The group of 49 LDCs and 23 other NFIDCs merit special attention in the process of world food trade liberalization, because the markets for the food crops that are typically imported by these countries are likely to be affected much more strongly than the markets for the commodities they export.
These concerns were recognized at a political level by the Marrakesh Ministerial Decision which stated that:
during the reform programme leading to greater liberalization of trade in agriculture least-developed countries and net food-importing developing countries may experience negative effects in terms of the availability of adequate supplies of basic foodstuffs from external sources on reasonable terms and conditions, including short-term difficulties in financing normal levels of commercial imports of basic foodstuffs. (The full text of the decision can be found in Annex 1.)
Table 1 shows the importance of food imports for many of these countries. Of the 58 countries in this group for which data are available:
36 spent, in 1995-1998, more than 10 percent of their available hard currency (revenue from the exports of goods and services, minus debt service) on food imports;
of these, 23 countries (19 in Africa) spent more than 20 percent;
of these 23, 8 spent more than 40 percent: Cape Verde, Comoros, Guinea-Bissau, Haiti, Mauritania, Mozambique, Rwanda and Sierra Leone.
Table 1: The importance of food imports in the Least-Developed and Net-Food-Importing Developing Countries, 1995-1998 average*
|
Africa |
Asia & Pacific |
Latin America & Caribbean |
Food imports / (exports of goods & services minus debt service) < 10 percent (total: 22 countries) |
Angola |
Cambodia |
Barbados |
Food imports / (exports of goods & services minus debt service) between 10 percent and 20 percent (total: 13 countries) |
Benin |
Bangladesh |
Peru |
Food imports / (exports of goods & services minus debt service) > 20 percent (total: 23 countries) |
Burkina Faso |
Afghanistan |
Haiti |
Lack of data (total: 14 countries) |
Democratic Republic of the Congo |
Bhutan |
Cuba |
Total |
42 |
17 |
13 |
* or the latest four years available.
Source: based on FAO. Towards improving the operational effectiveness of the Marrakesh Decision on the possible negative effects of the reform programme on Least-Developed and Net Food-Importing Developing Countries (mimeo), 21 March 2001.
Most of the food imports of these countries consist of bulk foods: wheat, maize, rice, vegetable oils (mainly palm oil and soybean oil), and sugar. Imports of dairy products, fruits and vegetables and meat are also important. Tables 2 and 3 show the import values for LDCs and NFIDCs, for 1997 to 2001, indicating the considerable fluctuations from year to year in imports to these countries.
Cereal imports account for more than half of the total food imports of LDCs, and for slightly less than half of the food imports of NFIDCs. Vegetable oils, including soybeans which are imported and then processed locally into oil and meal, account for one sixth of food imports of LDCs, and around one tenth of food imports in NFIDCs.[2] Annex 2 gives details of import tonnage by region.
Table 2: The major food imports of Least-Developed Countries, 1997-2001 (US$000)
|
1997 |
1998 |
1999 |
2000 |
2001 |
Wheat & wheat flour |
1 167 344 |
1 343 454 |
1 287 661 |
1 432 002 |
1 260 505 |
Maize |
175 541 |
416 611 |
203 537 |
152 091 |
417 146 |
Rice |
832 884 |
1 132 653 |
1 413 122 |
890 143 |
758 641 |
Palm oil |
488 288 |
539 898 |
509 514 |
510 493 |
545 545 |
Soybean oil |
494 654 |
339 193 |
554 175 |
569 033 |
406 103 |
Sugar |
698 509 |
705 316 |
633 435 |
600 599 |
567 422 |
Dairy products & eggs |
521 296 |
525 942 |
558 068 |
522 355 |
530 729 |
Fruits & vegetables |
517 558 |
686 209 |
582 508 |
521 888 |
537 392 |
Meat & meat preparations |
253 605 |
271 231 |
250 341 |
324 081 |
267 509 |
Total food & animal imports |
5 333 980 |
6 456 546 |
6 152 818 |
5 703 299 |
5 622 178 |
Total merchan-dise imports |
36 995 397 |
37 773 747 |
37 501 640 |
39 813 689 |
43 734 970 |
Source: figures drawn from the FAOSTAT Agriculture & Food Trade database.
