With regard to 1999, early indications point to a likely downturn in wheat production, after last year�s bumper crops in several countries. Winter wheat plantings in the EC are tentatively estimated to be down by between 2 and 6 percent, in response to an increase in the area set-aside requirements but also due to adverse weather at planting. Winter coarse grain plantings are also tentatively estimated to have fallen, and it is unlikely that spring plantings will increase much, if at all, because of the higher set-aside requirements this year. However, better yields could be expected for maize after last year�s drought-affected levels.
No significant change is expected in cereal output in 1999. Production potential remains limited by the prevalence of subsistence methods on small plots of land. FAO�s latest estimates put the deficit of wheat � the major staple � at about 350 000 tonnes in 1998/99. Supply of wheat is not reported to be a significant problem in the major urban centres, as imports of wheat and wheat flour either commercially or as food aid have been generally sufficient to meet demand. However, the food supply situation in the rural communities in the isolated northeastern parts of the country, which is normally difficult throughout the winter, is expected to be particularly tight this year given the influx of refugees from the conflict in the neighbouring Kosovo Province in the Federal Republic of Yugoslavia.
As of early February, Albania is reported to be hosting some 18 500 refugees from the civil unrest in Kosovo. Food distribution by WFP and several NGOs continues.
BOSNIA-HERZEGOVINA* (8 February)
Information on the cropping situation is scarce and unreliable. The area sown to winter wheat for harvest in 1999 has likely continued its declining trend as imports are available and other crops are more profitable. The cereal import requirement in 1998/99 is provisionally estimated at about 275 000 tonnes. Against this requirement food aid pledges amount to around 90 000 tonnes to date.
Bulgaria's wheat output is expected to fall by about 15-20 percent in 1999 from the estimated 3.3 million tonnes last year. The area sown to winter wheat last autumn is officially estimated at about 900 000 hectares, down from 1.08 million hectares in the previous year. Yields are also expected to fall as about one-third of total area was sown after the normal end-October deadline, and use of herbicides is reported to be limited. Nevertheless, assuming favourable weather for the remainder of the season and adequate fertilizer applications this spring, the 1999 wheat output could be sufficient to meet expected domestic consumption needs.
The early outlook for the 1999 winter grain crops is satisfactory, despite a reduction in the area sown. The area sown to wheat has been cut back to about 205 000 hectares but plantings of winter barley and rye increased. The 1998 grain harvest reached a bumper 3.3 million tonnes, including 1 million tonnes of wheat and 2 million tonnes of maize. The import ban on wheat, imposed in mid-1998 has been lifted but the import duty on wheat has been increased sharply.
Official estimates put the winter grain area for harvest in 1999 at some 980 000 tonnes, about 13 percent down from the previous year�s level. Of the total, wheat is estimated to account for about 730 000 hectares compared to 850 000 hectares in the previous year. As of mid-February, winter weather conditions for the dormant grains are reported to have been satisfactory so far.
The outlook for winter grains to be harvested in the spring of 1999 is satisfactory to date. Indications are that the area sown to wheat and rye remained close to the preceding year's 60 000 hectares. The 1998 grain harvest was somewhat less than 700 000 tonnes reflecting excessive rains during the harvest. The profitability of agriculture remains low. Progress with land privatization is slow - 75 percent of the land is still owned by the state - and uncertainty about ownership continues to have negative effects on productivity and investment. Exports of livestock products to the Russian Federation have been disrupted, further delaying recovery in the sector. The cereal import requirement in 1998/99 could be limited to small quantities of wheat and rye flour for human consumption.
FORMER YUGOSLAV REPUBLIC OF MACEDONIA (16 February)
Output of the 1998 cereal harvest is estimated at some 600 000 tonnes, virtually unchanged from the previous year�s level. According to WFP information, there are no registered refugees from the Kosovo crisis in Macedonia currently, however, many women, children and elderly people from the southern areas of Kosovo are reported to have gone to stay with relatives there. Resources within the host families are not likely to be sufficient and the refugee families are expected to require assistance in the coming weeks. Furthermore, intensified fighting may force a new wave of refugees into Macedonia, particularly if they are unable to cross into Albania.
Latest information confirms earlier expectations for a reduced winter grain area for the 1999 harvest. Official reports indicate that wheat was sown on a total area of 700 000 hectares, 500 000 hectares down from the previous year�s level. Farmers had limited incentive to plant wheat because of domestic market surpluses and poor price prospects. The ministry of agriculture will promote planting of high-quality durum wheat on the unsown area this spring.
