The State of Food and Agriculture, 1952

THE oTATE OF

FOOD A ji cucruiri, 0 REVIEW AND OUTLOOK 1952

FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS ROME, ITALY OCTOBER 1952 FAO STATISTICAL YEARBOOKS

Yr:P=3,7=3 OF FOOD AND AGRICULTURAL STATISTICS, 1947, 1948, 1949, 1950, 1951

I- PRODUCTION II- TRADE

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YrikEGOOKS OF FOREST PRODUCTS STATISTICS, 1947, 1948, 1949, 1950, 1951

Yearbooks of international forest products statistics including notes on the present salient features of the current world situation.1948 contains information on world output, imports, exports, and consumption of forest products for the years 1946 and 1947 reported by over 100 countries and territories ; 1950 covers the years 1948 and 1949. The 1952 volume is now in preparation. Bilingual English/French, with Spanish supplement. Per volume $2.50 12/6

REPORT ON THE ACTIVITIES OF FAO u DamTHE EXPANDED TECHIALCAL ASSISTANCE PROGRAM

for the First Financial Period, 1950-1951 and Outline of Activities for 1952

This report contains chapters on selectedprojects, a statistical summary of ETAP activities, regional activities and activities in various countries, policies and plans and a statistical summary for 1952.With photographs. In English, French and Spanish.$1.005/- CL 16/2

THE STATE

OF FOOD AND AGRICULTURE

REVIEW AND OUTLOOK-1952

FOOD AND AGRICULTURE ORGANIZATION OF THE UNITED NATIONS ROME - 1952 NOTE

The statisticalmaterialinthispublicationhas been prepared from such information as has been available to FAO staff not later than 30 July 1952

Printed inItaly

Advance Printing September 1952 Final Printing October 1952 CONTENTS

FOREWORD 1

Chapter I.Summary ...... 5 ChapterII.World Review and Outlook Agricultural Production, Trade and Consumption in 1951/52 ...... 13 The Demand Situation in 1951/52...... 18 Production and Supply Prospects for 1952/53 30 The Demand Outlook 1952-54 31 The Long-Term Food Situation 34 Ag ricu lturalI nvestment 37

Chapter IILRegional Review and Outlook Europe (excluding Eastern Europe and the U.S.S R ) 45 Eastern Europe and the U.S.S.R...... 50 North America (U.S.A. and Canada) 52 Latin America 58 Africa 63 The Near East. . 66 The Far East. . 70 Oceania (Australia and New Zealand) 75

Chapter IV.Review and Outlook by Commodities Wheat 81 Coarse Grains 85 Rice 86 Sugar 88 Livestock Products 90 Fisheries Products 93 Fats, Oils and Oilseeds 97 Fruit (Citrus) 99 Fruit (Dried) 101 Coffee. 102 Tea 103 Cocoa 104 Tobacco 105 Cotton ...... 107 Wool 110 Jute.. 113 Rubber 115 Forest Products (Roundwood) 116 Forest Products (Sawn Wood) 117 Forest Products (Wood Pulp) 118 Fertilizers 120 Pesticides 123 Farm Machinery 123 Fisheries Equipment 126

In Charts

Recent Increasesin Food Production above Prewar. . 12

II Postwar Increase in Food Production . 14

III Per Caput Food Consumption Prewar. 20

IV Per Caput Food Consumption Postwar (1950/51) 21

V Industrial Production in Selected Countries . 22

VI, VII Agricultural Wholesale Prices in Selected Countries. . 24

VIII, IX General Wholesale Prices in Selected Countries 25

X, XI Wholesale Price Indices : Ratio of Agricultural PricestoallPrices in Selected Countries 27 XII- XX Population and Food or AgriculturalProduction, Prewar and Postwar Europe 46

