfrom Bulgaria and Albania, which have no tractorindustries, all the countries of Eastern Europecontinued in 1951 their efforts to expand thevolume of tractor production. It is anticipatedthat Czechoslovakia will produce heavy tractorsfor export to Bulgaria, Poland and other countries.
Agricultural production. Agricultural production,although showing marked recovery since the endof World War II, is still below that of the 1934-38average.
Throughout most of Eastern Europe the breadgrain harvest in 1951 was reported to be the bestsince the war (Table 18). Yields per hectare
TABLE 18. CROP PRODUCTION : EASTERN EUROPE a
NoTE : Statistics are mostly derived from unofficial sources.a Bulgaria, Czechoslovakia, Eastern Germany, Hungary,
Poland, Romania and Yugoslavia.
51
were substantially greater than in 1950, exceptin Poland, where some crops, especially potatoes,had poor yields owing to drought. In the SovietUnion the total grain harvest was smaller thanin 1950.
The area under sugar beet and industrial crops(e.g. oilseeds, flax and tobacco) is rapidly expand-ing in several countries. In Bulgaria cotton, hemp,rice, and sugar beet all showed a considerableincrease. In Poland and Czechoslovakia, however,the planned increases in sugar beet and industrialcrops were not attained, though there was someincrease in acreage.
The improved crop situation in 1951 had notgreatly affected livestock numbers by the end ofthe year. In Bulgaria there was an increase of7 percent in livestock. In Yugoslavia livestocknumbers increased somewhat after the setbackscaused by drought in 1950, but except for sheep,smaller numbers were recorded in January 1952than two years previously. The cattle popula-tion in Czechoslovakia and Poland is stated tohave been about the same in 1951 as in 1950.In Poland pig breeding was reduced in the earlierpart of the year but showed signs of recovery inthe fourth quarter. Pigs and sheep increasedappreciably in Eastern Germany and in Czecho-slovakia.
Shortages of meat and fats were reported inseveral of the Eastern European countries. InPoland, the effects of the drought, combined withthe peasants' reluctance to meet the Government'sdemands, led to reductions in fat stock deliveriesfrom farms, and towards the end of 1951 a partialrationing of meat and fats was introduced. Theproblem of feeding industrial workers in Poland,110W about double prewar numbers, is of criticalimportance because of its vital connection withproductivity, the key to the fulfilment of all theGovernment's planning. Compulsory delivery ofslaughter animals and of some livestock productshas recently been reintroduced, and to encourageproduction and delivery of pigs there is a bonuspayment for pigs sold under contract above thequota. Such deliveries also bring some reductionin land tax and earn for farmers the right topurchase certain quantities of coal and feeding-stuffs.
At the beginning of the year, following thedrought of 1950 which had given rise to a shortageof feed, rationing was re-imposed in Hungary.After the good harvest of 1951 food prospectsbegan to improve and in December 1951 ration-ing was ended. In Czechoslovakia the production
0,111101)1'n' 1931-35 1950 1951
( .711 iIOoa metric tons . . )
Wheat 14.0 12.8 14.6Rye 11.8 11.1 11.4Barley 5.7 4.4 4.9Oats . 6.9 5.1 5.4Maize 12.2 9.0 12.3Sugar 2.6 3.2 3.1Potatoes 67.0 62.9 53.6
TOTAL, wheat equivalent. 62.0 55.6 57.3
Wheat equivalent per caput(kg) 371 339 335
of fat stock and milk fell short of the figure plan-ned, and in reviewing the year's achievements theGovernment stated that "serious shortcoming hadoccurred" in the supply of agricultural products.
A change in the system of food prices took placein Romania in January 1952 and in Bulgaria inMay 1952, with food rationing abolished and acurrency reform announced. The volume of salesof consumer goods, including food; increased there-after. This move in Romania followed a periodof shortage of livestock products. The MeatDepartment of the Romanian Ministry of Food isreported to have delivered only 42 percent of theplanned amount of meat for 1951.
In Eastern Germany meat consumption wassubstantially greater than in 1950, but still muchbelow the prewar level. Deliveries from farmswere regarded as unsatisfactory in view of theestimated production.
Trade. Trade within the region is reported tohave been intensified and there were growingrestrictions on trade with Western Europe.Eastern Germany and Czechoslovakia continue tobe supplied with grains in exchange for industrialproducts, especially machinery and scientific in-struments.
In Eastern Germany the livestock numbers envis-aged in the revised five-year plan for production(1951-55) and a trade agreement with the SovietUnion suggest that substantial supplies of coarsegrains are expected to arrive from or by way ofRussia.
The Soviet Union exported 300,000 tons or 27percent more grain to Western Europe in 1951than in 1950, the increase going chiefly to theUnited Kingdom (coarse grain) and to Finlandand Italy (bread grain). Poland, Hungary andYugoslavia, on the other hand, shipped less grain,and exports from the region as a whole werereduced 100,000 tons (6 percent). These ship-ments in 1951 made up 7 percent of WesternEurope's grain imports as compared with 10 per-cent in 1950.
Exports of wheat from the Soviet Union includ-ed about 180,000 tons to countries outside Europe,mainly to Egypt, during the six months endingJanuary 31st, 1952, and 180,000 tons to the Unit-ed Kingdom during the first four months of 1952.This was in fulfilment of the agreement concludedin September 1951, under which the United King-dom would receive 200,000 tons of wheat, as wellas 800,000 tons of coarse grains.
Early in 1952 Yugoslavia exported substantialquantities of maize (chiefly to Western Germany
52
and the United Kingdom) following the morefavorable harvest of 1951.
Poland's exports of bacon to the United Kingdomin 1951 were at the 1950 level of 37,000 tons,but reduced quantities were sent in the earlymonths of 1952. The trade in eggs has alsodiminished.
Exports of pigs to Western Germany fromPoland, Hungary and Czechoslovakia were muchless in 1951 than in 1950, but exports of sugarwere greatly increased.
NORTH AMERICA 3
Current situation
Throughout 1951/52 defence activities and theexpansion of industrial plant determined the pat-tern of demand for farm products as well as otherproducts. Stockpiling generally declined or stop-ped early in the crop year, and consumer purchaseswere relatively low during 1951 but started toimprove slightly in 1952. On the other hand,the imbalance in foreign trade that developed in1951 continued into 1952 with an export surplusof about 5,500 million dollars (annual rate). Man-ufacturing capacity in the United States expand-ed under the impact of the postwar boom.
Agricultural production increased during 1951/52 over that in 1950/51. In the United Statestotal volume of farm production advanced about2 percent, and in Callada the advance was 13 per-cent. The gains in production are largely attri-butable to substantial increases in cotton, tobacco,oilseed and truck crops in the United States andto large grain crops in Canada. Livestock andlivestock products gained moderately in the Unit-ed States, the increase in pigmeat, poultry, andeggs offsetting a slight decline in dairy productsand other meat. In Canada, beef, veal and eggproduction was reduced somewhat but produc-tion of pork and poultry was larger.
Food and agricultural supplies of domestic andforeign origin were adequate to meet the domesticand export demand. HOWeVer, the decline in po-tato production in both Canada and the -UnitedStates resulted in a shortage during the first halfof 1952, with prices rising sharply. By the endof 1951, agricultural stocks, with some changesin composition, were even larger than at the endof 1950, assuring adequate supplies of most food-stuffs for the balance of the 1951/52 year, but
'U.S.A. and Canada.
maize and wheat carr3-overs Nvill remain lowerthan a year earlier by the time the 1952 cropsare harvested.
General economic conditions. Increasing ratesof government expenditure and of business invest-ment were decisive factors contributing to anenlarged volume of output. Full employment wasmaintained and a larger number of persons wereat work at higher wage rates than the year before.Unemployment was reduced to less than 3.0 per-cent of the total labor force in the United Statesand to 2.0 percent in Canada.
Total output of goods and services increased sig-nificantly in both countries during 1951. Grossnational product in 1951 at current market pricesincreased 16 percent over the 1950 figure in theUnited States and in Canada 17 percent. Forthe United States nearly half of the increase wasbrought about by gains in real output and theother half by _higher prices. In Canada only aboutone third of the increase originated in gains inoutput and the other two thirds WaS due to higherprices. The rate of increase declined appreciablyin the first quarter of 1952.
The aggregate volume of industrial productionfor both countries WaS larger than in 1950, byabout 10 percent in the United States and in
Canada about 7 percent. Production for defenceand related purposes was the major factor support-ing the increased output. In contrast, productionof many types of consumers' goods dropped withthe decline in individual demand which affectedchiefly purchases of durable goods and some typesof non-durables at a -time when production wasclose to peak rates and stocks were rapidly accu-mulating. Price levels were affected by the reduc-tion in the volume of sales and by the slowdownin stockpiling following the decline in consumers'demand. These trends continued into 1952. Whole-sale prices of all products declined. by 1.5 percentbetween September 1951 and June 1952. In theUnited States, consumers' expenditure for non-durables rose slightly in the first quarter of 1952while those for durables remained unchanged.However, relaxation of government restrictionson instalment buying and on financing of privatehouse construction are expected to affect favorablyconsumer spending on houses and durables duringthe rest of 1952.
Government outlays for defence purposes weresubstantially larger than in 1950 and their sharewithin gross national expenditure rose in the Unit-ed States from 6.5 percent in 1950 to 11.5 percentin 1951, and in Canada from less than 3 percent
CHART XIII - UNITED STATES : POPULATION AND FOOD PRODUCTIONPREWAR AND POSTWAR
1 50
140
130
120
1 1 0
I 00
90
80
70
60
POPULATION
TOTAL FOOD PRODUCTION
Osey,
=WES ig.....42AMZ00.0001St,Set
10Z
FOOD PRODUCTION PER CAPUT
53
PERCENT
OF PREWAR
160
SEMI-LOGARITHMIC SCALE
' 1935-39 19 46 47 1947/18 1948/49 1949/50 1950/51 1951/52
CHART XIV - CANADA : POPULATION AND AGRICULTURAL PRODUCTIONPREWAR AND POSTWAR
PERCENTOF PREWAR
1935-39
to more than 5 percent. In addition, total invest-Ment for industrial expansion and development ofstrategic raw materials advanced for both coun-tries though proportionately more in Canada thanin the United States. In 1952 the rate of militaryexpenditure continued to increase. Deliveries ofmilitary goods were 21,A times as great in the firsthalf of 1952 in the United States as in the firsthalf of 1951. This rate will again double by the endof 1952.
Agricultural production. On the North Americancontinent total agricultural production continuedto increase in the United States at a reducedrate as compared to the war years and in Callada,because of the bumper wheat crops during thepast two seasons, at a very high rate. On theother hand, the rate of increase in population inboth countries was almost the same, with theresult that per caput production, both food andnon-food, showed a downward trend in the UnitedStates since the end of the war, while in Canada,per caput production declined at first, with poorweather, then rose sharply in the past two years.(Tables 19 and 20 and Charts XIII and XIV).
Adverse weather prevented even larger produc-tion in the United States, where abandonment ofplanted fields was greater than in recent years.With increased acreage, cotton production wasmarkedly larger. In Canada, although weather
TOTAL AGRICULTURAL PRODUCTION
........ ''''''''''''''''''''''''' o 0000000000 0000o0O 000000000000000000000000000000
oo ...........
..........
1946 /47 1947/ 48
54
AGRICULTURAL PRODUCTION PER CAPUT
1948 / 49 1949 /50
TABLE 19. -- TOTAL AND PER CAPUT AGRICULTURALAND FOOD PRODUCTION IN THE UNITED STATES,1946 TO 1951
SEMI-LOGARITHM'C SCALE
1950 /51
1935-39 100
SOURCE : U.S. Department of Agriculture and United Nations.
TABLE 20. TOTAL AND PER CAPUT AGRICULTURALPRODUCTION IN CANADA, 1946 TO 1951
1951/ 52
SOURCE : Dominion Bureau of Statistics and United NaMons.
Total agriculturalproduction. . . . . 137 136 138 140 137 40
Food production.. . 140 140 134 137 138 138
Population 110 112 114 116 118 120
Per caput agricultu-ral production. . . 125 121 121 121 116 117
Per ca,put food pro-duction. 127 125 118 11S 117 115
ITE)IS 916 1947 948 1919 1950 1951
1935-39 100
Total agricultural pro-duction. 126 116 125 122 140 157
Population 114 117 119 122 124
Per caput agricultu-ral production. . . 114 102 107 103 115 127
ITEms 194611947 1948 1949 1950 1951
was generally favorable during the growing season,extremely unfavorable conditions prevailing dur-ing the harvesting period in Western Canadaprevented a large part of the grain crop from be-ing harvested or threshed until the spring of 1952,creating serious handling problems.
Although the 1951/52 crop production in theUnited States was among the highest recorded,only 32.6 million tons of food grains were producedas against 33.2 million the previous season. Thevheat crop of 26.9 million tons was 8 percentbelow the 1940-1949 average, the decline resultingmainly- from abandonment of planted acreage inwinter wheat due to bad weather.
The rice crop, at nearly 2 million tons, was thelargest on record and exceeded by 13 percent thatof the previous year. Feed grains totalled 114million tons against 122 million tons producedin 1950/51. In spite of 6 percent decline in soya-beans and of 21 percent in peanuts, total produc-tion of oilseeds at 16.3 million tons exceeded by7 percent that of 1950/51. The estimated in-crease of cottonseed is about 50 percent. Theincrease in supplies of oilseeds was, however,accompanied by a substantial drop in fats andoils prices.
Beet and cane sugar was estimated below 2million tons against the 2.6 million produced theyear before. Potatoes and sweet potatoes werealso lower and dropped by 24 percent and 43percent respectively. Price support on potatoeswas discontinued after the 1950/51 crop. InDecember 1951 the price had more than doubledas compared with a year earlier and exceeded theparity level for the first time after several years,on account of reduced acreage and yields per acre.The tobacco crop was very high, exceeding by12 percent that of 1950/51.
In Canada, 1951/52 saw larger yields per acreand higher volumes than the previous year formost crops. Declines occurred in potatoes; fieldroots, sunflower seeds and sugar beets, due mainlyto reduced acreages.
The significantly increased Canadian grain cropswill provide larger export surpluses during 1952/53. The wheat crop of 15.3 million tons was 22percent above the year before. Supplies of feedgrains available from the 1951/52 crop plus carry-over were estimated at 20.3 million tons againstthe 15.3 million during 1950/51. Forage produc-tion also increased with important gains in hayand clover.
Cotton acreage was 50 percent larger than thepreceding year when acreage allotments were ineffect. Yields per acre were also slightly higher
55
and the crop at 15.3 million bales was 53 percenthigher than in 1950/51.
Both countries realized a net increase in livestockpopulation, but total meat production declinedslightly because reductions in beef and veal offsetincreases in pork. Poultry products in generalincreased for both countries but eggs declinedsomewhat in Canada. Dairy production remainedabout the same.
In 1951 the United States and Alaskan catchof fish and shell fish was about 10 percent lowerthan in 1950, while the value decreased by about5 percent. The decline was due primarily toreduced landings of pilchards, herring and tuna.Preliminary data also indicated that the 1951pack of canned fisheries products was 18 percentlower than in 1950. The largest decline was ob-served in the packs of California and Mainesardines, tuna and mackerel.
In Canada, excluding Newfoundland, fish land-ings in 1951 decreased by about 3 percent forall species. In Newfoundland, the market condi-tions for the cod fisheries had shown some signsof improvement in 1951. The 1951 Canadian packof salmon increased 32 percent above 1950 witha simultaneous upward trend in prices.
Owing to the very favorable marl:et conditions,production of wood pulp in North America rose11 percent during 1951 and that of newsprint 8percent. Consumption of wood pulp and pulp pro-ducts, particularly newsprint, however, rose lessthan one percent and consequently stocks both atmills and with consumers were at record levels in thefirst quarter of 1952. The increase in North Ameri-can wood pulp production resulted in reduced im-ports from other regions and the area became a netexporter in 1951. Lumber production in North Amer-ica during 1951 was about 1.5 percent below thatof 1950, sawn softwood declining about 4 percent,and hardwood lumber increasing about the same.This decline in the total output of lumber wasclue in large measure to the curtailment of housingand general construction in the United States.
Agric7iltural trade. The volume of United Statesagricultural and food exports increased 19 percentduring 1951, and the volume of agricultural imports,although increasing slowly for specific commodi-ties, in general declined and was 4 percent lessthan 1950. In the first quarter of 1952 exportsincreased another 17 percent over 1951, whileimports declined by 5 percent compared with thefirst quarter of 1951. Canadian agricultural ex-ports exceeded those of the previous year by 25percent.
Prices and income. Retail food prices in theUnited States by the end of 1951 were at thehighest level on record about 18 percent abovethat in the early months of 1950 but declinedslightly during the first months of 1952. InCana,da food prices reached their peak duringthe third quarter of 1951 and ha-ve been declin-ing steadily since then, while remaining a,bovethe levels of 1950.
Wholesale prices of farm products also declined.In the United States wholesale prices of food inJune 1952 were a,bout 3 percent lower than a yearearlier, and agricultural prices 5 percent lower.In Canada, wholesale agricultural prices in April1952 were 8 percent below those of a yea,r ago.
While prices received by farmers in the UnitedStates had risen more rapidly than costs duringthe general inflation in the latter half of 1950, aprice-cost squeeze has been developing since Febru-ary 1951. In the United States the parity ratio de-clined from 113 in February 1951 to 102 by June1952, reaching a,gain the levels of the first halfof 1950. In Canada prices received by farmerswere in April 1952 about nine percent lower thanin April 1951. Farm costs, however, increased.
Farm cash income, as a result of larger market-ings and the high prices prevailing throughout1951, increased substantially in both countries.In the United States farm cash income advancedby 14 percent over 1950 and in Cana,da the ad-vance was 27 percent. The estimated gross farmincome in both countries in 1951 was also muchhigher than in 1950. In spite of some furtherrise in production costs during 1951, net farmincome rose 38 percent in Canada (includingundistributed earnings of the Canadian WheatBoard), and 17 percent in the United States, thehighest on record for Canada and one of the high-est for the United States, but still some two thou-sand million dollars lower than in 1947.
Outlook
The heavy influence of the large defence pro-gram on business activity might have correspond-ing effects on the demand for farm products.On the basis of the program as it stands in mid-summer 1952, the high rates of defence expendi-ture and large private capital investment pro-grams will again, as in 1951, sustain a high levelof demand. Productive capacity will be higherin 1952/53 than in previous years and, apart fromsome frictional and spotty unemployment, total
56
number at work and wage rates may tend to showa gradual increa,se. Disposable incomes ina,yshow some gains and consumers' demand will bemaintained. These conditions will favor highlevels of agricultural production, increa,sed market-ings and consumption of almost all kinds of farmproducts. Import and export demand for agri-cultural products is also expected to remain fairlystrong. Foreign demand for North America,nwheat particularly may be well sustained, 011
account of the shortcomings of other importantsuppliers such as Argentina and Australia. For-eign demand for machinery and other a,griculturalrequisites will continue to be strong. In 1953/54however, termination of the expansion in defenceexpenditures and the sharp reduction in capitalproduction for defence plants, may cause somedecline in demand in both countries. The de-cline would probably be more marked in the UnitedStates than in Callada,.
Officially estimated acrea,ges and reported plant-ing intentions indicate that the overall area pla,nt-ed to crops during this season and probably thenext will be at recent years' levels, although mi-nor relative changes may occur in the area plantedto particular crops. If recent trends in yields aretaken into account and normal weather conditionsprevail, total agricultural output may be larger.
The 1952/53 wheat harvest in the United States,it is estimated, may exceed by more tha,n 25percent the 1951/52 crop. .Acrea,ges for feed grainsare about the same as in the pa,st season, butproduction is expected to be significantly largerthan in 1951. A maize crop about 14 percentabove last year's is forecast. Hay acreage andproduction may also be slighly higher than in1951/52 and the feed supply situation is there-fore estimated to be adequate for the increasedntunber of livestock. Acreage and output ofoilseeds, potatoes and sweet potatoes, pulses,sii?-ar and tobacco are not expected to show sub-stantial variations. The cotton goal of 16 millionbales is the same as for the past season, althoughwith planting, somewhat below the average, thefull output may not be attained.
In Canada, tinder favorable weather conditions,crop productiOn in 1952/53 may be the same asin 1951/52. Favorable conditions enabled thewhole 1951/52 crop to be successfully harvestedin the spring of 1952, and the new season cropsWere well advanced and generally in good to excel-lent conditions by the middle of the year. Ifthose conditions remain unchanged until harvest-ing time, wheat, feed grain and forage crops may
be as high as or even higher than last year'sbumper crops.
With normal yields, potato production mayalso be somewhat larger, stimulated by the reducedproduction in the United States in 1951752 andthe upward trend in domestic prices. Theoutlook for oilseeds and tobacco is also good.
Production of livestock and its products in theUnited States is expected to be larger in 1952/53than in 1951/52, beef having expanded fasterthan dairy cattle. Slaughterings of cattle andcalves and sheep and lambs are expected tobe larger than in the last year. Hog slaughter-ings however are expected to drop later in 1952because of the unfavorable level of prices com-pared to maize price which has reduced the 1952pig crop 9 percent and may bring a similar reduc-tion to the fall pig crop. Total meat production,however, is expected to be slightly above lastyear's.
The present forecast for the United States marketduring 1952 points to a peak in production ofedible fishery products, with some slight adjust-ment in prices.
Canadian cattle numbers showed an upwardtrend in 1951/52 and hog producers were expect-ing a 2 percent increase in the 1952 spring pigcrop. The general good prospects for the Cana-dian livestock industry that prevailed at the be-ginning of 1952 were, however, shaken by the an-nouncement in February of the outbreak of footand mouth disease in Saskatchewan. MeasuresWCYC taken by the Canadian Government to eradi-cate the disease, but at the same time the UnitedStates placed an embargo on Canadian livestock,fresh meat and hay. If the embargo continuesit will mean a substantial loss of export trade inmeat and livestock which last year broughtCanada 138 million dollars. With larger cattleand hog populations, the measure will also inev-itably result in a large surplus of meat for 1952/53.Increased meat sales to the United Kingdomunder the new three-country agreement includ-ing New Zealand are, however, likely to absorbpart of such a surplus.
Supply prospects in North, America for forestproducts in 1952 give no reason for anxiety, asstocks for most forest products at the end of 1951were at a high level ; current demand is thereforelikely to be met, particularly as an increase inthe output of sawn wood appears probable in1952.
Demand conditions for farm products are ex-pected to continue strong for both countries in
57
1952/53 with some temporary decline possibleduring late 1953/54. During time next seasonfarm prices on the average will probable be main-tained without major fluctuations at the levelsprevailing during late 1951 and early 1952. Fur-thermore, price support systems in the UnitedStates as well as in Callada constitute a safeguardagainst any sharp drop in farm prices. Farmers'cash income, therefore, will probably continue torise but net incomes may remain below the highlevels in 1951 due to increasing production expenses.
Present trends of economic activity and publicexpenditure also indicate for 1953/61 a fairlyhigh level of demand for farm products. Althoughemployment mal' be about the same as in 1951/52the gradual rise in wage rates is likely to bringsome increase in consumer incomes available forspending even if the present tax structure contin-ues. With production facilities becoming in-creasingly available for civilian use the generalprice situation at time retail level in 1953/54 maynot be much different from that in 1951/52.However, prices received by farmers could besubject to considerable downward pressure ifsupplies are heavy.
The already tight farm labor situation ma,ybecome more aggravated as more and better jobopportunities are created in non-faian occupations.Rises in farm Ivage-rates are therefore to beexpected. A continued decline in the number offarm workers is likely, but more efficient use ofthose remaining and a larger use of mechanicalimplements will continue to offset this decrease.In Canada the immigration program will contri-bute little to relieve the situation, although thegrowing need for mechanically skilled farm work-ers will continue. In the, .L.Tnited States the re-cruitment of outside workers during harvestingperiods will probably continue on an increasingscale.
iAlaterials required by farmers, such as equip-ment, fertilizers, pesticides and fuel, may showsome further price rises due to a relatively lightsupply situation arising from world-wide short-ages and the allocations required for the expand-ing defence industries. Supplies may not besufficient to meet the increased domestic andforeign demand.
With farm prices declining relative to prices ofgoods farmers buy but partially offset by largervolume of production, North American net farmincomes in 1952/53 may be slightly lower thana year earlier with a further decline possible in timefollowing year.
LATIN AMERICA
Current situation
In Latin America greater emphasis is beingplaced on agricultural expansion than duringrecent years. Industry has been expanding morerapidly tha;n agriculture, and in some instancesagricultural investment was discouraged by pricepolicies. There is, however, a growing realiza-tion that agricultural development must not lagbehind progress in other sectors of the economy.In most countries agricultural exports, which forthe area as a whole have declined during thepostwar period, are essential for economic develop-ment as they constitute at present an irreplaceablesource of foreign exchange with which to pay forincreased imports of capital and consumer goods.
The area planted and harvested in 1951/52was larger than that in the preceding year, exceptin Argentina where acreage dropped significantlymore farm machinery was in use in many countries.Nevertheless, a heavy setback in Argentina's pro-duction, caused mainly by unfavorable weather,offset progress elsewhere and overall farm produc-tion in Latin America during 1951/52 consequentlydeclined about 2 percent from the previous year.
There was a sharp contraction in production ofcereals and minor declines in potatoes, pulses,tobacco, cocoa, hard fibers and livestock products,which were only partially offset by a significantincrease in sugar and smaller gains in cotton, coffee,bananas and oilseeds.
The decline in production affected exportsrather than levels of domestic supplies and be-cause of increased imports food supplies in 1951/52 were generally higher than the year before.In several countries, e.g. Brazil, total suppliesincreased by a higher proportion than populationgrowth and supplies per caput were thereforealso higher. For Latin America as a whole,however, supplies did not exceed the populationincrease and food supplies per caput remainedalmost unchanged as compared with the previousyear.
General economic conditions. Industrial produc-tion as well as other non-farm economic activitiescontinued to expand during 1951/52. The rateof growth of industrial production was acceleratedin Chile; Mexico and Peru and remained almostunchanged for the rest of the region as comparedwith the previous year's. In Argentina, however,there was a slowing down, mainly in the produc-tion of durable goods. For the region as a whole
CHART XV - LATIN AMERICA : POPULATION AND FOOD PRODUCTIONPREWAR AND POSTWAR
160
150
140
130
120
110
100
90
80
70
60
;....................... .......
........................................
...... .
gyepN.0Ol...I ....
POPULATION
TOTAL FOOD PRODUCTION
FOOD PRODUCTION FER CAPUT
58
PERCENT
OF PREWAR SEMI-LOGARITHMIC SCALE
1934-38 1946/47 947/48 1948/49 949/50 1950/51 1951/52
CHART XVI LATIN AMERICA (EXCLUDING ARGENTINA) : POPULATION ANDFOOD PRODUCTION, PREWAR AND POSTWAR
160
150
140
130
120
110
100
90
80
70
601934-38
TOTAL FOOD PRODUCTION
....71.11.1.0.1S. .4102116NO
¡Isprafla
1946/47 1947/48
POPULATION
SIfirenseesa..¢1.0.
.0000¢,9100t,i
FCOD PRODUCTION PER CAPUT
1948/49 1949/50
0..4100 ......
SatliOIDOassa..10 =FS
1950/51 1951/52
the increase in the volume of non-farm productionmore than offset the decline in agricultural pro-duction. In several countries the share of agri-culture in gross national production was almostunchanged but in Argentina, Brazil, Chile, andMexico it was further reduced.
External and internal factors contributed tothe inflationary pressures and pushed the generallevel of prices upward, particularly during thefirst part of 1951. During the second half, priceincreases slowed down considerably. For theyear as a whole, however, price levels in nearlyevery country were substantially above thoseof the preceding year. By the end of 1951 andduring the early months of 1952, price increaseshad levelled off in most countries. In a few coun-tries, e.g. Chile and Paraguay, where inflationaryforces were mainly of internal origin, inflationcontinued although at a reduced rate. Earlyin 1952 the cost of living was higher than a yearpreviously in all countries of Latin America ex-cept Colombia, where it was about the same.
The domestic demand for agricultural products,especially foodstuffs, continued to be firm, asindicated by the sharper rise in food prices thanin prices of other consumer goods.
Increased and more expensive imports result-ed in a net decline of $ 300 million in foreign
exchange reserves. As a result, exchange andimport restrictions, which had been generallyrelaxed in late 1950 and early 1951, wereagain tightened in early 1952 in several instances.
iyricultural production. Total agricultural pro-duction has been increasing somewhat each yearsince the end of World War II, althoughthere was a setback in 1951/52. (Table 21
and Charts XV and XVI). Food production in1951/52 was about 22 percent above the prewarlevel. Nevertheless, population growth exceededthis increase, so that per caput food productionhas declined 10 percent below the prewar level.However, excluding Argentina, it is obvious thatconsiderable progress has been made in the region,with 1951/52 food production 47 percent abovethe 1934-38 average and exceeding the rate ofgrowth of population, and per caput productionconsequently increased by 8 percent. The dropof about 17 percent in cereal production in 1951/52 is accounted for by a decline of 44 percentin bread grains and 4 percent in rice against anincrease of about 3 percent in coarse grains. Re-duced production of wheat and corn in Argentina,and wheat in Mexico and Brazil, was due tobad weather. The 1951/52 Latin American wheatproduction declined by more than 3 million metric
PERCENTSEMI-LOGARITHMIC SCALE
OF PREWAR
TABLE 21. -- INDEX- NUMBERSa OF VOLE-ALM OF TOTAL PER CAPuT AGRICULTURAL AND FOOD PRODUETIONIN LATIN AMERICA 1946/47 TO 1951/52
tons from the 8.6 million metric tons producedthe year before. Despite unfavorable weatherthe increased maize acreage made possible a gainof about 1.2 million tons over the 14 8 millionproduced in 1950/51 with increases of 700 thou-sand tons in Mexico, 300 thousand in Brazil andabout 150 thousand in Argentina, the majorproducers. Decreases occurred in rice, rye, oatsand barley production. However, the success-ful drive for increased production of rice in Cubaand Venezuela during 1951/52 resulted in gainsof 50 percent and 60 percent respectively. Such
60
a These index numbers are weighted by -values. They are preliminary.coming, year.
b Sunflower seed, groundnuts, sesame and cottonseed.e Linseed and eastorseed.d Based on preliminary data.
NoTE : This index is not fully comparable with that shown in Table 1, because of a somewhat different commodity coverage.
All FAO production indices will be revised during, the
progress in these two countries is significant be-cause they, together with Puerto Rico, are thelargest importers of rice in the region.
Production of potatoes was about 3 percentless than a year ago, mainly as a result of a sub-stantial drop in Argentina's crop and a somewhatsmaller crop in Peru.
The area planted to cotton was larger and produc-tion was 9 percent above the 815 thousand tonsof 1950/51. Gains occurred principally in Argen-tina, Mexico and Peru.
Total production of oilseeds in 1951/52 increased
ITEms 1940/47 1947/48 1948/49 1949/50 1930/51 1951/52d
1934-38 100
Total agricultural product ion 109 114 114 117 120 117Food production 116 122 121 199 127 122Population 122 125 127 130 133 136Per caput agricultural production 89 91 90 00 90 86Per caput food production 95 98 95 94 95 90
LATIN AMERICA, ExcL. ARGENTINA
Total agricultural product ion 114 118 124 130 132 135Food production 125 129 135 142 144 147Population 122 125 128 130 134 136Per caput agr. prod 93 94 100 99 99Per caput food prod. 102 103 105 109 107 108
ALL LATIN AMERIcA, PrtoDucTioN BYCOMMODITIES
Food Crops . 120 127 123 122 130 127Cereals . 102 107 99 94 104 87Potatoes 129 158 156 163 175 173Other roots and tubers 184 181 194 195 201 203Pulses 128 130 144 150 150 149Sugar 157 161 159 165 171 191Oilseeds (for edible oils) b 160 189 213 206 234 242Bananas 125 133 135 116 151 155Cocoa 97 96 106 118 105 95
Aninbal FoodsMeat 108 114 115 120 120 117
Aron-Food Prochwis 91 92 94 101 102 104Coffee 78 81 86 SS 87 91Wool 114 120 114 118 120 118Cotton . 86 88 102 117 130 141Hard fibers 144 151 159 167 180 172Tobacco 151 141 141 149 145 136Oilseeds (for non-edible oils) e 67 66 44 57 52 42
because of higher cottonseed and groundnutsoutput which more than offset significant declinesin Argentina's linseed and sunflower.
The 1951/52 output of sugar was a record onein many Latin American republics and the gainfor the whole region represented a 12 percent in-crease over the 12.4 4 million metric tons producedin 1950/51. Increases were as high as 24 percentin Cuba, 13 percent in the Dominican Republicand 8 percent in Puerto Rico. With the newhigh level of sugar production Latin America'sshare in the world total moved from 33 percentlast year to 40 percent this year. The coffeecrop also improved by about 5 percent over the1,839 thousand tons produced in 1950/51. Thegain came mostly from an increased Brazilianoutput, which was S3 thousand tons larger thana year ago.
Persistent drought and heat have been impair-ing the production of meat since 1949, and thetotal 1951/52 production was lower than that of1950/51. In Argentina, particularly, reduced produc-tion is partly due to reduction in livestocknumbers, mainly cattle and hogs, which are closelyrelated to the pasturage and feed situation.
The fisheries industries of Latin America arepassing through a period of large capital invest-ment and technological improvement which shouldbring significant changes in the patterns of pro-duction and consuniption of fisheries products.The year 1951 has been characterized in severalLatin American countries, e.g. Brazil and Chile,by the fulfilment of established plans for the ex-pansion of primary and secondary fisheries in-dustries and the introduction of new and moremodern transport and market facilities. Coun-tries like Peru, for example, are even enteringinternational trade in fisheries products as impor-tant exporters of certain commodities, on equalterms with many of the traditional Europeanproducer countries.