Table 3: The major food imports of Net Food-Importing Developing Countries, 1997-2001 (US$000)
|
1997 |
1998 |
1999 |
2000 |
2001 |
Wheat & wheat flour |
3 151 620 |
2 953 986 |
2 489 116 |
2 619 804 |
2 640 565 |
Maize |
1 349 701 |
1 125 088 |
1 007 476 |
1 292 979 |
1 283 357 |
Rice |
688 200 |
688 143 |
706 453 |
604 193 |
788 502 |
Palm oil |
973 543 |
1 195 628 |
1 192 056 |
607 652 |
519 099 |
Soybeans |
213 509 |
156 942 |
128 840 |
183 006 |
242 164 |
Soybean oil |
585 622 |
820 705 |
828 499 |
554 479 |
522 122 |
Sugar |
1 152 563 |
1 186 339 |
954 023 |
1 043 146 |
1 018 876 |
Dairy products & eggs |
1 180 319 |
1 269 404 |
1 129 223 |
1 110 667 |
1 140 524 |
Fruits & vegetables |
1 172 338 |
1 249 969 |
1 388 529 |
1 428 411 |
1 430 659 |
Meat & meat preparations |
620 289 |
656 953 |
665 312 |
662 114 |
511 165 |
Total food & animal imports |
12 509 888 |
12 617 854 |
11 789 238 |
12 472 760 |
12 584 932 |
Total merchandise imports |
107 352 272 |
110 589 549 |
107 511 852 |
119 948 429 |
115 177 544 |
Source: figures drawn from the FAOSTAT Agriculture & Food Trade database.
Financing of food imports into developing countries consists, in general, of a mix of food aid grants, food trade on concessionary terms (e.g. sales under the US Governments PL480 title I programme, which have repayment terms up to 30 years), and commercial imports.[3] This report is principally concerned with commercial imports and the conditions for their finance, but it is worth noting that, assuming a fixed volume of food imports required by the country, increased food trade financing needs can be the result of a reduction in food aid grants and concessionary sales, and of increased world food prices. Indeed, the two often go together: both the US and the EU have budget allocations for their major food aid programmes, so if prices increase, less food can be donated.
World cereals trade fluctuates between 200 and 270 million tonnes a year, out of a total production of about 2 billion tonnes.[5] This represents, depending on price levels, US$25 to 40 billion. The main cereals are wheat, maize and rice. World cereals production is geographically very much concentrated, with Asia representing about half of world production (of which China and India produce about 65 percent). This is followed by the United States with a world production share of 16 percent, the EU with 10 percent and Latin America with 7 percent.
Production volumes of wheat, maize and rice are similar, at around 600 million tonnes for each. But the situation is different when it comes to international cereals trade, where wheat dominates (with a share of 42-43 percent in volume terms) and maize (30-31 percent). Over the period 1995-2001, on average 18.5 percent of wheat production was internationally traded, 13 percent of maize, and only 5 percent of rice.
The United States is the principal exporter of cereals, accounting for one third of world exports. Asia constitutes the second exporting zone, followed by the EU, Latin America and Oceania, all with relatively similar market shares. Seven countries account for 80 to 83 percent of world exports: United States, EU, Australia, Argentina, Canada, China and Thailand. Imports are also concentrated: Asia is the principal zone of cereals imports, followed by Latin America and Africa.[6]
With respect to oilseeds and vegetable oils, international trade has grown rapidly at an annual rate 3 - 4 percent over the past decade. It has reached a volume of 60 million tonnes, with soybeans and soybean oils accounting for almost three quarters. The major suppliers are the United States, Brazil and Argentina, which account for roughly 80 percent of worldwide exports.
Further statistics on production and trade of cereals and vegetable oils by LDCs and NFIDCs are provided in Annex 2, while Annex 3 describes the major food trade flows towards LDCs and NFIDCs. Details on the food import profiles of LDCs and NFIDCs, taken as groups and also for each country individually, are given in Annex 8.
[2] FAOSTAT Agriculture and
Food Trade Database. [3] Additional information on the evolution of the commercial food import bills of LDCs and NFIDCs, taken as groups and also for each country individually, is given in Annex 8. [4] FAOSTAT Agriculture & Food Trade database. [5] Cereals include wheat, maize, rice, barley, sorghum, millet, oats, rye, buckwheat, quinoa, fonio, triticale, canary seed and mixed grain. [6] Ministère français des Affaires étrangères, Cirad Ecopol. 2002. Le marché mondial des céréales, by Vincent Ribier. Fiches techniques April. Paris. |