Wednesday, May 1, 1996


Lester R. Brown, President, Worldwatch Institute

Projections of future food production trends by the World Bank and the U.N. Food and Agriculture Organization (FAO) are overestimating food production and misleading political leaders. This in turn may be leading to costly underinvestment in agriculture and family planning, setting the stage for future food shortages.

Official projections by the Bank and FAO through 2010, which are largely extrapolations of past trends, differ only in minor details. Both indicate that the world is facing surplus agricultural capacity through 2010 and falling prices for wheat, rice, and other grains. However, they do not sufficiently take into account emerging constraints on food production, such as the diminishing response to the use of additional fertilizer, spreading water scarcity, the cumulative effects of soil erosion, rising global temperatures and the crop-withering heat waves associated with them.

Using 1990 as a base, the World Bank projects that growth in the grain harvest will average 26 million tons per year between 1990 and the year 2010. The FAO projects a slightly faster growth of 28 million tons per year during the same period. But, after nearly tripling from 1950 to 1990, there has been no growth in the grain harvest during the first five years of the nineties. As a result, world carryover stocks of grain have dropped to 48 days of consumption, the lowest on record, and prices are soaring.

Bank projections have overestimated the grain harvest every year since 1990, with the discrepancy growing from 56 million tons in 1992 to 225 million tons in 1995. (See table below) FAO projections, which appear in World Agriculture: Towards 2010, published in 1995, show an even greater gap. With each passing year, the difference between the Bank and FAO projections of output and the actual trend is growing wider. (See figures below)

The lack of any growth in the world grain harvest during the five years from 1990 to 1995 should not be taken as a new trend any more than the trend from 1950 to 1990 should be taken as a trend that will continue indefinitely. But the reasons for the lack of growth over the last five years need to be carefully examined to see what effect they are likely to have on production over the longer term.

The World Bank is quite explicit about its use of extrapolation to project future growth. In The World Food Outlook, the Bank study that contains its agricultural projections, the authors say, "Historically, yields have grown along a linear path from 1960 to 1990, and they are projected to continue along the path of past growth."

To justify this approach, the Bank argues that the past is the only guide to the future and, therefore, that extrapolation is the most appropriate technique. To project crop yield per hectare beyond 1990, the Bank economists simply extrapolate the historical trend. For example, they take the U.S. wheat yield per hectare in 1960 and in 1990, and draw a line between the two. They then extend this line to get the wheat yield for the year 2010. They simply assume that the historical trend will continue for the next 20 years.

It is true that past production trends must be taken into account, but the recent past also offers evidence that emerging constraints are making it more difficult to rapidly expand production. A well developed body of scientific literature in the field of production biology describes the trends in biological growth processes in finite environments. These trends invariably follow S-shaped growth curves.

The high school biology lab experiment with algae in a petri dish is designed to teach this concept. If a few algae are introduced into a petri dish containing a plentiful feedstock, the colony will grow slowly at first and then more rapidly for a period, but at some point the growth will come to a halt, in this case as the accumulation of waste limits growth. If properly conducted, this rudimentary experiment yields an S-shaped growth curve.

The levelling off in the world fish catch during the nineties reflects such a curve. The catch increased slowly from 1900 until 1950 and then accelerated after mid century, climbing steeply in the sixties, seventies, and eighties before leveling off during the nineties, yielding an S-shaped growth curve as the catch is limited to the sustainable yield of fisheries. Whether measuring the growth potential of algae in a petri dish, the capacity of the oceans to supply seafood, or the rise in grain yield per hectare, any biological growth process in a finite environment eventually slows and levels off. With agriculture, of course, yields are raised by technological advances, but eventually these efforts run up against the limits imposed by plant physiology, metabolic efficiency, and photosynthesis.

If the World Bank, for example, wants to produce more realistic food production projections, it will need to replace the team of economists who do the projections with an interdisciplinary team that can analyze the new forces that are shaping the food prospect. Such a team should contain, at a minimum, a hydrologist, a plant physiologist, an agronomist, a biotechnologist, and a meteorologist, in addition to an economist. There is a need for economic input, but not to the exclusion of other key inputs.

For example, a hydrologist is needed to assess the rate of aquifer depletion, estimating the date when aquifers that are currently overpumped will be depleted and how this in turn will affect irrigation water supplies. With water tables falling in key food-producing regions such as the southern Great Plains of the United States, several states in India (including the Punjab, the country's breadbasket) and much of northern China, any projections that do not take into account aquifer depletion will overstate future food gains.

Closely related to this is a need for an urban planner who can project the future water needs of cities and how these needs will be satisfied. In cities as different as Los Angeles and Beijing, growing needs are being satisfied by diverting water from irrigation.

China now officially recognizes that 300 of its largest cities are facing water scarcity. Of these, 100 cities, including Beijing, face acute water scarcity. In the spring of 1994, the government banned farmers from reservoirs in the agricultural regions surrounding Beijing, because all available water was needed in the cities. This experience is likely to be repeated hundreds of times over the next few decades in the world's water-scarce regions.

Reliable food production projections will require estimates from land use experts on future cropland losses to non-farm uses, particularly in Asia, which is industrializing at an unprecedented rate. This also includes land loss to urbanization and to the development of automobile-centered transportation systems, such as those now planned for India and China. For instance, China plans to expand its car fleet from 2 million in 1995 to 22 million in 2010. That expansion is threatening future food security as cropland is covered with roads, highways, and parking lots.

Any projections of world food supply need to include the inputs of a plant physiologist who understands the limits of existing crop varieties to absorb nutrients and how this restricts the use of fertilizer to raise yields. With millions of farmers already applying more fertilizer than existing crop varieties can effectively use, the future contribution of fertilizer to growth in the world grain harvest needs to be reassessed.

