Emerging ag powerhouses expected to flourish

Monday, August 9, 2010

Food prices will increase in the next decade, but the run up will be muted by rapidly growing agricultural production in emerging economies, says a report produced jointly by the United Nations and the Organization for Economic Co-operation and Development (OECD).

Growth in food production in Europe has stalled, but Brazil, Russia, India and China (the so-called BRIC economies) are growing three times as fast as overall world production. Brazilian agriculture output is expected to grow by more than 40 per cent to 2019. Ag output from Ukraine and Russia will grow 29 and 26 per cent respectively. China agriculture will grow by 26 per cent and in India by 21 per cent.

Crop prices are predicted to be 16 to 40 per cent above their average for the next decade. Dairy prices will rise the same amount. Butter prices will increase the most. BF