The volume of forest products output as a wholeincreased somewhat in 1951. Wood pulp produc-tion rose by less than 1/4 percent and remainedbelow its relatively high level in other regions.The increase was almost entirely accounted forby the production of mechanical wood pulp inArgentina. With demand exceeding production,imports of wood pulp from other regions rose 13percent over the 1950 level. Encouraged byincreased building activity, production of sawnwood particularly in Brazil also expanded.
4 Refers only to production of sugar at raw valueand excludes panela.
61
It has been estimated that 60 to 70 percentof the increase of sawn wood production in thewhole of Latin America went to meet the de-mands of domestic consumers and that only30 to 40 percent was exported, either to countrieswithin the region, or overseas. The domesticprices of sawn wood were higher than the exportprices which in 1951 reached a record.
Agricultural trade trends. During 1951 exportsof agricultural products were lower than in 1950,because of reduced shipments of grains, meatand wool. However, sugar, coffee and cottonwere exported in greater volume than the yearbefore.
The reduction in net exports is a continuationof the downward trend that began in the waryears, with the sharp fall in net exports of grainsand significant decline in those of meat and oils(Table 22).
TABLE 22. NET TRADE IN MAJOR AGRICULTURALCOMMODITIES, LATIN AMERICA : 1934-38, 1950AND 1951
= Net Exports= Net Imports
COMMODITY Average1914-33 1950a 1951"
( .. . thousand metric tons
SugarCofil eeMaizeVegetable oils and oil-
seedsMeatCotton (ginned).BarleyCocoaOats.Hard fibersWool (greasy) .
RyeAfillet and sorghumTobaccoJute .RubberDry beansAnimal and marine oilsPotatoesRice.Wheat
a Trade data re/ate to calendar years with the exception ofwheat, rye, barley, maize and oats, where the data for tradeseason July-Tune beginning in the year stated have beenused.
Imports of foodstuffs and other agriculturalproducts generally increased under the influenceof increased consumption and the greater avail-ability of foreign exchange arising out of thelarger export surplus of 1950. Rice was an
3 790 6 570 7 0501 370 1 394 1 4906590---- 330 570
447 551538 468231 285
15 285216 185230 170
79 140280 109200 100
90 8058 58
-- 9533 + 4114 H- 5060 + 120
230 + 160180 -l- 950500 + 2 100
549
265'8241
380 +196-400109216120504637
76
70 _1_
156 "7"+ 290
1 700
exception, mainly due to higher production in theimporting countries.
Prices and income. Because of higher prices,reflecting a strong domestic ami foreign demand,gross farm income was higher in 1951/52 than in1950/51, except possibly in Argentina. Withproduction expenses rising, net farm income in-creased less tha.n gross income. The trend in theratio of agricultural prices to general wholesaleprices, however, suggests that in some countries(Venezuela and Costa Rica) farming benefitedfrom price increases more than did other activi-ties, while in others (Mexico and Chile) it gainedless.
Outlook
During 1952/53 and 1953/54 the overall rate ofagricultural progress in Latin America will beinfluenced largely by changes in Argentina's pro-duction. Due to the new price policy of stimul-ating agricultural production in that country asubstantial advance toward the official goals ofgreater output of cereals and linseed may beexpected in 1952/53. These goals call for anincrease of slightly over 20 percent in the areaplanted to these crops above that in 1950/51and an estimated 45 percent over the area in 1951/52.
Assuming normal weather and the same rate ofincrease in output as in recent years in the regionoutside Argentina, total production of grains mayexceed by approximately 3 million metric tonsthe 29 million metric tons produced in 1951/52.With a significant increase in the area planted tolinseed in Argentina, oilseed production is likelyto increase substantially. In 1952/53 sugar maya.gain show another advance as the Cuban produc-tion may increase somewhat over that of the pre-ceding year, if no administrative measures aretaken to reduce output. Production of coffeemay make some gains, particularly in 1953/54,as a result of new plantings in recent years inalmost every producing country. Cotton out-put is likely to be somewhat higher in 1952/53,since larger crops are expected in Brazil, Mexicoand several of the minor producing countries.
Livestock slaughter and output of livestockproducts during 1952/53 may decline further,mainly as a result of recent measures adoptedby Argentina in order to increase cattle numbers.Argentina's meat output is likely to fall to about80 percent of current production while the measure
62
limiting the number of slaughtering days in eachweek is in force. Progress made in other coun-tries is not likely to offset the expected declinein Argentina's meat output next season. HOW-ever, in 1953/54, if the increase in stock in Argen-tina is a.chieved, total meat production in thearea may surpass the levels reached during thelast two years and perhaps exceed the recordattained in 1949/50.
Expansion of Latin American forestry productsw 11 contribute to the improvement of the supplysituation in this region and make it less dependenton imports, particularly of wood pulp and pulpproducts.
Total a.gricultural exports during 1952 arelikely to he reduced and exportable supplies areeven lower than in 1951. Some commodities,however, such as coffee, wool and sugar, may beexported in somewhat larger volumes. Meatexports may- increase through the efforts beingmade by Argentina to keep her export levels higheven at the expense of reduced home consumption.For 1953 total agricultural exports may be abovethe volume of the two preceding years, but ifArgentina should not succeed in improving herproduction of grains and meat, exports may bebelow the low levels expected during 1952.
Food and agricultural imports will probablycontinue to increase although at a slower ratethan in recent years, mainly as a result of exchangedifficulties being faced by several countries.During 1952 at least, these imports will require ahigher expenditure in hard currencies than inprevious years on account of the present shortsupplies in Argentina.
Industrial production during the coming yearmay continue to expand more rapidly than agri-culture, except perhaps in Argentina. Incomeand employment will probably, also show somegains. The demand for food will continue to bestrong but supplies will probably not keep pacewith increased population and consumer income.In some instances food exports will have to bereduced in order to maintain the level of domesticconsumption. Total consumption of food duringthe next two years may be above that in 1951/52but on a per caput basis it is not likely to showany significant change.
Several programs for expanding South America'sforest industries are under way. By 1952/53 thesupply situation in this region may begin to im-prove. The probability is that this region will,particularly as regards pulp and pulp products,gradually become less dependent on imports.
AFRICA'
Current situationAlthough this review deals with Africa as a
whole and not with specific countries, the conti-nent should be considered in three broad regions.These are North Africa; which forms part of theMediterranean economy, the intra-tropical colo-nial territories which are complementary to thoseof the administering metropolitan countries, andSouth Africa, which is the only partly industrial-ized region. The nature and rate of developmentfor each of these regions varies of course with itseconomic relationships with other parts of theworld and with its resources.
Agricultural food crop production showed asteady rise in the postwar period, per caputproduction reaching a peak in 1949/50, the onlyyear when it reached the prewar level. Duringthe last two years food crop production wasmaintained near the 1949 level, but a furtherpopulation increase slightly reduced per caputproduction. (Table 23 and Chart XVII).
Excludes Egypt, Anglo-Egyptian Sudan, Eritrea,Ethiopia and the Somalilands.
60
150
140
130
120
1 00
o
90
80
70
60
POPULATION
...................
FOOD CROP PRODUCTION PER CAPUT
63
TABLE 23. INDEX NUMBERS OF TOTAL AND PERCAPUT AGRICULTURAL PRODUCTION IN AFRICA a1946/ 7 TO 1951/52
TOTAL FOOD CROP PRODUCTION
CHART XVII - AFRICA : POPULATION AND FOOD CROP PRODUCTIONPREWAR AND POSTWAR
a These index numbers are weig ited by values. Theyare preliminary only. All FAO i roduetion indices willbe revised during the coming year.
b Commodities included in food crops production arewheat, rye, barley, oats, maize, rice, millet, sorghum, drybeans, dry peas, broad beans, chicle peas, lentils, potatoes,sweet potatoes, groundnuts, and raw sugar.
Production. Production in 1951/52 in Africa,which accounts for 5 percent of total world agri-cultural output, did not show any appreciableincrease over last season. Some important chan-ges in the agricultural situation have taken place,however, the most important of which were the
ITEms 1946/.17
1947/ 1948'11949149 50
1950151
1951/52
1934-38 100
Total agricultural pro-duction. 104 108 116 122 122 123
Food crops b 06 109 113 118 118 118
Population . 113 114 116 119 120
Per caput agriculturalproduction . . . . 92 95 co 104 103 102
Per caput food pro-duction. 94 95 97 1CO 99 08
PERCENTOF PREWAR
SEMI-LOGARITHMIC SCALE
1934-38 1946 / 47 1947/48 1948 / 49 1949 / 50 1900/01 1951/ 52
almost, record high production of oil crops. anincrease of approximately 25 percent over theprevious year, and a 14 percent drop from lastyear's cocoa production (Table 24).
TABLE 24. AGRICULTURAL PRODUCTION IN AFRICA
COMMODITY Average1934-3S
a Includes also rye, barley, oats and rice.b Calendar year, from export data.c Estimate.
Cereal production in Africa during the crop year1951/52 was 21.2 million tons, 3 percent belowthat of the previous year, but above the prewaraverage of 19 million tons. The pattern of produc-tion within the region was not uniform ; in NorthAfrica, reduced yields due to local droughts inAlgeria and Tunisia were offset by very good cropsin French Morocco. An average harvest in SouthAfrica yielded a small exportable surplus thatoffset somewhat the 40 percent deficit in Rhodesia,,caused by drought in March 1951. In East Africaheavy ra,ins during the early harvest damaged thecrop, about one quarter of which . was spoiled. InWest Africa, the crop year under review WaS excep-tionally good owing to favorable weather condi-tions, and the territories will be self-sullicient insta,ple food crops. There are no marked changesin the relative position of the different cerealswithin the group, except for an increase in riceproduction.
Last year's poor groundnut crop was followedin 1951/52 by an above-average crop estimated at2.23 million tons, an increase of just over 25percent. In Nigeria, the crop wa,s more thandouble that of last year, whereas in Senegal theincrease wa,s only about 20 percent. Productionof palm oil and of palm kernels shows a decreaseof 2 percent and 13 percent respectively, comparedwith the previous season ; this was mainly due
1919/50 1950/5
64
to a fall in Nigerian output, whereas the BelgianCongo registered a slight increase. A near-recordolive crop was harvested in 'Morocco and the over-all gain for the region as a whole is some 20 per-cent compared with last year.
The total output of raw cotton at about 213,000tons increased by 21/2 percent over 1950/51 witha decline in the East African crop balanced bylarger crops in the Belgian Congo, French Equa-torial Africa and, above all, in Nigeria.
Cocoa production in West Africa is estimatedat about 450,000 tons, 14 percent less than la,styear and also less than the prewar average of484,000 tons. The crop suffered from excessiverainfall and, in the Gold Coast and Ivory Coast,yields dropped 20 percent and 25 percent respec-tively, whereas the Nigerian crop declined 5 per-cent.
The coffee crop of 257,000 tons shows an increaseof 3 percent against la,st season with a decreasein Angola and the Belgian Congo more than off-set by increases in Kenya, Uganda and the FrenchWest African territories. The production of teahas also slightly increased. The plantations inNyasaland are making steady progress owing tothe improved methods of cultivation and, to alesser extent, to expanding acreage. Raw sugarproduction in Africa this year registered a decreaseof 7 percent. A good yield in Mauritius and inall the smaller producing areas has been cancelledby a 22 percent fall in the Union of South Africa,the other large producer.
Several postwar projects for the developmentof fisheries on the continent of Africa were stillin progress during 1951. It is too early yet forany significant results to have been achieved.Figures available for South Africa show the entryof this country into international markets for fishmeals with a considerable volume of exports.
Trade and prices. The demand for imports remain-ed at a high level, although new import restrictionswere imposed in sterling countries. In the Unionof South Africa, for example, the allocation offoreign_ exchange to importers ha,s been cut by£70 million or 15 percent. The prewar export-able margins of cereals a,nd sugar in the 'Union ofSouth .Africa and of cereals in French North Africahave in the postwar period been progressivelyabsorbed by increasing domestic food consump-tion, due to population growth and higher levelsof employment.
Export crop prices were maintained, with somenotable exceptions, during the first half of 1951,whereas a more general slackening was noticeable
( . . thousand ?IIeirie tons . . )
Cereals a 18 810 22 010 21 800 21 200
Millet and Sor-ghum 7 770 7 820 8 130 8 100
Maize 4 490 6 040 5 560 4 850-Wheat 2 520 2 810 3 130; 3 040
Groundnuts(unshel ledbasis) 1 476 1 908 1 831 2 228
Palm oil b 300 420 430 440Palm kernels 670 730 770 e670Olive oil 67 155 75 91Cotton 137 196 208 213Cocoa 484 487 521 450Coff ee 119 204 249 257Tea 9 16 20 e20Raw sugar. 1 034 1 300 1 455 1 350
in the first quarter of 1952, reflecting internationamarket developments.
South African wool prices dropped to aboutone half of the previous season's, which led to aconsiderable reduction of the country's farm income.Prices of vegetable oils and oil seeds have beengradually declining since their peak in early 1951,and a further fall in the spring of 1952 broughtthem down to almost half of the earlier level. A
tendency to reduce stocks and a good harvesthave both contributed to this trend. Coffee sisal,and tea have maintained their high prices andcocoa prices, as a singular exception, are evenrising owing to a tight world supply situationcau,sed by this season's short crops.
Both production of and trade in forest productsincreased in 1951. Imports of sawn wood, mainlyby the Union of South Africa, rose 13 percent in1951 largely clue to an accelerated building pro-gram. Some of the imports went to replenishstocks so that at the beginning of 1952 the Unionof South Africa was able to ease its purchaseprogram. The capacity of the pulp and paperindustries expanded and consumption and stocksincreased. Good market conditions, particularlyin Europe, increased African exports of ivood,notably hardwood, the 1951 volume being about30 percent, larger than that of 1950. With thedecline in demand, particularly that of the Unitedlilfingdom, which started towards the end of 1951,the production as well as exports of African hard-wood are expected to decrease in 1952.
The high export earnings have in many instancesbeen matched by a rise in the prices of domesticfood and consumer goods and have thus beenpartly absorbed. In South Africa, however, foodprices are subject to Government regulation andthe rise was relatively smaller than in territoriesoliere a free market operates. In British WestAfrica, on the other hand, the various ProductMarketing Boards absorb part of the increasedincomes generated by exports and they have inthis sense some anti-inflationary effect. Domesticfood and consumption goods are, however, notsubject to price control and their rising level tendsto restrict the rise in the real income of the pro-ducers.
Outlook
In French North Africa, a somewhat increa,sedacreage of bread grains is expected owing to thehigher prices fixed by the Government. In theUnion of South Africa, livestock production dur-
65
ling the coming winter will be adversely affectedby a widespread failure of the maize crop dueto drought. It is estimated that the crop will beone-third below that of la,st year.
Long-Term Production Trends and Outlook,. Areview of production trends over the last two dec-ades indicates that, throughout the thirties, theemphasis was on production for export. Duringthe war this uniform pattern became differenti-ated into three main regional trends ; in FrenchNorth_ Africa, there iras a drop in the generallevel of agricultural production, due to politicaland military conditions. In tropical Africa, therewas a switch from export crops to staple foodcrops for domestic consumption because of thedifficult shipping situation. In the Union of SouthAfrica, rapid general development and further di-versification of the economy resulted in increas-ing both production and domestic consumption of'food crops.
The recent postwar period has not restored theprewar pattern. In French North Africa the pre-war production level has only been reached by1951 but has been overtaken by a 33 percentincrease in consumption. In tropical Africa, theemphasis is again on export crops and prewarlevels have been surpassed. Simultaneously, anattempt is also being made to maintain domesticfood production at a higher level. In the Unionof South Africa, the ivartime trend continues anddomestic eonsumption is rising slightly faster thanproduction.
In the long run, additional food supplies forexport are most likely to come from tropical Africa(generally the area between the tropic of Cancerand the tropic of Capricorn) through the opera-tion of long-term governnaent development plans.Their aim is to create a basis for further productiveinvestment, by the provision and extension ofbasic equipment and of administrative and socialservices. Numerous agricultural developmentschemes are in operation, such as the large NigerIrrigation Scheme in French West Africa and theGonja Development Scheme on the Gold Coast.In their implementation, particular attention isbeing given to the expansion and diversificationof domestic food supplies (rice, sorghum and leg-umes are being introduced into new areas) togetherwith expansion and improvement of the qualityof export, crops and the introduction of mechaniza-tion. The growing agricultural processing indus-tries (pilot palm-oil mills in British West Africaand larger plants in 13elgian a,nd French territo-ries) are likely to contribute to this trend.
There are, however, two factors that do notencourage optimistic expectations. One is theshortage of capital goods in soft-currency coun-tries and their rise in price in metropolitan coun-tries, due to rearmament, which is making itnecessary to slow down the implementation ofthe government plans. This is in turn reflectedin the difficulties encountered by investors whohave to shoulder heavy initial development costs.At present, prospects of substantial investment inagriculture do not appear to be particularly favor-able. The growing internal markets for agricul-tural products, created by .the expanding miningindustries in the Belgian Congo, the Rhodesiasand the Union of South Africa, ancl by the emer-gence of secondary industries producing consumergoods in Southern Rhodesia, the Belgian Congoand, of recent years also in Kenya, are likely tohelp expand domestic consumption.
Viewing the tropical pattern of development asa whole, two complementary trends emerge: broad,gradual improvement of African peasant agricul-ture, Nvhich is in the difficult transition stagefrom subsistence farming to a market economy,and European-managed research stations, develop-ment schemes and plantations which point theway to the better use of modern techniques.
THE NEAR EAST 6
Current situationAgriculture remains the basic economic activity
of some 90 million people in the Near East,despite the rapid expansion of industry duringthe war and the postwar period. In no coun-try, except Israel, cines industry (excludingoil) account for more than 15 percent of the na-tional income and in most of the region its con-tribution is substantially lower. So far bothpublic and private investment have tended tofavor industry at the expense of agriculture, butthere is evidence that in shaping developmentpolicies governments are increasingly aware of theneed for a more balanced approach, stressing foodand agricultural expansion, not as an alternativeto but as a necessary basis for industrialization.Agricultural development, however, is severelyrestricted by limitations of soil and climate. Only
6 This term is taken to include the countries fromTurkey in the .North to Ethiopia and the Somali-lands in the South, from Egypt in the West toAfghanistan in the East.
66
6 percent of the region is cultivated, and a largepart of this is left fallow each year. While theregion as a whole has ample land for increasingits cultivated area, lack of water is the main limit-ing factor. Moreover, the basic weaknesses in thesocial and economic structure of the Near East,such as unsuitable systems of land tenure, primi-tive cultivation methods, widespread illiteracy andpoverty, and unstable governments, tend to slow-down food and agricultural development.
General economic conditions. In most of the NearEast, recent progress of industry has been greaterthan that of agriculture. The improvement infarm income resulting from larger crops during1950 and 1951 stimulated industrial production,notably in Egypt, Iraq, Syria and Turkey. InIsrael, output rose considerably owing to highinvestment levels and continuing strong domesticdemand as a result of large-scale immigration.Government policies frequently encouraged theestablishment of new industries through grantingspecial subsidies and other measures. There isevidence, however, that in some instances theexisting plant capacity is in excess of presentrequirements ; in Egypt and Iran for instance, thetextile industry has gone through periods of severerecession since the end of the war.
Output of crude petroleum reached the recordlevel of 98 million metric tons in 1951 comparedwith 89 million in 1950, and 71 million in 1949.Investment in the industry continued at a highlevel ; the pipeline from the Arabian oilfields tothe Lebanon is now in use and a pipeline fromIraq to Syria is nearing completion.
Important investments have been made in theEgyptian fishing fleet which now includes morethan 300 motor vessels. In Israel 15 trawlersare to be added this year to the existing fleet of25. More than 60 craft of other t3Tes are alsoto be put in commission this year. In Turkey,important equipment, including boats and cold-storage equipment, has been imported.
In most countries, prices showed an upwardtrend, reflecting higher costs of imports, inflation-ary pressures at home generated by high ratesof investment in Israel and Turkey, budgetarydeficits in 1951152 in Iran, and the considerableincrease, in revenue in some of the oil-producingcountries. At their peak in 1951, wholesale priceswere generally 10 to 20 percent above the averagefor the first six months of 1950, and the costof living was up about 10 percent. However, in nocountry of the region, except Egypt, did whole-sale prices or the cost of living in 1951 reach
the annual average of 1948 or 1949, the postwarpeak period. Prices, however, were rising at theend of 1951.
In countries with short grain crops in 1951, grainprices went up sharply, especially in Lebanon andSyria, where wholesale prices increased by almosttwo thirds over 1950 levels. As a. result, theSyrian authorities banned all exports of wheatduring the past season. To counter the increas-ing cost of living, a variety of anti-inflationarymeasures were adopted. In Egypt, the 1951/52budget included increased appropriations for foodand other subsidies to check the increase in pricesto consumers. In the Sudan, import duties wereabolished on cotton piece goods, flour and coffeeand were reduced from 15 to 10 percent on food-stuffs. In Israel, the Government has taken spe-cial measures for subsidizing food and other vitalconsumer goods. Similar measures to maintaincontrol of prices of at least a minimum range ofessential commodities have been applied withvarying degrees of success in other parts of theregion.
The terms of trade, which had improved consid-erably since the outbreak of war in Korea forcotton and wool producing areas in the Near East,became less favorable toward the end of 1951 andthe beginning of 1952, as international pricesdropped and import prices of manufactured goodsrose. The terms of trade also moved againstcountries whose a.gricultural exports consist mainlyof citrus and other fresh or dried fruits, vegetablesand tobacco, as their prices did not share in theadvance.
In their trade policy, most governments arecontinually trying to limit imports to essentials,especially from hard-currency areas, and to im-prove both the quantity and quality of their ex-ports. Most countries have entered into bi-lateraltrade agreements, some of which are on a barterbasis. At the regional level, Near East tradecontinued to suffer from such impediments as thedisruption of traditional trade patterns followingthe Palestine conflict, repercussions of the Kashmirconflict on Afghan trade, the cessation of thecustoms union between Lebanon and Syria, andthe decline in Iranian oil exports. In February1952, however, Lebanon and Syria signed a com-mercial and financial agreement, thereby puttingan end to the trade deadlock which had prevailedsince March 1950. At present there is a tendencyfor improvement in the region's balance of trade,while the gradual shifting of trade to soft currencyareas, Eastern Europe, and Asia still continues.
67
Agricultural production. In food a.nd agriculture,the outstanding development of 1951 was thesignificant expansion of area cultivated, largelydue to favorable prices for farm products and theincrea.se in the number of tractors and irrigationpumps used. Most of it, however, took place incountries like Turkey, Iraq, Syria, and SaudiArabia, where the pressure of population on resour-ces is relatively light and, except in Israel, therewas little increase in area in the countries withthe more intense population pressures. Moreover,the expansion tended to be concentrated on non-food commodities like cotton at the expense offood crops (Table 25).
TABLE 25. AGRICULTURAL PRODUCTION IN THENEAR EAST
CaMMODITY
Total grains a
WheatBarley. .MaizeRice
Pulses
Sugar
Citrus fruits .
Cotton (ginne,d).
Tobacco
800
500200300600
900
220
770
550
85
thousand netric tons
21 800
9 2004 4002 3002 300
1 100
360
640
600
130
10522
a Including rye, oats, millets and sorghum.
Counter-balancing the effects of the expansionon agricultural production were the serious droughtconditions in 1950/51 in Cyprus, Israel, Jordan,Lebanon and Syria, and parts of Iraq and SaudiArabia. Consequent reductions in yield weregreatest in Israel, Jordan and Syria, where graincrops declined 40 percent from the 1950 level.With heavy insect infestation and low water sup-plies the cotton crop in Syria failed, with the1951 output hardly larger than that of 1950,although acreage planted was three times as great.
Bumper crops were harvested in Turkey. Out-put of grains rose to a record 10.2 million tonsin 1951, an increase of more than one-third over1950. Cotton, certain oilseeds and sugarbeet alsoshowed substantial increases. In other parts ofthe region production levels were either similarto or somewhat below those attained in 1950.In Egypt, output of wheat and maize was higherthan in 1950, although still below prewar, but
24 200
600000200500
1 000
410
750
680
125
25 400
1 7005- 3002 5001 700
1 000
460
800
640
115
Prewar 1940 1950 1951
90
9
21
declined to under half the average postwar output,owing to shortage of irrigation water. Cottonoutput also fell off sharply.
On the whole, total volume of food and agri-cultural production in 1951 for the Near Eastincreased only slightly over the previous year.Grains rose to 25.4 million tons in 1951 or 5 per-cent over 1950 and 22 percent above prewar,due mainly to the increase in Turkey. Productionof sugar, citrus and vegetable oilseeds and oilsalso increased. Output of pulses remained un-changed, while that of cotton and tobacco decreas-ed. The fish landings for Israel for 1952 havebeen estimated at over 14,000 tons, i.e. roughlydouble those of 1950. In Egypt, the fish outputwas 60,000 tons in 1950 against 42,000 tons in1948.
Consumption. In spite of some 20 to 25 percentincrease in total food production in the regionsince before the war, the rapid population growthof 23 percent for the same period leaves only anarrow margin of improvement in per caput pro-duction. (Table 26 and Chart XVIII).
However, with greater imports of grains in recentyears, the total and per caput food supply withinthe region increased by 35 percent and 12 percentrespectively. In countries where as a result ofgreater activity in trade and industries such as
PERCENT
OF PREWAR
160
150
140
130
120
o
100
90
80
70
601934-38
...
POPULATION
1946 / 47 1947/48
68
TABLE 26. INDEX NIM.IBERS OF TOTAL AND PERCAPUT CROP PRODUCTION a IN THE NEAR EAST,1946/47 TO 1951/52
ITEMS
1948 / 49 1949 / 50
a These index- numbers are weig lted by values. Theyare preliminary only. All FAO production indices willbe revised during the coming year.
b Includes total grains, pulses, potatoes, sugar and citrusfruits.
oil, the purchasing power of certain populationgroups has increased, there is evidence ofsome improvement during the past two years inaverage consumption levels. Such improvement,however, is far from general. In most of theNear East, food supplies for human consumptioncontinue to be inadequate, both in quantity andcomposition. Moreover, in many instances, sub-stantial increases in the cost of living during thepast year made it difficult for large sections ofthe Near East populations to obtain more satis-factory diets.
CHART XVIII - NEAR EAST : POPULATION AND FOOD CROP PRODUCTION PRE-WAR AND POSTWAR
SEMI-LOGARITHMIC SCALE
TOTAL FOOD CROP PRODUCTION
...................
/.4.0,0 Za
FOOD CROP PRODUCT ON PER CAPUT
1950/ 51 1951/52
1)34-38 100
104 11S 106 116 123
114 115 116 119 121
91 102 97 102
61 1 017 -194S/ 1949/11950f 1951;" 50 51 52
Food crop product ion 109
Population
Per caput food pro-duction. 97
Trade. Despite the somewhat larger volume ofproduction in 1951, net exports of food and agri-cultural commodities from the Near East as awhole were smaller than in 1950 (Table 27).
TABLE 27. NET FOOD A 'D AGRICULTURE TRADEOF THE NEAR EAST
Exports+ = Imports
a Including rye, oats, millets and sorghum.
The relatively high cotton prices in Egyptslowed down its exports and other cotton-produc-ing areas like Turkey and Syria also experiencedmarketing difficulties. As a result, the regionexported some 100,000 tons less than in 1950.Exports of grains from Turkey, partly to neigh-boring countries where crops had failed, amount-ed to almost 800,000 tons. Imports into grain defici-ent countries like Egypt, Israel and Lebanon contin-ued at high levels, thus accentuating the shiftwhich has taken place in the .Near East duringrecent y-ears toward greater dependence on grainimports in contrast with the prewar period whenthe region was a net exporter.
Outlook
In the Near East as a whole, food productionin 1952/53 is unlikely to exceed that of the preced-ing year and may even decline should the seriousinvasion of locusts over large areas in Iran, Jordanand Saudi Arabia not be checked by the activecontrol measures already under way.
Most of the region received unusually highprecipitation in the form of snow and rain duringwinter and early spring of 1952, but in some areas,floods caused considerable damage to agriculturalproperty and installations. Crop prospects arefavorable in Israel, Jordan and Syria, which suf-fered from severe drought during the past season.Present expectations in these countries are forthe new grain crops to be over twice as large as
69
in 1951. In Turkey, earlier hopes for anotherbumper crop of grains were dimmed by a prolong-ed drought in the central Anatolian Plateau.Late rains have eased the situation and it is likelythat the temporary ban on grain exports announc-ed as a precautionary measure against crop failurewill soon be lifted.
In Egypt, the area sown to wheat is almost 45,000hectares smaller than in 1951, and a decline ingrain output is expected. Owing to the insuffi-cient flow of the .Nile, the area under ricenot exceed some 180,000 hectares, as comparedwith approximately 300,000 hectares in 1949 and1950. Output is likely to be sufficient to meetlocal requirements, but will leave no surplus forexport. In this country where the situation isparticularly serious, far-reaching measures haverecently been taken to counter the danger of foodshortage resulting from an extension of cottoncultivation at the expense of food crops. Thecotton area. for the next three years has beenrestricted to one-third of the total cultivated areaand minimum acreages to be SOAVn tO wheat havebeen established. At the same time, guaranteedprices to wheat growers, beginning with the 1953crop, have been raised appreciably. Similar meas-ures are reported to be under consideration inother Near East countries.
Owing to the abundant rainfall, forage cropshave been plentiful and livestock are recoveringrapidly from the effects of the drought of lastseason, when, in some areas, up to 25 percentof the herds WCFO lost.
Indications are that the cotton boom is subsid-ing following a. sharp decline in prices of non-dollarcottons on world markets, and the disappoint-ing crops harvested last year in some Near Eastcountries. In Syria., measures have been takento regulate cotton cultivation through the crea-tion of a Cotton Board with powers to controlthe areas sown and the varieties used, and, incollaboration with the Agricultural Bank, to sup-ply farmers with chemicals and spraying equip-ment for pest control. The area under cottonwill probably not exceed some 100,000 hectares asagainst over 200,000 hectares in 1951. Reductionsin area are also reported from Egypt and theSudan, where the early 1052 harvest showeda decline of 40 percent from the exceptionallyhigh crop of 1951.
The short-term outlook for food and agriculturalexpansion beyond 1952/53 is not encouraging. Forthe next few years, Near East agriculture is likelyto remain subject to severe annual fluctuations
COMAIODITY Prewar 1949 1950 j 1951
thousand metric toas
Total grainsa . 520 + 160 + 640 + 860wheat +1000 +1200 +1300barley 340 600 500 250maize +160 + 90 + 40rice 50 310 130 255
Sugar + 210 + 410 + 590 + 580Citrus fruits . 340 200 200 190Cotton (ginned 470 460 570 460Tobacco 25 65 40 45
in volume of production, under the impact ofsuch factors as weather conditions and plant pestsand diseases. Stabilization of output at perman-ently higher levels will only be possible afterimplementation of the major flood-control andirrigation schemes now in progress in variousparts of the region, some of which, however, maytake as long as 25 years to complete.
While the economy of some areas on the fringeof the Near East seems almost stagnant, in otherparts of the region more or less comprehensiveplans and programs for development of food andagricultural resources are under way. The mostrecent is that initiated last year in Iraq, whichis to be financed from the country's oil revenues.Development programs in Iran, especially the sev-en-year plan, are at a standstill due to reducedoil revenues. The speed with which plans andprograms are put into effect varies widely fromone country to another. In many instances, im-plementation is considerably slowed clown by thephysical obstacles to be overcome and by social,economic and political factors such as the unequaldistribution of property and income, lack of tech-nicians and skilled labor, poor health conditionsand unsatisfactory tenure systems, and frequentchanges of government.
For 1953, new progress in the fisheries industry
CHART XIX - FAR EAST (EXCLUDING CHINA) : POPULATION AND FOOD CROPPRODUCTION PREWAR AND POSTWAR
180
150
140
130
IZO
110
100
90
80
70
601934-38
POPULATION
1946/47 947/ 48
70
is foreseen in Egypt and Israel. Developmentswill also take place in Turkey when the equipmentrecently acquired has been put in use. Iraq,Saudi Arabia, Syria and Yemen have decided todevelop their fisheries and positive results of thesedevelopment programs should be apparent in afew years.
THE FAR EAST
Current situationAgricultural Production. :Although unfavorable
weather in the Indian subcontinent and civilunrest in parts of South-East Asia impeded 1951/52production, total crop production in the Far Eastregion reached the average prewar level. For thepostwar period this was the highest point in acontinuous though gradual upward trend since1946/47, except for the setback in 1949/50 harvestson the Chinese mainland. Excluding China thevolume of the region's food production in 1951/52was the same as in the preceding year, 3 percentabove prewar average. On a per caput basis,food production in the region (excluding China)increased steadily from 1946/47 to 1949/50, butsince then has declined slightly. (Chart XIXand Table 28).
...... ...... ...... ....................... ...
TOTAL FOOD CROP PRODUCTION
FOOD CROP PRODUCT ON PER CAPUT
1948/49 1949/50 1950/ 51 1951/50
PERCENTSEMI-LOGARITHMIC SCALE
OF PREWAR
TABLE 28. - INDEX NUMBERS OE VOLUME OF TOTALAND PER CAPUT CROP PRODUCTION IN TFIE F.AREASTu 1946/47 TO 1951/52
e These index numbers are weigmted by values. Theyare preliminary only. All FAO production indices willbe revised during, the coming year. The figures includeestimates for China which are approxiinations only since1949/50.
b Food crops include cereals, sugar, root crops, pulses, edi-ble oilseeds, tea, coffee and cocoa. Non-food crops includefibers, linseed, tobacco and rubber.
TABLE 29. CROP PRODUCTION IN THE EAR EAST
1934-
a Includes maize, barley, oats, millets and sorghums.
