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V. Commission reports

A. Report to the conference by commission I (world food and agriculture situation)
B. Report to the conference by commission II (Technical Activities)
C. Report to the conference by commission III (constitutional, administrative, and financial questions)

A. Report to the conference by commission I (world food and agriculture situation)

Item 1 of agenda - The world food crisis
Item 2 of agenda - Shortage of exchange
Item 3 of agenda - Optimum utilization of food
Item 4 of agenda - International allocations
Item 5 of agenda - World food proposals
Item 6 of agenda - Fertilizers and agricultural machinery
Item 7 of agenda - Action on particular products
Item 8 of agenda - Periodic reports

The Commission had before it The State of Food and Agriculture: 1947 and other valuable documents in the same subject prepared by the staff of FAO, for which it wishes to express appreciation. It also had important contributions from governmental and nongovernmental observers.

Item 1 of agenda - The world food crisis

The Commission's consideration of the state of food and agriculture has been dominated by the critical food emergency which the world faces today. This emergency was already apparent in the periodic reports which the member nations of FAO submitted to the Director General early in the summer. It was further underlined at the special Cereals Conference held in Paris in July, which reported a very serious world deficit in cereals in prospect for 1947/48. Since then there has been a further significant deterioration of crop conditions both in Europe and in North America.

As a result of these developments, it appears that while 38 million metric tons of bread-grain imports will be needed by the deficit countries to continue even the very low cereal rations of the past crop year, only 29 million tons at the most will be available for export from the surplus producing countries unless extraordinary new efforts are made. The people in the deficit countries, many of whom have suffered undernourishment over a period of years, thus face the threat of lower rations than at any time since the war, and in a number of countries even lower than during the war.

The adverse crop conditions, especially in European countries during the winter months, have been greatly intensified by the subsequent drought which was almost without precedent. There has been a sharp decline in the outturn of cereals, and prospective sugar beet and potato crops have been greatly reduced. More recently, drought has curtailed fodder supplies and seriously reduced pasturage, so that milk production is declining in many areas and live stock is being slaughtered. Nearly all countries will be affected by the greatly reduced maize crop in North and Central America. In addition parts of Latin America have smaller grain acreages for harvest in the latter part of 1947. Promise of a good wheat crop in India was dissipated by a scourge of rust, while in Southeast Asia the outlook for rice crops in the major producing areas is not satisfactory. There may be some temporary increase in world meat production at the expense of milk production as a result of the slaughter of livestock which cannot be fed, but over-all output of meat during the latter half of the crop year 1947/48 will be decidedly reduced. World export supplies of sugar and fats and oils may be somewhat greater, but deficit countries will reap little benefit from such improvement owing to shortage of foreign exchange. Landings of fish will be likely to continue to increase but transportation, distribution, storage, and processing difficulties will persist.

Shortages and maldistribution of requisites for agricultural production make difficult an immediate expansion in production. Fertilizers and pesticides remain in short supply. In several countries there is a lack of sufficient quantities of suitable seed. Draft power, farm machinery and equipment are still far from adequate in many countries. These conditions are major obstacles to a realization of early recovery in world food and agricultural output.

Considering the food supply as a whole, the decline in cereals supplies will much more than offset the increases in supplies of other foods. The consequent shortages and famine prevailing in certain countries will cause further mortality and jeopardize the physical development of the younger generation. Indeed, such conditions may provoke or sharpen social unrest in countries where reasonable minimum living standards are not enjoyed. Further, they can easily be contributory to international disorder or even conflict. Unless special efforts are made to mobilize more food, the calorie intake in deficit countries must inevitably fall to still more unsatisfactory levels.

The longer-range prospects are not promising. The output of nutritionally desirable foods such as milk, meat, and eggs will increase only slowly in many countries because rebuilding of livestock enterprises is a time-consuming process, and even the recovery of production of basic food crops is now expected to take some time.