A biotechnologist can strengthen the projections by incorporating an up-to-date assessment of the capacity of genetic engineers to develop crop varieties that are more drought resistant, salt tolerant, or pest resistant. Although biotechnology has not contributed a single high-yielding variety of wheat, rice, or corn during its first two decades, it may one day do so.

Historically, farmers have always had to deal with the vagaries of weather, but in the future they will also have to cope with the consequences of climate change. The 11 warmest years since recordkeeping began 130 years ago have all occurred since 1979. Within these 11 years, the three warmest have been during the nineties, with the all-time high recorded in 1995. Rising temperatures can translate into crop-withering heat waves of the sort that reduced the 1995 grain harvest in several large food-producing countries, including the United States.

A meteorologist can estimate the effect of the continuing rise in atmospheric concentrations of carbon dioxide and other greenhouse gases on the frequency and intensity of heat waves. In the past, there was little need to be concerned about climate change in agricultural projections, but with atmospheric carbon dioxide levels rising to new highs each year, largely as a result of fossil fuel burning, the world may be moving into a climatic regime that is quite different from the one that has prevailed since agriculture began, some 10,000 years ago.

Without an agronomist to assess the effect of soil losses from wind and water erosion on future land productivity, projections will overstate future production gains. Because soil erosion is a gradual process and because data are often lacking on topsoil losses, the effect on food production is often simply ignored.

There is also a need for an economist who can assess the production response to higher prices under the changing conditions outlined above, rather than simply assuming that it will be the same as in the past. In the mid seventies, farmers invested heavily in new irrigation wells. But in many countries, such an investment in the late nineties will only accelerate the depletion of aquifers. Similarly, in the mid seventies, higher grain prices sharply boosted fertilizer use. But in many countries, investing in additional fertilizer in the late nineties will have little effect on production.

In the mid seventies, for example, the doubling of grain prices and the associated rise in food prices overall led to extensive additional investment in fishing trawlers, which in turn boosted the world fish catch. Such additional investment in the late nineties, however, would simply hasten the collapse of oceanic fisheries. In summary, there will be a production response to higher food prices, but it is likely to be muted compared with those in the past.

The failure to take into account such trends as aquifer depletion, the diminishing response of grain yields to fertilizer, the cumulative effects of soil erosion on land productivity, and the effects of increasingly frequent crop-withering heat waves on yields has contributed to the widening gap between Bank and FAO projections of grain production since 1990 and the real world production trends.

Until recently, the Worldwatch Institute was almost alone in arguing that the FAO and World Bank projections were misleading, but this is now beginning to change. At the end of 1995, Japan's Ministry of Agriculture released its own agricultural supply and demand projections, showing that the future would bring scarcity, not surpluses, and a doubling of grain prices. In projections similar to those of the Institute, the Ministry, using 1992 as a base, projected that by 2010 the price of wheat would increase to 2.12 times the 1992 level and that of rice to 2.05 times.

The differences in these projections need to be resolved as soon as possible, certainly before the U.N. World Food Summit scheduled for November. The difference between the projections by the World Bank and FAO on the one hand and the Worldwatch Institute and the Japanese government on the other are not merely a difference of degree, but a difference of direction. The former say that real world grain prices will continue the long-term historical decline through at least 2010. The latter argue that they will rise, more than doubling by the year 2010.

If the Institute and the Japanese government are at all close to the mark, and the world's farmers cannot restore rapid sustained growth in the world's grain harvest, then steeply rising prices will reduce demand until it balances with supply. In Third World cities, where hundreds of millions of people will be trapped between subsistence level incomes and rising food prices, there will be more hunger and political instability. In a global economy that is more integrated than ever before, political instability in any major country or region can affect economic trends everywhere.

                             World Grain Production, 1950-1995
                     With World Bank and FAO Projections, 1990 to 2010

                                Difference Between                Difference Between
            Grain    World Bank Actual Production        FAO      Actual Production
Year     Production  Projectionsand Bank Projections Projections  and FAO Projections
                                    (million tons)   

1950        631

1955        759

1960        847
1961        822
1962        864
1963        865
1964        921
1965        917
1966      1,005
1967      1,029
1968      1,069
1969      1,078
1970      1,096
1971      1,194
1972      1,156
1973      1,272
1974      1,220
1975      1,250
1976      1,363
1977      1,337
1978      1,467
1979      1,428
1980      1,447
1981      1,499
1982      1,550
1983      1,486
1984      1,649
1985      1,664
1986      1,683
1987      1,612
1988      1,564
1989      1,685
1990      1,780        1,780             0             1,780              0  
1991      1,696        1,806           - 110           1,808            - 112
1992      1,776        1,832           -  56           1,836            -  60
1993      1,703        1,858           - 155           1,864            - 161
1994      1,745        1,884           - 139           1,892            - 147
1995      1,685        1,910           - 225           1,920            - 235
2010                   2,305           2,346                            

SOURCES: Historical data are from U.S. Department of Agriculture, "Production, Supply and Demand View" (electronic database), Washington, D.C., November 1994; USDA, "World Agricultural Supply and Demand Estimates," Washington, D.C., January 1996; projections are from The World Food Outlook, Donald Mitchell and Merlinda D. Ingco, International Economics Department, The World Bank, November 1993, and World Agriculture: Toward 2010 Nikos Alexandratos, U.N. Food and Agriculture Organization, 1995.

World Bank Projections for Grain Production

FAO Projections for Grain Production

- END-

A copy of this brief is being sent to James Wolfensohn, President of the World Bank, and Jacques Diouf, Director General of the U.N. Food and Agriculture Organization.