71
Production of non-food crops suffered a greatersetback during the war, but has progressedmore rapidly in recent years, stimulated bymore favorable price relationships. Only rubberand j ute, however, have actually surpassedprewar production, though other fibers andtobacco are still increasing. Livestock, whichrepresents only a small percent of the region'sfood production, is still well below prewaroutput, with the possible exception of milk(Table 29).
_Despite increased efforts to grow more rice, thestaple food of the Far East, production has failedto expand in anything like the same proportionas the arca planted. Since 1942 a substantialexpansion of area under food crops generally andrice in particular has taken place ni the Indiansub-continent, but in the absence of adequate meas-ures for improvement of soil fertility and waterresources in the expanding food areas, averageyields have tended to decline throughout thedecade. With the growth of population at rel-atively high rates the region, which had a sizableexport surplus of grains before the war, has be-come increasingly dependent on imported grainsupplies, particularly from the Western Hemisphere.In 1951 the regional net imports of cerealsreached the record total of 7 million tons.
Although the intra-regional trade in rice reach-ed its postwar peak at about 3.3 million tonsin 1951, the food supply situation in several coun-tries remained precarious and local droughts andnear-famine conditions were reported in variousparts of India and Pakistan.
_Many fisheries development projects were con-tinued throughout the area. These include biolog-ical research and management in inland andmarine fisheries, the improvement and extensionof fish culture, the mechanization and improve-ment of fishing craft, the introduction of car-rier launches, the training of personnel and var-ious schemes for improving distributive methods.In spite of political unrest in some arcas, progresswas made and fish production increased. Wherefigures are available they reveal significant in-crease over the 1950 levels of production - e.g.South Korea over 25 percent, and Philippinesover 30 percent. Japan's more highly developedindustry expanded rapidly to achieve a productionof 3.8 million metric tons in 1951 which wasby far the largest in the world. The overallexpansion of fishing operations in the region in-dicates that the total catch in 1951 was nearthe prewar level of 8 million metric tons.
1946/ITEMS 471947
41948/49
1949/50
1950/51
1951/52
1934-3S - 100
All crops b 89 93 98 95 99 101Food crops 92 94 99 96 99 101Non-food crops . . 73 84 90 86 99 104Population 108 110 Ill 112 112 113Per caput all crops . 82 85 88 85 88 89Per caput food crops 85 86 89 86 88 90
Far East excludingtChina
All crops 87 94 99 103 104 104Food crops 91 96 101 105 103 103Non-food crops . . 71 84 91 91 107 110Population 113 115 117 118 119 120Per caput all crops . 77 82 85 87 87 87Per eaput food crops. Si 84 86 89 87 86
-Timms38
(Aver-age)
194S/49
949/50
1950/51
1951/52
million metric tons
Ora in crops
Rice(cleaned basis) 00.6 99.6 98.2 97.5 98.3Wheat. 34.8 35.2 32.6 36.6 38.1Coarse grainsa . 65.0 62.7 61.0 61.3 63.1
TOTAL: . 200.4 197.5 191.8 195.4 199.5
Other crops
Potatoes and rootcrops 41.0 53.2 51.8 52.9 53.5
Vegetable oils andoilseeds - oilequivalent . . 8.1 7 7.5 7.9 8.0
Sugar - raw equiv-alent . . . . . 7.3 5.1 5.9 6.5 6.8
Tea 0.7 0.6 0.6 0.7 0.1Tobacco 1.5 1.4 1.2 1.2 1.1
Raw materials
Cotton . 1.9 1.1 1.2 1.4 1.6Jute. 2.0 1.4 1.3 1.5 9.1Rubber 0 . 0 1.5 1.4 1.8 1.8
Political instability in many parts of the regionalso continued to hamper the production of for-est products in 1951. Exports of timber over-seas in general continued on a rather high level,except in Thailand, where exports declinedsomewhat from the 1950 level. High prices forexported timber tended to increase domestic pricesin most countries.
Forestry output in Japan continued to expandand accounted for one half of the total Asian
TABLE 30. QUARTERLY INDICES OF EXPORT PRICES OF SELECTED ColusroDITIEsIN FAR EASTERN MARKETS 1950-52
(1949 100)
wood production and 90 percent of the Asianwood pulp. Japanese production of wood pulpincreased nearly 50 percent in 1951. In spiteof an increased production of sawn wood in Japan,there was a severe shortage for domestic purposesin 1950. U.N. purchases for Korea further ag-gravated this shortage. Japanese fellings wereaccelerated in anticipation of severe restrictionson forest exploitation which became effective inJanuary 1952.
Prices and Demand. The greatly increased in-come due to the expanded demand and higherprices (Table 30) for export raw materials in1950/51, lasting about a year, was only partiallyutilized for increasing the pace of economic de-velopment, and generated rising inflationary pres-sures. These tended to reduce real farm income.Expectation of continued high returns led farmersin India to transfer rice lands to jute-growing,while high wages or profit sharing caused diver-sion of labor forces from intensive rice productionto increased tapping of rubber trees in Indonesia.Anti-inflationary measures in the last few yearswere applied generally in the Far East with
72
varying degrees of success. They comprised impo-sition of heavy export taxes on goods in highworld demand and liberalization of imports ofa wide range of consumer goods. Governmentsalso maintained control over prices and distri-bution of staple foods which constitute the mainitem of the cost of living in all countries of theregion. With subsequent decline in export pricesthe inflationary pressures also declined somewhatin several countries of the region.
a Base period first six months of 1950.b Base period average of 5 months in 1919 January, February, May, June July.t Two-month average.
In the absence of sufficient inflow of foreigninvestment capital, several underdeveloped coun-tries have continued to resort to deficit financingof their agricultural and industrial developmentprojects. In the immediate future production offood and supply of consumer goods are unlikelyto expand sufficiently to offset the resultant in-flationary trends although some countries areattempting to strike a balance between govern-ment spending on necessary economic develop-ment and the need for checking inflation.
Trade. By the end of 1951 several countries inthe Far East had -substantially exhausted theforeign exchange reserves built up in the firsthalf of the year and some developed appreciabledeficit in their balance of trade, especially withthe dollar areas. The most striking developmentwas the reduction of more than 20 percent inthe second half of 1951 in the value of the UnitedStates' imports of such regional products asrubber, tin and jute goods.
In the latter part of 1951 and early 1952, withthe slackening of foreign demand for, and fall in
COMMODITY Market1950 1951 1952
III IV II III IV II
Copra Singapore 119 122 137 145 179 144 1221 124 100 84Groundruits . Bombay. 102 110 115 106 121 127 1041 101 85 73Sugar Manila 101 104 109 105 100 105- 1021 97 --Tea Colombo 121 90 107 112 123 95 871 91 92 781-Tobacco a . . Guntur 100 100 108 1081 108 106 1061 104 108 103Cotton, raw . Karachi 87 87 104 1511 199 190 1591 147 144 128Jute, raw Chittagong 70 78 71 691 160 1091 100 97 73tRubber Singapore 136 198 326
4681567 446 389 382 323 2581-
prices of, raw materials and textiles, there has beensome tightening of import controls, particularlyon luxury goods, and a reduction of export taxes.
Export of timber, particularly overseas, contin-ued at a high level, except in Thailand, wherethere vas a drop from the 1950 level. Although theproportion of timber exported was small, exportsdid have an inflationary effect on domestic pricesin most countries, particularly for high-gradetimber. Exports to some countries within theregion, notably Pakistan, Hongkong and Arabia,declined, mainly because of the high prices.
Rice surplus countries of South-East Asia. Inthe major rice surplus producing countries ofBurma, Thailand and Viet Nam, rice productionin 1951/52 increased appreciably over the previo-asyear. Export availabilities in 1952 from thiscrop, however, are expected to be somewhatlower than the previous year's high exports of3.3 million tons. Early in 1952 the Thai Govern-ment announced its intention of withholding asubstantial quantity of the country's rice sur-plus for building up internal stocks and of program-ming an export of some 800,000 tons in the periodJanuary-September 1952. The announced maxi-mum export target of 1.3 million tons for 1952as compared with total exports of 1.5 million tonsin 1951 may- be reached if by the end of Sep-tember the situation in South-East Asia does notdeteriorate and if the prospects for the comingcrop are favorable. Exports from Burma arealso expected to be below those of 1951. Thiswould mean a decline of at least one-eighth inthe region's total rice available for export. Atthe same time export prices of rice in these coun-tries were raised while prices to producers N'ereheld at previous levels.
Seven years after the war a quarter of Burma'sprewar rice area still remained abandoned to jun-gle growth. Partly, as a result of land national-ization, private capital is not available for financ-ing the rehabilitation of the industry,. The con-tinuing shortage of work-animals also constitutesan important limiting factor.
Under comparatively- peaceful conditions Thai-land has been able to expand its rice productionand at the same time begin to bring about somediversification in its agricultural production. Theeconomy of Viet Nam is at present dominatedby the political and military situation. Understimulus of high prices rubber production inCambodia and Viet Nam has more than doubled.
1?aw material exporting countries deficient or self-sufficient in food. The decline in demand and
73
the sharp fall in export prices for the region'sraw material exports in 1951/52 decreased theforeign exchange earnings of the raw materialexporting countries, particularly in dollars. Withthe rising prices of imported foods, capital goodsand certain categories of consumer goods, theterms of trade of these countries also became in-creasingly adverse. These changes particularlyaffected the economies of Ceylon and Malaya,both of which depend heavily, on the exports ofa few specialized crops and import two-thirdsof their basic food requirements. In view of thepostwar scarcity of rice supplies and the rapidgrowth of population (2.8 percent per annum inCeylon and 2.5 percent in Malaya) both countriesare giving increasing attention to expanding do-mestic production of rice. Some of the hand re-clamation and irrigation projects undertaken inCeylon are reported to be nearing completion.In Malaya, rice production in 1951/52 has beenmaintained at the relatively high levels of thelast three years, around 35 percent over the pre-war average.
In Indonesia agricultural production \ MS at ahigher level in 1951 than in any previous postwaryear. Production of various export crops onestates, however, is not showing progress. Riceproduction is said to have reached the prewarlevel but per caput supplies remained well belowthis. Local shortages due largely, to disorganizedinternal marketing and dislocated transport causeda steep rise in prices of rice and other foods andled the Government to plan increased imports ofrice in 1952. The Government also decided topay, heavy subsidies on imported rice and to con-trol domestic prices in the interest of consumers.
With favorable price relationship, productionand exports of rubber rose to a record high levelin 1951. Smallholders produce three-fifths of Indo-nesian rubber and all of the copra. The benefitsto them of increased income from exports were,however, largely offset by rising prices and costs.
Assured markets in the United States for copraand sugar from the Philippines gave a strongimpetus to the expansion of the former and reha-bilitation of the latter industry-. The peak levelof copra production, reached in 1947/48, two thirdsabove prewar output, was almost regainedin 1951/52. Sugar output reached the prewarlevel but exports have not yet reached the UnitedStates quota of 850,000 metric tons. Food pro-duction, though well above prewar levels, suf-fered a slight setback in 1951/52 from typhoonsand floods, and imports of rice continued to benecessary to check rising prices.
Under the stimulus of high prices early in theseason production of jute in Pakistan in 1951/52increased 40 percent over the previous y-ear'slow output. A reduction in export demand forjute in the second quarter of 1952 led to the fallin prices below the minimum level established bythe Government. Production of cotton also increas-ed, though with the general fall in prices of rawcotton abroad the demand for the Pakistani pro-duct slackened and carry-over stocks increased.Lower production of rice and wheat was dueto unfavorable weather, necessitating an em-bargo on grain exports and intensive internalprocurement for distribution to the deficit areas.The Government continued to develop bilateraltrading in raw materials for manufactured goodsand at the same time to expand the productivecapacity of the newly established textile industriesunder a two-year program.
Food and raw material importiny countries. Withhigh population density and limited agriculturalresources, Japan has to import some of its foodand virtually all of its raw material requirementsin exchange for its industrial products. In 1951/52it produced almost 83 percent of its total foodsupply compared with 85 percent prewar, despitea 30 percent increase in population in the courseof the last decade. This has been made possiblemainly through slight undermining of rice, res-trictions on industrial uses of food and a some-what lower consumption level. The upsurge in in-dustrial activity- after June 1950 called for pro-gressivelyr heavier imports of raw materials. Al-though trade expanded considerably in 1951and Japan re-emerged as the largest exporter ofcotton textiles, the trade deficit was larger thanin prewar years. Buy-ers' resistance in the faceof falling prices of raw cotton caused the Japa-nese textile industry, to effect a heavy cut inproduction early in 1952.
In India, food grain production in 1951/52suffered from drought in some important areas.Production of groundnuts and tobacco also de-clined, but on the other hand increased acreageand favorable growing conditions resulted inbumper harvests of sugar cane, tea, jute andcotton. Food grain imports in 1951 of 4.7 mil-lion tons, twice the volume of the preceding year,eased the internal supply, situation and the year-end stocks were larger. Although per caputgrain availabilities increased in 1951-52, the prob-lem of providing adequate purchasing power topopulations in the drought affected areas re-mained acute.
74
The acreage under food crops as well as cashcrops has expanded in recent years, though therate of increase has varied from crop to crop andfrom State to State. Production of fibers pro-gressed more rapidly, due partly to internal pricepolicies and partly to world market forces. Do-mestic production of jute supplies the bulk ofthe mill consumption requirements. Cotton pro-duction, which also shows marked expansion,consists mainly, of short-staple varieties. Aboutone-fourth of the total mill consumption require-ments, which consist of long and medium staplecotton, is met by imports.
Industrial production in India rose by 15percent in 1951 to a postwar peak 20 percent above1946 and IleNN' engineering and chemical fertilizerindustries began operation during the year. Com-pared with the previous year's favorable tradebalance there was a deficit in foreign trade. Tostimulate trade, export duties were reduced in thelatter part of 1951 and early in 1952. The anti-inflationary measures adopted by the Govern-ment contributed to the downward trend of do-mestic wholesale prices. The sudden break ininternal prices toward the end of the first quarterof 1952 is attributed mainly- to freeing of spec-ulators' hoarded commodity stocks in the faceof increased availability of supplies.
Despite drought in 1951/52, procurement ofgrains was more successful in 1952 than in theprevious year. With increased paynients on in-ternally procured grains and reduction or aban-donment of subsidy payments on imported staplefoods. and higher prices for farmers, marketablesupplies and stocks in the hands of the Govern-ment increased. The fall in free market pricesof grains below the controlled prices for rationedsupplies has led the Government to decontrol foodgrains in several deficit States. The food importtarget for 1952 is likely to be revised downwardsfrom the target of 5 million tons previouslyfixed (including unshipped balance of the lastyear's United States grains loan).
Outlook
The economic outlook for a large part of theFar East continues to depend heavily on the rawmaterial demand of the highly industrialized coun-tries of the West. With the fall in prices of rawmaterials and relative increase in grain prices,greater efforts will be devoted to production offood crops. The reduced foreign exchange earn-ings may, however, have serious impacts on the
financing of agricultural and industrial develop-ment programs upon which many of the under-developed countries of the region have embarked.
Prices of several export products of the FarEast under the prospective supply and demandconditions may be stabilized at or near the levelsprevailing in the first quarter of 1950. Foodprices on the other hand are tending to rise bothabsolutely and relatively in many countries andgovernments are finding it increasingly difficultto subsidize imports or to control domestic pri-ces in the interests of the consumer. In severalcountries prices paid to producers of rice and othergrains are being raised in order to provide thenecessary incentives for increased production.
In the present unsettled conditions in South-EastAsia any major expansion of rice supplies is
highly problematical. Rice surpluses availablefor export are therefore expected to remain shortin relation to import demand. Even if the short-term programs for agricultural development inCeylon and Malaya are fully implemented, theirimport demands for rice are unlikely to showany material decline by 1953/54. Indonesia'sagricultural program continues to concentrate onthose measures most likely to bring immediateimprovement in the production of food and ex-port crops. Provided that this program achievessome success, and the internal transport andmarketing facilities are improved, imports of ricemay be scaled down somewhat by 1953/54. Givenaverage weather conditions for grain productionand effective control of food distribution, Paki-stan may once more have a surplus for exportin 1953/54 after meeting the expanding require-ments for domestic consumption. Per caputfood availability in the Philippines has exceededthe prewar level and the country, aided by finan-cial and technical assistance from the UnitedStates, is on its way to achieving a position of rel-ative self-sufficiency in rice, and rehabilitationof its agricultural production and trade in exportcrops.
The high rate of population growth in Japan,estimated at 2.16 percent per annum, requiresthat the industrial progress be maintained at ahigh level and that an increasingly higher pro-portion of its foreign exchange earnings is spenton imports of raw materials than on food. Al-though the Korean rehabilitation program mayprovide additional impetus to Japanese industrialprogress, a balanced development of the nationaleconomy may be difficult to attain without pro-motion of trade with the other Asian countries.
75
The country's agricultural development programsare designed to increase domestic food productionin step with the population growth.
The annual rate of population growth in Indiaat 1.25 percent is relatively moderate but thisrate applied to 357 million makes the task ofproviding adequate food supply for the nationtruly gigantic.
The Indian Planning Commission has givenhigh priority to development of agriculture throughcompletion of various large and small scale irri-gation projects in the first Five-Year Plan. Thegoal of the agricultural programs is to secure by1955/56 additional production of 7 million tonsof food grains, 1.2 million bales of cotton, 2 mil-lion bales of jute, and a substantial increase inoutput of sugar and oilseeds over the 1950 levels.If these goals are achieved, domestic food produc-tion would be increased by 1955/56 by 16 per-cent above that of 1949/50, while population isexpected to increase only 9 percent over thatperiod.
Although the demand will remain unsatisfiedfor some time, the projected large expansion ofAsian forest industries will gradually tend tolessen the gap between demand and supplies,though little immediate change is anticipated.
OCEAN A'
Current situationThe two most important factors in the agricul-
tural situation for the 1951/52 season in Oceaniawere the serious decline in wheat production inAustralia, which reached a point where that coun-try could no longer meet her current commitmentsunder the International Wheat Agreement, andthe recent sharp drop in export income in bothAustralia and New Zealand, particularly fromthe sale of wool, from the previous exceptionallyhigh levels established in 1951. As a result theAustralian Government introduced measures toencourage greater output of primary products,on the sale of which the export income is dependent.In New Zealand food output has been increasingsince the war and exports have also continued torise. Declining export surpluses from Australiawere offset by increases from New Zealand ; theratio of agricultural exports to agricultural produc-tion and per caput exports of agricultural goodsfor the region averaged slightly higher in the 1948-51 period than prewar.
7 Australia and New Zealand.
General economic conditions. The sharp fall inwool prices contributed to a moderation of businessexpectations and by the end of 1951 the index ofpastoral share prices had dropped in Australia to127 (1948 = 100) from a peak of 169 duringApril of the same year. A less marked declinewas experienced in industrial share prices. InNew Zealand the index of industrial share pricesalso declined steadily throughout the year from115 in January to 96 in December. Althoughindustrial activity has increased slightly over lasty-ear's high levels, the inflationary pressures releas-ed by the high export income of the two previousseasons were still in force during 1951/52. InAustralia during 1951, the index of wholesaleprices rose 24 percent and the cost-of-living index22 percent over 1950, while in New Zealand theyrose 17 and 11 percent respectively. In bothcountries the cost of food increased more thanany other item in the consumer's budget. Al-though there has been an increase in the effectivedemand, the rise in food prices is also due to theeasing of price control on some basic foodstuff'sand to the fact that the prices of a number ofbasic foodstuffs were adjusted in accordance withthe movement of the production costs.
After the middle of 1951 the unit value of ex-ports declined sharply, whereas the total value
of imports increased considerably on account ofheavy purchasing by Australia of motor vehicles,textiles and machinery, mainly from the UnitedKingdoin. The result was a mounting deficit in thebalance of trade with the Sterling Area and otherparts of the world. This forced the AustralianGovernment to impose severe restrictions onimports from all sources. In New Zealand, al-though a general cut of 20 percent in the allocationof foreign exchange to all importers was imposedin April 1952, there has since been some improve-ment.
Further measures to combat inflation in Aus-tralia included heavier direct and indirect taxa-tion and budgeting for a surplus in 1951/52. InNeW Zealand the new budget provides for highnrGovernment expenditures, but even greater reve-nues, less direct taxes and more subsidies. Mean-while, proceeds of the wool levy established lastyear are to be returned to farmers in Australia.Regulations freezing one-third of the proceeds ofthe wool sales were suspended as of 15 August 1951in New Zealand. At the same time the rise inthe cost of living forced new increases in basi.cwage rates in both countries.
Agricultural Production. Total food productionwhich increased rapidly between 1946 and 1950
CHART XX - AUSTRALIA AND NEW ZEALAND : POPULATION AND FOODPRODUCTION PREWAR AND POSTWAR
160
150
140
130
120
110
100
90
80
70
60
76
1934-3e 1946/47 1947/48 1948/49 1949/50 1950/51 1951/52
PERCENTSEMI.LOGARITHMIC SCALE
OF PREWAR
PRODUCTION TOTAL FOOD
POPULATION ----------
............... -------------------- ----------------- ------
Mama. am00 Mvam.
SA.es,
FOOD PRODUCTION PER CAPUT
declined in the following two years mainly dueto developments in Australia. With populationincreasing rapidly the per caput food productiondropped by 1951/52 to 84 percent of the prewarlevel (Table 31 and Chart XX). This de-cline was due mainly to the substantial reductionin the areas sown to wheat which dropped 10percent to 4.3 million hectares, while productionfell 13 percent. The drop in wheat acreagereflected the previous higher relative returnsfrom wool and from cereals other than wheat.
TABLE 31. INDEX NUMBERSa OF VOLUME OF To-TAL AND PER CAPUT AGRICULTURAL AND FOODPRODUCTION IN AUSTRALIA AND NEW ZEALAND1946/47 TO 1951/52
ITEMS 11946f47
1947/ 1948/49
1949/50
1950/51
1951/52.
NOTE : This index is not fully comparable with that givenfor Oceania on Table 1, becahse it refers only to Australiaand New Zealand and covers a somewhat different group ofcommodities.
* Preliminarya These index numbers are weighted by values. They
are preliminary. All FAO production indices will be revisedduring the coming year.
b All groups below.c Cereals, potatoes, dry peas and sugar.d Wheat, maize, barley, oats and rice.e Meat on calendar year basis. Production of meat for
one year is combined with production of milk for the seasonbeginning at the middle of the same year, i.e. production ofmeat in 1946 with production of milk in 1946/47.
In Australia the areas sown to barley and oatswere respectively 9 and 20 percent greater thanlast year's, but with yields 10 percent lower totalproduction did not increase correspondingly. Pro-duction of sugar was about 800 thousand metrictons or about 15 percent below last year's crop.In New Zealand, except for peas, the area plantedto basic crops and the corresponding output wereless than the year before. Total production ofmiLk, meat and wool showed little decline from1950/51, which saw high records for milk and wooldue to increased production. The severe droughtin Australia affected some of the most importantgrazing areas in the country. Cattle losses in
77
Australia were estimated at about one millionhead, and Australian milk production declined 16percent during the first eight months of 1951/52as compared with the same period last year.
Some of the factors contributing to a slowerrate of development and even a decline in Austra-lian agriculture are the great emphasis placedon development of secondary industries sinceWorld War II ; price policies and arrangementsregarding agricultural products, particularly wheat;high freight rates and inadequate transportationfacilities ; taxation incidence on farm productionand lack of sufficient machinery, materials andfarm labor. Long-term factors affecting agri-cultural exports are the rapid growth of popula-tion, the increase in real income and the resultingincrease in domestic consumption.
Production of soft and hard sawn wood inAustralia in 1950/51 was 1,234 million super feet,76 percent over prewar production. Softwoodproduction has been increasing annually and in1951 constituted nearly 17 percent of the total.
Trade. Because of higher world prices, totalvalue of agricultural exports in 1951 surpassedall previous figures, although the volume did notincrease. Wheat exports from Australia at 3.5million metric tons were about 7 percent largerthan the year before, but shipments of dairyproducts, which constitute an important propor-tion of agricultural exports of the area, weresomewhat lower. Net wool exports amountedto 734 thousand metric tons as compared to arecord of 781 thousand in 1950. Total meatexports from both countries also declined about24 percent.
Early in 1952 it became apparent that wheatexports would be much lower than last year's .
Meat exports on the other hand will probablybe maintained at the 1951 levels with lowershipments from Australia offset by increased ex-ports from New Zealand.
The improved balance-of-payments position ofthe Sterling Arca in 1951 led to increased importsof forest products, particularly sawn wood. Be-cause of increased needs for building materialsarising out of immigration and industrial expan-sion, imports of sawn wood into Australia in 1951increased 55 percent over the previous year'srecord level. A large part of these imports, mainlyfrom Europe and North America, was used toreplenish stocks. Towards the end of 1951 thebalance-of-payments situation of the Sterling Areadeteriorated and Australia, like other Common-wealth countries, was forced to curtail her imports.
1934-38 100
Total agr. productionb 92 107 los 115 111 105Population 110 112 114 117 120 124Per caput a.gr. prod 84 96 95 98 93 85Food production. . . 91 107 108 115 Ill 104Per caput food prod. 83 96 95 98 93 84
Production by majorgroups
Food crops e . Si 137 124 138 122 109Cereals a . . . 79 145 124 140 122 109Meat ancl milk e . 95 99 104 108 108 104Fats and oils . . 87 92 99 103 97Wool (greasy). . 103 107 105 113 114 113
Prices and income. The adverse effect of thedecline in wool prices after the boom conditionsprevailing during 1950/51 was strongly felt in bothcountries after mid-1951. In Australia the indexof wholesale prices for farm products, which dur-ing the calendar year 1951 was 60 percent abovethe 1950 average, dropped sharply from a peakof 259 (1948 = 100) in March to 163 in Sep-tember. By December the price of wool wasUS 876.4 per 100 lbs as against US 8134.6 for allsales during the year. The average price of salesfrom the 1951/52 wool clip is expected to beabout 60 percent of the 1950/51 price. In thecalendar year 1951 Australia's total farm in-come, amounting to ¡A 800 million, was the lar-gest on record, and farmers' share of the nationalincome was 26 percent as against 21 percent in1950 and 6 percent in 1939. In 1951/52, be-cause of falling prices and reduced output, totalfarm income will decline and with rising costs netincome will probably show a proportionatelygreater decrease.
Outlook
Total agricultural production in 1952/53 and1953/54 may surpass this year's levels, assumingnormal weather conditions and progress in thefulfilment of the Australian program now underway. The object of this program is to increaseagricultural production by 20 percent over theaverage for the five years ended June 1950. Thetargets for 1957/58 call for such increases as 12percent for meat, 13 percent for milk, and 30percent for wheat over current levels of production,as well as increases in the production of oats,barley, sugar and wool. At the same time theGovernment has classified agricultural productsas equally important to Australia's securitywith coal production and the defence industries,and it has been recommended that State prioritybe given to primary production in the allocation ofmaterials and the accomodation of farm labor.Some taxation concessions on capital investmentin agriculture have also been made. The farmlabor situation has improved somewhat since
78
jobs are getting scarcer in the cities and immi-gration policy is being re-directed to bring intothe country more -%s-orkers with farming experience.A large part of the two World Bank loans of USS150 million has been allocated for imports ofagricultural equipment and materials. Prices foragricultural products will be revised to makethem attractive to farmers. Following a reviewof movements in the index of wheat productioncosts over the preceding year, the growers' guar-anteed price for the 1951/52 wheat crop has beenfixed at 10/ per bushel 8 bulk basis, f.o.r.ports, an increase of 2/2 per bushel over the1950/51 price. A further incentive to wheatproduction is the suspension of the Wheat Ex-port Tax. The State Acts covering the 'WheatStabilization Scheme have been amended, with aview to allaying some of the growers' dissatisfac-tion with the guaranteed price, by providing twoseparate prices for wheat sold in Australia. Wheatfor stock feed up to a total of 26 million bushelswill be sold at 2/ per bushel above the guaranteedprice. In addition, the Commonwealth Govern-ment has agreed to pay growers a subsidy onfeed wheat sales equal to the difference betweenfeed wheat price and the maximum price underthe International Wheat Agreement. Under anew contract of 15 years duration recently signedwith the 'United Kingdom, minimum meatprices after 1 July 1952 were guaranteed at the1950/51 levels for some years and will also be relat-ed to costs and other considerations, and an in-crease of 23 percent in the price of beef and of15 percent in the price of mutton was negotiatedunder the previous contract.
The supply outlook for forest products in 1952appears satisfactory as the existing stocks ofimported sawn wood have been reported to be
far beyond the ability of the building industryto absorb. " Australia is continuously develop-ing her OW11 forest industries and is also activelyengaged in expanding timber operations in East-ern New Guinea.
8 One bushel of wheat = 60 lb. = 27.216 kg.
arid AS L
AI JalciDLID
Chapter IV - REVIEW AND OUTLOOK BY COMMODITIES
WHEAT
Current situation
The year 1951/52 was characterized by a slightincrease in the aggregate world wheat productionover 1950/51, by a high level of wheat exports andby some reduction at the end of the year in thecarry-over stocks of the four major exporting coun-tries. Though prices of wheat exports outsideWheat Agreement quotas were generally firm, themovements were not spectacular and at the endof the year they were somewhat lower than atthe beginning. With reduced supplies in Argen-tina and Australia, importing countries dependstill more on purchases in Callada and the UnitedStates. This accentuated dependence on NorthAmerica may not be greatly mitigated in 1952/53.
World wheat production in 1951/52 (e,xcludingthe U.S.S.R.) again increased slightly to about147 million metric tons, 14 percent above the
81
average production of 1934-38. This is the high-est figure reached in postwar years and was ex-ceeded only in 1938/39. About four-fifths ofthe net gain occurred in North America. Produc-tion in Europe, which had dropped to drasticallylow levels by the end of the war, just regained theprewar level in 1951. Among the other regions,only Latin America showed a lower level of pro-duction than before the war, but this deficit,brought about by a serious drop in Argentine pro-duction, WaS of serious consequence for otherparts of the world, because it caused a significantloss in exportable supplies. Asia showed a gainon the previous year and on the prewar level, butthe increase is inadequate when set against theregion's increased food requirements. Good cropsin some African areas brought the total for thecontinent to about 10 percent above prewar, butthe cultivated area has not increased correspond-ingly. Production in Oceania was slightly abovethe prewar level, but compared poorly with otherpostwar years (Table 32).
TABLE 32. - WHEAT PRODUCTION BY REGION'S, PREWAR AND 1947-1951
a Includes Austria, Belgium, Denmark, Finland, France, Federal Republic of Germany, Greece, Ireland, Rai!, Luxembourg,Netherlaiads, Norway, Portugal, Spain, Sweden, Switzerland and the -United Kingdom.
REGION 1934-35average 1947 1948 1949 1950 1951
million metric torts )
Europe 42.3 23.4 36.8 40.6 41.5 42.4Western Europe a (28.2) (15.9) (24.5) (27.5) (28.6) (27.7)Other Europe (14.1) (7.5) (12.3) (13.1) (12.9) (14.7)
North America 27.0 46.9 46.8 41.7 40.9 42.6South America 8.2 8.8 7.6 7.2 8.0 4.4Asia. 43.0 41.1 44.6 40.5 46.0 48.7Africa 3.8 3.3 3.8 4.1 4.3 4.4Oceania 4.4 6.1 5.4 6.1 5.2 4.5
TOTAL (excl. U.S.S.R.) . . 128.7 129.6 145.0 140.2 145.9 146.9
The gain in world production over 1950/51 wasbrought about by good harvests in a very smallnumber of countries. Canada produced the secondlargest crop in its history, the increase exceedingthe net gain in the world total. In Europe,there was a bumper crop in Spain, good resultsin the Danube countries, Germany, and Polandand limited gains in some other countries. France,Italy, Sweden and the United Kingdom, however,experienced significant decreases, totalling over2 million tons. Consequently, European importrequirements were greater than in the precedingyear. Similarly, the better total for Asia wasmainly due to the marked improvement in Tur-key's crop, other countries showing only modestchanges.
Poor crops were harvested in Argentina and inAustralia. In the former, where many producersappeared to be dissatisfied with the prices theyreceived, farmers reduced their sowings by 25percent ; due to an unusually adverse season ofheat and drought, they reaped an arca only halfof that of prewar days, and production was onlyjust over 2 million tons, less than one-third ofthe 1934-38 average. In Australia the sown area,owing to the competition of other forms of farmproduction, was over a million hectares or 25 per-cent below the postwar peak (1947) and theharvest; despite good yields per acre, was ba-rely equal to prewar. On balance, therefore, theyear 1951/52 proved less favorable than recentyears, and one in which the trade difficulties ofimporting countries were accentuated.
World shipments of wheat in 1951/52 (1 Julyto 30 June) were again at a high level. Prelimi-nary estimates suggest that gross exports fromall sources may have exceeded 27 million tonsand thus reached the highest level on record.Exports from the United States As'ere maintainedat a consistently high level, just exceeding onemillion tons per month, and totalled about twomillion tons more than in the previous year.Supplies in that country were somewhat lowerthan in the previous year owing to a smallercrop and some reduction in carry-over, and thehigh level of exports has scaled down the carry-over stocks by a further 4.1 million metric tons.On July 1, 1952, the carry-over was tentativelyestimated at 6 9 million metric tons, about halfof the quantity now regarded as a desirable year-end carry-over. The current good crop prospects,however, give promise of reinforcement in 1952/53.(Table 33).
82
TABLE 33. - WHEAT AND WEIEAT FLOUR EXPORTS,PRELEVIINARY ESTIMATE FOR 1 951 /52 WITHCOAIPARISONS
JULY/JUNE
Includes estimates of shipments to U. S. Territories andPossessions as well as exports of flour milled from wheat notwholly U. S. wheat.