Item 2 of agenda - Shortage of exchange

Added to the purely agricultural obstacles to a rapid improvement of food supplies for all deficit countries, are the obstacles to increasing supplies for certain countries which arise from the lack of foreign exchange prevailing in those countries. The products of agriculture, forestry, and fisheries represent an important part of the trade between nations, and, on the basis of essentiality, are entitled to the highest priority when consideration is being given to the use of available exchange and to ways and means of providing additional credits.

Unless drastic steps are taken to safeguard the purchase of foodstuffs, the peoples of many nations will be unable to supplement their meager home supplies with much needed imports. This year, more than at any time since the end of the war, it is important that the flow of foodstuffs should not be impeded.

The Commission recommends that the Council of FAO should be requested to examine the problem and to take appropriate action with competent intergovernmental organizations for its consideration. [See Resolutions]

Item 3 of agenda - Optimum utilization of food

In the face of this grave situation, vigorous action by governments is required. There are many ways in which grain can be saved for human consumption. Consideration should be given to milling extraction rates in exporting countries as well as in some importing ones in order to get more bread from the same volume of grain.

All practicable steps should be taken in every country to reduce the amount of bread grain fed to livestock. In addition, every effort should be made by countries with animal numbers expanded or maintained during the war to release feedingstuffs to countries with animal numbers greatly reduced during the war and now threatened with further reduction or with serious retarding of efforts to rebuild. Slaughter of dairy cattle should not be undertaken if by any practicable means the animals could be transferred to another country where they could be maintained on natural pastures. Exporting countries and the more prosperous importing countries, with abundant supplies of livestock and livestock products, can sacrifice part of their more adequate standard of food consumption for the benefit of those whose needs are greater.

All the milk produced should be used primarily for human consumption. In particular, much of the milk now being fed to animals should be diverted to direct human consumption, especially to mothers and children. It should be in natural form, if suitable transport and distribution arrangements are possible, or else in processed form.

The Commission therefore recommends that member nations should take immediate steps

The Commission calls attention to the fact that both paragraphs 3 and 5 of this recommendation will be served by maximizing as far as practicable, in view of economic conditions in exporting countries and other limiting factors, the movement of certain food supplies in the form of raw materials rather than as finished products.

Item 4 of agenda - International allocations

The present world scarcity of foodstuffs, feedingstuffs, and the means of food production makes it essential to maintain a system of allocation and hence to maintain the legislative and administrative machinery required for the control of experts and imports. The Commission urges that member governments should pay particular attention to this extremely important question. It believes that in the present circumstances a policy of decontrol would have serious consequences both upon the quantity of food available and upon its international distribution. Therefore the valuable work which has been undertaken by the International Emergency Food Council should be continued.

However, if a Council of FAO is set up composed of representatives of governments, it is clear that this Council and the IEFC would to some content exercise parallel functions and the co-existence of the two organizations could not but lead to a certain duplication of work. Moreover, it is becoming more and more difficult to deal entirely separately with the so-called emergency problems and the longer-term problem of expanding agricultural production.

Nor does it seem that the absorption of IEFC by FAO would be likely to raise serious technical or administrative difficulties; the personnel of the IEFC has been engaged only up to 31 December and the expenses involved are met by FAO. For these reasons, after paying warm tribute to the work of IEFC, the Commission has come to the conclusion that FAO should take over the functions of the IEFC at an early date, the detailed arrangements to be made jointly by the appropriate FAO authorities and by IEFC, bearing in mind that the latter also is an intergovernmental organization.

This transfer of IEFC should in no way occasion changes in the functions and terms of reference of the Commodity Committees. It is clear that by virtue of their composition and experience these Committees are the most appropriate bodies to continue within the framework of FAO to recommend the allocation and programming of commodities in emergency short supply. In making the proposed transfer to FAO, it is essential that the participating governments continue to implement the allocation recommendations of the Commodity Committees.