Recent cold weather has likely occasioned some winterkill but otherwise the outlook for the 1999-grain harvest remains satisfactory. The area sown to winter grains (mainly wheat and rye) is estimated at about 180 000 hectares, similar to the preceding year. The 1998 cereal and pulse harvest is declined to about 1 million tonnes, harvested from 0.5 million hectares. Output was 4 percent less than in the preceding year due to excessive rains. Nevertheless, cereal imports in 1998/99 are expected to continue their declining trend in part as food grain production increases and demand for feedgrains is depressed by the financial crisis in the Russian Federation.
Growing conditions for the winter-planted wheat and rye crop have been satisfactory to date. The 1998 grain harvest declined by 8 percent to 2.8 million tonnes, mainly due to excessive rains during the summer. Nevertheless, the country has an exportable surplus of food quality wheat and rye amounting to about 100 000 tonnes. The 1998 sugarbeet crop was also down but output of potatoes and vegetables increased. Exports of livestock products to the Russian Federation have been resumed, but at reduced volumes. Consequently, demand for animal feed is likely to remain depressed.
The winter grain area for the 1999 harvest is estimated to have remained similar to the previous year�s. The areas sown to wheat and rye are put at about 2 million hectares and 2.3 million hectares respectively.
Latest information points to another decline in grain area for the 1999 harvest. Sowing operations last autumn were delayed due to adverse weather, and farmers� incentive was reduced by low market prices. Tentative estimates put the winter wheat area at about 1.6 million hectares. As of February 1999 many producers were reported to be still holding large stocks of the 1998 crop unwilling to accept the prices offered so far.
Prospects for the 1999 cereal crop are uncertain. Winter wheat planting is reported to have been limited to about 250 000 hectares due to adverse weather last autumn. The planned area was 400 000 hectares. The Slovak Agrarian and Food Chamber will promote increased spring planting to compensate for the reduced winter grain area.
Winter wheat plantings for the 1999 harvest are estimated to have fallen by about 10 percent, but weather conditions have been optimal so far and good yields are expected. Assuming normal weather conditions for the rest of the season wheat output is expected to match last year�s 190 000 tonnes.
YUGOSLAVIA, FED. REP. OF (SERBIA AND MONTENEGRO)* (8 February)
The early outlook for the 1999 wheat harvest is unfavourable. Reports indicate that winter plantings have fallen well short of the target of 810 000 hectares. Persistent and heavy rains delayed planting and only 30 percent of the crop was sown in the optimum period. Unofficial reports indicate that the area sown to wheat fell to about 650 000 hectares from 785 000 in 1998. In addition, reduced domestic fertilizer production and high price vis-�-vis the price for wheat are expected to reduce use.
The 1998 grain harvest, officially put at an average 8.6 million tonnes was 17 percent less than the record 1997 harvest. A dry summer and excessive rains at harvest reduced maize production to 5.2 million tonnes; wheat output remained stable at 2.9 million tonnes. Despite the lower harvest, the country continues to have an exportable surplus of grains. However, the high cost of production and quality considerations limit the country's capacity to barter grain for essential imports.
In Kosovo Province, the overall number of displaced persons is estimated by UNHCR at about 21 000 in early February. Renewed displacement in some areas has been offset by an increased rate of return in others. Interagency convoys led by UNHCR continue to deliver food and non-food items to the displaced, returnees and host families but relief operations are being impeded by the difficult security situation. Regarding agricultural operations, wheat sowing last autumn is likely to have been very limited. Many villagers had fled there homes at planting time and much seed and equipment was looted or destroyed. The wheat crop in 1999 is likely to be well down from the normal output and the Province is expected to continue also into the next season to have an abnormally high wheat deficit.
The 1998 cereal and pulse harvest is provisionally estimated at around 300 000 tonnes. It is likely that lack of snowcover has caused some crop damage to winter wheat and barley to be harvested later this year. The country is seeking to mobilize high-grade seed for spring planting.
The cereal import requirement in 1998/99 is estimated at about 340 000 tonnes. Against this requirement, food aid pledges of nearly 50 000 tonnes have been reported to date and the balance would have to be imported commercially. The actual volume of imports will hinge crucially on the availability of credits and food aid. The financial crisis in the Russian Federation has impacted heavily, disrupting trade. Remittances from family members working abroad were an important element in household budgets. Remittances from the Russian Federation have virtually ceased and many workers are returning, increasing the number of unemployed. In view of the deteriorating economic situation, there is little scope for phasing out humanitarian assistance for the most vulnerable.