Canada, with a significantly increased carry-over and a large crop, held a considerably increas-ed export surplus in 1951/52, though the CanadianWheat Board had to contend with a severe trans-portation problem and to cope with large suppliesof poor quality grades and a large demand on dry-ing facilities. About one quarter of the crop couldnot be gathered and threshed until the spring of1952, but good weather enabled this part ofthe crop to be saved in good condition. About50 percent more wheat was exported than in1950/51.
The two North American countries togethersupplied about SO percent of the total wheatexports, as compared with about 65 percent inthe two preceding years. Exports from Argentinascarcely exceeded 500,000 tons and virtually cameto a standstill at the beginning of 1952. The lastArgentine crop was inadequate even to meetdomestic requirements ancl special measures -drastic in an exporting country - such as highmilling grades and mixing of substitutes in breadflour have been applied ; it is also reported thatwheat is to be imported from the United States.The deficit in Argentina will still be felt in worldtrade in 1952/53 and can only be relieved if amore normal harvest becomes available in De-cember 1952. In Australia the 1951/52 crop wasreduced to 4.4 million tons as against 5.0 mil-lion tons in 1950/51. Its total exports in 1951/52 reached about 2.6 million tons comparedwith over 3 million tons in recent years. Thereduced supplies compelled Australia to applyfor a reduction of about 450,000 tons in its quotaunder the International Wheat Agreement andto reduce its sales outside the Agreement. As
mil/loa metric tonsArgentina . . 3.30 1.66 2.42 2.83 0.82Australia . . . . 2.84 3.30 3.07 3.49 2.64Canada 4.70 6.13 6.32 6.12 9.25United Stales a . 1.80 13J0 8.65 10.25 12.79TOTAL, 4 countries 12.64 24.89 20.46 22.69 25.50Other countries. . 5.04 2.09 2.39 2.73 2.00TOTAL 17.68 26.98 22.85 25.42 27.50
1934/35 1951EXPORTER 193S/39 1948 1949 1950 /52aver-age
/49 /50 /51 esti-mated
in the case of Argentina, the shortage will con-tinue to affect exports in 1952/53.
The carry-over of wheat on July 1, 1952, inthe four major exporters was reduced to about
18.5 million tons (679 million bushels) as com-pared with 22 0 million tons (806 million bushels)a year earlier, Canada alone showing some increasein stocks (Table 34).
Exports from sources other than the four majorcountries are only partially known. They mayprove to have been a little smaller than those of1950/51. France, though an exporter of a smallquota under the International Wheat Agreement,was a net importer of about half a million tons.Turkey, though reappearing as an exporter, ap-pears to have held much of the increased suppliesresulting from the bumper crop of 1951 to increaseits stocks. Exports from the U.S.S.R. appear tohave been somewhat larger, but exports fromPakistan appear to have been quite small, and it isreported that imports have recently been necessary.
The quantity of wheat traded under the Inter-national Wheat Agreement in 1951/52 I. was 15.5million tons, which is the total of the guaranteedtransactions for the year following the reductionin Australia's quota of 450,000 tons and the in-crease in the Canadian quota of 150,000 tons.This represents some 57 percent of the estimatedworld shipments for the year. Trade under theAgreement was more active than in the precedingtwo years.
Wheat prices on United States markets showedthe normal harvest time weakening in June1951, but there, was a consistent upward trend
The Wheat Agreement year runs from 1 Augustto 31 July and thus differs slightly from the tradeyear adopted in this review.
83
thereafter until the end of December. By thelatter month Chicago quotations liad regainedthe peak of $2.60 per bushel set in February1951. The strength of wheat prices during this
TABLE 34. - ESTIMATED WHEAT STOCKS IN PRINCIPAL EXPORTINGl COUNTRIES,1 JULY 1948-1952
metric tons (million bushels in parentheses)
period reflected the sustained export movenientand the continuing poor crop news from Argen-tina and Australia.. After the turn of the year,markets were more hesitant and became weaker.
There was a general weakening in commod-ity markets early in 1952, but the good progressof the United States winter wheat crop was un-doubtedly also a factor in U.S. wheat prices andlater became the dominating influence. With thecontinuing good crop reports prices declined fur-ther until in early July the Chicago price stoodat $2.27. At such a level, the commercial priceWaS below the price corresponding to the rate atwhich farmers could pledge their wheat under theprice support arrangements, and it was to beexpected that, after the initial pressure of newcrop supplies had abated the loan level ($2.22 perbushel national farm average) would become effec-tive as a support to the market price.
In Canada, the inital price to growers for 1951wheat was raised from Can. $1.40 to 51.60 perbushel (No. 1 Northern in store William PortArthur). For export sales outside the Interna-tional Wheat Agreement, the Canadian price hasfollowed the same trend as the United Statesmarket, averaging Can. $2.17 in June 1952 againstCan. $2.32 in June 1951.
In Australia, following the review of movementsin the index of wheat production costs prescribedby the Wheat Stabilization Scheme, the growers'guaranteed price for the 1951/52 crop was fixedat 10/ - (US $1.12) bulk basis, delivered at ports,an increase of 2/2 per bushel (27 US cents) on the
1948 5.3 (196) 2.9 (105) 3.5 (130) 2.9 (105) 14.6 (536)
1949 8.4 (308) 3.7 (135) 3.4 (125) 2.6 (95) 18.1 (663)
1950 11.6 (427) 3.7 (140) 2.7 (100) 3.3 (120) 21.3 (787)
1951 10.8 (396) 6.3 (230) 2.3 (85) 2.6 (95) 2L9 (806)
1952a 6.9 (254) 8.2 (300) 1.4 (50) 2.0 (75) 18.5 (679)
YEAR United States Canada Argentina Australia Total
Souncp : Official data and estimates of the United States Department of Agriculture, Office of Foreign Agrien al Relations,and FAO estimates.
Preliminary.
1950/51 price. In addition, with a view to allay-ing some of the growers' dissatisfaction with theguaranteed price, the Stabilization Scheme hasbeen amended to provide a higher price for wheatsold for stock feed, supplemented by a subsid.ywhich will bring the returns on feed wheat up to alevel equivalent to the maximum price (16/1 perbushel) under the International Wheat Agreement.
Outlook
Wheat crop prospects in the Northern Hemi-sphere in mid-1952 gave promise of increases overthe previous year in many of the important produc-ing countries. The July estimate of the U.S.crop was 1,250 million bushels (34 million m.t.),an increase of one-fourth over 1951. This wasdue to an increased acreage of winter crop whichsurvived the winter with rather less than theusual loss, in distinct contrast to the precedingyear. The spring crop, however, covered a reducedarea and was reported in some areas to be suf-fering from drynes,s. The Canadian crop wassown on about the same acreage, but in unusuallygood sub-soil moisture conditions. Western Eu-rope also enjoyed a generally good wheat season,and it appeared that there would be larger cropsin France, Germany, Italy and the United King-dom. A still more marked improvement has ap-parently occurred in the Near East and FrenchNorth Africa. India reports a somewhat betterwheat crop, but there has been some decline inPakistan.
In the Southern Hemisphere, the first reportsfrom Argentina indicated an improvement in weath-er conditions at sowing time after a long periodof drought. This came at an opportune moment,since the Argentine Government policy is nowplacing greater emphasis on the expansion ofagricultural production. A number of meas-ures have been introduced with the aim of re-storing agricultural production and export capac-ity. The most important of these measures is anincrease in the prices to growers of the maincrops ; for wheat the price to producers for thecrop year 1952/53 has been fixed at 50 pesos perquintal compared with 34 pesos for wheat of thelast harvest, and this increase is believed to beproving effective in securing an increase in wheatsowings. Other measures with the same objec-tive are the passing on to producers of the profitsobtained from export sales, priority in the alloca-tion of foreign exchange for purchases of agricul-tural machinery, revisions in labor regulationsand the favoring of rural immigration.
84
In Australia the improved payments for 1951/52have been followed by a series of measures design-ed to bring about a reversal of the recent declin-ing trend in wheat acreage. Thus for the year1952/53 no deductions are to be made from ex-port proceeds for payment into the stabilizationfund. Other and more general provisions havebeen made to encourage agriculture. Neverthe-less, the target set in the Government's produc-tion program is not unduly ambitious as re-gards wheat, since the aim for 1957/58 is only5.2 million metric tons, a figure which, while it is24 percent over the prewar average is substantiallylower than the actual yields in 1947 and 1949.
On the whole, the preliminary crop indicationssuggest that there may be some reduced pressurein deficit regions for imports in 1952/53, thoughthe general pattern of 1951/52, notably the high de-pendence on North America, is likely to be repeated.
The year 1952/53 will be the fourth and lastyear of the current International Wheat Agree-ment. Discussions aiming at a renewal began inApril 1952 and will be continued early in 1953.The first stage closed with a wide gap betweenthe prices proposed by exporters and importers.During the operation of the current Agreement,non-agreement prices have been generally signif-icantly above the maximum stipulated in theAgreement, and the exporting countries took theview that the maximum of the price range of anew Agreement should make allowance for thegenerally higher level of prices now ruling incommodity markets as a whole, and proposed asthe new maximum approximately the price forfree wheat ruling in the spring of 1952 beforethe good prospects for the new crops began toaffect the commercial markets. Importing coun-tries regarded this proposal as being so far fromtheir own ideas that no workable basis for pricenegotiations could be found at the April-Maymeeting, and it was agreed to adjourn discussionuntil later in the year. Consideration is also beinggiven to the introduction into the price arrange-ments of a formula whereby the agreed pricesunder the Agreement could undergo subsequentadjustments corresponding with movements ingeneral world price levels.
The more remote outlook is indeterminate, °W-ing to the numerous relevant factors concerned.The supply situation should not, in itself, becomeburdensome : the North American wheat acreageis unlikely to show any further marked expansion ;Australia does not envisage any drastic increasein its production ; a considerable rise in the Ar-
gentine grain output is indeed possible, but therelative price position may induce farmers togrow coarse grain rather than wheat. Prospectsof supplies from Eastern Europe remain uncertain.
On the demand side, the OEEC countries expecttheir requirements of bread grain, i.e. wheat andrye, might expand by 2.5 million tons by 1956/57,but that this increase could be provided by anexpansion of indigenous production. The mark-ed rise in the wheat imports of non-Europeancountries is largely due to a rise in populat-ion coinciding with a fall in rice produc-tion and an adequate provision of foreign funds.The degree of the persistence of non-Europeandemand will depend on the political situation inSouth-East Asia and on the financial and socialpolicies of governments.
COARSE GRAINS
Current situationPreliminary estimates of world shipments of
coarse grains in 1951/52 indicated a total notgreatly different from that of the two previousyears, or approximately 12 million tons as compar-ed with the prewar movement of over 14 milliontons. As in 1950/51, the bulk of the exports wassupplied by the United States and Canada, thelatter showing a considerable increase followingits large 1951 crops, and the former some reduc-tion. Argentina exported some 1.1 million tonscompared with less than 700,000 tons in 1950/51.Exports from sources other than these three havein the last three years approximately equalledthe prewar quantities but, though this is satisfac-tory from the standpoint of the importing coun-tries, the development cannot yet be regarded asassuring regular supplies, since in several of thesesources exports are dependent on fluctuating cropyields. The failure of East European countriesto recover their prewar regular export capacitydeprives the importing countries of an importantand regular source of supplies (Table 35).
TAI3LE 36 - COARSE GRAIN PRICES, 1951/52
85
TABLE,' 35. - EXPORTS OF COARSE GRAINS," PRELIM -INARY ESTIMATE FOR 1951/52 COMPA_RED WITH1948/49, 1949/50 AND 1950/51
a Includes shipments of rye, barley, oats, maize and prod-ucts. The last three postwar years include grain sorghums.
b Calendar year average.
The most serious aspect of the general situationis the drastic shrinkage in Argentine exports, apostwar feature which has become accentuated inthe past two years by unusually unfavorablegrowing conditions. Before the war Argentinasupplied half of the world exports, but in the pasttwo years it has provided only a fraction of thetotal and is not likely to ship very much in 1952/53, unless the next crops are considerably moreabundant.
The importing countries - mainly those inWestern Europe have thus had to depend ondollar sources for a substantial part of their sup-plies, and this has prolonged the stringency inanimal feeding stuffs first imposed by the warand postwar shortages. Importers have also alteredthe nature of their purchases, taking barley andsorghum to replace maize.
Prices rose sharply towards the end of 1951,but by July 1952, they had receded in NorthAmerica to a level only slightly above that ofa year ago. In Europe, this recent fall has beenaccentuated by the drop in freight rates (Table 36).
CoAr1s1. GRAINS 3/VII/51 27/XII/51 8/VII/52
Chicago Maize, spot (U.S. cents per 56 lbs.) 174 200 182
Winnipeg Barley, spot (Can. cents per 48 lbs.) 112 140 118
Australian Feed Oats (In E. c.i.f. U. K., permetric ton) 341A ($ 96.6) 391/2 ($ 110.6) 251/2 ($ 71.4)
Iraq Barley- (In E c.i.f. U.K., per metric ton) 321/2 ($ 91.0) 451/2 (8 127.4) 301/s ($ 84.7)
million nietric tons
Argentina . 7.34 2.31 1.94 0.66 1.12Callada 0 48 1.24 1.09 1.13 2.67United States 1.10 3.45 4.42 6.05 4.90
TOTAL 8.92 7.00 7.45 7.84 8.69
Other Countries 5.88 3.22 5.39 4.04
TOTAL 14 80 10.22 12.84 11.88
EXPORTER
JULY/JUNE
1934-38 1948/ 1949/ 1950/
1951/52
aver-age b
49 50 Si esti-mated
Outlook
The large stocks of coarse grains built up inthe United States in 1948/49 and 1949/50 havebeen scaled down considerably in the past twoyears, and at the end of 1951/52 they are probablyno larger than a normal carry-over. In view ofthe generally sustained domestic demand for live-stock products, supplies for domestic and exportpurposes are very dependent on the 1952 harvest.Looking beyond 1952/53, however, it is possiblethat United States consumption may fall sharplyin 1953/54, since the maize/hog price ratio hasbecome much less favorable to hog productionand fattening.
If the July estimates prove to be fulfilled,the 1952 United States maize crop will be thesecond largest on record, namely 85.5 millionmetric tons. The total United States feed grainproduction is expected to exceed last year's by8 percent.
In Canada, carry-overs of coarse grains are con-siderably larger than those of a year ago. Intend-ed sowings in 1952 are smaller, but conditionsfor seeding were very favorable. Very good cropprospects were also reported from some of theother exporting areas, particularly those of theMediterranean and the Near East, and a goodexport supply of barley seems to be assured. Theprospects of the new Argentine maize crop willnot be known for some time, but substantiallyincreased growers' price and official encourage-ment is expected to produce a significant increasein cultivation.
COUNTRY
TABLE 37. - WORLD AREA AND PRODUCTION OF RICE
AREA PRODUCIION : PADDY
1931-38 195102 1934-381950/51(average) (provisional) (average)
a 22 Provinces and Manchuria.b Unofficial estimate.
86
The outlook for supplies from the Danube/U.S.S.R.. region remains uncertain. These countriescould no doubt export substantial quantities ofcoarse grains, but their own development plansare believed to favor the utilization of such cropsfor livestock products within their own region.
In the main European importing countries, theoutlook was quite fair until the long drought andheat wave raised fears concerning the growingcoarse grain. The OEEC countries hoping to in-crease their output of livestock products, expectto require 15 to 22 percent more feeding stuffsby 1956/57. In the absence of additional importsthis would entail an additional 1.25 million hec-tares under coarse grain by 1956.
RICE
Current situationIn contrast to most other commodities, rice has
become increasingly scarce during the past year,and its price has risen. The world area underrice continued to increase gradually to a recordtotal in 1951/52 (Table 37). Total productiondid not expand, however, because of a furtherfall in the yield per acre in some important areas.The recent sharp fall in the price of Far Easternexports has not been reflected in a lowering ofthe effective demand for rice. The price of ricein international trade has continued to rise, andthe price spread between rice and wheat has wid-ened. Developments in China, the world's larg-est rice producer, and events in Korea have reduced
87.9 144.86.9 6.4
1050/51
139.8 140.1
1951/52(provisional)
48.3 b31.311.811.37.25.5
24.7
China " 19.8 18.5bIndia 25.2 30.5Pakistan 8.6 9.1Japan 3.2 3.0Thailand 3.4 5.3Burma 4.9 3.8Other Asian Countries 16.9 17.0
TOTAL : Asia J 82.0 87.2Other Continents 3.8 6.7
World Total (exel. U.S.S.R.). . J 85.8 93.9
117 ion lactares ) ( mil/ion metric tons
18.9 b29.89.13.05.93.8
17.4
50.534.211.211.54.47.0
26.0
47.0b31.112.512.06.85.2
25.9
11.211.4
151.394-.8 151.2 151.2
the reliability of global statistics of rice acreagesand crops. Most of the more important Asianproducers report lower yields, particularly Japanand Pakistan, whilst Thailand has recently sharplyreduced its crop estimate and increased its stock-pile requirements. India's rice harvest was indeedslightly better than last year's, but as that hadbeen an exceptionally low one, the result remainsdisappointing. In Asia, only Burma and Indo-china report any marked improvement. The mostsevere fall in production occurred in Egypt, wherethe crop was halved by the failure of the Nile
AREAS
million metric tons
ThailandBurmaU.S.A.Indochina
JapanIndiaMalayaIndonesiaOther Asian Countries
Others
WORLD TOTAL
"Covers about 90% of world trade in rice.
floods. In Brazil; the greater attractiveness ofcotton reduced the acreage under rice.
On the other hand Europe, the United Statesand Cuba had good rice crops, the latter countryin particular continuing its rapid rise and thusenabling the United States to export increasedquantities to the deficit areas of Asia.
Although the dis'appointing yields in some ofthe main rice importing countries are intensifiyingdemand, world trade in rice is unlikely to expandin 1952 (Table 38). Of the main exporters,Thailand is pursuing a cautious policy and hasreduced its official estimate of available supplies.Burma's liberal shipments in 1951 reduced hercarry-over considerably, so that this year's increas-ed crop will not be reflected in greater exports.Pakistan has announced that it will have no export-able surplus, but is bartering some rice againstwheat with India; nor can Egypt be looked tofor supplies. The sustained large output in
TABLE 38. - INTERNATIONAL TRADE IN RICE (MILLED )a
1934-38 Average
'Ports Imports Exports
87
Europe and North. America wil thus be doublywelcome; the United States and Italy are expectedto increase their exports and Spain and Portugalhave recently joined the ranks of exporters, ifonly on a modest scale. The chief unknownfactor on the supply side is the extent of Chineseexports in the second half of 1952.
The main increases in demand have come sofar from Japan and Indonesia ; the Philippineshave raised their import requirements by 35 per-cent. Indian needs remain high, although unev-enly distributed, for in some rice districts the
. 51.20.50.1
0.1
0.6
1950 1951
Imports Exports
0.60.40.50.31.0
1.2
4.0 4.0
1.61.30.50.3
0.3
0.8
4.8
monsoon has failed for the fifth consecutive year.Although the rise in purchasing power has beenchecked in Ceylon, Indonesia and Malaya by thesharp fall in the price of their main export products,their effective demand has not, so far, shown an37sign of falling.
In contrast to most other commodities, thevalue of rice has continued upward. In the mainAsian countries, the internal procurement pricehas been controlled and has remained nominallyunchanged. India, however, allowed a 3 percentincrease at the beginning of 1952 to the equivalentof U.S. S 94 per metric ton. In Indochina, theprice at Saigon rose by 40 percent between March1951 and March 1952, whilst Japan raised itsprice to internal producers by 15 percent. Inthe United States, the average price received byfarmers has fluctuated considerably, but at S 118per metric ton in March 1952 it was 10 percentlower than that recorded last year. Whilst prices
15.55 Forecast
Imports Exports I Imports
1
1.31.20.60.5 1
0.8 0.80.8 0.70.5 0.50.5 0.5LO R
1.2 2.31.2
4.8 1
1
4.8 48
1.43.10.11.3
1.1 i
1.80.5 i
0.3 1
1.6 I
0.3 2.0
to producers were in some countries preventedfrom rising by government action, there has beena constant rise in the prices exporters have askedand received at the ports. This was particularlynoticeable at the regular sales by tender to allocat-ed destinations, which Burma has instituted forone third of her exportable surpluses. As contrast-ed with the £443.0 ($123.6) at which SmallMills Specials, 42 percent Brokens, had been soldf.o.b. Rangoon in 1951 on a government to gov-ernment basis, f.o.b. prices for the same qualityhave recently ranged from £ 59.10.0 ($166.6)to 64 (---$179.2) according to destination.For a better quality, with only 20 percent Brokens,Spain recently obtained $184 f.o.b. Spanish Medi-terranian ports. In the United States, high qual-ity Gulf rice sold during May at $242 for No. 2Rexoro f.o.b. Houston, whilst Californian rice wasexported at $220 for No. 1 Pearl f.o.b. San Fran-cisco. It was not surprising that under theseconditions, every normally rice-eating countrytook up its full wheat quota under the Interna-tional Wheat Agreement.
The effect on consumers of these rises in f.o.b.prices was, however, somewhat cushioned by thegeneral fall in freight rates.
Outlook
The prospects for rice production have recentlyimproved. Costs have not risen as much as wasfeared, nor have alternative demands broughtabout as serious a shortage of capital goods andagricultural requisites as seemed probable a yearago. The severe fall in the price of rubber, copra,palm-oil and oil-seeds will tend to shift some landand labor back to rice-growing. The degree towhich this occurs will, however, be greatly in-fluenced by the extent to which the actual produceris allowed to reap the benefit of the relativelyhigh prices prevailing for rice in internationaltrade. Taking the internal price in Burma as100, internal prices elsewhere are roughly
Thailand 230 Japan . 440Egypt 280 Indochina 460India 310 Pakistan 550Italy 330 Brazil. 740U.S.A.. ..... 390These indices are not strictly comparable sincethey refer both to varying qualities and varyingconditions ; nevertheless, the range is striking.The extent to which order and peace will prevail,e.g. in Burma, Indochina, Korea and Malaya, isclearly a factor of the utmost importance to the
88
future supply of rice. Political considerations, too,will probably determine the amounts of rice whichChina will be willing to export.
The remarkable degree to which the demandfor rice has been sustained, in spite of its relativelyhigh price, is a clear sign of the great preferenceit enjoys amongst the vast, growing number ofhabitual rice-eaters, and this factor is unlikely tochange rapidly. On the other hand, the sharpdrop in the incomes of some of the chief importingcountries, due to the fall in other commodityprices, may reduce effective demand. Japanesedemand will depend more on industrial activity,but the annual increase in its population aloneconstitutes an equivalent rise in requirements ofover 100,000 tons a year if present rice consump-tion per caput is to be maintained.
The smaller, but absolutely large section, whichdoes adjust its consumption by relative prices,will continue to be able to rely in 1952/53 onwheat imports under the prices of the currentInternational Wheat Agreement. The future ofthis Agreement is, however, still under discussionand great doubt prevails concerning the f.o.b.price-levels that any fresh Agreement may pre-scribe. No further relief appears to be likelyfrom any renewed sharp drop in freight rates.On the other hand, the tendency to allow pricesto the internal consumer to reflect costs seemsto be spreading, as in the case of the Indian gov-ernment reducing food subsidies.
Viewed somewhat narrowly, the demand forrice seems likely to absorb all available supplies,even at prevailing prices. Should price-levels ofother products continue to fall, the price of riceis unlikely to remain insulated from consequentadjustments amongst producers and consumers.
SUGAR
Current situation
Following the war time decline in production,the prewar average was first passed in 1947/48,and since then it has continued to grow, exceed-ing the prewar average also on a per caput basis.Production (excluding the U.S.S.R.) during the de-cade preceding the outbreak of World War IIvas comparatively stable at 26 million tons per
year. This was equal to about 13 kgs. per caput,as compared with 10 kgs. before World War I.The crop of 1951/52 was equal to 14.4 kgs. percaput, 10 percent higher than prewar. But thegreat increase in production in dollar countries
has in 1952 engendered new problems for theworld free market supplies (Table 39).
TABLE 39. - CENTRIFUGAL SUGAR PRODUCTION 131'CONTINENTS a
89
Production is likely to continue to expand inimporting countries and future growth in consump-tion is likely to depend increasingly on domesticproduction or on production in soft currencycountries. A return to prewar per caput consump-tion in countries where sugar is still rationed wouldcreate a market for an additional 1.5 million tons.Imports to the United Kingdom aild Japan alonewould have to rise by 1.2 million tons, but postwareconomic and political dislocations are likely toretard such a return to prewar consumption. Thegreat increase in exportable supplies has takenplace in countries which require payment in dollars.Cuba alone will have for export in 1952 over amillion tons more than in 1951 while suppliesfrom non-dollar exporting countries are still sub-stantially lower than before the war.
Prices remained remarkably stable during 1951/52 except for the decline from the artificial priceboom during the first part of 1951. Cuban worldmarket prices have fluctuated between 4.5 and4.2 cents a lb. While the appearance of the large1952 Cuban crop tended to weaken prices not onlyof dollar supplies, but also of sugar from softcurrency countries (except from the British Com-monwealth, where the price was fixed in negotia-tions at the end of 1951), it has not yet greatlyaffected current market p1-ices. The Cuban Gov-ernment has established a single seller for " Spe-cial Quota, " sugar for the world market, and a" Sugar Stabilizing Reserve " of 1.5 million tonsto be marketed over a period of not more than 5years. Until now, these measures have met witha high degree of success and have prevented asteep decline in prices, but it is too early to judgethe long-term effects, especially if, as seemsprobable, production in importing and other export-ing countries increases substantially during the1952/53 crop year.
Outlook
Early indications point to a further increasein production in 1952/53, but weather conditionscan still affect final output by as much as 1.0 per-cent. There is also the possibility that the world'slargest sugar-producing country may restrict nextyear's crop. The great increase in postwar produc-tion has been unevenly distributed between coun-tries. Indeed, the marketing problems which su-gar is likely to encounter in the near future mustbe considered in the light of the changes in theworld production pattern. Asia's production wasstill 5 percent below prewar in 1951/52, due to
38
million 'metric tons ....
Europe 6.5 6.8 9.0 8.8 135North America .
F
2.5 1.9 100Central America 5.1 8.8 9. 1 10.8 212South Auaeriea 1.8 2.9 3.1 3.4 189Asia 7.4 6.0 6.3 7.0 95Africa 1.2 1.4 1.6 1.5 125Oceania 1.8 2.0 1.9 1 8 100
World (excl.USSR) 25.7 29.9 33.5 35 2 137
U.S.S R 2.3 2.1 1 2.21 2.3
REGION 1934- 919/38 50
1950/51
Prelim-in9a57
1951/59
as per-e ntage
of52 1934-
a Includes gur in India and istali in terms of rawsugar.
Larger supplies, rising national income, and com-paratively favorable sugar prices in relation toother foods have made possible a substantialgrowth in per caput consumption in most countriesas compared with the prevar level. Increasesare especially pronounced in underdevelopedcountries, particularly in those which had thelowest per caput consumption in prewar years.In many territories in Africa and Latin America,consumption has increased by 100 percent ormore. Only in Asia and Europe has consumptiondeclined.
Although the bulk of the increase in consump-tion has been made possible by larger domesticproduction, imports have also increased duringthe postwar period and in the last two years reach-ed high levels. In 1950 and 1051, about 11.5million tons of sugar entered world trade as com-pared with 9.8 million tons in the prewar period.In 23 of the leading importing countries, produc-tion increased 33 percent from prewar to 4.3million tons in 1950/51, while their net importsrose 10 percent to 10.1 million tons. In 1S ofthe chief exporting countries, production in 1950/51 was 15.1 million tons, as compared with theprewar average of 11.S million tons, an increaseof 28 percent. Their exports increased to 10.6million tons in 1951, and domestic consumptionincreased 88 percent from 2.2 million tons to 4.2.
There are indications that the rate of increasein international trade in sugar may diminish.
the great decline in Java and Taiwan. Produc-tion in Central America, however, has more thandoubled. It expanded in all countries of thatarea, but the major increase was in Cuba whereproduction rose from a prewar average of 2.8million tons to about 7.2 million tons in 1952.Adverse weather conditions during 1951/52 inNorth America, Europe and Oceania gfive a some-what distorted picture of the changes whichhave taken place, and during the forthcomingyear their production is likely to show an increaseof an additional 5 percent over the prewar period.With sugar prices in most markets showing muchless increase above prewar than most other foods,and with demand growing with population andbuying power in the less developed countries,continued expansion in the world consumptionof sugar seems likely. However, the effect ofthese trends on prices, particularly for suppliesfor the free world market, will depend on specialmeasures which may be taken either on an inter-national basis or by the major exporting country.
LIVESTOCK PRODUCTS
Current situation
Major developments in the livestock producesituation in 1951 and early in 1952 included(1) a shrinkage in butter production and a muchmore considerable decrease in the volume of worldtrade in butter ; (2) a very great expansion ofmargarine production ; (3) increased utilization ofmilk in the form of fluid, canned and dried milk,and of cheese ; (4) a shOrtage of beef and muttonand (5) an increase of pigmeat, largely due torecovery in pig numbers in Europe.1. In 1951 butter imports fell from 341 to 313
million kgs. in the United Kingdom and from46 to 26 in the German Federal Republic.The latter in mid-1951 raised the import duty(DM 30 per metric quintal since April 1950)to DM 75 without diminishing imports notably,but as of October 1, 1951, changed the rateto 25 percent ad valorem, which worked outat about DM 110. After this second increase,imports practically ceased and during thewinter stocks, belonging mostly to the Govern-ment, were halved. The United Kingdomconceded a 7 14 percent increase of the pricespaid under its long-term contracts with Aus-tralia and New Zealand and with Denmark.It attracted much more butter from NewZealand, but a reduction in imports from
90
Denmark entirely offset this. The export pri-ces the Danes received for butter developedunfavorably compared with those for cheeseand especially for beef and veal. While butterin 1949 fetched 13 1/3 times the price of lin-seed cake, in 1951 this ratio was 8 2/3. Den-mark de-rationed butter and increased domesticconsumption. So did Australia, whose exportsfell from 83 to 34 million kgs.
In the western world considered as a whole,butter production fell a little owing to smalleroutput in the exporting countries of Europeand to decreases which were very heavy inabsolute figures in the United States andrelatively large in the United. Kingdom. Butmore butter was produced in Western Germany, ,which almost reached the prewar output, andin France and Italy, both of which had at-tained that goal a year earlier. World exportsof butter rose between 1947 and 1950 from330 to 490 million kgs. The year 1951 marksa break in this upward trend.
2. The demand for butter is very elastic, de-pending mainly on the ratio its price bearsto that of margarine. Cost of production perunit of fat is lower in vegetable than in milkfat. Measures to raise butter prices to consu-mers are of no avail if not coupled with marga-rine restriction to which governments couldnot very well afford to turn after the invasionof South Korea.
Oilseeds and seed oils, the main raw mate-rials for margarine, had risen in price afterthe middle of 1950, but early in 1952 fellbelow their pre-Korea level. Cheaper vegeta-ble oils favored margarine in its competitionwith butter, and so did government measures.
In 15 leading margarine countries, produc-tion in 1951 rose to 2,066 million kgs. as against1,812 in 1950 and 876 in 1938. More marga-rine was produced both in North America andin Europe, but North America, producing 50million kgs. more of margarine, had 90 mil-lion kgs. less of butter. In Europe, margarineproduction expanded mainly in the UnitedKingdom and more in Western Germany.
The margarine/butter price ratio, about one-third in Norway and Switzerland, dropped toa similar level in Germany and Austria ; itrose from 42 to 47 percent in the UnitedKingdom ; it fell from 46 to 40 in the UnitedStates. It was higher, and still rose, in Den-mark and Sweden, but remained lowin Belgium (between 32 and 30 percent). In
most national price systems the ratio (loesnot offer a bright prospect for butter.
While demand for butter is very elastic, themilk supply is not. Several promising out-lets for mili have, however, been opened bythe growing demand for fluid milk and cheese.A shift of preference from " visible " fats tofluid milk and to cheese, i.e. to food richer inprotein, is reported from the United Statesand other northern countries, and it seemsthat the old mistrust, so powerful in warmregions, against fluid milk is breaking downbefore the achievements of the modern tech-niques of refrigeration and preserving.
Milk preserves and cheese absorb about asmuch milk as has been set free by the reces-sion in butter. In 1951 not only WesternGermany but also leading European cheese-exporting countries increased their outputnotably. Cheese replaced butter and meatto a large extent in the United Kingdom,which increased imports from 156.5 to 197
million kgs., buying almost one-fifth in theUnited States.
Commercial policy affected the cheese mark-ets by two measures : the United States, thelargest producer and for short periods duringand after the war the largest exporter of cheese,subjected imports to quotas in August 1951,and Western Germany increased import dutiesto 30 percent ad valorem.
Beef prices did not share in the decline whichmany commodities underwent in 1951/52.For this year more abundant meat suppliesmight have been expected, because the ratioof meat to wool prices rose from the low levelto which it had fallen in the great run on rawmaterials after the invasion of South Korea.In August 1951 when Australian export pricesfor cheese and butter were raised, meat hadincreased still more whereas wool in the UnitedKingdom declined until in April 1952 it was16 percent below the pre-Korea price level.The exceptionally high wool prices had re-duced slaughterings and greatly increasedstocks, preparing a recovery in meat supplies.Such an increase, in fact, ean be reported forNeW Zealand, where meat output has risenby one fourth. In Australia and Argentinahowever, continued droughts reduced output.In Argentina the price policies of the Govern-ment favored domestic consumptionJanuarv 1952.
91
Thus various factors combined to reduceexports from the three great surplus areas ofthe Southern Hemisphere in 1951, and thisreduction seriously affected the United King-dom whose imports fell from 1,220 to 940million kgs. In the beginning of 1952 im-ports from New Zealand increased, greatlysurpassing the level of the preceding year,and very considerable quantities arrived fromthe Argentine.