Item 5 of agenda - World food proposals

The world's population continues to increase rapidly and the shortages of today can be remedied only by a far-reaching expansion of production of essential foods in short supply. Bold steps must be taken to increase food production throughout the world. Reference has already been made to measures which may help to increase the output of the 1948 harvest. Longer-term programs of agricultural development are also urgently needed, and the Commission has noted with satisfaction the development plans which several countries have announced.

The solution of the emergency problem of maximizing food supply cannot be found except in the context of a long-term policy. Whatever governments may plan, agricultural production is primarily the result of the efforts of individuals. However great the need now and however high the prices, the fear of an early fall in prices tends to discourage the individual from all-out expansion. The Commission was impressed therefore by the need for assuring price stability at a fair level as a means of encouraging primary producers to plan with confidence for this expansion. The various organizations dealing with problems of allocation, nutrition, agricultural policy, and economic policy must all combine to help forward this planned expansion.

It was with these considerations in mind that the Commission undertook the study of the Report of the Preparatory Commission on World Food Proposals.

The Commission has considered the Report of the Preparatory Commission and generally endorses its recommendations. It accepts the outline in Chapter I of the general economic situation which confronts the world.

This Commission agrees with the Preparatory Commission on the importance of promoting agricultural and industrial expansion concurrently, especially in less developed countries. Both agricultural and industrial development will require large-scale investment. For many countries this will involve external financial aid and the reorganization of national financial systems. In reviewing these matters the Commission has particularly stressed the need for effective over-all co-ordination of the work of the various United Nations agencies, and urges the Economic and Social Council to give this matter further attention.

The Preparatory Commission's advice on the expansion of agricultural production was accompanied by important recommendations on ways of providing producers with the necessary security, especially assured markets and stability of prices.

Two systems were proposed:

The Commission has noted the discussion on commodity policy in the Preparatory Committee for an International Conference on Trade and Employment. It has noted also the resolution of the Economic and Social Council, suggesting to governments that they use the principles set out in the chapter on Intergovernmental Commodity Agreements of the draft ITO Charter as a guide for their commodity policy, pending the establishment of an International Trade Organization. The Preparatory Commission on World Food Proposals also enunciated certain principles concerning the content of commodity agreements, particularly as to price determination, reserve stocks, quotas, long-term contracts, the position of nonparticipants, and sales at special prices.

The Commission did not discuss in detail the techniques appropriate to commodity agreements since the form and contents of each agreement must vary from commodity to commodity. It is, however, important that the basic principles to which governments are pledged as members of FAO, notably the expansion of production to meet human needs and the stabilization of prices at levels fair to producers and consumers alike, should find expression in any agreement negotiated. The restrictive practices of past agreements must as far as possible be avoided. In the opinion of this Commission, the suggestions of the Preparatory Commission regarding the building up of stocks and sales of commodities at special prices would, if made use of wherever possible in commodity agreements, reduce the necessity of resorting to measures of restriction.

In the determination of prices during the negotiation of a commodity agreement recognition should be given to the need for maintaining and progressively raising living standards.

It is one of the regular duties of FAO to be constantly studying agricultural commodity situations and problems. Some of these problems are local in character, calling for measures to improve the production and distribution of particular products. Others involve international trade. Frequently it will be advantageous to study all these problems together. In the case of some commodities FAO will be pursuing these studies at the staff level; in the case of others, member nations may wish to have intergovernmental studies and there are a number of products for which the early conclusion of commodity agreements would be desirable. In this connection the Commission wishes to stress that in any meetings where food and agricultural questions are considered the fullest advantage should be taken of the resources and experience of FAO.

Commodity councils supervising agreements and study groups watching situations must pursue mutually consistent policies from the point of view of food and agriculture, in particular the relationship of one agricultural product to another, and the relationship between production, consumption, trade, and prices. It will be an important function of the Council of FAO to secure this consistency. On the other hand mutual agreement in respect of commercial policy and the international trade relationship between agricultural products, manufactures, and other raw materials is being achieved ad interim by the Interim Co-ordinating Committee on Intergovernmental Commodity Arrangements. When ITO is established there will obviously be need for close co-operation between it and FAO; this could be provided for to some extent at least in an interagency agreement.