FAO tentatively estimates the 1998 grain harvest to be about 1 million tonnes, including some 900 000 tonnes of wheat. This compares to 1.2 million tonnes last year. The reduction is due to a 10 percent fall in the area sown, notably barley, and lower yields.
In the 1998/99 marketing year, the cereal import requirement is estimated at 520 000 tonnes. Food aid pledges, for distribution to the vulnerable populations, amount to nearly 55 000 tonnes of grain and the balance is likely to be imported commercially. Some 177 000 tonnes of cereals were imported in the first 5 months of the marketing year. GDP continued to grow in 1998, but growth will be slower in 1999 as the fallout of the Russian financial crisis affects the economy, reducing exports. Food requirements up to mid-1999 are estimated at 6 500 tonnes of wheat flour, 1 700 tonnes of pulses, 1 400 tonnes of oil and 770 tonnes of sugar.
The outlook for the 1999 grain harvest remains uncertain in view of the economic deterioration and financial crisis in the country. The winter wheat area (for harvest in 1999) is reported to have increased this year by a further 10 percent. However, the area ploughed in the autumn, in advance of spring sowings is down. The 1999 grain production target has been set at 7 million tonnes. Following the poor 1998 grain harvest and shortages of foreign currency to import foodgrains, all regions have been ordered to increase the minimum area sown to grain by 20 percent. The extent to which farmers can comply will depend heavily on the availability of central government subsidies and adequate and timely availability of inputs
The 1998 grain harvest is officially reported to be only 4.9 million tonnes, down from last year�s crop of 6.4 million tonnes, in response to adverse weather. In view of the tight controls on pricing, inflation and the impact of the Russian crisis, it would not be surprising if farms had held back grain to barter. The wheat crop, estimated at 800 000 tonnes, is above last year's (744 000 tonnes) but excessive moisture has reportedly reduced the proportion of the milling quality wheat. The country has a deficit of food quality wheat, officially estimated at 300 000 tonnes. In response to the mounting economic and financial difficulties, cereal imports in 1998/99 are expected to fall to about 560 000 tonnes, from an estimated 640 000 tonnes last year, despite the poor harvest. As bread is highly subsidized, food consumption of grains is expected to remain stable, but feed use is likely to fall sharply. In urban areas, chronic shortages of most other foodstuffs and panic buying are reported following the imposition of price controls last year.
The outlook for the 1999 winter crops, mainly wheat and barley is satisfactory to date. Lack of adequate maintenance of irrigation and drainage systems preclude any significant improvement in average yields, estimated at 1.5 tonnes per hectare for wheat and 2.6 tonnes per hectare for maize. The 1998 cereal and pulse harvest is now estimated at 0.8 million tonnes, including about 200 000 tonnes of wheat. Aggregate output is 11 percent less than in 1997 and reflects lower plantings and crop damage to the wheat crop. In contrast, growing conditions for maize were satisfactory.
Wheat imports for the 1997/98 marketing year (July/June) reached 0.6 million tonnes, of which some 160 000 tonnes were food aid. It is expected that imports in 1998/99 will remain at around this level. Food aid pledges to date amount to nearly 130 000 tonnes. The country is self sufficient in maize.
The area sown to the minor winter grain crop (mainly wheat) declined by 6 percent to 0.7 million hectares. The bulk of the grain crop is planted in the spring. The 1999 agricultural campaign is expected to be difficult and the area sown to grains is expected to contract further. Farmers' financial problems have been exacerbated by the debts incurred as a result of 1998�s drought-reduced harvest, making access to agricultural credit even more difficult. In addition, locusts could pose a threat to this year's crop unless adequate funds are made available in a timely manner.
The 1998 grain harvest is estimated by FAO at about 8 million tonnes, some 37 percent less than in 1997 as hot and dry weather from mid June to August caused the crop damage and reduced the area harvested to 11.4 million hectares. FAO's estimate of grain output is about 21 percent higher than the official figure of 6.4 million tonnes as farmers have under- reported yields systematically for a number of years.