Trade restrictions of hnporting countries espe-ciall3r affected live cattle. In February 1952the outbreak of foot-and-mouth disease inCanada caused the United States to closeits frontiers for Canadian cattle and freshmeat ; iii -111,7 an agreement was concludedunder which Callada replaced New Zealandmeat in United Kingdom supplies and NewZealand replaced Canadian meat in UnitedStates imports. In the United States theoutput of beef and veal fell by 388 millionkgs. Imports, especially canned meat fromArgentina, rose from Si to 133 million, theUnited States taking the second place amongbeef importing countries. Average prices forsteers rose 21 percent in the United States(31 in Canada and 36 in Argentina) ; numbersof cattle increased, promising a recovery inbeef supplies. The pig/maize price ratio was12.4 in the spring of 1951, and pigmeat outputrose by 372 million kgs. or 10 percent. InMarch 1952, the ratio was from 9 to 9 1A.
The year 1951 brought great progress in thereconstruction of the pig industry of Europewhich is the more remarkable as it was achievedwith less maize from other continents. In 12European countries pigmeat production in-creased 10 percent in 1951. The greatest in-crease took place in Western Germany whereDecember pig numbers between 1947 and 1950had already risen from 5.5 to 11.9 million.In December 1951 the figure was 13.6 mil-lion and pigmeat output for the whole yearrose from 830 to 1,040 million kgs. (as against985 in 1938). The price ratio of pigs to feedsliad remained favorable in the first half of theyear ; it deteriorated towards the end. -
Among the traditional exporters, Denmarkand the Netherlands increased output by 11and 16 percent. Both shipped more baconto the United Kingdom which got almost nonefrom Canada and much less pork from Argen-tina. Western Germany had taken 360,000 livepigs and 580,000 quintals.of pigmeat in 1950 ;
it reduced such imports by 60 - 70 percentin 1951.
Pig numbers and pigmeat production, espe-cially in Europe, showed most progress in1951. Cattle and sheep numbers increasedonly slightly. In world trade in livestockproducts shrinkages were greater than ex-pansions : while world exports of cheese in-creased a little, meat exports fell 10 percentand butter exports 12 percent.
The development of world trade in livestockproducts does not, however, mean an overalllowering of the degree of international divisionof labor. The butter trade is shrinking mainlybecause of the expansion of margarine whichis almost wholly produced in the countrieswhich consume it, but mostly from importedoilseeds. The meat shortage had transitorycauses, namely, the preceding great rise inwool prices and the great droughts in theSouthern Hemisphere, and it is hard to be-lieve that the quantitative restrictions of im-ports announced in the spring of 1952 bythe United Kingdom, which at the same timecut down food subsidies, will be permanent.
Outlook
The prospects for the 1952 harvests of feedingcrops are generally favorable in most of the North-ern Hemisphere. Summer pastures appear to bein good condition and satisfactory surpluses ofhome-grown fodder are likely to be available atthe end of the year. In the Southern Hemisphere,grazing is improving, the droughts in Argentina,Australia and the Union of South Africa havingbeen broken by rains.
Barring a substantial fall in consumer income,demand for livestock products at current pricesis likely to continue strong throughout 1952/53.On the other hand, some of the factors limitinglivestock production in 1951/52 the shortageof dollars to pay for feed imports, the increasein costs of livestock products, and foot-and-mouthdisease may be felt more strongly in the com-ing season. The year may, however, see an im-provement in exportable supplies of feed grain insome non-dollar areas.
In Argentina, meat output in 1952 may decline,owing to the introduction of measures limitingcattle slaughterings, but efforts to reduce thehigh domestic consumption may contribute tolarger meat exports.
92
Owing to losses of cattle from the 1951/52drought it will take a number of years beforebeef production in Australia fully recovers. Someincrease in the output of lamb may be expectedfor 1952/53, while higher feed prices and farmwages make any appreciable change in pigmeatproduction unlikely. Exports of meat from Aus-tralia during the coming season will be very small.The new 15-year agreement with the UnitedKingdom and the overall agricultural expansionprogram of Australia should, in the long run,improve its exportable supplies. In New Zea-land, on the other hand, livestock numbers areat a high level, and both production and exportsof meat are likely to expand.
The aggregate meat output of the United Statesis expected to show an increase in 1952/53,cattle numbers having reached a record level atthe beginning of 1952. Hog production, however,will probably decline in 1953 as a result of thesharp reduction in recent hog prices compared tomaize prices. The future of the Canadian ex-port market will depend to a large extent on howlong the embargo which the United States hasplaced on livestock and fresh meat from Canadacontinues, but it is anticipated that the Canada/New Zealand/United Kingdom agreement willenable the expected surplus of meat in Canadain 1953/53 to be disposed of.
In Western Europe some increase in meatproduction, mainly pigmeat, is expected in 1952/53.Feed and crop prices to farmers have advancedsharply during the past season compared withmeat animal prices, however, and this may limitthe increase in meat production or bring about adecline in some countries. The 1952 review offarm prices in the United Kingdom encouragesthe rearing of calves for beef and the productionof additional domestic feeding-stuffs by the plow-ing up of grassland. Given no deterioration infeed-grain imports, European meat exporters areexpected to niaintain shipments of pigmeat atthe level of the previous season.
During 1951/52 most countries have been con-centrating on the expansion of beef herds. Thiswill tend to curtail milk output and any increasewill largely depend on higher yields per cow. Itis likely that total output of milk in Western Europein 1952 will rise by one to two percent over thelast year's level, whereas in North America itmay not change substantially. Depleted dairyherds will retard recovery in Australia. NewZealand, however, is expected to show a steadyincrease during the coming season, provided rain-fall is adequate.
Trade in cheese in 1952/53 will be seriouslyaffected by the import limitations of the UnitedKingdom and by the continued restrictive im-port policy of the United States. The marketsfor cheese are, however, more diversified thanthose for butter and in general production aswell as consumption of cheese will continue toincrease. The upward trend in the productionand trade of preserved milk is likely to continue.
Egg production in Western Europe may con-tinue to feel the impact of feeding-stuff difficulties,and is expected to rise only slightly. In NorthAmerica, on the other hand, further considerableincreases are expected for 1952. Reduced suppliesof feeds may check egg production in both Argen-tina and Australia.
Exports of eggs from Western European coun-tries in 1952 are likely to be maintained or evenslightly increased over the previous year's level,as smaller supplies are expected from Australiaand China. The upward trend in exports of eggsin shell from the United States is also expectedto continue during 1952.
FISHERIES PRODUCTS
Current situation
Fish production increased in 1951 and continuedthe upward trend recorded since the end of WorldWar II. The figures in Table 40 are based onrecords and estimates of landings in 60 countries.The catches actually reported by 30 of thesecountries totalled 14,227,400 metric tons andshow an increase of 4 percent over 1950.
TABLE 40. TOTAL LANDINGS OF 60 COUNTRIES BY REGIONS, 1938, 1947
SOURCE: Official publications and communications and FAO estimates.a Round fresh weight for most countries.b Japan and South Korea only.
Union of South Africa, French Morocco and Angola only.
93
This production reflects an overall increase in thefishing effort achieved mainly by the restorationand reconstruction of war damaged fleets, includ-ing the introduction of more powerful vesselswith a high degree of technical efficiency and bythe steady progress of development and mecha-nization projects in technically underdevelopedcountries. In 1951, however, while the continuingstrong demands of populations in underdevelopedareas stimulated the growth of indigenous pro-duction, the heavily capitalized industries of West-ern Europe and North America were facing mar-keting problems which, in the light of rising costsand prevailing restrictions on capital expendi-ture, tended to limit production at a level whichwas inconsistent with the potential world de-mand.
Fisheries commodities reviewIn the pattern of postwar utilization, while tech-
nological development encouraged a swing awayfrom curing to marketing in the fresh and frozenstate, the emphasis was on the distribution ofedible fish products. In 1951, however, the out-put of most edible fish products, except stock-fish, frozen fish, salted herring and canned salmonfell below the level achieved in 1950. Thiswas due to the attraction of the market for oiland meal where demand was firmer and to theuncertainty which prevailed generally in themarkets for edible fish products. The steadyincrease of oil and meal production was madepossible by the slackening in the demand for ediblefish products, especially in the case of herring andsimilar species whose production is concentratedover a relatively short period of time.
1950 AND 1951
thousand metric tons a
5 551.2
3 269.1
3 272.8
460.2
223.4
12 776.7
6 C67.6 6 771.6
4 013.0 4 073.6
3 671.5 3 378.6
556.7 563.0
508.7 521.8
14 817.5 15 3'8.6
REGION 1938
Europe (excl. U.S.S R) 5 350.1
Asia b 4 149.8
North America 3 250.1
Latin America 265.0
Africa e 109.5
TOTAL 13 124.5
1947 1950 1951
TABLE 41. - PRODUCTION OF CERTAIN FISHERIES COMMODITIES a, 1947 TO 1961
Fresh fish. The wartime disruption of fishproduction increased the dependence of belligerentcountries on imported supplies and caused somecountries, traditionally engaged in processing, todevelop a larger fresh fish trade, In Western Eu-rope exports increased from 340,000 tons in 1938to 540,000 tons in 1949. The revival of indigen-ous production caused a corresponding declinein this trade which in 1950 was below the 1938level. In 1951, notwithstanding a remarkable re-covery, which in S selected European countriesamounted to an increase of 5 pereent over 1950,the total production of fish marketed fresh drop-ped to 38 percent of the total catch as comparedwith 42 percent in 1950, and further reflects theincreased production of oil and meal.
Frozen fish. The steady postwar development offrozen fish production continued during 1951. Inthe Americas, Asia and Europe, production was20 percent higher than in 1950 and, in Iceland,Norway and the United Kingdom the sharp declinewhich had occurred in 1950 was reversed. Themain increases over 1950 were
Denmark. . 34 percent .Norway . 63 percentIceland . . 64 » U. K. . . . 169,Tapan . 13 » U.S.A.. . . 13
94
a The number and identity of the reporting countries are not the same for each commodity, but in some cases thefigures are close to world totals.
b Product weight.e Dried basis.d Includes smoked herring for some countries.e Body oil may be included.j Includes herring meal for Germany, Netherlands, Spain and United King,dom.
In the United. States, the largest producer offrozen fish, production increased from 130,000 met-ric tons in 1950 to 148,000 metric tons in 1951,due chiefly to the growth of the ocean perchand the whiting trade. The United States is alsothe principal customer for the frozen tuna exportsof Angola, Japan, Mexico, Peru, etc., and her im-ports of frozen tuna and similar species increasedfrom 6,620 metric tons in 1939 to 28,567 metrictons in 1951.
Stockfish (cod (tnd similar species dried withoutsaffing). In Norway, the most important producer,postwar production has steadily increased andnow exceeds the 193S level. In 1951 exportsamounted to 20,800 metric tons compared with16,500 metric tons in 1950 and 26,000 metric tonsin 1938. There is still a firm demand in Italy andWest Africa.
Salted cod, ha/ce, etc. In 1951 the world output(excluding U.S.S.R.) of salted cod dropped by 6 per-cent to 302,000 metric tons owing mainly to de-creases in Callada (S percent), Iceland (37 percent),Japan (33 percent). Norway, however, which pro-duces 15 percent of world supplies, increased itsproduction by 51 percent to 54,200 metric tons,based on the increased exploitation of the Green-
COMMODITY No. ofcountries 1947 1948 1949 1950 1951
thousand metric tons b
Fish, frozen 14 361.3 427.6 375.8 451.7Cod, hake and similar species,
saltedc 14 255.3 221.3 261.0 322.6 301.9Cod, hake and similar species,
dried (stockfish) 3 17.4 16.5 10.6 21.1 37.7Herring and similar species,
saltedd 19 511.9 538.9 609.3 473.0 532.0Salmon, canned 4 156.6 133.9 151.9 124.2 150.5Herring and similar species,
canned 20 239.5 252.5 327.9 397.4 320.0Tuna, true mackerels and similar
species, canned 14 107.9 124.0 116.8 155.3 153.2Cod liver ode 11 38.1 37.6 38.0 35.9 46.9Herring and other clupeoid oil 10 114.1 127.3 105.4 158.7 182.0Herring and other clupeoicl meal. 10 236.8 313.9 280.2 385.9 433.3Other fish meal 1 13 150.0 181.5 230.1 263.7 315.9
SOURCE : Official communications.
land grounds which supplied 20,000 tons. Fur-ther increases are forecast in 1952. Iceland andthe Faeroes have also directed more salt-fish voy-ages to the Greenland grounds. In the five mainproducer countries (Callada, Denmark, FaeroesIceland and Norway), exports increased by 16percent to 181,700 tons (dried weight) in 1951.Although exports of wet, salted cod dropped by19 percent this was offset by a revival of the" klippfish " trade.
Canned fish (salmon and similar species). The world,pack (excluding the U.S.S.R.) increased from 124,000metric tons in 1950 to 150,400 metric tons in1951. Although the United States pack of 104,600metric tons showed an increase over the very low1950 pack it was still only equal to two-thirds ofthe 1938 pack. Prices are higher as a result ofthe reduced pack.
In Canada the pack increased to 42,800 metrictons and there is some sales resistance which maydisappear owing to the lighter pack expected in1952. Japan did not produce a pack of commer-cial significance in 1951.
Canned tuna. The significant features of produc-tion in 1951, as in 1950, were the emergence of Japanas the second largest producer and the continuedpredominance of the United States. The UnitedStates' industry sought protection against increas-ing competition from imported tuna. The lapseof the United States-Mexico trade agreement re-stored the ad valorem duty to 45 percent, so thattotal United States imports of tuna canned inoil dropped from 20,000 metric tons in 1950 to7,000 metric tons in 1951. The future of theUnited States market is uncertain owing to heavysupplies although at the lower level of wholesaleprices ruling in the latter half of 1952, there is achance that all available supplies will be absorbed.
Canned clupeoidae (herring and similar species).Production in the 12 main producer countries fellby 26 percent in 1951. Sharp falls in the Cali-fornia and Maine sardine packs were characteristicof the overall decrease in United States productionwhich at 95,400 tons was 48 percent lower thanthe heavy 1950 production. Production, althoughfairly stable elsewhere, increased by 43 percentin Callada and 11 percent in French Morocco butfell by 29 percent in Portugal, both of the lattercountries finding considerable resistance in theirtraditional export markets in Europe and Northand South America.
95
Oils and meal. Production continued to expandin 1951 and in 13 selected major producer coun-tries absorbed a further 2 percent of fish suppliesand accounted for 20 percent of the total catch(excluding offals). This trend is shown in the fig-ures below, which show the output of oils andmeal commodities in selected countries (1948 --100) :
COMMODITY
An fish crustacean and molluskmeal
All fish oils
1949 1910
10 129
91 124
Although the United States accounts for 30percent of world production, her output fell by22 percent in 1951 owing to reduced landings ofherring and pilchard. South Africa achieved aconspicuous increase in its production viz. 124percent in the case of meal and 50 percent inthe case of oil. In the United States the marketfor meal, although fairly stable, may weaken as aresult of heavier production and imports, and thedemand for body oils, stimulated by the war inKorea in 1950, has later shown a sharp recession.
Trade
While the total volume of exports in 1951 wassomeAshat higher than in 1950, analysis revealsa re-distribution of trade and some significantreductions in the export of the main commodities.
The export of fresh and frozen fish continuedto expand in 1951 chiefly because of improvedcommunications and rapid advances in technique.Significant increases were recorded, for example,in France (69 percent), Iceland (83 percent) and.Norway (30 percent).
The export trade in cured fish is gradually ap-proaching its prewar level although notable ex-ceptions were Iceland, the Netherlands, and theUnited Kingdom which were respectively 29 per-cent, 35 percent and 74 percent below their 1938levels. In the United Kingdom there was a reduc-tion of 4 percent between 1950 and 1951.
The sustained demand for canned products inthe war and postwar period has given way to anunstable situation characterized by increased com-petition and uneven balance of trade betweenthe major producer countries, especially since theappearance of new and growing productions suchas those of French Morocco and Peru. The industry
1951
149
141
has suffered from the growing demand for freshand frozen products on the one hand, and by-products such as oil, meal and fertilizers on theother. Portugal, ill-equipped for the frozen tradeand the manufacture of by-products, has beenunable to adapt her production to the shiftingworld demand so that her canned products werebeing quoted at 20 percent below price levels pre-vailing before the Korean war.
In several other European countries the cann-ing trade in 1951 was lower than in 1950 e.g.Denmark (54 percent), France (18 percent) andNorway (6 percent). In countries with few alter-native outlets this has meant stockpiling the 1951pack which with the other factors may compli-cate still further the distribution of canned goodsin 1952.
The trade in oil, meal and fertilizers continuedto expand during 1951 and in some countriesachieved very large increases over the 1950 produc-tion ; notably Denmark (768 percent), Iceland (117percent) and Norway (89 percent). In South Afri-ca, exports of fish meal in 1951 reached 20,000metric tons, thus placing this country among themajor producers.
Prices
Generalizations are difficult because of the widerange of fish products which, during the processof distribution, often have very little in commonbeyond their origin. Moreover, owing to the perish-able nature of the bulk of fish products, prices areparticularly sensitive to the availability and priceof other commodities and to purely local conside-rations of quality, variety, season, discriminationand abundance. Price movements as a wholeneed to be considered against the background ofsteeply rising costs of production and distribu-tion, and it would be misleading to draw compar-isons when prices have been subject to varyingdegrees of commercial or governmental controland where no significant correlation exists bet-ween consumer prices and production costs. Withinvery broad limits, however, it is possible to tracean overall increase in fish prices in 1951. Thisincrease was not so much due to any sustainedincrease in the consumer demand as to the effortsof producers and distributors to recover the risingcosts of manpower and materials and to the occa-sions when seasonal shortages coincided with ademand stimulated by shortages of alternativefoodstuffs. It was More marked in the case offresh and frozen products which, as a result of
69
improved techniques, are attracting demand awayfrom canned products. In the United States, forexample, the index of wholesale prices of fish andshellfish increased by nearly 3 percent, but thismasks the significant adjustment in demand sug-gested by the fact that fresh and frozen fish pricesadvanced by nearly 10 percent while the priceof canned products fell by 8.5 percent during thesame period. In Western Europe, white fish retailprices advanced 30-45 percent above 1950 levels.
Where canned products were concerned thisshifting of demand was accompanied by the increas-ed competition of new producers, so that Portu-gal, for example, was forced to quote canned pro-ducts at 20 percent below 1950 prices.
Meanwhile the sustained demand for oil andmeal and the incentive of higher quayside pricesencouraged more craft to fish exclusively withthis production in view.
The capacity of the markets in technically under-developed countries is expected to absorb localproduction and to encourage the development offisheries resources for some years. In other coun-tries, however, producers in more commercializedindustries are facing a critical slackening in demandwhich suggests that markets are becoming over-supplied at present price levels and under exist-ing restrictions on imports.
Outlook
The competition which has characterized themarketing of canned products during 1950 and1951 will probably be intensified by the carry-over of stocks accumulated in these two years.The expansion of trade in frozen fish productsin 1951 will continue through 1952 although fur-ther development may need to recognize a some-what lower level of prices. The increasing pro-duction of salt fish may become more difficultto sell at a price which is consistent with the risingcosts of long-range trawling operations.
It is difficult to appraise the demand for fishmeal which, during the postwar years has neverbeen seriously tested, but new high levels of pro-duction suggest that marketing will become morecompetitive and more responsive to fluctuationsin livestock production. The demand for bodyoils is expected to be weaker ; these profited fromthe wide demand for fats and oils which was in-tensified in 1950, but there was a sharp recessionin 1951 and keener competition is expected inthe coming year owing to the anticipated largeproduction of olive oil in 1952. Medicinal oils
too, will meet more competition owing to theincreasing production of synthetic Vitamin Awhich is already competing in price and is ex-pected to overtake and eventually replace fish-liver oil.
In general, the highly commercialized industriesmust expect to face more discrimination in consu-mer demand which will give increasing effect toimport restrictions resulting from the protectionof some markets and the exclusion of others bybalance-of-payments problems.
FATS, OILS AND OILSEEDS
Current situationThe acute world shortage of oils and fats that
characterized the early postwar years has beenrelieved. World production of fats and oils in1951 is estimated at about 7 percent larger thana year earlier and more than 10 percent abovethe prewar average. Production per caput hasnearly recovered to the prewar level. Productionof oils and fats continued at a high level in early1952.
World indigenous exports of fats and oilseedsin 1951 were still below the prewar level (Table42). The apparent contradiction between increasedworld production and reduced world exports isexplained by the fact that consumption has in-creased materially in some of the major prewarexporting countries, including India, parts ofAfrica, and Argentina.
97
TABLE 42. WORLD INDIGENOUS EXPORTS a OF
FATS, OILS AND OILSEEDS IN TERMS OF OIL, 1938,1950 and 1951
a " Indigenous exports " comprise oilseeds grown withinthe exporting country, and oils or fats derived from oilseedsor animals produced within the country. Minh, oil producedfronf whales caught in the Antarctic Oca,, is counted in thistable as an export from the Antarctic.
Indigenous exports from European countries consist mainlyof butter and slaughter fats going to other European coun-tries.
Butter is included in terms of fat content (calculated at51 % of product weight). Sperm oil and fish-liver oils areexcluded where reported separately.
b Preliminary.
The pattern of world trade in fats, oils, and oilseeds has changed considerably since prewar.Exports from Argentina, China, Eastern Europe,India and Indonesia have declined materially.Production of whale oil in the Antarctic has
TABLE 43. FATS, OILS, AND OILSEEDS IN TERMS OF 0m: RETAINED IMPORTS a AND IMPORT BALANCE:PRINCIPAL IMPORTING COUNTRIES, 1938, 1950, AND 1951
* Export balance.a "Retained imports" comprise fats and oils imported and not re-exported, and the estimated oil irr imported oilseeds that
is not re-exported in the form of oilseeds or as oil. The "import balance" is the difference between total imports and total ex-ports of all fats, oils, and oilseeds in terms of oil. Whale oil of Antarctic origin bronght into a country and retained for consump-tion is counted in this table as 'in import, even if produced on ships flying the country flag. Butter is included in thesetotals in terms of fat content. Sperm oil and fish-liver oils are excluded where SIIONVR separately.
b Preliminary.e All Germany (1937 frontiers).d Norway, Sweden, Denmark, time Netherlands, Belg,ium and Luxembourg, Switzerland, and Italy.
COUNTRY OR AREA 1933 1950 19.51 b
EuropeUnited States and CanadaArgentina, Brazil ancl UruguayAfrica, South of the Sahara .
:India, sea-borne trade .
IndonesiaMalaya, Ceylon, and Pacific
IslandsPhilippine RepublicChina (including Manchuria)Australia and New Zealand.AntarcticOther areas
WORLD TOTA
(thousand
495135658948676637
420384580254566366
metric
367942599
1 235,172332
328511215216344218
tons)
363I 091
6181 052
164472
396565197208347141
6 089 5 479 5 613
COUNTRY Retainedimports
ImPortbalanceRetained.imports
Importbalance
Retained Importbalance
thousand metric tons
-United Kingdom 1393 1393 1464 1464 1562 1562Germany (Federal Republic). e 1157 e 1157 761 761 684 684France 515 506 333 327 502 495Other Western Europe d. 791 558 915 642 959 663
United States 710 659 582 *309 512 *552Canada 124 100 164 109 136 109Cuba 45 45 96 96 97 97
japan 171 166 113 107 148 139
193S 1950
declined. These reductions have been partl-y, butnot entirely, offset by increases in exports fromthe United States, the Philippine Republic andWestern Africa. Exports from Argentina weretemporarily large in 1950 and 1951, and thosefrom Africa temporarily low in 1951.
The import balance of 10 leading industrialcountries in Western Europe in 1951, at 3.4 mil-lion metric tons (including the oil equivalent ofoilseeds), was 5 percent less than in 1938. Thisreduction, however, was more than accounted forby the Federal German Republic (Table 43).The import balance of Sweden was also materiallylower than prewar, reflecting increased productionof rapeseed in that country. The import balan-ces of Italy, the Netherlands and the -UnitedKingdom in 1951 were considerably larger thanin 1938, and those of Belgium, Denmark, France,Norway and Switzerland were at the 1938 levelor slightly higher.
TABLE 44. PRICES OF SPECIFIED FATS, OILS AND OILSEEDS, JT_TNE 1952, WITH COMPARATIVE DATA
Compiled from The Public Ledger (London.) Prices are international market prices, for prompt or early shipment, c.i.f.or c. and Î. European ports, except as otherwise noted. Original quotations are converted to U.S. dollars at the official ratesof exchange.
a Last month before prices were affected by the Korean crisis.b Peak month since June 1950 for most items.c Chinese, bulk, plus $40, the difference in June 1950 between the Indian and the Chinese quotations.d Drums.e Estimated from Chicago quotations.f Bulk.* F.o.b. American port.
Apparent consumption of fats and oils percaput in 1951 (total food and nonfood) was lessthan 90 percent of prewar in Denmark, Germany,Italy and Norway. In Belgium, France, theNetherlands, Sweden, Switzerland and the United
98
Kingdom apparent consumption was about aslarge as prewar or slightly larger. Nearly allWestern European countries showed a sharp im-provement over 1950.
Prices of fats, oils and oilseeds in internationalmarkets advanced rapidly after the outbreak ofhostilities in Korea in June 1950 and by March1951 most had reached peaks only slightly belowthose of early 1948. A declining trend began inthe spring of 1951, however, and continued throughApril 1952. There was a moderate recovery inMay and June 1952. In contrast to a year ear-lier, there was a widespread desire in 1951/52 toreduce the relatively large stocks built up inthe previous year (Table 44).
Prices of most of the oils and fats used princi-pally for food or soap were lower in June 1952than in June 1950. Total world production andexport supplies of these oils and ats were largerin 1951/52 than a year earlier. The leading in-
creases were in coconut, groundnut, cottonseed,olive, and whale oils.
Prices of linseed and castor beans, and of lin-seed, castor, and tung oils- declined less in 1951/52than prices of other fat-and-oil -items. The Ar-
15 :,11Currencyin whi eh 1950 1952
ITEM originallyquoted June a March b June Tune
( U. S. dollars per metric Ion
Dliye oil, North African, 1% f.o.b. . . . E st. 4!)6 1 047 882 6233roundnut oil, Indian, driuns V st. 397 601 e 612 364lroundnut oil, American, crude, bulk . U.S.$ * 352 ... * 437 424-ioybean. oil, American, crude, bulk. . . . U.S.$ 310 * 495 * 404 * d 264Lard, refined, 37 lb. tins, N Y U.S.$ * e 310 * 486 * 415 * 276
Joconut oil, Straits, 3 or 34%, bulk . E st. 322 526 414 244Palm oil, Belgian Congo, bulk B. fr. 260 548 359 209"'allow, fancy, bulk, N Y U.S.$ * e 133 * 352 * 317 * 160
í,insecd oil, Belgian, drums, f o b B. fr. 337 530 448 / 400-Jastor oil, Bombay firsts, drums . . . . V st. 315 686 820 482
3oy-beans, Manchurian bulk V st. 116 150 156 127ioybeans, American, No. 2 yellow, bulle. . U.S.$ * 102 ... 113-Jopra, Straits E st. 227 366 261 176Dopra, Ph,ilippines, bulk U.S .$ 190 323 213 152Palm kernels, French West Africa . . F. fr. 168 283 204 155inseed, Bombay Bold V st. 182 251 993 201
gentine linseed crop, which is harvested late inthe year, amounted to only about 300,000 metrictons in 1951 compared with 559,000 metric tonsa year earlier, and 1.7 million metric tons prewar.Also, large surplus stocks of Argentine linseedand linseed oil, which had been accumulated in1946-49, were nearly exhausted by the beginningof 1952 as a result of relatively heavy exportsin the two preceding years. Exports of linseedand linseed oil from Argentina in 1952 are notlikely, to total more than 100,000 tons, in terms ofoil, compared with 345,000 tons in 1951 and524,000 tons prewar. Droughts in Brazil andIndia prevented an increase in world productionof castor beans in 1951, and the demand fromthe United States for castor beans and oil re-mained strong. Exports of tung oil from Chinain 1951/52 were much below average.
Outlook for 1952/53
According to indications on July 1, total worldexport supplies of fats, oils, and oilseeds in 1952/53 will probably be about as large as in the pre-vious year. World production may decline slight-ly, but stocks of oils and oilseeds in several lead-ing producing countries will be larger at the be-ginning of the 1952/53 marketing year than a yearearlier.
The total quantity of lard and edible vegetableoils available for export from the United Statesis likely to remain approximately the same in1952/53 as in 1951/52. Reflecting a record pro-duction, stocks of edible vegetable oils have in-creased substantially since the fall of 1951. Thisincrease in stocks is a little larger than the de-cline in lard production in 1952/53 expected asa result of a 9 percent reduction in the 1952pig crop. Production of edible vegetable oils maybe slightly smaller than in 1951/52 with declinesin cottonseed and groundnut oil nearly offset byan increase in soybean oil. Edible vegetable oilsand lard compete strongly- with each other inthe United States because " shortening " is manu-factured mainly from vegetable oils and is widelyused for the same purposes as lard.
The 1951 Mediterranean crop of olives set anew record and large olive crops are usuallyfollowed by small ones. Although there was agood " set" of olives in the major Mediterraneanolive-producing countries in 1952, the crop wasdamaged in some by unusually hot summer weath-er. The carry-over of olive oil into 1952/53AA-ill be substantially, larger than a year earlier.
Commercial sales of Nigerian groundnuts from
99
the 1951/52 crop totalled about 400,000 metrictons of kernels, compared with only 145,000 tonsa year earlier and an average of 296,000 tons inthe 1945/46-1949/50 period. Because of limitedtransportation facilities, however, only about280,000 tons will be exported before the newcrop season. Hence there will be a carry-overinto 1952/53 of about 120,000 tons compared withno carry-over a year earlier. Unless weather con-ditions are unusually unfavorable for the 1952crop, Nigeria in 1952/53 Avill have an exportablesurplus of groundnut kernels, including carry-over,at least as large as the 280,000 tons being ex-ported in. 1951/52.
Prospects for other major world oilcrops in1952/53 are mixed. The area planted to ground-nuts in French. West Africa may be smaller thana year earlier. Growers were apparently dis-couraged by the sharp reduction in prices for the1951/52 crop from the high levels of a year earlier.In India, average growing conditions in 1952/53should result in an increase in groundnut produc-tion, which was impeded by drought in 1951/52.A reduction in 1952 in total Philippine and Indo-nesian production and exports of copra fromlast year's high levels is forecast, partly becauseof the severe decline in prices since mid-1951and partly because weather conditions for settingthe new crop in Indonesia were less favorable in1951 than a year earlier. World palm oil pro-duction and exports, however, are rising in 1952-reflecting restoration of order in Sumatra andmore favorable weather for the oil palms in Ni-geria in 1951 than a year earlier.
Consumer and industrial demand for oils andfats in 1952/53 is likely to be wed sustained by ahigh level of economic activity. Also, demandor stockpiling will probably be somewhat stron-ger than in 1951/52. These are price-supportingfactors, but with prospects for large world exportsupplies as favorable as they were in July, a majorrise in 1952/53 in the general level of fats and oilsprices in world markets is not probable.
FRUIT: (a) CITRUS FRUIT
Current situation
Total supplies of citrus fruit in 1951/52 Av-ereabout the same as in the previous season. In thetwo main producing regions, the United Statesand the Mediterranean, oranges and mandarinescontinued their upward trend whereas the lemoncrop was smaller, particularly in the United States
and Italy. Grapefruit production in the UnitedStates declined as a result of frost. In the South-ern Hemisphere, which suppl.ies the Europeanmarket with "summer" oranges, Brazil had excep-tionally low yields.
Compared with the five-year period beforeWorld War H there was a substantial increasein all citrus fruit production, 50 percent for oran-ges including mandarines, 40 percent for lemonsand 30 percent for grapefruit (Table 45).
TABLE 45. PRODUCTION AND EXPORTS OF CITRUS FRUITS BY 1\1,1/2.J-on PRODUCING AND EXPORTINGCOUNTRIES, PREWAR AND 1949-51
Estimate.
International trade in citrus fruit continued toexpand and reached a new high level in 1951,favored by the progress in trade liberalization inthe OEEC countries of Western Europe and astrong consumer preference for citrus fruit asa supplement to home-grown fruit in the im-porting countries. It is noteworthy that Spainand the United States also increased their exportsto Western Europe though they did not benefitfrom the trade liberalization. Spanish orangeexports, practically exclusive to Europe, rose from421,000 tons in 1950 to 730,000 tons in 1951, anincrease of 309,000 tons against a total increasefor Mediterranean orange eXports of 350,000 tons.The United States increased exports of all citrusfruit to Belgium and the Netherlands and founda new market in France.
Nearly all European countries increased importsof oranges in 1951, taking substantially larger
PRODUCTION
947701350252204437909
800
800
quantities than prewar. In spite of the increasein United Kingdom imports that country tookonly 402,000 tons as against the 1934-38 averageof 543,000 tons. The United Kingdom market isnow second to that of France, which with a 1951import of 498,000 tons of oranges and mandarineshas doubled imports since prewar. Lemon andgrapefruit imports to the United Kingdom in 1951were only 50 and 66 percent respectively of theprewar averages. Western Germany's import of
1951/52
3 0454 810
3651 100
213375
2 092
12 000
1 600
400 1 400
100
1934-38 1949average
EXPORT
1950 1951
thousand me rie tons
1 259150
1488563
115
1 026 1 100 1 451179 187 261
9 32 ...70 85 76
108 147 1444 5 ...
51 14 40
1 820 1 440 1 570 1 980*
110 130 110 110
280 220 220 230*
248,000 tons of oranges exceeded prewar importsto all Germany by 30 percent.