Item 6 of agenda - Fertilizers and agricultural machinery

A working group appointed by the Commission to consider the FAO reports on materials for farm production, particularly fertilizers and agricultural machinery, recommended that member countries give high priority to the increased output of fertilizers and farm machinery and see that supplies available are used in the most effective way.

For fertilizers, it is recommended that member governments make special efforts to provide the necessary materials for existing producers of nitrogenous and phosphatic fertilizer to operate at full capacity, that member governments improve their own measures for internal distribution and use, and that exporting countries review their own requirements to see if more cannot be released for other countries; and also that FAO do what it can to help countries use most effectively the fertilizer supplies available and to assure that the necessary transport is provided.

With respect to the longer-term position, it is recommended that FAO obtain additional information, particularly on firm requirements over the next five years, and that the Council of FAO consider what further action, including possible measures for assuring markets for expanded fertilizer production, can stimulate adequate increases in output.

On agricultural machinery it is recommended that nations encourage increased output in existing plants especially of spare parts and of tractors, and that FAO obtain information which could serve as a guide for developing increased production.

The following report by the working group was approved by the Commission.

1. Fertilizers

The restoration of industrial activity in war devastated countries depends on an increase in the output of coal and steel. Such an increase is in turn largely dependent on the workers being better fed. However, sufficient food supplies can only be developed if more production goods, particularly fertilizers and agricultural machinery, are made available to the agricultural producers. Efficient transport arrangements are also necessary to ensure that agricultural supplies reach their destinations in time to be used effectively for seasonal cultivation's. The highest priority should therefore be given to the production and transport of supplies needed for food production.

Soil fertility is depleted and supplies of natural manure are low in many war-damaged countries. Many underdeveloped countries are handicapped by chronic low soil fertility. There is serious danger that crop yields and world food supplies will continue insufficient until far more adequate supplies of mineral fertilizers can be produced and applied.

To date, efforts have been made to distribute available supplies as equitably as possible, and there is little prospect of great additional improvement in the allocation process. It is however most important to increase both in the immediate future and, on a long-term basis, the output of production goods needed by the farmers.

The problem is different for each group of fertilizers.

In potash the problem is to increase the mining output in the five or six big producing countries. Increased production in these countries is largely a matter of supplying plants and equipment. In phosphates, the natural resources existing mainly in four areas should be fully utilized, together with the by-products of the steel industry. These byproducts are produced in a fairly large number of countries. Plants for the treatment of phosphate rock exist in many countries, but many are not fully utilized. The most difficult problem, however, is that of the nitrogenous fertilizers. Natural resources (Chilean nitrates) only meet a part of total requirements, but synthetic and byproduct nitrogen is now produced in 21 countries and, with new plants or equipment, could be produced in many others.

[The working group recommended both short term and long-term measures for increasing fertilizer production and supplies. These recommendations were adopted by the Conference]

The following points are suggested for consideration by the Council of FAO in examining ways of increasing fertilizer production and supplies:

During the war many countries were unable to assure a normal replacement and upkeep of the mechanical equipment used by farmers. The current demand therefore is exceptionally high because of the need for renewing the existing material and on account of new equipment requirements. In addition, many less developed countries, wishing to speed their development programs, have large new demands.

Studies undertaken by FAO clearly show that the lack of draft power, of new agricultural equipment, and of spare parts still hampers agricultural production to a considerable extent.

Consequently it will be desirable to distribute the machinery now produced (especially repair parts and tractors) as efficiently as possible. If more of the tractors now being produced were made available to countries where the lack of draft power is greatest, that would materially increase the world's food supplies in 1948 and 1949.