The existence of some 2 million tonnes of carry-forward stocks has enabled the country to continue cereal exports in 1998/99. Exports between July-December 1998 totalled almost 1.4 million tonnes and the country could export up to 1.9 million tonnes in the marketing year until June 1999, mostly to neighbouring countries. Exports to the Russian Federation have dwindled owing to payment difficulties and the substantial quantities of food aid pledged. At the same time, in view of the devaluation of the Russian rouble the Government has had to suspend the free trade agreement with the Russian Federation and limit the inflow of Russian food products, notably cereals meat, powdered milk and butter.
Growing conditions for the major winter grain crop have been satisfactory to date but indications are that the area continued to fall as farmers divert land to fruit, vegetables and tobacco. The 1998 cereal harvest is officially estimated at about 1. 6 million tonnes, cleaned weight, compared to 1.7 million in 1997. Following the sharp increase in recent years and reduced profitability for this crop, wheat production in 1998 declined by 6 percent 1.29 million tonnes. Output of cotton, tobacco, potatoes and vegetables increased in 1998. Private farmers now produce just over half of the grain crop, as well as 61 percent of cotton, 60 percent of tobacco.
Cereal imports in 1998/99 are tentatively forecast at around 145 000 tonnes and include food aid pledges amounting to 58 000 tonnes.
The early outlook for the 1999 winter wheat and barley crop, which accounts for about half of annual grain production, is mostly satisfactory. The aggregate 1998 grain harvest is officially estimated at 2.7 million tonnes, against 3.3 million tonnes last year. The maize crop of 1.4 million tonnes is eighteen percent lower than the 1997 outturn, but well above the five-year average. Production of wheat (1 million tonnes) and barley (225 000 tonnes) is below average, reflecting dry conditions and low profitability.
With ample domestic supplies and carry-forward stocks, no significant commercial imports of cereals are expected 1998/99 marketing year (July/June). The high cost of production makes exports uncompetitive at current prices.
RUSSIAN FEDERATION (8 February)
Drought and economic problems reduced the 1998 aggregate grain (cereal and pulse) output to an estimated 55 million tonnes, compared to 88.6 million tonnes in 1997. FAO's estimate is 15 percent higher than the official 47.8 million tonnes, as farmers this year have underreported wheat output by 5 million tonnes according to the Minister of Agriculture and by up to 20 million tonnes according to the trade and other informed sources. The overall grain supply situation is tight but not critical, owing to the availability of large carryover stocks (in excess of 25 million tonnes) from last year's good harvest and the relatively high proportion of food quality grain in this year's crop. However, the overall situation masks significant disparity in the supply situation between regions. This disparity is exacerbated by local restrictions on the movement of grain, uncompetitive official purchase prices (US$45 per ton for 3rd class wheat incl. taxes), and the impact of the deteriorating economic and financial situation. In addition, the large differential between domestic and international grain prices has stimulated exports of 0.9 million tonnes of cereals up to November 1997. The remote and most disadvantaged areas are particularly at risk as mobilizing and stockpiling reserves for the harsh winter months was impeded by the financial crisis in the autumn. The most vulnerable socio-economic groups, pensioners, orphans, the unemployed and households dependent on public salaries are also experiencing difficulties, especially in the large, depressed industrial cities.
Despite the poor harvest, cereal imports in 1998/99 are currently estimated at just over 4 million tonnes, compared to 3.5 million tonnes in 1997/98. Against this requirement, the country has received food aid pledges amounting to 3.8 million tonnes of cereals (including 2.8 million tonnes of wheat) as well as significant quantities of meat, oilseeds and meal. Virtually no food aid has been delivered to date, and the bulk of the shipments (not rolled over to 1999/2000) should arrive towards the end of the current marketing year, when the aggregate supply situation is expected to tighten.
Following the large expected stock drawdown this year, a significantly better harvest is needed next year but the outlook remains uncertain. The 1999 agricultural year is expected to be difficult. Budget allocations for agriculture have been halved, agricultural credit remains scarce and in addition, two-thirds of the revolving soft credit fund for agriculture is still outstanding. Nearly 90 percent of farmers reportedly made losses in 1998. The availability of fuel, operational machinery and agrochemicals on farm is currently tighter than last year and there is a substantial backlog of autumn ploughing. Nevertheless, the spring grain planting target is 38 million hectares. Winter grains were planted on 13.15 million hectares, only 3 percent less than in the preceding year but crop condition on over 2 million hectares is poor.