The decline in citrus fruit supplies in the UnitedKingdom has not been compensated for by in-creased supplies of other fruits. The per caputconsumption of all fruit (including tomatoes) wasin 1951 only 90 percent of prewar, whereas mostother European countries have increased percaput fruit consumption substantially.
The United States has as in previous yearsencouraged citrus fruit exports to Europe (excl.Eastern Europe) and other overseas territoriesby substantial subsidies. The export promotionprogram in 1950/51 provided for payments up toone-half of the export price f.a.s. U.S. port forfresh and processed oranges and fresh lemons.The program for 1951/52 provided for paymentof 40 p`ercent of the f.a.s. value and grapefruitwere included in the program.
Oranges and Mandarines.
Mediterranean Region . . 2 315 2 177 2USA 2284 4 173 4Mexico 139 411Brazil 1 172 1 195 1
Union of South Africa . 132 196Tapan 465 318Other countries 1 393 1 930 1
WORLD TOTAL. 7 900 10 400 11
Grape f rant
WORLD TOTAL. 1 200 1 400 1
Lemons and Limes
WORLD TOTAL. 1 000 1 200 1
COMMODITY AND REGION 1934/35-1938/39 1949/50 1950/51average
Spain is encouraging orange exports by a favor-able exchange rate to exporters and Greece stim-ulates exports of mandarines by granting importrights covering a certain percent of the exportvalue. Israel and Lebanon are granting directsubsidies.
Prices of oranges and grapefruit were generallylower in the 1951/52 season than in the previousseason, but lemon prices increased.
Outlook
Crop prospects for 1952/53 are favorable. EarlyJune estimates in the United States indicatean average yield of oranges and lemons, but alower than average yield for grapefruit thoughhigher than in 1951/52. Spain expects an orangeproduction of some 1.3 million tons against 1.1million tons in 1951/52.
New plantings of citrus trees have been sub-stantial during the last five-year period in Florida,U.S.A., as well as in the Mediterranean region,and these young trees are now reaching bearingage. The citrus area in Israel which at presentis approximately 12,000 ha. against 29,000 ha.in prewar Palestine is expected to increase by10,000 ha. in the next few years. The rapidexpansion in French Morocco is being continued.The present area of 20,000 ha. is expected to bedoubled by 1960. Greece, also, expects a furtherincrease in area.
The revocation of trade liberalization withregard to mandarine imports to the United King-dom in November 1951 and of all citrus fruit im-ports to France in February 1952 may have somelimiting effect on total European imports in1952/53, but Western Germany has since April 1952put all citrus fruit on the free list from OEECcountries.
Whereas most consumption in Europe is stillin the form of fresh fruit, the United States isexpanding the consumption of processed citrusfruit, particularly concentrated frozen juices. Ofthe Florida crop of oranges and grapefruitabout 62 percent and 55 percent respectively wentinto processing in the 1950/51 season. Process-ing is becoming an important outlet also for Cali-fornia oranges which were previously marketedmainly as fresh fruit.
In spite of the increasing supplies of winteroranges in the Northern Hemisphere the trade doesnot expect any major surplus marketing problemswithin the next few years. The situation maybe somewhat more difficult with regard to man-
101
darines and this may affect prices of winteroranges.
There is no immediate prospect of substantiallylarger supplies of summer oranges though demandfor this fruit is apparently increasing.
At the Second Mediterranean Citms Congress,held in Spain in May 1952, a resolution recommend-ing the stopping of new plantings in the regionfor some time was not approved. The Congresshowever recommended the establishment of ajoint advertizing program to stimulate consump-tion in the European markets.
(b) DRIED FRUIT
Current situationThe output of the major varieties of dried
fruit in 1951/52 was larger than in 1950/51, thesize of the pack being affected by the expectationof a strong demand (Table 46).
TABLE 46. DRIED FRUIT, PRODUCTION ANDEXPORTS, 1934-38 AND 1949/50 - 1951/52
A. Production in the Major Producing Countries
13. Exports from Major Exporters
a Preliminary estimates subject to revision.b U.S.A. only.e September-February only.
The absence of carry-overs and the rearma-ment programs then under way suggested that thedemand for storable foods would be at high levels.Moreover, since the small packs of the previousseason resulted in working stocks being lowerthan usual in the importing countries, a concen-tration of purchases in the early part of the seasonwas expected.
COMMODrrY 1931-38 1919/50 1950/51 11951152
thousand metric tons
Raisin- 447 455 389 449
Currants 181 108 93 98
Dried prunes. 270 193 107 209
Dried figs . 261 230 927 184
COMMODITY 1934-38 9/50 1950151 1951/52
housand nutrir tons
Raisins 185 198 140 147
Currants 80 65 62 69
Dried prunes b 87 72 95 c26
Dried figs . 65 42 43 41
No change of particular importance is expectedin the demand for dried fruit. The demand ofthe American consumer is expected to be main-tained, and some advance in prices is expectedin the United States. However, it appears likelythat subsidies on exports will be maintained,unless the contraction in output is more drasticthan expected. In Western Europe, consumers'tastes are moving away from dried fruit. Onlya drastic change in their price relative to those
102
Current situationThe world coffee economy was probably more
prosperous in 1951/52 than in any previous year.Production increased nearly everywhere as com-pared with 1950/51 ; imports rose about 10 per-cent ; and the strong import demand kept pricesremarkably stable at a high level. The problemof the world coffee industry appears to be one ofsupply rather than of markets.
The tendency towards larger packs did not of competing commodities could reverse the trend.affect all varieties and all producing countries. The American packers are expected to enterRaisin production in North America increased 50 the 1952/53 season with very small carry-overspercent, while elsewhere smaller yields were ob- and the Mediterranean countries at the end of thetained. The pack of currants did not change season will have only a few thousand tons of theappreciably in size, but part of the Greek product old raisin crop.was diverted to industrial use because of poor United States production of dried fruit in 1952/quality. The production of prunes almost doubled 53 is expected to be slightly- smaller than in theowing chiefly to the recovery of the Californian current year. A shorter grape crop is forecastindustry and the return of the Balkan product. which may lead to a smaller pack. The latter,The output of dried figs contracted severely in however, is dependent not only upon the sizeItaly-, Portugal and Spain owing to adverse sea- of the crop but also upon the demand for grapessonal factors, but increased in other countries. by wine manufacturers. The carry-over of wineThe production of minor dried fruit (dried apples, is likely to be substantial. On 31 March 1952pears, peaches and apricots) continued to decline California stocks amounted to 177 million gallonsfrom the peaks reached in the 1940s. against 138 million at the same date of 1951.
The expected demand for the major dried These circumstances are likely to lead to reducedfruits failed to materialize in spite of the relaxa- activities by the wine producers, but on the othertion of import controls in some countries. Buy- hand they are trying to obtain Federal aid toers were rather cautious throughout most of the set up a marketing scheme which would allowseason and chiefly during its first months. In them to maintain the scale of their operations.the United States, to avoid the full impact of The outcome of this scheme may have decisiveincreased supplies on growers' incomes, the export effects upon the size both of the wine outputsubsidy program for raisins and prunes was rein- and of the raisin pack. The size of the packtroduced. At the end of March, 1952, the Govern- of prunes is forecast as smaller than last year's.ment had paid S5 million in subsidies on sales Early estimates of .Australian raisin and currantabroad. The largest single deal taking place production in 1952 place the pack at 70 to 7;5,000under the program was the sale in December of tons. This would leave a surplus for export ofthe whole surplus pool of seedless raisins 30,000 30 to 40,000 tons, which the British Ministrytons to the United Kingdom. It appears of Food has agreed to purchase except for somethat the American program had some depressive quantities to be sold to other Dominions and oneffect on raisin export prices of Greece and Tur- the international market. The prices to be paidkey. When the United Kingdom purchase in by the United Kingdom are t 98.10.0 per shortCalifornia was announced those prices fell consid- ton, f.o.b., for sultanas and raisins and £80erably, but they recovered toward the end of for currants, i.e. $286 and 8224 respectively.the season, as the Californian supply was near In Turkey, severe frosts are reported to haveexhaustion and the demand for the Mediterranean reduced the April estimate of the raisin crop toproduct became more active. The recovery: of 60,000 tons.Turkish prices, however, was also affected by a late While no great change is expected in the Cali-realization that the actual size of the stocks at fornian pack of figs, a larger Mediterranean crophand were far smaller than previously estimated. is likely, though no estimate of its size is avail-
able.
OutlookCOFFEE
Favorable weather conditions increased the1951/52 crop by about 5 percent above that of1950/51. Production was higher in Brazil, whichstill contributes about 50 percent of world supplies,in Africa and in most of the minor producing coun-tries in Latin America. However, total worldoutput is still below prewar, due to the decline inproduction in Brazil and Indonesia from the highlevel attained in the nineteen-thirties.
The rise in population, income and demand forcoffee in the chief importing countries, with pro-duction still below the prewar level, resulted in asubstantial rise in prices. Demand would havebeen even stronger but for the restraining influenceof financial restrictions imposed for balance-of-payments reasons as well as of high taxes andimport duties. Hence, European imports remainedin 1951 substantially below prewar and increasedonly 2 percent as compared with 1950. On theother hand, United States imports increased 10percent in 1951. The United States absorbedalmost 60 percent more coffee than in prewar years,and 1101V takes about 65 percent of total worldimports, as compared with 49 percent in 1934-38.
The strong demand sustained prices in 1951
and the first part of 1952 higher than at anylevel since coffee became an article of generalconsumption. The United States retail priceof about 87 cents a lb. was higher than at anytime since 1913. Consumer resistance to theprice rises which took place with the exhaus-tion of the Brazilian stock in 1949 and, sub-sequently, with the outbreak of hostilities inKorea, appears to have diminished in 1951/52.However, the 8 percent decline from the record'mports of 1949 and the marked increase inconsumption of soluble coffee products whichproduce more cups of coffee per lb. of beans,indicates continued consumer sensitivity to prices.Indicative of the strong demand for coffee isthe difference between the behavior of coffeeprices during 1951/52 and those of most otheragricultural products important in foreign trade.
Outlook
Production in 1952/53 is not likely to exceedthat reached in 1951/52. The Brazilian crop suf-fered from drought during the flowering seasonand the expansion of production in Colombia, theCentral American countries and in Africa is notyet sufficiently great to counte,rbalance an impor-tant decline in Brazil. No stocks of significancehave been accumulated in producing countries.
103
On the demand side, there is no reason for anti-cipating a substantial decline. United Statesimports may stabilize at the 1951/52 level, butimports to Europe are likely to show some im-provement. Latin American producing countriesare endeavoring to increase exports to the Europeanmarket, which absorbed only 28 percent of totalworld imports in 1950, as compared with 43 per-cent in prewar years. A large number of tradeagreements have been signed with European im-porting countries. Indications are that majorchanges in prices are not likely to take place.
In the long run, and taking into account theagricultural development and improvement pro-grams in Latin American and African producingregions, some expansion in coffee production maybe anticipated. In Brazil, the greatest increaseis likely to take place in Parana, whereas in theold regions of Sao Paulo the decline in the treepopulation over the last decade has not yet beencompensated by new plantings. Efforts made byColombia, Mexico and the Central American coun-tries to improve both volume and quality of theiroutput are likely to produce satisfactory resultsover the next few years. The outlook appearsfavorable for the African producing regionswhere labor costs are relatively low, and produc-tion in Indonesia can be expected to recover onceinternal conditions have become stabilized. Atthe same time, world demand seems likely tocontinue its upward trend with little indication ofproduction tending to overhaul the growing de-mand.
TEA
Current situation
For the first time since the end of the war,exportable tea supplies were in 1951/52 larger thanimports for current consumption. Production in-creased in all the main exporting countries withthe exception of Japan, where the crop was reducedby unfavorable weather conditions. The slightlylower harvest in Northern India was more thancounterbalanced by an exceptionally large cropin the southern part of the country. Ceylon, Whichin 1950/51 produced a crop 42 percent larger thanprewar, again increased production by 3 percent,and Pakistan harvested a record crop. Indonesia'sproduction rose to 62 percent of the prewar level,notwithstanding labor difficulties and the spreadof blister blight disease.
Although exports in 1951 from the main produc-ing countries were 13 percent above those of 1950,marketing encountered some difficulties, especiallyof lowe,r quality teas (Table 47).
TABLE 47. - TEA EXPORTS FROM MAIN PRODUCINGCOUNTRIES
(. thousand si etric tons.)
India li ,-, 9h177.31 196.6+ 11Pakistan -'-`h-"IÌ 7 31 '15. L 218Ceylon 99.6 1:.=A; 138.i 1.,
Indonesia i (17.6 m.c 29Japan. 1.6 8.6 + 19China,/ 40 14.51+ 7Other Far Eastern . J 12.72 10.51+ 15Brit, East Africa. . 3.11 5.94 5Nyasaland . 3.4 7.L+ 3Othersb 0.41 3.71 -
31.67.2
13.69.5.6!6.913.71
* Preliminary.e Estimates of the International Tea Committee.b Including 'Mozambique, Iran, Brazil, Turkey, Southern
Rhodesia, Union of S. Africa, Mauritius.
Imports and consumption were higher in 1950and 1951 than in prewar years in the United States,Canada, most South American and African coun-tries and in Oceania, but increases in consumptionhave been very small and no new markets haveemerged to absorb larger supplies. In the UnitedKingdom, which before the war absorbed abouthalf of the total supplies entering internationaltrade, rationing continued and total consumptionwas about 10,000 tons lower than prewar, despitethe increase in population. Imports rose in 1951to almost prewar levels, but most of the increasewent for rebuilding stocks and did not enter cur-rent consumption. Imports by othe,r Europeancountries averaged 17 percent below the prewarvolume. The Eastern European market has beenreduced to a fraction of prewar ; consumption hasnot yet returned to prewar levels either in Ger-many, or in the _Netherlands which were beforethe war the largest importers of tea on the Euro-pean mainland.
Following the rise after the outbreak of hostili-ties in Korea, prices declined in all the main auc-tions, especially of lower quality teas. The aver-age for all teas at the London auctions fell from43.68 pence a lb. during the 1951 season to 35.51pence in 1952, or 19 percent. The price of Ceylontea declined relatively less, but those of SouthIndia, Africa and Malaya relatively more, between32 and 42 percent. On the Calcutta auctions,
104
prices declined froin 38.7 pence on 28 May 1951to 23.3 pence on 24 March 1952. Even so, 1952season prices were still 150 to 200 percent higherthan prewar.
OutlookProduction in 1952/53 is promising. In North
India, weather conditions have been favorable andtotal Indian production is likely to exceed the1951./52 crop. In Ceylon, the campaign againstblister blight is proceeding with a high degree ofsuccess. In Japan, production is likely to rise.On the consumption sitie, the most importantdevelopment is the increase in the United Kingdomration which will raise import requirements byabout 30,000 tons a year. Indications are thatfurther relaxation of United Kingdom control ofconsumption and imports might be announced ifproduction expands and prices do not advanceunduly. The efforts of tea-producing countries toexpand consumption in the United States and inEuropean countries are likely to show slow butsteady results.
COCOA
Current situationCocoa production in 1951/52 at 679,000 metric
tons was lower than at any time since the aban-donment of international allocations in 1949. Thedecline was clue to lower crops in almost all themajor producing areas, the Gold Coast, Brazil.,Nigeria and French West Africa, which_ normallycontribute 75 to 80 percent of the total worldproduction. In the other 25 countries, total pro-duction remained practically unchanged (Table48).
TABLE 4,8. -- WoRLD PRODUCTION OF COCOA BEANSPREWAR AND 1941/42-1951/52
N-E.ARSGoldCoast
Nige-ria
CC
Bra-zil
TOT-ers I AL
thousand metric tons
1934/35-1938/39 . . 283 96 83 124 144 7301941/42 255 99 62 132 113 6611942/43. 211 113 55 109 112 6001943/44. 199 75 44 125 123 5661944/45. 232 88 74 109 116 6191945/46. 213 104 76 110 124 6271946/47. 195 113 78 148 128 6621947/48 211 77 78 97 139 6021945/49. 283 110 05 128 148 7671949/50. 250 103 02 161 157 7751950/51. 266 112 15 131 157 7551951/52 214 107 95 110 153 676
COUNTRIES ,1931-35 1959 1951 inenhseoverPia
TOTAL 397.11 398.5 450.71+ 13
The demand for cocoa products has increasedin Latin America, Africa., Asia and Oceania and al-though per caput consumption in underdevelopedcountries is still a small fraction of the averageconsumption in Western countries, consumptionhas been rising. Until World War I, 70 percentof world net imports went to Europe, and 26.6percent to the United States and Callada. Therest of the world absorbed only 3.4 percent. Thebig change between the two world wars was theincrease in United States and Canadian importsto about 39 percent while the share of Europedeclined to 57.7 percent. Since the end of WorldWar II, cocoa-producing countries of Central andSouth America have retained for domestic con-sumption a much larger proportion of their cropthan before, and imports into countries outsideEurope and North America have risen from 3.7to 5.2 percent.
The average price of "spot" cocoa on the NewYork Cocoa Exchange will probably be close to35 cents per lb. for 1951/52, as compared with32.1 cents in 1949/50, and with the average of 33U.S. cents per lb. during the 5 years 1947-51.Prices in non-dollar countries were from 2 to 4cents higher. These prices compare with theaverage of 6.1 cents during the last five prewaryears. The rise is impressive even after currentprices are deflated by the general United Stateswholesale price index (1926 100), the price be-ing about 20 U.S. cents per lb. for the postwaryears, as compared with the 1935-39 average of7.5 cents. Unlike most commodities, cocoa pricesshowed no decline after the collapse of the post-Korean boom.
Soine countries have established high exportduties on cocoa beans, and revenue from thissource has been used both for general administra-tive expenses and for special developm.ent projects.The British West African territories, where thecocoa crops are marketed by official bodies, havebuilt up large reserves to stabilize prices if theydecline.
Outlook
There is no reason for anticipating a recurrenceduring 1952/53 in all the major cocoa-producingareas of the unfavorable weather conditions whichwere largely responsible for the poor crops in1951/52. However, long-term prospects for a sub-stantial increase in production are not promising.New plantings in Brazil, the Gold Coast, andNigeria will be barely sufficient to compensate
105
for the decline in the yield of senile trees, theinroads of swollen shoot disease, and other factorswhich are tending to reduce yields. Productionwill expand in French and Belgian territories ofAfrica and in most of the 25 countries which 11011'contribute about a quarter of world production.Plantings are also taking place in countries whichhave not previously produced cocoa. Still, thetotal increased contribution from these sourcesduring the next 5 or 6 years is likely to be compar-atively small, and no major increase in worldsupplies of beans over the average for the 3 years1948-50 can be anticipated during this period. Theincreased world buying power and demand forcocoa products, with supplies no larger than pre-war, have resulted in the high postwar price rise.The upward trend in world demand seems likelyto continue over the years ahead, and all the cocoathat can be produced in the next few years islikely to be absorbed at relatively high prices.
TOBACCO
Current situationProduction of manufactured tobacco increased
in most countries during 1951/52 and the demandfor leaf tobacco was strong as the industry madeefforts to increase stocks which generally, sincethe war, have been below the normal relation toannual requirements (Table 49).
World leaf tobacco production in the 1951/52crop year was approximately 100,000 tons (3
percent) above the 1950;51 level. Productionin Asia and Latin America decreased but thiswas more than offset by increases in North Americaand Africa.
The tobacco area in the United States and Can-ada increased substantially as a result of largerarea quotas. There were some increases in areain Asia and Africa but yields were lower.
World production of flue-cured Virginia cigarettetobacco increased by 184,000 tons but the totalproduction of other tobacco types decreased. TheUnited States flue-cured crop increased by 15 per-cent and reached a record high level of 659,000tons, 43 percent higher than the average of thelast ten years. Canadian flue-cured productionwas the largest on record.
Amongst other major cigarette tobacco typesthe United States Burley crop reached a recordlevel of 24 percent above the 1950 figure. Produc-tion of oriental cigarette tobacco increased inGreece and Yugoslavia whereas Turkey had aslightly lower production.
TABLE 49. PRODTJCTION AND EXPORTS OP LEAS, TOBACCO, PREWAR AND 1949-51
Asia and Oceania a
North America b
Earopec
Latin America .
Africa
WORLD TOTAL d
* Unofficial estimate.a Excluding Turkey.1, United States and Canada.c Including Turkey.d Excluding U.S.S.R.
Tobacco exports in 1951 reached 580,000 tons,only 15,000 tons above those in 1950. The UnitedStates exports of 236,000 tons were the highestsince the record of 1946 and about 20,000 tonsabove the previous year. Most remarkable wasthe 101,000 tons export to the -United Kingdom,66 percent over 1950, although the value of ECApaid shipments to the United Kingdom was lessthan one-third of the previous year. United Statesexports to Western Germany were only 22,000tons, a decline of 40 percent from 1950 althoughECA paid shipments to that country were at leasttwo-thirds of the previous year.
Total ECA paid shipments from the UnitedStates in 1951 amounted to $72.6 million against8149.8 million in 1950 and 8153.4 million in 1949,so that the expanded exports in 1951 have beenmainly based on the regular dollar earnings ofthe importing countries.
Exports from Brazil, Cuba and India were atthe same level as the previous year. SouthernRhodesian exports in 1951 fell 25 percent belowthose of 1950 because of the smaller crop.
Exports of oriental tobacco from Turkey andGreece increased in 1951 but Greek exports werestill only two-thirds of prewar whereas Turkey'shave doubled.
Leaf tobacco imports into Europe (excluding East-ern Europe) in 1951 increased to 410,000 tons11 percent above 1950 but only 5 percent higherthan the prewar level. This region accounted forapproximately 70 percent of world imports. Total
1934-38/39average 1949/50 195 0/5 1
106
1951/52 1934-3Saverage
thousand metric tons
1949 1950 1951
imports to the United Kingdom increased only by22,000 tons, mainly a result of reduced shipmentsfrom India and Southern Rhodesia. Common-wealth countries supplied 37 percent of the totalas against 48 percent in 1950. United Kingdomimports in the first quarter of 1952 continuedvery high, with heavy imports of flue-curedtobacco from the United States and Callada.Imports of other leaf types were practically un-changed and Commonwealth supplies accountedfor only 50 percent as against 70 percent in thesame quarter of 1951. The announced cut in dol-lar spendings on tobacco imports in 1952 have notaffected imports in the first quarter of the year.
Western Germany's imports in 1951 were almostunchanged from 1950 in spite of the decrease insupplies from the United States, but France andBelgium had increases of about 50 percent over1950. The United States also increased her im-ports of oriental cigarette tobacco for blending.
Stocks of unmanufactured tobacco in the UnitedKingdom increased in the latter part of 1951 andreached the highest level since 1938.
In the United States as of April 1952 therewere substantial increases in the holdings of flue-cured, Burley and Maryland tobacco, slight in-creases in stocks of Turkish tobacco and slightlylower stocks of fire-cured and dark air-curedtobacco. Stocks of flue-cured and Burley tobaccowere substantially higher than prewar in absolutequantities but only slightly higher in relation tothe increased requirement.
1 485 1 213 1 229 1 172 116 55 79 804
618 958 976 1 129 203 233 228 249
335 441 455 462 129 150 Ill 104*
209 312 304 281 58 73 72 784
70 130 130 150 31 63 75 69
2 717 3 054 3 094 3 194 537 574 565 580*
PRODUCTION EXPORTS
REGION
By the end of April 1952, Greece still had a22,000 ton carry-over of tobacco from the 1950and earlier crops. This is the equivalent of morethan two-thirds of 1951 exports and 70 percentof the 1951 crop was still in the hands of produc-ers. The stocks held by the Turkish Monopolyare not known, but they are no longer assumedto exceed requirements for domestic use.
Tobacco prices in 1951 were slightly lower onan average than in 1950 but there was no uniformtrend. Prices paid to farmers in the UnitedStates for the 1951 flue-cured crop averaged about52.4 cents per pound against 54.7 for the 1950crop. This decline is partly explained by thelarger proportion of lower-priced grades in 1951.Burley prices increased from 48.9 cents to 51.0cents per pound. Average prices of dark air-curedand fire-cured tobacco increased substantially butmainly because of an improvement in qualitycompared with the previous year. Average pricesof flue-cured as well as of Burley tobacco exceed-ed the support prices.
The average price received for the Southern Rho-desian flue-cured crop sold during 1951 WaS 34.6d.per lb., 3.1d. per lb. less than for the 1950 crop.The 1951 crop, however, contained a higher pro-portion of low-grade leaf for which there wasonly a limited demand.
The average value per lb. of United Kingdomhnports of unstripped leaf consisting mainly ofbetter grades increased to 56.1d. in 1951 as compar-ed with 52.2d. and 41.6d. per lb. in 1950 and1949 respectively. The average value of importsto the United Kingdom of flue-cured tobaccosfrom all countries rose, but those of Nyasalanddark fire-cured and Greek Oriental leaf showeda further decline.
Outlook
Total supplies of leaf tobacco in 1952/53 arelikely to increase further and supplies in the hardcurrency countries may exceed demand.
The area allotments for flue-cured and Bur-ley in the United States are practically the sameas last season. If yields are approximately thesame as the average for recent years, UnitedStates production in 1952/53 will be close to lastyear's. Price supports for these types are beingcontinued in 1952/53 and the support level isonly slightly lower than last season.
Canadian producers have however undertakena drastic reduction in the area under flue-curedtobacco, anticipating reduced exports to the
107
United Kingdom and a lower consumption. TheMarketing Board of Ontario has set this year'sarea at two-thirds of the base area or 35,400 ha.against 43,000 ha. in 1951. Area allotments forBurley and cigar tobacco have been cut.
The 1952 plantings in most other countries arenot yet known but the strong demand for tobaccopayable in soft currency is likely to stimulatefurther expansion in area.
The United Kingdom has announced a £22 mil-lion cut in 1952 imports from the United Statesand Callada, a 30-40 percent reduction comparedwith 1951. However the United States hasgranted some credit facilities through the Com-modity Credit Corporation to finance a sizableamount of flue-cured tobacco held under optionfor United Kingdom manufacturers. It is notyet clear to what extent the financing of tobaccoexports will be included in the Mutual SecurityAdministration's activities, but it has been in-dicated that tobacco may be included becauseof its vital importance to the fiscal policy ofEuropean countries. It is probable, however,that any support given after June 1952 will bemore limited than under the ECA program.
COTTON
Current situation
Total cotton production for the season, esti-mated at 34.5 million bales, is the largest inpostwar years and the second largest on record.The very high prices prevailing at planting timewere a great incentive to acreage expansion.Although a ceiling was provided by the officialmaximum price in the United States, prices receiv-ed by farmers in April 1951 at time of plantingaveraged 50 percent higher than in April 1950and were 28 percent above the parit3r price.Acreage restrictions being lifted, area planted in-creased by 50 percent to 28 million acres. Theyield improved slightly and production increasedby rather more than half to over 15 million bales.
In other countries, the area planted to cottonhas generally increased gradually during the post-war period ; the need to maintain and increasefood crops has limited the expansion in manycountries. Nevertheless, with uncontrolled pricesfor non-United States cottons relatively high, theincentive to plant tended to be even greateroutside the United States. It is not surprising,therefore, that the scale of expansion last season
in many countries was greater than in any preced-ing postwar season. Increases in the cotton areawere specially marked in the Near East coun-tries, e.g. Syria (130 percent), Turkey (43 per-cent). Mexico increased its cotton area by 28percent and Argentina by 20 percent. Food_ pro-duction policies prevented any expansion in Egypt,but were less restrictive in India, where the cottonarea increased 10 percent.
Despite efforts to expand production, farmers inmany countries were not fully rewarded. Yieldsgenerally were affected by the extension of produc-tion into marginal lands and by the employmentof unskilled labor. In the Year East, there wasvery heavy insect damage. Drought adverselyaffected yields in Mexico, and weather was unfa-vorable in Egypt, the Sudan and Pakistan. Onlyin India was there an increase in production nearlycommensurate with the expansion in acreage.As a result, production increased only 2 percentoutside the United States apart from the SovietUnion and China, where strenuous efforts arereported to have resulted in an increase of 20percent in cotton production.
The contraction in 1951/52 in textile opera-tions and in cotton consumption folloivs a periodof unprecedented activity caused by the Koreanconflict and by fears of scarcity. Cotton andcotton textile prices liad been carried to extra-ordinary heights and there was an accumulation oftextile and apparel stocks at all levels from man-ufacturer to consumer. With the trend towardsmore stringent monetary conditions and the pros-pect of increasing fiber supplies, trailers duringthe past year have tried to niove excessive textilestocks. Moreover; since the denfand on militaryaccount has proved to be smaller than expected,acute competition has developed and textile priceshave been falling steadily in the face of a patternof civilian consumer expenditure which has be-come unfavorable to apparel and textiles. Tradersreduced their orders on textile manufacturingindustries and the latter reduced their commit-ments for cotton, the decline in cotton pricesinducing caution.
A feature of the recession has been that cottontextile industries operating under quite differentconditions have been affected. In the UnitedStates, although cotton prices were still rising,mill margins for cotton textiles began falling asearly as the beginning of last year. By April1951, cloth prices were under pressure. The re-cession was continuous throughout the follow-ing twelve months, textile prices falling by 30
108
percent and mill margins by a half. Meantime,mill activity continued to contract, the rate ofcotton consumption in March 1952 being about20 percent lower than a year earlier. Over thewhole season, consumption may be 12 to 15 per-cent lower, which represents a significant dropsince the United States accounts for about one-third of the global consumption.
Other major cotton manufacturing industries,(excluding U.S.S.R. and China) have also sufferedthe recession. It is not clear whether the reces-sion will have any great effect in India where theindustry operates under relatively low controlleddomestic cotton and cotton textile prices andenjoys an advantageous competitive position inexport markets. In Japan, as in India, recessioncame rather late in the season. A large unsatis-fied domestic market for textiles (rationing wasonly abolished in Japan in 1951) and, in Japan,substantial military orders, offset the fall inexports. From March, Japanese output of cottontextiles became subject to an officially enforcedreduction to 40 percent below capacity level. Inview of substantial earlier expansion, however, thevolume for the entire season may not show anyreduction.
European textile industries were affected bythe recession later than the United States, butbefore the industries of the Far East. The im-pact ivas particularly severe in those dependentupon textile export markets. Curtailment com-menced at the turn of the year in the UnitedKingdom and the Low Countries. By mid-1952, it had spread to practically all WesternEurope. In the United Kingdom, the decline inoutput was as steep as 40 percent, and elsewhereproduction fell in varying proportions up to 20percent, as compared with a year earlier. Euro-pean consumption of cotton in 1951/52 will there-fore be considerably less than in the precedingseason.
The decline in cotton prices from the highlevel reached during 1950/51 began in April 1951ivith better supply prospects. Since prices andexports of American cotton had been subjectto a maximum, the shortage had much moreeffect on the prices of other growths. .Neverthe-less, with the prospect of a very large crop in theUnited States, prices there fell sharply to only afew cents above the support level. Following atemporary recovery, the trend has been generallydownward. The decline of prices of non-UnitedStates cottons was much more marked. Short-age and United States export restrictions had
CHART XXI - COTTON PRICES AT VARIOUS MARKETS POSTWAR
forced them to extraordinary- heights, and heavyexport taxes had been in force. With an ampleUnited States supply, at relatively, low prices, thedemand for non-United States growths subsidedand prices were reduced. As a result, Brazil,Egypt, Pakistan and some other countries havebeen undertaking price support operations. Asthe season progressed, however, there was a moveto sell cotton below earlier support levels and toreduce export taxes, in order to stem the accumu-lation of cotton stocks (Chart XXI).
109
OutlookEven assuming that the textile recession has no
deep-seated economic cause, there is little to indi-cate what the timing and scope of recovery, willbe. Available information suggests a further eas-ing of the overall cotton supply situation, produc-tion continuing in excess of consumption and bothpossibly subsiding somewhat.
Supply and consumption in the last threeseasons, as recorded by the International CottonAdvisory Committee, are as shown in Table 50.
U. S. CENTS
1i0
100
90
BO
70
60
50
40
30
20
10
0
FEB. LB. SEASONAL AVERAGES MONTHLY AVERAGES
1
ALEXANDRIA
1 1 1 1
KARNAK
1 1
GOOD
1 1
1
ASHMOUNIALEXANDRIA
GOOD
A
..._\...
\
Fi,;
//
i\1 \
s.
k\\
\ --\;\
t.--4.N.
..---1t
1
."S'AO PAULO TYPES
/i
/L.
P.,../-
..
I1
ii \
:.
1
1 */
'
/ --\.N.\\\_,__
..1
\- -..\-/i
\\
------'-itr-C7:4
',..---,e.
\
e
.
\,../
..
/
U.
A,
';':::..-.\ I
/
i
289
SPOT
MIDDLING
1------1
\ v.
\s
1 //
/1i.,, ---
1
7 ---
\1 ''s,:
--...,--
TORREON
KARACHI
S. A.10
- PUNJAB
MAI
15/16
R
I
.:.5--f
KE1
% ...,/se."-I
\N..
1
-......
- ..... - TS M
%. ............
DDLING1 I
15/16
...... .... ; .......
BOMBAY JARILLA FINE
Ill1946 1947 1948 1949-47 -48 -49 -50
ASONDJ FMAMJ JASONDJFMAM1950-51 1951-52
TABLE 50. COTTON : SUPPLY AND CONSUMPTION
Thus, the 1952/53 season may open with a carry-over of 13.2 million bales. Given a repetition ofthe 1951/52 volume of production, total supplyin 1952/53 would be about 48 million balesa record postwar supply. It appears however thatproduction is unlikely to be as large as in 1951/52.Price is less favorable to cotton planting. Insome countries crops less susceptible to the pestsaffecting cotton may be grown. With govern-ments committed to supporting prices at near cur-rent levels, plantings may be restricted to smallerareas.