It would also be desirable to consider (a) whether action is necessary with a view to increasing the production of existing plants, and (b) whether on the long-term outlook new plants ought to be constructed with a view to ensuring adequate equipment for less developed countries.

[The working group's recommendations on agricultural machinery were adopted by the Conference]

Item 7 of agenda - Action on particular products

The Commission notes with satisfaction that action has already been initiated to deal with the difficulties in regard to certain products.

Having considered the Report of the Rice Study Group which met at Trivandrum, India, 16 May to 6 June, the Commission

The Commission notes also that a commodity study on salted fish has begun and joins with Commission II in recommending that this work should be extended to other fisheries commodities in need of similar attention.

The Commission recommends that the Council in consultation with the Director-General, consider what further commodity studies should be undertaken and draws special attention to fats and oils, also to fruit and horticultural products, which are of great importance to the economic life of individual countries.

The Commission understands that during the past year FAO has been represented at a number of other study groups and conferences, notably the International Wheat Conference, the international Whaling Conference, the Wool Study Group, the International Cotton Advisory Council, the Rubber Study Group, and the International Sugar Council. The Commission urges that these contacts be continued and strengthened in order to facilitate the co-ordination which the Council of FAO is being asked to undertake.

Item 8 of agenda - Periodic reports

For the purpose of this Conference, member governments were requested to submit at the end of May 1947, progress and program reports in accordance with Article XI of the FAO Constitution. The response was generally satisfactory and many reports furnished FAO with much valuable information for use in the preparation of Conference documents. However, some reports did not meet requirements either as a source of reference material or as a statement to the Organization and to member governments on government programs and the progress made in executing them.

A working group appointed by this Commission considered the problems involved. The group recognized the wide differences in conditions and in the amount of information available in various countries and recommended that future progress and program reports be divided into two categories.

A minimum report would be required of all member nations, while a more comprehensive report could be submitted by governments with adequate facilities and resources. The Commission endorses this recommendation.

The working group further recommended that the minimum report should be primarily a qualitative discussion of the prevailing situation and the critical problems. It should outline steps taken and progress achieved in improving the food and agricultural situation. The more comprehensive report should contain the same topics as the minimum report but in addition should include quantitative information on matters such as targets of food consumption, imports, exports, and agricultural production. Summaries and analyses of these reports should form part of the documentation for the Progress and Program Review at the annual Conference.

The Commission points out that the questions raised in the report of the working group such as matters of size and content of the reports, their frequency, numbers required, and so forth, should be determined by the Council of FAO.

Report of Working Group on Periodic Reports

The working party has considered the question of periodic reports and has formulated certain principles and recommendations for improving future reports which are commended to Commission I for inclusion in its report to the Conference. As background for consideration of these recommendations it will be helpful to review the purposes of periodic reports and to note how closely the reports prepared this year fulfilled these objectives.

Provision for periodic reports is contained in the FAO Constitution, Article XI, paragraphs 1 to 3, as follows:

Other common defects are that the reports vary widely in content thus increasing difficulties in summarization. They lack definitiveness in discussion of progress and plans for the future. Also they generally do not contain enough analyses of the current food and agricultural position of each country.

Some of the weaknesses and confusion reflected in these reports this year were caused by failure to distinguish between the progress and program reports required by paragraphs 1 to 3 of Article XI and the statistics and official publications required by paragraphs 4 and 5 of this article.

Another serious defect is the timing of the reports. Because the annual Conference was convened early, FAO requested that these reports reach Washington by 31 May to permit their analysis and use in connection with the preparation of Conference documents. However, only two governments submitted their reports by that time. Nine more were received in Washington by 15 June, and by 30 June a total of 19 of the 48 member governments had reported. Four additional reports were received during the last half of July and two arrived during August, making a total of 25 reports received up to date. Only by delaying the completion of many of the Conference documents was it possible to utilize the majority of the 1947 progress and program reports.