The outlook for the 1999 wheat crop is satisfactory so far. Cereal production in 1998 is estimated at 510 000 tonnes, some 15 percent below the 1997 crop. This is due to a small shift in the area planted, back to cotton, after the good harvest in 1997 (about 600 000 tonnes) and lower yields due to floods in April. Production of cotton, a major export earner, increased by 9 percent to 384 000 tonnes, but remained well below the target of 0.6 million tonnes.
The cereal import requirement for 1998/99 (July/June) is tentatively estimated at about 360 000 tonnes of wheat and some rice. Food aid pledges amount to some 52 000 tonnes to date. The balance will have to be mobilized commercially.
An appeal was launched in December 1998 for a total of US$24.8 million, to respond to the humanitarian and rehabilitation needs of over half a million vulnerable people during 1999. The appeal includes projects to enhance basic food production and food security as well as food for the populations at risk.
The area sown to winter grains, for harvest in 1999 remained close to last year's high level of 570 000 hectares. Timely planting was facilitated by recent imports of farm machinery. The 1999 production target has been raised to 1.4 million tonnes. Official data indicate that the 1998 grain harvest of 1.24 million tonnes was on target and nearly twice as much as in 1997. By contrast, although the 1998 cotton harvest increased by about 12 percent to 0.7 million tonnes, it remained well below the target of 1.5 million tonnes in response to chronic problems in the sector. Official dissatisfaction with the cotton harvest has led to further reorganization of the agricultural sector. Reduced export earnings from both cotton and gas for a number of years in succession, has severely limited the availability of inputs and foreign exchange. In view of the good grain harvest, cereal imports in 1998/99 could fall to below 100 000 tonnes, mainly wheat and some rice.
At this early stage, the outlook for the 1999 winter grain crops is satisfactory, given the economic situation. The area sown to winter crops in the public sector farms (which account for 88 percent of the agricultural land) remained stable at 7.5 million hectares, of which 6.9 million hectares were grain. The winter wheat area increased to 5.9 million hectares, while that sown to barley and rye declined. In addition, the private sector (subsidiary plots and individual private farms) plant about 0.5 million hectares to winter grains. Overwintering conditions to date have been mostly good and about 85 percent of the crop is reported to be in satisfactory condition. Some plantings occurred late and input use will remain very limited as suppliers are further tightening credit conditions following poor repayment rates again in 1998. Budget allocations for agriculture have increased, (as has inflation), and government influence is expected to remain pervasive in input provision and marketing, despite recovery of only 2.1 million tonnes of the 5.8 million tonnes of grain owed to the state for input supplies in 1988. The official target for the 1999-grain harvest is 35 million tonnes. Winter grain plantings reached 85 percent of target.
FAO estimates the 1998 grain harvest at nearly 30 million tonnes, including 17 million tonnes of wheat and 12 million tonnes of coarse grains. These estimates are 15 percent higher than the official figure of 26.5 million tonnes (including 14.9 million tonnes of wheat). Farmers this year hid large quantities of grain in response to the official prohibitions on grain shipments until all debts to the budget and pension fund had been cleared. Despite the lower harvest, the country is likely to export up to 3.4 million tonnes of cereals in the current marketing year. By December 1998, 1.6 million tonnes had already been shipped.
The early outlook for the 1999 main grain harvest is satisfactory. Winter wheat and barley was sown in a timely fashion, on 1.3 million hectares, including 1 million hectares of irrigated land on the large farms. In addition, the rural population has to plant additional area on their private subsidiary plots, where yields are increasing at a faster rate than on the large farms. The target for winter grain production in 1999 has been set at 4.6 million tonnes, including 4.0 million tonnes (3.8 million tonnes of wheat,) from the large farms and the balance from the private plots. This compares with an actual output of 3.8 million tonnes of wheat and barley in 1998, some 12 percent more than in 1997, but short of the target of 4.22 million tonnes. In addition, the country produced roughly 0.5 million tonnes of maize and rice, bringing the total 1998 grain output to 4.3 million tonnes (1997:3.8 million tonnes). By contrast, the 1998 cotton crop - a prime foreign exchange earner - declined by 12 percent to 3.25 million tonnes, due mainly to adverse weather, machinery shortages, the high cost of inputs (97 percent of the crop had to be picked by hand) and a lack of adequate incentives. All imports are being cut back to maintain a positive trade balance, but the 1998/99 cereal deficit, tentatively estimated at about 530 000 tonnes is expected to be imported commercially.
The Land Code, which came into effect in 1998, confirms the state as the sole owner of land but allows Uzbek citizens to lease land for agriculture or for the construction of housing.
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