Much depends on the United States crop whichaccounts for from 40 to 50 percent of the worldtotal. Acreage controls are not in force and theofficial view is that a crop of up to 16 million balesis possible. However, the first official reportindicates that the area planted is 7 percent smal-ler than last season. On the other hand, acreageabandonment was unusually heavy last seasonand yields were no higher than the postwar aver-age. Given normal weather conditions the 1952153 crop may be 15 million bales.
Elsewhere, reduced cotton areas have beenreported from the Middle East and Mexico. Al-though the area in Egypt may show little change,yields llave been falling steadily for the last fewyears. In India and Pakistan little expansion isto be expected because of food production priorityand technical reasons, but yields may improve.In Africa, immediate prospects for expansion arelimited. On the whole, last year's production out-side the United States may well be taken as amaximum for the 1952/53 season, especially be-cause of the recent exceptional harvests in theSoviet Union and China.
Consumption recovery awaits a trade revivalin textile industries. Greater scope for a fall intextile prices is provided as the replacement valueof raw materials declines. As tisis takes place,it should quicken the disposal of excessive tex-tile stocks in the earlier stages of the produc-
110
tion chain. A larger movement of textiles intoconsumers' hands is, of course, also dependenton increased real incomes, particularly in areaswhere clothing standards are relatively low.
As far as the textile industry is concerned, manu-facturers will feel more inclined to accelerate theiroperations when cotton prices show more signsof stability. The level at which this is achievedwill, of course, also effect to some extent manufac-turers' choice between cotton and rayon. Inmajor textile manufacturing countries, rayoncontinues to be the cheaper, and displacementoil a greater scale than in the earlier postwar yearsis now possible as a result of the great expansionin rayon production capacity. Consequently, un-less the price relationship changes, cotton is notlikely to enjoy the full fruits of recovery in textileindustries.
Rayon is now the second most important appar-el fiber, accounting for 17 percent of total con-sumption in 1951 as compared with 11 percent in1939. Until the Korean outbreak, which injectedlarge-scale military requirements, much more im-portant in cotton than in rayon, into the demandsituation, cotton consumption was still 4 percentbelow the prewar volume whereas that of rayonwas 20 percent above it. The recession in demand,being largely civilian, will tend to have a greaterimpact on rayon (Table 51).
TABLE 51. INDICES OF COTTON CONSUMPTIONA.ND RAYON PRODUCTION
a Calendar year.
WOOL
Current situationThe gradual increase in world wool production
over the last few seasons virtually came to a haltin 1951/52. Drought caused some decline in theAustralian clip, and adverse pastoral conditionsprevented any further significant recovery in theCape clip. Argentine production declined slightly.
Rayon
100
120
150
177
( boles of 478 lb. set. .)
Opening stocks . 15.1 16.7 11.2
Production 31.2 27.8 34.5
TOTAL SUPPLY 46.3 44.5 45.700/1Sumption 29.6 33.3 32.5
CLOSING STOCKS. 16.7 11.2 13.2
ITEMS 1949/50 1950/51 1951/52
1938/39 100
1948/49 92
1949/50 96
1950/51 108
1951/52 105
YE AR Cotton
There has been some increase in sheep num-bers in the socialized sector of the economy in theSoviet -Union, but it is not known to what extentthis has been at the expense of the private sec-tor. In the other main wool-producing countries
New Zealand, the -United States, Uruguayproduction remained virtually unchanged.
On a clean basis, the 1951/52 clip is estimatedat 1,040,000 metric tons. Joint Organizationstock wool was not a factor in the supply situa-tion as it had been in earlier postwar seasons,the United Kingdom-Dominion wartime accumu-lation having been practically all disposed of bymid-1951. There were, however, considerablecommercial stocks in producing countries ; in par-ticular, about one-third of the previous season'sNOW Zealand clip, which had remained unsoldon account of the waterfront strike in the autumnof 1951. There was also a substantial accumula-tion of wool in Argentina which has not yetcome on to the market.
Both the woollen and worsted branches sharedfully in the recession which overtook the entiretextile industry in the 1951/52 season. Althoughthe relatively high demand for wool textiles sincethe war wa's unlikely to continue, the downwardadjustment was accentuated by the results ofthe Korean conflict. When the immediate buy-ing movement which followed the outbreak of theKorean war ended, consumers and distributionchannels were exceptionally well stocked frompurchases on a rising market. The effects of thisworked their way back to the mills, leading to aprecipitous decline in both home and export de-mand for mill products. The situation wasfurther aggravated by the decline in raw mater-ial values which occurred in the spring of 1951and which made consumers and traders even morehesitant to buy.
The decline in mill operations was accompaniedby a proportionately greater reduction in woolconsumption in 1951. The exceptionally highprice of wool in the 1950/51 season had caused asignificant increase in the use of materials otherthan virgin wool in the manufacture of wooltextiles. It was not until the second half of 1951,when wool had become much cheaper, that thetrend towards a greater use of other materials washalted.
Wool consumption fell by 16 percent in 1951 to1,020,000 metric tons, clean basis the lowestlevel since the war. The decline would have beeneven more severe but for the large volume oforders for military requirements (both for cur-
rent needs and reserves), particularly in the Unit-ed States where apparel wool consumption wasreduced much less than in Western Europe. Itis estimated that military orders accounted foras much as 45 percent of -United States apparelwool consumption in 1951. Among the majorwool-consuming countries, the only one remainingunaffected by the general downward trend wasJapan. Japanese consumption not only contin-ued to increase, but was as much as 60 percentgreater in 1951 than in the previous year(Table 52).
TABLE 52. WoRLD CoNsuMpTioN OF WOOL
After the third quarter of 1951, the decline inwool consumption was at least halted, but thereis as yet no real evidence of general recovery.Over the 1951/52 season, consumption has beenabout 25 percent below the level of the previousseason, and for the first time since the war, lessthan current production.
Trade in wool also diminished by about 25 per-cent in the 1951/52 season. Exports from Aus-tralia have been running at a lower rate than inthe previous season. On the other hand, NewZealand exports have been substantially highersince they included shipments from a carry-overenlarged by last season's waterfront strike. Butthe most striking development has been the dras-tic decline in South American exports which,in the first half of the season, were only one tenthof the volume usually exported. Prices of SouthAmerican wool have been high in relation to thoseprevailing in the world market. Governmentlicensing policy and fears of devaluation have in-terfered with shipment. It was not until Maythat the South American markets began to showsome signs of animation (Table 53).
COUNTRY 1943 1949 1950 1051
( .thou and m. t., clean basis . .)
United States 320 232 289 222United Kingdom. . 219 223 235 180U.SS . R 75 90 90 100France 116 119 115 90Germany(FederalRepub-
lic) 21 41 58 53Italy 62 54 57 44Japan 5 7 23 36Belgium 28 27 33 25Other countries . . 304 307 304 276
TOTAL 1 150 1 100 1 210 1 020
TABLE 53. EXPORTS OF WOOL FROM CHIEF EXPORT-II,TG COUNTRIES
July - December
Imports into all major importing countries,with the exception of Japan, have been reducedboth in accordance with the lower requirements
of the industry and in view of the lack of confi-dence in values. Trade stocks in consuming coun-tries had generally been run rather low towardsthe end of the season.
After a very irregular market early in the sea-son, prices again moved downwards at the be-ginning of 1952. The need to cover requirementsled to some price recovery as the season was draw-ing to its close. Average prices appear to havebeen not much more than half the exceptionallyhigh values of the 1950/51 season. At the endof the season they were below the level existingbefore the Korean conflict. The differential be-tween qualities widened as prices declined, buttowards the end of the season the pie-Koreanrelationship between Dominion wool qualitiesvas re-established (Chart XXII).
CHART XXII - WOOL PRICES AT DOMINION AND UNITED KINGDOM AUCTIONSPOSTWAR
PENCE PER POUND OF CLEAN WOOL
SONDJFMAMJJASONDJFMAM464 47/48 48/49 49/50 1950/51 1951/52
112
COUNTRY1950 1951
(thousand in t. actual weight)
Australia 216 167New Zea land 42 83South Afr lea 48 41Argentina 46 4Uruguay 50
TOTAL 402 301
320
300
280
260
240
220
200
180
160
140
120
100
80
6040
20
o
The 1951/52 season saw the final liquidation ofthe Joint Organization stockpile. Intergovern-mental negotiations for an Inter-CommonwealthOrganization to continue operating the reserveprice scheme, which had been a feature of theJ.O. disposals plan, had been proceeding forsome time, but the joint plan was abandoned,after having been rejected by the Australianwool growers in a referenchun in August 1951.South Africa decided that it would not be prac-tical to operate a reserve price scheme withoutthe participation of Australia ; but New Zealandintroduced a scheme of its own covering New Zea-land wool (except slipes) sold at auction in theDorninion or the United Kingdom. The schemecame into effect in January 1952 at an averagereserve price of 24d per lb., greasy, ex-store NewZealand. The New Zealand Wool Commissionsupported the market during the second half ofthe season by buying small quantities of wool inNew Zealand and London, which failed to reachthe Commission's reserve price.
Meantime the United States 1952/53 price sup-port program on the basis of an average p1-iceof 54.2 cents per lb. greasy basis became operativein February 1952. Support prices especially forfiner wools proved to be high in relation to p1-icesprevailing in world markets in subsequent months.Consequently United States demand was attract-ed to overseas sources while United States supplywas entered to some extent in the Governmentloan.
Government programs, therefore, in the UnitedStates and New Zealand and in the United King-dom, where the acquisition of a stockpile of 22,000tons was in progress, strengthened the wool mar-ket, especially in the later part of the 1951/52season.
Outlook
Estimates of the coming clip are not yet avail-able, but after the unfavorable weather conditionsof 1951/52 in Australia and South Africa, thereseems little prospect of an3r significant increase inproduction. It generally takes a season or twoafter a drought before wool production begins torecover. Efforts to increase production may verywell continue, however, in view of the lesser in-centives provided by alternative products. Thelevel of production is still somewhat above theprevailing rate of consumption.
With real incomes in the main wool-consumingcountries and in wool textile export markets re-maining high, there is reason to believe that the
113
present recession in wool-manufacturing indus-tries will be short-lived. The public has generallyheld off buying for about a year and traders hold-ing high-priced textile stocks have been reluc-tant to order ahead. With the current lower woolvalues and textile prices the prospects of a re-vival of buying by consumers and traders are nowdecidedly more favorable. The prospects for theindustry and the wool market depend basicallyon how soon this will be realized and in whatmeasure particularly as the government sec-tor of the market promises to be less importantthan in the last twelve months.
While stocks both of textiles and raw wool inconsuming countries are being progressively re-duced, any substantial resumption in buying maywell cause a temporary pressure in some sectorsof the market. Though raw wool stocks aregenerally low in consuming countries, there aresubstantial stocks of crossbreds in South Amer-ica, notably Argentina, which a rise in worldprices would be likely to bring on to the market.
JUTE
Current situationA sudden transition from severe shortage of
jute to relative plenty- occurred in the 1951/52season. Throughout the postwar era, jute and juteproducts have been in short supply, particularlyin the first half of 1951 when prices were 12 or15 times above prewar level. With the advent ofmuch larger crops in 1951/52, prices fell and exceptfor the best qualities of white jute and good tossasupplies became plentiful. Demand for jute goods,however, fell towards the middle of the season,and imports of raw jute were reduced. On thebasis of Indian consumption and overseas exportsfrom Pakistan, total absorption of raw jute willexceed production in 1951/52 by 15 percent. Thiswill be the first increase since the end of the war.Moreover, stocks of jute goods have accumulatedin the Calcutta mills (Table 54).
Both Pakistan and India expanded their juteacreage by 35-40 percent in 1951/52, resultingin a crop of over 10 million bales. This was thefirst time since 1940 that production exceededthe prewar level. Yields in Pakistan were aboutaverage. In India yields, although slightly higherthan last year, are still markedly lower than inearlier postwar years. This is probably largely dueto the extension of acreage outside West Bengalinto areas less suited to, or less experienced in,jute cultivation.
TABLE 54. RAW JUTE : PRODUCTION AND DISTRI-BUTION
Estimated.
With more raw jute, mills in Calcutta extendedtheir operations in December 1951. Hessian wasthen relatively unprofitable and 121/2 percent ofthe Hessian looms remained sealed. This wasattributable mainly to a continued fall in the Unit-ed States demand, by far the largest market. Thefall was particularly marked in 1951 when a highrate of export duty was in force. The extensionof operations by the Calcutta mills was short-lived,as larger output of sacking was not absorbed, andat the end of March they reverted to the 421/2hour week.
To encourage exports, the Indian Governmenthalved the export duty on Hessian in Februaryand subsequently abolished quotas on exports ofgunnies to soft currency markets. Even after thecut in the export duty, the Calcutta industry wasbeing undersold by European mills which increas-ed their exports significantly to the United King-dom, the United States, and other markets. Inthe United Kingdom, where notable improve-ments have taken place in the productivity ofthe Dundee industry and where the more amplesupply of raw jute has made possible the abandon-ment of rationing, domestically produced goodsllave made headway against Indian. Consequently,there was a further reduction in Indian exportduty on both Hessian and sacking in May 1952.
The general recession in demand also affectedthe jute industry in other centers, notably Dundee.In the weaving section, the decline in activity
114
appears to have been comparatively short-lived, buta lower level of demand persisted for non-weavingyarns, largely due to the reduced operations ofcarpet weavers. Similar conditions prevailed inthe United States where yarn production is almostentirely for purposes other than weaving.
Because of the large domestic crop and thestate of demand for their finished products, theCalcutta mills have not been taking up their fullquota (2 5 million bales for the season) of Pakistanjute. Shipments from Pakistan overseas, whichin 1950/51 regained the prewar level of exportsfrom undivided India, have also been smaller in1951/52.
With falling exports, prices in Pakistan recededsharply in the early months of 1952. In March, thePakistan Government announced for the interiora new schedule of minimum prices for loose jute,while the Jute Board expressed its willingness tobuy jute at the minimum prices. In the Calcuttamarket, prices showed signs of falling further. Atthe end of June 1952, the Pakistan minimum pricewas reduced by about 26 percent.
Outlook
The Pakistan Government has increased thelicensed area by 10 percent. Last season, 97 per-cent of the licensed area was planted, but thisseason's jute prices at planting time were far lessfavorable as compared with rice prices and plant-ings are reported to have been no higher thanin the previous season. In India, the area plan-ted is expected to be rather less than in 1951/52.There is a feeling in Indian Government circlesthat jute cultivation should encroach no further onfood production, and increased output shouldcome through higher yields.
Given favorable weather, production shouldagain be adequate to naeet the requirements of juteindustries, and a recurrence of the very highprices of previous years seems unlikely. Suchprices had greatly encouraged the displacementof jute, at both the raw material and manufac-tured goods stages. Illustrative of this is the in-creasing use of paper as a packing material inthe United States.
The quantity of material used in the manufactureof bags increased 62 percent between 1939 and1950, but whereas paper expanded fourfold theusage of jute burlap declined 17 percent. A similardevelopment, if to a less marked degree, has beentaking place in other countries. Meanwhile, theproduction of substitute fibers, although still quite
Production
PakistanIndia
TOTAL
Exports
From Pakistanto IndiaOverseas
From India
TOTAL OVERSEAS .
Consumption
India
( thousand
860 605560
metric tons
808597
. .)
I 148819
1 860 1 165 1 405 1 997
760305317109
460773
400*650*
760 426 773 650*
178 905 966 950
1934/35-
PrEms 1938/39
1919/50
1950/51
1951/52
aver-age
limited, is being expanded in the Belgian Congo,French Equatorial Africa and elsewhere.
As regards jute manufactures, the market forthese is becoming more competitive. The Calcuttaindustry is still predominant, but a good deal ofre-equipment has taken place in European mills.Ten jute mills are being set up in Pakistan withan aggregate of 6,000 to 7,000 looms. These areto have a capacity for processing about one millionbales of jute a year. In the 1951/52 season thefirst Pakistan jute mill came into operation andthe first exports of hessian were made to theUnited States. The effect of the Pakistan indus-trialization program will not be seriously felt foranother three years, but since manufacturing ca-pacity is already much in excess of the highestlevels of output that have ever been reached, itwill ultimately have a considerable effect upon thejute industry in other countries.
Since raw jute is a large element in the cost ofthe goods produced, Pakistan and India with theirample supply of domestic raw material are in anadvantageous position. Moreover, the export taxin Pakistan in effect provides a subsidy to the localindustry. If carried too far, it will serve tointensify the search for substitute fibers andalternative packing materials.
RUBBER
Current situation
Production of natural rubber in 1951 showeda trend similar to that of prices. During the firstfour months output exceeded the volume producedin the corresponding period of 1950. After Apriloutput declined until the end of the year. Thus,whereas world output in the year ending April 1951was about one-third larger than in the precedingtwelve months, that for the year 1951 showed noadvance on 1950. While insurrection interfered with
1951 United States
World
1952 United State
World
thousand 'metric tons
115
production in Malaya, the fall in rubber prices,coinciding with advancing costs of production andof living, was unfavorable to production. Theonly significant advance in output was in Indonesia,chiefly in smallholdings and in the earlier partof the year when prices were relatively favorable.Indonesian output was 16 percent larger than in1950, offsetting the decline in Malaya and elsewhere.
World consumption of natural rubber declinedby 12 percent in 1951, the drop being accountedfor by the United States where restrictions werein force with a view to accu/nulating strategicstocks. Consumption elsewhere increased by about5 percent and there was strategic stockpiling incountries other than the United States.
Production of synthetic rubber increased con-tinuously throughout the year in the UnitedStates, as did consumption, while consumption ofnatural rubber fell. Despite restriction, consump-tion of both kinds of rubber in the United Statesdeclined only slightly in 1951, but the natural rub-ber proportion dropped from 57 to 37 percent.
Natural rubber prices, which had receded almostcontinuously in 1951, declined more steeply in theearly months of 1952 with_ the fall in the UnitedStates stockpile purchases and the continued re-strictions on imports and consumption. By themiddle of the year, however, private importationwas fully restored, the New York market wasabout to re-open and the ceiling on United Statesrubber consumption had been removed. Naturalrubber prices were then more stable at the pre-Korean war level of about 28 U.S. cents per lb.which is 5 cents above the United States Govern-ment fixed price for GR-S synthetic rubber.
Outlook
The world and United States supply/demandsituation in 1952, as forecast by the InternationalRubber Study Group, is shown in Table 55.
1 910
859
923
859
2 833
462
1 524
771
828
1 233
2 352
1 717
838
925
838
2 642
472
1 473
803
889
1 275
2 362
TABLE 55. RUBBER : PRODUCTION AND CONSUMPTION UNITED STATES AND WORLD TOTAL
PRODUCTION CONSUMPTION
YEAR AND ARENatural Synthetic Total Natural Synthetic Total
A drop of some 200,000 tons (11 percent) isexpected in natural rubber production, chiefly onsmallholdings in Malaya, Indonesia and Thailand,as a result of the discouraging price trend andconditions affecting yields. As regards syntheticrubber, little change in the volume of outputis foreseen. In this connection it may be notedthat the United States Reconstruction FinanceCorporation has been directed to produce GR-Srubber at an annual rate of no less than 600,000tons until, in addition to satisfying all other re-quirements, a Government stock of at least 75,000tons has been accumulated. When this point isreached, production of GR-S may be allowed tofall, but to no less than 450,000 tons annually,and only with a corresponding increase of GR-Sstocks up to at least 122,000 tons. Limited ex-ports of synthetic rubber from the -United Statesare now taking place.
World consumption is expected to be about thesame in total in 1952, although smaller shipmentsto China will reduce consumption of natural rubber.The removal of restrictions on the use of rubberin the United States was not expected to haveany appreciable effect on the relatively low levelof natural rubber consumption there, in view ofthe price advantage which synthetic rubber en-joyed early in 1952 and which had been increasedwith the advent of oil-extended rubber. However,the sharp fall in natural rubber prices has nar-rowed the margin, while the extent to which com-petition between the two products can take placeis limited by a requirement which supports theabove-mentioned production directive, that at least510,000 tons of synthetic rubber (450,000 GR-Sand 60,000 butyl) must be consumed.
The estimated excess of production over Con-sumption in 1952 at 275,000 tons is considerablysmaller than in the previous year. For naturalrubber, it is 240,000 tons as against 380,000 tons.On the other hand, the United States stockpiilngprogram is nearing completion and purchasinigis on a decreasing scale. (Lower grade rubber isgradually being rotated out of the stockpile). More-over, the prevailing price trend is unfavorableto commercial imports and the holding of stocksin importing countries.
In view of the uncertainties in the rubber situation, the International Rubber Study Groupresolved to establish a Working Party to con-sider whether measures designed to prevent bur-densome surpluses or serious shortages of rubberare necessary and practicable ; to prepare draftsof any agreements required to implement suchmeasures ; and to report back to the Study Groupas soon as possible.
116
FOREST PRODUCTS: (a) ROUND WOOD
Current situationThe 1951 world production (excluding U.S.S.R.)
of all categories of roundwood, both coniferousand -broadleaved, is tentatively estimated atslightly over 1,080 million m3, as against some1,020 million in 1950. While production of saw-logs declined from about 365 million m3 in 1950to some 360 million, the decrease in the UnitedStates not being offset by increases in other re-gions, the expansion in the production of pulp-wood was particularly pronounced in all regions.
The heavy demand for pulpwood and otherroundwood in 1951 resulted, notably in Europe,in an unprecedented rise in price of 100 percentor more. This was mainly due to the conditionsprevailing in Europe, where the locations of pulpmills and other consumers of roundwoocl, such ascoal mines, are not always the same as those ofroundwood supplies, and industries therefore inmany countries have to rely permanently on im-ported raw materials. Consequently, the com-petition between the users of different categoriesof rounclwood, such as pulpwood, pitprops, andsawlogs, has a much greater importance in Europethan in most other regions, where the suppliesare more evenly distributed, or not even utilizedto their full extent (Table 56).
TABLE 56. IMPORTS OP FOREST PRODUCTS1950 AND 1951
}legionSawn softwood
1950
in 1,000 stds
By
Europe . . 2 300 3 000
o f which
U K 800 1 640
U.S.A. . . . 1 597 1 142Australia. . 134 208
1951 1950
Prices in Canada and the United States through-out 1951 showed only minor fluctuations. InNorth America the decline in the consumption ofsawn softwood arising from the reduction inbuilding activity also reduced the demand forsoftwood sawlogs and made it easier to meet in-creased requirements of pulpwood. This absenceof competition between different categories ofsoftwood in North America, together with the
1951 1950 1951
in thousand m3 r
5 4771 2 4342 926 2 623
3 614 6 401
Pulpwood Pi tprops
establishing of price ceilings for sawn wood inthe United States, were the main factors contrib-uting to stable prices.
Towards the end of 1951 a pronounced fall indemand occurred. This was partly the result ofaccumulated stocks and reduced consumption ofsome forest products and, in Europe, partly theresult of the buyers' increased resistance to highforest products' prices. The falling demand forfinished products had also an immediate down-ward bearing on the output of roundwood, par-ticularly of sa.wlogs, in the main exporting coun-tries (Chart XXIII).
Output of broadleaved roundwood in 1951 was4 per cent higher than the previous year, due tosome substitution of broadleaved sawn wood forsaNvn softwood because of excessive prices forthe latter, and to increased purchases of tropicalbroad leaved woods by the British Commonwealthsterling countries at the beginning of 1951. Theefforts to promote the utilization of forest resour-ces in the underdeveloped areas for both saw-mills and pulping also contributed to this increase.Towards the end of 1951, with the balance ofpayments position of the Commonwealth countriesdeteriorating, substantial cuts were planned for1952 imports. This consequently led to a declinein the output of broadleaved roundwood duringthe first half of 1952.
While output in 1951 showecl record figuresin most regions for many categories of roundwood,the outlook for 1952/53 is less promising. Theweakening of the market for wood pulp and pulpproducts which was already strongly felt towardsthe end of the first half of 1952, is likely to reducetemporarily the volume of new pulpwood sup-plies, particularly as industries prefer in a fallingmarket to dispose of their existing stocks beforereplenishing them. The high level of sawn woodstocks in most countries at the beginning of 1952and a somewhat reduced consumption consider-ably decreased the requirements for 1952. Pro-duction of sawlogs in the main exporting coun-tries has already declined and sawn wood availa-bilities for 1953 will decline correspondingly.If the present reduced demand for finished prod-ucts continues towards the end of 1952 and pro-duction is adjusted to the existing requirements,there is a likelihood of a price rise in 1953. Mostof the consuming countries will by that time havemet their requirements by having drawn largelyupon their stocks which consequently will need
117
replenishing. In the United States where restric-tions on financing housing have been greatlyeased, construction expanded in the second quar-ter to above the level of a year earlier and recent-ly starts of new houses have increased. Simi-larly in Europe (excluding Eastern Europe) it isanticipated that the demand will strengthenwith the increase in building activity and mili-tary construction. As the production of forestproducts, however, lags behind changes in demand,the possibility of a new rush for existing suppliesis not to be excluded.
(b) SAWN WOOD
Current situationThe world production of sawn wood (excluding
the U.S.S.R.) was estimated at some 175 millioncubic metres, about the same as in 1950. Pro-duction of sawn hardwood rose by 4 percent to39.1 million m3 (s) while softwood production fellabout one percent to 139 million m3 (s) (29.7million standards). The decline in sawn softwoodproduction was due to marked reduction in theUnited States output, which was not fully offsetby increases in other regions (Table 57).
TABLE 57. PRODITCTION OF SA)ArN WOOD1950 AND 1951
REciox1950 1951b 1950 1951b
a Excluding U.S.S.R.Estimates.
There was a pronounced upward trend in tradeof sawn woods all over the world. The mainfactor in this development was the great increaseof sawn wood purchased by the United Kingdomand other Commonwealth countries, notably Aus-tralia, which practically doublei the imports ofsawn wood from all sources of supply (Table56). In the United Kingdom, imports rose to800,000 standards (3.7 million m3) in 1950, andto 1.640,000 standards (7.7 million m3) in 1951.These increased purchases by the United King-
in thousand stds in thousand
.North America 18 945 18 279 18 833 19 583Europe a 8 388 8 611 8 299 8 678South America. 520 550 1 200 1 300Africa . 20 20 650 700Asia 820 1 900 3 800 3 900Oceania 290 300 1 900 1 900
TOTAL 29 983 29 660 34 682 36 061
Outlook Sawn softwood Sawn hardwood
dom contributed to an extraordinary increasein the export prices of sawn softwood in all mar-kets. This rise in prices, particularly for NorthernEuropean softwood, which during 1951 amountedto 50 percent, was however met by a growingbuyers' resistance and led towards the endof 1951 to a slackening of demand in most con-suming countries. In the United States and Can-ada, however, prices remained stable throughout1951, as ceiling prices were fixed for sawnwood inthe United States and Canadian prices are moreinfluenced by price conditions in the United Statesthan elsewhere. In addition to this general re-sistance to high prices, the United Kingdombecause of its balance-of-payments difficulties an-nounced cuts in its 1952 imports. As a result,the main exporting countries, particularly thosein Northern Europe, reduced their productionschedules for 1952. During the first two quar-ters of 1952, the sawn wood market was unusallyquiet and was characterized by the buyers' con-tinued resistance to high prices and by sellers'efforts to maintain the prevailing price level.However, at the beginning of June, 1952 pricesdeclined and a new price level for internationalsawn wood trade was established, at 25 to 30 per-cent below the previous top prices. However, thedemand did not show any particular response.Stocks were high in most countries. Since theyhad been acquired at a time when prices weremuch higher than those prevailing toward theend of 1951/52, they represented a considerablecapital investment and as prices continued to fall,buyers remained reluctant to enter the market.By the late spring, however. United Stateslumber stocks of softwood had been slightly re-duced with production, by April, about 10 per-cent lower than a year previously.
In general, the total consumption of sawn woodin 1951 was somewhat below the level of 1950.The considerable decline in the civilian consumptionin most countries, particularly for housing, was
TABLE 58. STOCKS OF SAWN SOFTWOOD
REGIox
Western Europe a
USA
Canada
31 December1950
31 December1951
thousand standards
709.6 1 281.0
I. 739.9 1 938.3
530.0 545.1
a Including only : Austria, Belgium, Denmark, WesternGermany, Greece, Iceland, Switzerland, Turkey, and thnUnited Kingdom.
118
not fully compensated by increased requirementsfor military purposes and industrial packaging,and stocks of sawnwood in practically all coun-tries were therefore higher at the end than at thebeginning of 1951 (Table 58).
Outlook
The world sawn wood trade is likely to showsome decline in 1952, 1-vith consumption in generaldrawing largely upon the existing stocks. However,by the end of 1952 the situation will probablybe completely reversed, and new supplies will beneeded in most countries, both to satisfy thecurrent demand, and to replenish stocks. As al-ready pointed out, the production of forest pro-ducts does not follow easily the changes in de-mand and therefore, if the present weakdemand and standstill on the sawn wood marketcontinues until the last months of 1952, theremay be considerable difficulty in the main pro-ducing and exporting countries in meeting anysubstantial increases in the demand immediately;there is, therefore, a possibility of price increasesin 1953.
(C) WOOD PULP
Current situationThe wood pulp and pulp products situation,
which during 1949/50 WaS characterized by a slack-ening in demand and a consequent slowing downof production, improved after June 1950, andboth production and trade moved at high levelsuntil the end of 1951. Production was 11 percent,imports 4.5 percent and exports 6.5 percent abovethe 1950 level, and consumption increased in1951 by 8.5 percent. The United States sub-stantially increased its demand for wood pulpand pulp products for civilian and defence re-quirements in 1951 and for stockpiling. Manycountries in Europe and elsewhere shifted theirimports of wood pulp and pulp products fromNorth America, because of dollar shortages, toEuropean, notably Northern European pulp indus-tries ; this shift consequently brought about an in-crease in the production in that area (Table 59.)
As the world demand continued on a high lev-el throughout 1951, pulp industries were work-ing at full capacity even with the addition of newmills in 1951. Stocks at mills, which at the be-ginning of 1951 liad been large, had fallen to un-usually low levels by the end of the same year, in
TABLE 59. - WORLD PRODUCTION AND CONSUMP-TION OF WOOD PULP
a Finland, Norway and Sweden.b Estimated figures.
spite of increased output. The sulphur shortagewhich was hampering pulp industries duringearly 1951, particularly in Callada., was eased byallocations made by the International Materials
CHART XXIII - PRICES OF VARIOUS FOREST PRODUCTS 1949-52
600
500
400
300
200
150
DECEMBER 1949 =100
1 1 1
FINLAND: CHEMICAL WOOD PULP EXPORT UNIT VALUE
FINLAND: NEWSPR/°. VALUENT EXPO T UNIT
SWEDEN : SAWNWOOD EXPORT PRICE
1
UNITED STATES : CHEMICAL WOOD PULPWHOLESALE PRICE
Notes: Finland : Chemica, Wood Pulp : unbleached sulphateSweden : 2 1/2 " 7 " redwood battens f. o. b. Härnösand.
119
Conference. The extraordinary demand for wood-pulp and pulp products also led to a substantialincrease in international pulpwood trade, someSO percent above the 1950 level, as mills drewheavily upon stocks in order to be able to maintainthe high level of production (Table 60).
TABLE 60. - EXPORTS OF WOODPULP
a Excluding Eastern Europe and U.S.S.R.
As a result of this greatly increased activity,export prices of wood pulp in some cases rose closeto 250 percent in the course of 1951 (Chart XXIII)
United States : Domestic and Canadian sulphite (ex-dock Atlantic sea-board) Bleached No. 1, book f. o. b. mill.
REGION
1950 1051
Pro-duction
Con- pro_sump- Icluctiontion
Con-sump-tion
. million metric tons
North America 20.8 21.3 23.2 22.9Latin America 0.2 0.4 0.2 0.4Northern Europe a 6.1 2.6 6.5 2.9Western and Central Eu-
rope 2.5 5.2 2.7 5.4Eastern Europe
USSR b .... 3.4 3.5 3.6 3.6Asia, Pacific and South
Africa . 0.9 1.0 1.3 1.4
TOTAL 33.9 34.0 37.5 36.6
EXPORTED BY 1950 1951
(... million metric tons
United States 0.09 0.18Canada 1.66 2.02Northern Europe. . . . 3.69 3.76Other Europe° 0.20 0.92
TOTAL 5.64 6.18
950
too -
DEC J J FM Am19521951
With this strong upward trend in pulp prices inall parts of the world except in North America(as price ceilings for domestic pulps were ineffect in the United States), wide price differentialsappeared between markets and between pulpsbeing sold in the same market but originatingfrom different sources, particularly between do-mestic and imported pulps. The rise in the pri-ces of imported pulps was particularly markedduring the first half of 1951. However, thebuyers' growing resistance to the high prices anda noticeable weakening in demand caused by anaccumulation of stocks towards the end of 1951,led to a temporary stabilization of prices, whichduring the first months of 1952 changed to ageneral fall, except in North America, for allcategories of wood pulp. By June 1952 prices were30 to 40 percent below the previous top levelquoted for Scandinavian pulps. This fall wasaccelerated when the European buyers' stoppedbuying imported pulps of other than NorthAmerican origin, which by the end of 1951 hadreached a level far above that of domestic andNorth American pulps. In spite of this pronounceddecline in prices no strengthening in demand wasnoticeable by the summer of 1952. This slack-ening in the general market situation for woodpulp and also for pulp products led to a markedslowing down in production and in the summerof 1952 some pulp mills in the main exportingcountries, notably in Scandinavia, were tempo-rarily closed.
Outlook
While the wood pulp and pulp products situationin 1951 was characterived by a growing demand
120
and by efforts of many countries to increase thecapacity of pulp industries in order to eliminatethe apparent shortage, there seemed to existduring the first half of 1952, with a decline indemand, a possibility of over-produci ion of woodpulp and some prilp products, for imtance news-print. This is likely to lead to a somewhat re-duced production in 1952 in many countries ora mere maintenance of current production becauseof the needs of the mills to replenish stocks,which were generally very low at the beginningof 1952.