The working party noted that another important provision of Article XI is frequently being overlooked, namely, that the periodic reports are intended to be official expressions of governments. Some of the reports this year were prepared by National FAO Committees and transmitted by them to FAO without formal clearance through the governments concerned. While National FAO Committees should have a great interest in the progress and program reports and frequently will participate in their preparation, it is essential that the reports be given official clearance. Otherwise the National FAO Committees should be given authority to represent governments for this purpose, and reporting governments should signify in the letter of transmittal or otherwise that the report has official status.

Examination of the 25 reports from the viewpoint of their scope and content reveals that only a few of them cover the range of subjects suggested by FAO. While it is recognized that governments will not wish to reveal secret arrangements, the discussions of international trade and marketing, and of the current measures for stimulating production and better distribution of farm, forest, and fisheries products are much too vague for use of the Conference.

All reports would have been improved greatly if subject-matter and recommendations contained in the several related chapters were integrated into a uniform summary of national policy and program.

While the comments above emphasize the weaknesses of the 1947 progress and program reports, it should be noted that most of them were sufficiently high in quality to lend encouragement to the opinion that they can become an extremely valuable aid to the Conference and an influential medium for developing international understanding and cooperation.

[The recommendations of the working party were adopted by the Conference]

B. Report to the conference by commission II (Technical Activities)

Item 1 of agenda - Agriculture
Item 2 of agenda - Nutrition
Item 3 of agenda - Fisheries
Item 4 of agenda - Forestry and forest products
Item 5 of agenda - Economics, marketing, and statistics
Item 6 of agenda - World census 1950
Item 7 of agenda - Rural welfare

The Commission held 15 meetings which were attended by delegates from member nations as well as by observers from nonmember nations and international organizations. It devoted a full discussion to each of FAO's technical divisions, and to the projected census in 1950. It also considered plans for a Rural Welfare Division.

The discussions were based on the Director General's Second Annual Report and were opened by introductory statements made by the Directors or other senior officers.

This report of Commission II was drawn up by a group of rapporteurs working as a drafting committee headed by the Commission's chairman. Its recommendations and suggestions constitute the official commentary to the Director-General's report and should be read in conjunction with the latter since no attempt was made to deal in this final report with the entire program of FAO's technical divisions.

By now five technical divisions have been organized and partially staffed. Each of their directors presented an impressive record of work undertaken and suggested programs which meet with the Commission's general approval.

The Commission is impressed with the budgetary limitations on the work of the technical divisions. Insufficiency of funds will be increasingly felt as projects already initiated attain their full proportions. No efforts should be spared to achieve the highest degree of efficiency in the work of the technical divisions.

At this stage it appears necessary to select among the working projects those which members consider to be of the greatest urgency and to suggest an order of priority which will become a valuable guide for the Director-General in organizing FAO's work during the coming year. This will help to avoid undesirable dissipation of effort and to reduce expenditure.

The Commission is aware that there are now a number of international bodies concerned with related fields of activities, and that there is a possibility of duplication of effort unless care is taken to avoid such a development. On the other hand the existence of a common interest FAO, Second Annual Report of the Director General to the FAO Conference, Washington, July 1947. emphasizes the need for co-ordination and joint effort which may lead to more and better service. The Commission accordingly urges the Director-General to continue taking whatever action is necessary to assure suitable collaboration between FAO and other agencies.

This is the first time that a Commission of the Conference has devoted its full time to the technical activities of FAO. This fact in itself provides tangible evidence that FAO has grown beyond the phase of planning. The Commission is of the opinion that such review of technical activities should become a regular feature of the annual Conference of FAO.

The programs of the technical divisions revised in the light of the recommendations contained in this report inspire every hope that FAO will rapidly reach the stage where its services constitute an indispensable and much appreciated element in the food and agricultural policies of member nations. The Commission's deliberations bring out three major points which are worth emphasizing:

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