FERTILIZERS
Current situationThe world-wide trend towards increasing the
use of fertilizers continued in 1951/52. Not onlydoes the total production and consumption offertilizers continue to rise, but the increase isparticularly marked in the many regions of theworld where commercial fertilizers are relativelyless used. Governments in many countries areshowing an increasing interest in promoting theproduction and a wider and more efficient useof both inorganic and organic fertilizers, and spe-cial measures have been taken towards this encl.Much remains to be done, especia,lly in the lessindustrially developed areas.
Production. The total production of nitrogen(N), phosphoric acid (P205) and pota,sh (K20)amounted to 14,988,342 tons in 1951/52, an in-crease of 4.9 percent over the previous year(Table 61).
Nitrogen. T WO new plants were put into operationin 1951/52, a calcium nitrate plant in Egypt and
TABLE 61 TOTAL WORLD FERTILIZER PRODUCTION AS N, P205 AND K20
REGION 1950/51 1951/52 195 2/5 3
°A CHANGE
1950/51 tO195 1/5 2
1951/52 101952/53
thousand metric tons )
Europe 8 080 S 435 8 879 + 4.4 + 5.3North America 4 505 4 658 5 215 + 3.4 + 12.0Latin. America 383 373 380 2.6 + 1.9
Near East 17 51 63 + 200.0 + 23.5Far East 683 819 916 + 19.9 + 11.8Africa 124 136 138 + 9.7 + 1.5Oceania 490 516 457 + 5.3 11.4
IATORLD TOTAL 14 282 14 998 16 C48 + 4.9 + 7.1
a sulphate of ammonia plant in India (Sindri).Thus, for the first time in history, synthetic ni-trogen is being manufactured in every continent.
The largest nitrogen production increases oc-curred in the Near East (frora 588 to 28,740 tons)and the Far East (18.3 percent). In Europe andNorth America nitrogen production increased7.7 percent and 9 percent respectively. Althoughstill at a high level, nitrogen production in LatinAmerica declined slightly. For the world as awhole, the supply of nitrogen in 1951/52 increasedby an estimated 8.5 percent over 1950/51.
Phosphoric Acid. Reflecting the continued short-age of sulphur, the production of phosphate fer-tilizers (superphosphates, basic slag, fused phos-phate and other forms) increased by only 3 per-cent in 1951/52. There was, moreover, practicallyno increase in the production of superphosphate-which represented some 76 percent of the world'ssupply of iihosphoric acid in 1951/52. This isa vital factor in the overall supply problem. Onthe other hand, basic slag - an important sourceof phosphoric acid supply in Europe, increasedby 33,000 tons P205 in the six principal producingcountries.
An increasing interest in phosphate fertilizersother than superphosphate is being shown allover the world. Among others, for instance,fused phosphate is now being manufactured inTaiwan and " soda phosphate " is being manu-factured in Kenya. In general, there is a trendtowards the increased production of these kindsof phosphatic fertilizers which require little or nosulphur in their manufacture.
Plant capacities for the production of triplesuperphosphate have been substantially expandedin recent years, for example, in Greece, the Neth-
TABLE 62. - WORLD CONSUMPTION ALL FERTILIZERS. PERCE1`..+TAGE CHANGE BY REGIO-2,_TS IN THECONSTJMPTION OF N, P205 AND K20 1951/52 OVER, 1950/51
121
erlands, North Africa, the United Kingdom andthe United States. However, since elementalsulphur is required in many of these plants, itis possible that this increased capacity is notbeing fully utilized.
Potash. The production of potash is principallycentered in Europe and North America. In bothregions there has been an increasing trend towardthe production of potash materials containing ahigher concentration of K2O. Increasing quan-tities of potash, as potassium nitrate, are beingproduced in Chile in connection with the newsolar process for producing nitrate of soda.
The increase in world production of potash in1951/52 over 1950/51 was 3.6 percent. Theoutlook, however, is for a world increase in con-sumption of 8.8 percent in 1952/53 over 1951/52which is the largest increase for any of the threeplant nutrients.
Consumption. The consumption of commercialplant nutrients in 1951/52 is estimated to haverisen 5 percent over the previous year. However,the rate of increase varied greatly from region toregion, 2.7 percent in Europe, an expansion of ap-proximately 10 percent in most underdevelopedregions and an exceedingly large increase of over100 percent in the Near East (Table 62).
Particular interest is attached to the consumptionof phosphates. Although the total supply in1951/52 was much higher than estimated in June1951, it will still be insufficient to meet the needsfully, particularly of those countries chiefly de-pendent upon superphosphates. Rationing ofsuperphosphate was adopted in some states ofAustralia. In the Union of South Africa super-phosphate was diluted with rock phosphate, in.New Zealand with rock phosphate and serpentine.
REGION
TOTAL TONNAGE PERCENT CHANGE 1951/52 oVER 1950/51
1950/51 1951/52All
fertilizers N P2 05 K. 0
tho sand tons....)
Europe 6 977 7 166 + 2.7 + 1.8 - 1.9 + 7.9North America 4 700 4 867 + 3.6 + 9.1 -- 0.2 + 4.6Latin. America
1
276 310 + 11.9 + 11.8 + 11.0 + 14.1Near East 98 206 + 109.7 + 162.0 + 23.1 + 43.4Far East 1 015 1 168 + 15.1 + 13.0 + 11.9 + 34.3Africa 186 204 9.2 + 14.8 + 9.7 + 3.4Oceania 526 552
1
5.2 - 8.6 + 4.5 + 49.5
WORLD TOTAL 13 778 14 473 5.0 8.6 + 0.6 + 7.8
The chief phosphate-producing countries helpedto meet the needs of other areas, to some extentat the expense of lower home consumption rates.In Europe, the reporting countries showed thatthe net exports of phosphoric acid increased 60percent while consumption declined by 1.9 per-cent. In North America, largely through theneed for substantial quantities of elemental sul-phur for industrial purposes and the need to meetexport requirements, the available supply ofphosphoric acid in 1951/52 was slightly smallerthan in 1950/51.
Despite the increase in fertilizer production inthe Far East, imports of nitrogen, phosphoricacid and potash were larger by about 25 percent,100 percent and 40 percent respectively in 1951/52as compared with those of 1950/51. The largestpercentage increase was in the Near East. Largepercentage increases in potash consumption areevident in Oceania (50 percent), the Near East(50 percent) and the Far East (35 percent).
In line with commodity prices generally, theprices of fertilizers were higher in 1951/52. Thiswas partly due to the relatively short worldsuppl3r of phosphates. In several European coun-tries fertilizer prices, particularly those of phos-phates, increased in varying degrees.
More countries are becoming interested in theuse of commercial fertilizers. In 1951/52, forinstance, nitrogen consumption was reported in88 countries or telTitories located in all parts ofthe world, and that of phosphoric acid and potashin 70 countries or territories. The total numberof consuming areas is even larger, as dependentoverseas territories are not all listed separately.
Government interest in the many difficult prob-lems associated with the successful productionand distribution of plant nutrients is growing.It includes a wide range of activities in the con-servation and marketing of natural organic ma-terials often the cheapest source and inthe production, distribution and utilization ofcommercial fertilizers.
For example, in India millions of tons of com-posts have been prepared under the Town Ref-use Composts Scheme involving over 1,000 urbanareas and under the Village Compost Schemecovering over 100,000 villages. The conservationand more efficient marketing of guano in Chile,Ecuador, Mexico and Peru, are other examplesin this field.
Many countries, either by direct assistance orthrough appropriate agencies, are helping in thepresent or planned future production of ferti-
122
lizers, e. g. Brazil, Ceylon, Colombia, Egypt, India,Mexico, and Pakistan. Fertilizer subsidies arepaid in Austria, Germany, Norway, Portugal andthe United Kingdom. Some countries such asColombia purchase and import the necessaryfertilizer materials ; others, such as Uruguay,pay part of the freight for fertilizer shipments tothe farmer. In the United States, assistance isgiven in the purchase of fertilizers for certain crops.Many countries are also improving credits for thepurchase of fertilizers.
Outlook 2
Reports from governments indicate that bothproduction and consumption of fertilizers maybe expected to rise considerably in 1952/53.The aggregate of production estimates gives a to-tal of 16 million tons, an increase of 7.1 percentover 1951/52. Consumption is expected to ex-pand by 8.6 percent but will, of course, be limitedby production, apart from small reductions instocks.
The largest increase in consumption, in per-centage terms, is expected in the Near East whereestimates for the consumption of potash and phos-phoric acid for the coming year are particularlyhigh. All regions, with the exception of Oceania,expect a substantial gain in fertilizer consumptionin 1952/53. The position in Oceania is dominatedby the unsatisfactory outlook for the productionof sulphuric acid and superphosphate (Table 63).
The anticipated expansion in world productionof all phosphates is nearly 6 percent. Whiledata for the proposed production of superphos-phate in 1952/53 are not sufficient, indicationsare that some of the overall increase will be in theform of superphosphate. In Oceania, however, adecrease is expected.
The prospective overall improvement in thetotal phosphate supply is due, in part, to the spe-cial measures being taken by many countries toovercome the current world shortage (about onemillion tons) of elemental sulphur by such meansas a greater use of pyrites and a more completeutilization of all other industrial sources of sul-phur. The outlook is also improved by the lar-ger prospective production of phosphatic fertili-zers which require little or no sulphur.
The outlook. for 1952/53 is based on officialgovernment information.
TA B LE 63. OUTLOOK FOR WORLD CONSUMPTION,ALL FERTILIZERS
TOTAL TONNAGE
REnioN
o
1952-53over
1951-52
Fertilizers
The supply situation for nearly all pesticideswas very tight in early 1951. However, the re-sultant increase in prices led to considerable ex-pansion of production, principally in the UnitedStates which is the major producer, exporter andconsumer of pesticides. After mid-1951 whenthe domestic demand in the United States declinedseasonally, some supplies were made availablefor export, but the situation remained tight upto the end of the year. Howe-ver, by mid-1952supplies of most pesticides, with the notable ex-ception of sulphur, were readily available.
Owing to the difficulties which had been expe-rienced by some consumers in obtaining suppliesduring 1951, an important meeting on the demandand supply situation of two principal pesticides,DDT and BHC, was held in Geneva in February1952. These consultations revealed that therehad been significant increases in production capa-city, especially in the United States, and that nosignificant shortage of these pesticides existedat that time. It also became plain, however,that difficulties do occur in filling orders owingto the fact that consumers often fail to put theirorders in sufficiently far ahead or to pay attentionto the seasonal trend in the production of pesti-cides. These considerations apply to other pesti-cides as well as DDT and BHC. Considerabletime is required to move raw materials, and tomanufacture, formulate and ship pesticides. Fur-thermore, production in the United States isgeared principally to the domestic market and atpresent the potential capacity is not fully used
123
throughout the year. So that orders placed byimporters in other countries may be met fullyand on time, it is important that they should beplaced well in advance and at a time permittingtheir being filled during the slack months of thelate summer and autumn. While this is not theonly factor in improving the supply situation forpesticides, it will stabilize the situation.
Outlook
Supplies of most pesticides, especially chlorin-ated hydro-carbons, are likely to remain amplefor the needs of agriculture during the 1952/53season. However, temporary shortages may oc-cur in areas distant from the basic supplies, iforders are not placed far enough in advance. As inthe case of fertilizers, sulphur is certain to remainin short supply for several years and copper isalso likely to be short. There are, however, pos-sibilities for use of substitutes, such as methylbromide in fumigants to replace those using chlo-rine, which require sulphur in the manufacturingprocess, and some of the organic fungicides in-stead of Bordeaux mixture, thus saving bothsulphur and copper.
FARM MACHINERY
Current situationProduction, sales and exports of farm machinery
in 1951 were generally at record levels. Theexpectation, in early 1951, that the United Statesfarol machinery industry would not be able toequal the production levels of 1950 turned out tobe unfounded ; in the United Kingdom productionof tractors and implements increased markedlyand 1951 tractor exports by the principal Euro-pean producers indicated a higher level of produc-tion than in 1950. However, some decline inproduction, at least in the United States, occur-red towards the end of 1951 and in early 1952. Im-ports of tractors into underdeveloped countriesincreased although largely concentrated in alimited number of countries.
Production and exports. Production in the UnitedStates in 1951 exceeded the 1950 level by nearly7 percent and even passed the 1948 record. Trac-tor production amounted to 62,000 units morethan in 1950 and reached 1949 levels. However,in the final quarter of the year the allocations ofmetals kept production below capacity and out-put of tractors in the first four months of 1952
1(thousand '»zetric tons)
Europe 7 166 7 745 + 8.1
.North America 4 867 5 388 + 10.7
Latin A_merica 310 321 + 3.6
Near East 206 234 + 13.6
Far East 1 168 1 321 + 13.0
Africa 203 209 + 2.7
Oceania 552 501 9.21
14 472 8.6WORLD TOTAL 15 719
PESTICIDES
Current situation
was 21 percent below the corresponding periodof 1951. The continued decline in agriculturalmanpower and the high demand for farm productsled farmers to continue to buy farm machinery.
Production of farm machinery in the UnitedKingdom reached a record value of £106.8 mil-lion, compared with 4'84 7 million in 1950. Pro-duction of agricultural tractors was 17 percentabove the 1950 record and output of nearly alltypes of implements exceeded that of the previousyear. More than half the farm machinery pro-duced was exported (Table 64).
TABLE 64.- TRACTOR PROD UCTIO1,T IN THE -UNITEDSTATES AND THE UNITED KINGD OM
(Exluding Garden Tractors)
United States . . .
United Kingdom.
thousands
508.8 570.8
120.2 140.2
At the time of writing, production data werenot available for Canada, the European conti-nental producers and Russia. However, theGerman industry made further gains in 1951 withexports of tractors at 22,000, compared with12,000 in 1950 and 1,400 in 1949. France, Italyand Sweden also sharply expanded exports, whilethose from Canada declined slightly. Productionin Russia is estimated at 137,000, in terms of 1511.p. units, as compared with 180,000 15 h.p. unitsin 1950.
Imports ami tractor numbers in underdevelopedarcas. Imports of tractors increased in all regionsand in most countries in 1951, indicating expan-ding mechanization. However, the increment in ab-solute terms is as yet small in most countries. Inthe Far East, India is rapidly becoming the ma-jor importer of tractors, even by world standards.Over 7,000 tractors were imported in 1951 asagainst approximately 4,000 in 1950 and 2,400in 1949. Indian imports comprised 80 percentof imports into the region, excluding China, whichhas apparently been purchasing tractors fromthe U.S.S.R. for use in North China. In theNear East, Turkey (over 6,000) and Egypt (over3,000) accounted for 90 percent of the total. InAfrica three-quarters of the tractors went to theUnion of South Africa, which has nearly doubledits imports. Brazil (over 12,000) nearly doubled
124
its 1950 imports, and Argentina, Uruguay andseveral other countries had a significant importvolume. Imports to Australia and New Zea-land increased slightly. Most European countries,including some which manufacture tractors butexceptilig France and the United Kingdom, show-ed higher imports in 1951. Callada continues tobe the world's principal importer of tractors.
In general the increase in tractor imports bythe minor users is equally striking in percentageterms. The aggregate imports into the FarEast, the Near East and Latin America by coun-tries not mentioned above, increased by 62 per-cent, 22 percent and 44 percent respectively. InAfrica a decline in imports into French NorthAfrica more than offset a slight tendency torising imports in Africa south of the Sahara. Aft-er allowing for old tractors going out of use, itis evident that tractor numbers in underdevel-oped areas are increasing rapidly (Table 65).
TABLE 65. - TRACTOR IMPORTS BY REGIONS a(Excluding Garden Tractors)
a According to destinatioa of exports.b Mainly Canada.
, Utilization and servicing . Even where actual eco-nomic conditions are favorable for the use of powermachinery and large scale implements, mech-anization must proceed slowly in the earlystages if serious waste of resources is to be avoided.Facilities must be built up for the regular andeconomic supply of fuel and replacements, forthe servicing and repair of machinery and for thetraining of operators and mechanics. It is particulayly important therefore to watch to whatextent countries in underdeveloped regions aretaking measures along these lines either by directgovernment action or through facilities establish-ed by private enterprise.
In India the Government has established re-gional workshops and the technical assistance ex-
IMPORTED BY 1050 1951
thousands
North Americo 58.1 58.7Europe 42.7 55.4Latin America 26.0 41.0Far East 5.2 9.0Near East . 8.1 10.8Africa. 16.3 23.5Oceania 34.8 38.4Destination unknown. 10.0 21.6
TOTALS 201.2 258.4
COUNTRY 1950 1931
perts there are instructing and helping in theorganization of modern 'workshop practices. Fieldservice engineers are being recruited under theExpanded Technical .Assistance Program to in-struct drivers and machinery operatives in hand-ling, care and maintenance. The Government ofIndia has also given attention to the introductionof hand tools and small implements and to fur-ther this policy they have sent young men to studyabroad.
The Government of India has a Central Trac-tor Organization which owns fleets of tractors,used mainly for reclamation operations, workingon a non-profit basis. This organization assistsvarious State Governments in land clearing, deepploughing and eradication of weeds. Each Stateowns tractors and agricultural machinery ; UttarPradesh, for instance, has some 400 units, andseveral of the States have a machinery import-ing program. We11-equipped workshops with ma-chine tools and tractor servicing tools have beenestablished in some States.
On the request of the Pakistan Government,FAO has made available an expert to give over-all assistance in operating the machinery and inorganizing maintenance workshops. The Govern-ment has further requested FAO to provide threeor four field service engineers for similar dutiesin various provinces. The FAO Technical Assist-ance Mission in Ceylon, in conjunction with theagricultural engineering staff of the School ofAgriculture, are studying and designing smallmachines and hand cultivating tools for Ceylonfarming conditions.
In Turkey it is estimated that approximately20,000 tractors will be on the land in 1952, aswell as the equipment that goes with them, includ-ing combines, as compared with the 2000 unitsin use less than four years ago. The servicingpotential, however, has not risen to anythinglike the same degree. The Government, throughthe Ministries of Agriculture and Education, andwith the assistance of ECA and later MSA hastaken certain steps to initiate training of tractordrivers and mechanics. 13oth the Governmentand machinery dealers have reasonably equippedworkshops in which training could be undertaken.
The Department of Agricultural Machinery inIraq owns several hundred tractors and relatedmachines, as well as workshops. To assist theGovernment in its mechanization program FAOand the United States Technical Co-operation Ad-ministration are both providing experienced per-sonnel.
125
The Brazilian Government is carrying outseveral plans to promote mechanization of agri-culture. One of them consists in the formation ofmechanized patrols ' or groups, official machinery
pools which hire their services to farmers, assist-ing them in ploughing, planting and other tasks.The farmers have to pay a reasonable rate forthese services. ,Another important plan providesfor training; in rural engineering of agronomists,who in turn train men as tractor operators. Theplan was started in 1947 in collaboration withthe United States Department of Agriculture andthe first center was established at the IpanemaExperimental Farm. The plan calls for creationof two regional centers for training tractor oper-ators, 23 repair centers and 120 demonstrationfarms.
In Chile the Corporación de Fomento, an offi-cial agency, provides assistance to farmers rent-ing mechanical equipment at rates which includeamortization interest and operational cost, andhas established several regional repair shops forthe maintenance of the machinery belonging tothe Corporation.
TABLE 66. ESTIM ATED TI ACTOR POPULATION INECONOMICALLY UNDERDEVELOPED REGIONS
(Excluding Garden Tractors)
a Based 011 a 15 percent write-on of the 1950 tractor strength.
Important work has been done in Peru, mostlythrough SCIPA, an agency to which the Peruvianand the -United States Governments both contrib-ute. This agency OW11S a series of machinerypools, repair shops and training centers for instruc-tion in handling and operating all types of farmmachinery.
Outlook
There is eveiy indication that production of farmmachinery will be lower during 1952/53 thanduring the period under review. The combinedeffects of the rearmament programs of the twomajor producers, the United States and the United
Latin Arnerica 35 90 118 31
Asia 8 31 46 48
Africa. 17 63 77 22
% In-crease
REGION 1939 1950 1951 1951over1950"
( 17t( Isands )
Kingdom, and the prolonged steel strike in theUnited States, will curtail the supplies of steel tofirms making farm machinery. Even beforethe steel strike it was estimated that productionby the United States industry would suffer atleast for the remainder of 1952 and output hadbeen stabilized at around SO percent of capacity.
With reduced production in both these countriesit is probable that fewer tractors and less farmmachinery in general will be available for export.With the newly awakened interest in farm machin-ery in the underdeveloped areas, it may wellbe that during 1952/53 the demand for importswill exceed deliveries. It is possible that theremay be no fall in the volume of machinery exportsfrom the United Kingdom, since the Governmentputs a high priority on exports. However, inthe United States, the outlook is for a continuinghigh demand for farm machinery, and it is prob-able that the domestic demand will exceed thesupply, leading to severe competition betweendomestic and export demand.
FISHERIES EQUIPMENT
The expansion and technological developmentof modern fisheries undertakings involves heavycapital expenditure. In view of the prevailingrestrictions on capital investment programs, thefishing industry has 110W to be considered in termsof its significance in the economic structure ofthe country concerned, so that its needs, eitherof capital or of materials and manpower can befully appraised and integrated with those of otherbasic industries.
This is one important reason why the steep risein costs tends to retard the expansion of the fish-ing effort, which in certain countries may evenfall short of the consumer demand for fisheriescommodities. These high costs present a seriousproblem, especially in countries where the uncer-tain balance between production and distributiontends to discourage the investment of furthercapital.
In the United States, expansion continued withlittle or no restriction of the availability of equip-ment and materials, although a few shortages ofpackaging materials were reported. New carriervessels equipped for freezing and packing wereengaged in the Gulf of Mexico shrimp fishing, whileexperimental tuna fishing was carried out there, andin New England, South Atlantic and Central Pacific
126
waters. In Canada, as part of the 1949 develop-ment plan, the issue of licences was extended tocover British-built trawlers as well as second-handvessels from the United Kingdom and UnitedStates. The Atlantic coast trawler fleet has beenincreased and modernized and 10 more vesselsare under construction. In Latin America, de-velopment in both production and distributionproceeded steadily, especially in Brazil, wherelarger vessels have been acquired and a new quickfreezing plant is planned.
In the Far East there has been further mecha-nization of fishing fleets and a start has been madeon the improvenient of processing and distribu-tion. In Ceylon, the Colombo Plan includes theconsideration of distribution, harbor facilities andthe mechanization and improvement of the fleets.In Hong Kong the number of mechanized junksincreased from 81 in 1949/50 to 112 in 1950/51.In Indonesia, EGA has financed the purchase of75 vessels of various types and 100 small motorsJapan now operates about 1,000 vessels of over20 tons and in 1951 several tuna fishing operationswere undertaken using mother-ships. The coastalfisheries, however, have had to face a steep risein operating costs following the lifting of pricecontrols. In Singapore the Fisheries Loan Boardhas allocated M$250,000 for the support of off -shore fishing and M55,000 for materials and equip-ment. 'Mechanization has been extended by theuse of outboard motors.
In the development of the European fleets theemphasis is now on vessel size and technical equip-ment. New and larger trawlers are being addedto the cod-fishing fleets of Spain and Portugal ;in Spain more cod is being caught by the largerparejeros following the successful introductionof the pareja ' (pair) trawl to this fishery. InGermany, despite rising costs, the rebuilding ofthe fleet is proceeding steadily and, allowingfor scrapping, the construction of 92 new steamtrawlers has increased the trawler fleet toabout 220 vessels of approximately 96,000 GRTas compared with a fleet of 373 craft with atonnage of approximately 123,000 GRT in 1939.In Belgium the depression suffered throughout theindustry has virtually halted construction andrestricted the operation of the fleet. In the UnitedKingdom, although new building is in progress,the effect of steeply rising costs has been to restrictthe fullest utilization of the fleets and to discouragefurther capital expenditure.
T1POGRAFIA FAUSTO FAILLI - ROMA
FAO AGRICULTURAL ST7..7)-
Efficient Use of FertilizersA guide book on fertilizers and their use in crop production. In English, French and Spanish. $2.00 10/- (EnglishEdition published by Leonard Hill Ltd, London)
Breeding Livestock Adapted to Unfavorable EnvironmentsA study of the adaptability of various breeds of sheep, cattle, horses, pigs, buffaloes, camels, etc. to different climatesand altitudes. Well illustrated. In English, French and Spanish. $1.50 7/6
Preservation of Grains in Storage: Papers presented at the International Meeting on Infestation of Foodstuffs, Lon-don, 5-12 August 1947.The problems of grain storage discussed by contributors from Canada, USA, Britain, France, Egypt and Australia. In
French or Spanish. $1.50 7/6
Nutritional Deficiencies in LivestocksSymptoms of nutritional deficiencies in dairy and beef cattle, pigs, poultry, sheep, horses and mules. Well illustrated.In English and French. $1.00 5/-
Storing and Drying Grain in Canada, in the United States, in the United KingdomAn illustrated discussion of the usual methods. In English, French and Spanish. $0.50 2/6
Better Utilization of MilkA study of current uses of milk and its by-products, and of the possibilities of using them more fully. Written for thetechnician or government expert. In English, French and Spanish. $0.75 3/9
Rinderpest Vaccines, Their Production and Use in the FieldThe latest information on the production of recently developed Rinderpest vaccines and their uses (1949). In Englishand French. $1.00 5/-
Some Important Animal Diseases in Europe : Papers presented at the Animal Disease Meeting, Warsaw, 1948.Papers written by contributors from England, Czechoslovakia, Poland, and the World Health Organization. In
English with French summaries. $2.00 10/-
Consolidation of Fragmented Agricultural HoldingsIndividual studies on the problem of fragmented agricultural holdings in Denmark, France, Ireland and Switzerland.In English, French and Spanish. $1.00 5/-
Some Aspects of Food Refrigeration and FreezingA well-illustrated compilation of papers written by experts of many nationalities. In English $2.00 10/-
Weed Control by Growth-Regulating SubstancesA short practical guide to the use of hormone weed killers. In English and French. $0.50 2/6
Improving the World's GrasslandsAn international study giving latest information on grassland improvement. Available in English only from LeonardHill Limited, Stratford House, 9 Eden Street, London, N. W.1., 10/6. Spanish and French editions in preparation at FAO.
FAO FORESTRY AND FOREST PRODUCTS STnDIES
Planning a National Forest InventoryA treatise on modern methods of taking a forest inventory, containing chapters on classification, map-making, aerialphotography, sampling, etc. In English, French and Spanish. $1.00 5/-
Forest Policy, Law and AdministrationA lucid study of forest policy with reference to specific laws in various countries. In English and French. $2.00 10/-
FAO ECONOMICS MONOGRAPHS
Progress and Economic Problems in Farm MechanizationProgress in the manufacture and utilization of farm machinery and equipment, and world trade in these products. In
English, French and Spanish. $1.00 5/-
Program for the 1950 World Census of AgricultureSupplies governments with outline of data required for completion of the 1950 World Census of Agriculture.In English, French and Spanish. $1.00 5/-
Economics
MONTHLY BULLETIN OF AGRICULTURAL ECONOMICSAND STATISTICS
This bulletin continues in enlarged form the Monthly Bulletin ofFood and Agricultural Statistics. Statistical tables present cur-rent figures on production, trade, prices and census results ofvarious agricultural products. Notes on current trends of in-dividual commodities, and on the work of FAO's EconomicsDivision, are Included.In English, French and Spanish. Annual subscription $5.00 25/-
Fisheries
FAO FISHERIES BULLETIN
Published bimonthly, this bulletin presents analyses of recentfisheries developments, economic notes, statistical tables onlandings and production of certain fisheries commodities,reports of fisheries activities of FAO and notes on recentfisheries publications.In English, French and Spanish. Annual subscription $1.50 7/6
FAO PERIODICALS
Forestry
UNASYLVA
This quarterly review of forestry and forest products containsarticles on world conditions and developments, reports on world,regional and technical conferences, commodity reports on forestproducts entering international trade, news items and reviews ofcurrent technical literature. Articles are contributed by FAO'sForestry Division and forestry experts from all parts of the world.Photographs, graphs, and charts illustrate the articles.In English, French and Spanish. Annual subscription $2.50 12/6
FORESTRY AND FOREST PRODUCTS BIBLIOGRAPHY
A monthly bibliography sent free to subscribers to Unasylva. InEnglish, French and Spanish.
WORLD FISHERIES ABSTRACTS
A bimonthly review of technical literature on fisheries and relatedindustries; covers the field of fisheries technology, processing meth-ods, boat design, fishing methods, chemical examination of fish-eries products, etc. The abstracts are published in such a formthat they can be cut out and filed.In English, French and Spanish. Annual subscription *4.00 20/.
SALES AGENTS FOR FAO PUBLICATIONS*
Argentina ; Editorial Sudamericana, S. A., Alsina 500, Buenos Aires ; Australia : H. A. Goddard Pty., Ltd. 225a George Street,Sydney ; Austria : Wilhelm Frick Verlag, Graben 27, Vienna 1 ; Belgium : Agence et Messagerles de Is Presse, 14-22 Rue du Persil,Brussels ; Brazil : Livraria Agir, rua Mexico, 98-B, Rio de Janeiro : Canada : The Ryerson Press, 299 Queen Street West, Toronto 2,Ontario ; Colombia : Agricultura Tropical. Avenida Jimenez No. 8-74, Bogotá ; Costa Rica : Trejos Hermanos, Apartado 1313,San Jose ; Cuba: René de Smedt, La Casa Belga, O'Reilly 455, Havana; Denmark: Einar Munksgaard, Norregade 6, Copenhagen K.Ecuador: La Hacienda," Malecón 710-711 y Roca, Guayaquil; Egypt : Librairie de la Renaissance d'Egypte, 9 sh. Adly Pasha, CairoEl Salvador : Manuel Navas y Cia., I" Avenida Sur 35, San Salvador; Finland : Akateeminen Kirjakauppa, 2 Koskuskatu, HelsinkiFrance ; Les Editions A. Pedone, 13 rue Soufflot, Paris 5; Germany : Paul Parey, Lindenstr. 44-47, Berlin SW 68 ; Greece
Eleftheroudakis Constitution Square, Athens ; Guatemala : Goubaud y Cia. Ltda., 5" Avenida Sur No 28 ,Guatemala ; Haiti : MaxBouchereau. Librairie " A la Caravelle, " P.O. Box 11113, Port-au-Prince; Iceland : Halldor Jonsson, Mjostraeti 2, Reykjavik ;Jonssonand Júliusson, Garöastraeti 2, Reykjavik; India : The Oxford Book and Stationery Co., Scintlia House, New Delhi ; The Mall,Simla ; 17 Park Street, Calcutta ; Messrs. Higginbothams, Mount Road, P. O. Box 311, Madras ; Kitab Mahal, Publishers, 235-237Hornby Road, Bombay ; Ireland : The Controller, Stationery Office, Dublin ; Israel : Blumstein's Bookstore Ltd., P. O. Box 4154;Tel Aviv ; Japan : Maruzen Company Ltd., Tori-Nichome 6, Nihonbashi, Tokyo ; Lebanon : Librairie Universelie, Avenue des Francais,Beirut ; Mexico : Manuel Gómez Pezuela e Hijo, Donceles 12, Mexico. D. F. ; Netherlands : N. V. Martinus Nijhoff, Lange Voorhout 9,The Hague ; New Zealand : VVIiitcombe & Tombs Ltd., Auckland, Wellington, Hamilton, Christchurch, Dunedin, Invercargill, TimaruNorway : Johan Grundt Tanum Forlag, Kr. Augustsgt. 7, Oslo ; Pakistan : East : Farces' Publications, P. O. Box 13, Ramna, Dacca.West ; Ferozsons, 60 The Mall, Lahore ; Variawa Bldg., McLeod Rd., Karachi ; 35 The Mall, Peshawar ; Perú : Libreria Internacionaldel Perú, S. A P. 0, Box 1417, Lima ; Philippines : D. P. Purez Co. 132 Riverside, San Juan, Rizal ; Portugal : LIvraria Bertrand,S. A. R. L. 73 Rua Garrett, 75, Lisbon ; Sweden : C. E. Fritze Fredsgatan, Stockholm 16 ; Gumperts AB, Göteborg ; HenrikLindstahls Bokhandel, Odengatan 22, Stockholm ; Switzerland : Librairie Payot, S. A. Lausanne and Geneva ; Hans Raunhardt, Kirch-gasse, 17, Zurich 1 ; Syria : Librairie Universelle, Avenue Fouad ir, P. O. Box 336, Damascus ; Thailand : Requests for FAO publi-cations should be addressed to : FAO Regional Office for Asia and the Far East, Maliwan Mansion, Bangkok ; Turkey : Librairie Hachette,469 Istiklal, Caddesi Beyoglu, Istanbul ; Union of South Africa : Van Schaik's Book Store Pty. Ltd., P.O. Box 724 Pretoria;United Kingdom H, M. Stationery Office, P. O. Box 569, London S.E.I. ; United States of America ; InternationalDocuments Service, Columbia University Press, 2960 Broadway, New York 27 N. Y. ; Uruguay s Hector d'Elia, Oficina de Repre-sentación de Editoriales, 18 de Julio, 1333, Montevideo ; Venezuela : Suma S. A., Sabana Grande 102, El Recreo," Caracas ; Yugo-slavia : Dr:i.avno Preduze6e, Jugoslovenska Knjiga, Belgrade.
Requests from countries where sales agents have not yet been appointed may be sent to : Documents Sales Service, Food andAgriculture Organization of the United Nations, Viale delle Terme di Caracalla, Rome, Italy.
*FAO publications are priced in U. S. dollars and pounds sterling. Payment to FAO Sales Agent:, may be made in local currencies.
PRICE: U. S. $ 1.00 or 5 shillings