United States . 53 Canada . 54 Latin America . 58,59 Africa 63 Near East. 68

Far East. . 70 Oceania. 76

XXI Cotton Prices, Postwar. . 109

XXII Wool Pricesat Auctions, Postwar 112

XXIII Prices of Various Forest Products (1949-52) . 119

iv FOREWORD

puttingthislatestreview of the State of Food and Agriculture before our -.Member Gov- ernments and the general public,I feelit my duty to recall once more the unanimous reso- Inlution of FAO Member Governments,adoptedat the Sixth Sessionof the Conference, to try by every means for "a well-balanced increase of one or two percent per annum in world production of basic food and other essential agricultural products in excess of the rate of population growth". Looking over the past year's results,thereis some reason for satisfaction, as total agricultural production has increased by about two percent over the previous year.However, the greater part of the gain was made in products other than food, notably fibers and rubber, and food production alone increased by only one percent.Gratifying as these increases may be, they reveal the need for government planning to take full account of the possible interferences from changing world-market conditions which, if uncountered by adequate incentive policies and other measures, may divert productive resources from the most essential to the most profitable.The expansion of world food production by one percent from 1950/51 to 1951/52 has only barely kept abreast with the rate of population growth and we are thus stillfar below the rate of increase required for essential improvements in the diet of the large majority of the world population.In addition, beca,use of the uneven regional distribution of productive achievements, the need for more rapid expansion in some regions is even much greater than the global figures reveal. On the technical side, it is encouraging to note that the generosity of the economically more advanced countries has enabled the community of nations to undertake a co-operative effort of sharing their technical skill and knowledge for the benefit of all, in the Expanded Technical Assistance Pro- gram of the United Nations.Recognizing the basic necessity of first developing the agricultural resources of the more backward areas of the world, the largest single share of the available funds hasbeen allocated to FAO, and our work in this field is reported in another document *. But technical assistance is only the first step towards higher production.While there are many instances in which countries have put to good use the newly acquired technical knowledge without considerable capital expenditure, the fullest advantage from this new program can only be achieved if international co-operation in the financial field is stepped up simultaneously with the expanded technical assistance.Within the framework of its charter and resources, the International Bank for Recon- struction and Development is helping the financing of agricultural development programs.Yet, not all such programs can be financed at the cost of a regular bank credit.Low-cost credit and international grants-in-aid could contribute immensely to implementing some of the major agricultural development projects.I am following with interest the current attempts in the United Nations to find ways of providing these, and thus of giving the -Member Governments of FAO increased and better opportunities in their endeavor to increase the output of agriculture. Moreover, technical help may easily be frustrated if we do not succeed in securing permanent stable markets at adequate prices for the increased production, while at the same time maintaining the flexibility required or meeting major changes in the general price level, in production techniques and in the conditions of demand.The need for such flexibility, no doubt, complicates the adoption of national and international stabilization measures.None the less, our efforts must be directed toward overcom- ing these difficulties and toward developing an adequate groundwork of carefully planned stabilization, to provide the needed security.

* Activities of FAO under the Expanded Technical Assistance Program 1950-1952, Rome, May 1952. The picture of world trade in agricultural products remains clouded with difficulties. The exchange and trading difficulties mentioned in my report last year have increased and once again the dollar shortage is putting obstacles in the flow of international trade.It will require the concerted effort and good will of all nations for finding ways and means to prevent the recurrence of these difficulties, which im- pede so greatly the task of expanding the world's food supply. Again this year, I am submitting the review and outlook of agriculture against the background of the more general trends in world economy.The great expansion of production and trade has continued in the past year and the most careful analysis of today's operating economic forcesindicates another year of high economic activity.Agriculture is called upon to contribute to as well as benefit from existing favorable economic conditions.Governments, in laying their plans and in advising farmers, should keep in mind that demand for the products of agriculture, fisheries and forestry is likely to remain high.But they also should look farther ahead.Within the limits inherent in any long-term forecast, we have also attempted to project economic trends farther ahead and to indicate some of the problenis agriculture may have to face once the present economic expansion comes to a standstill. If this report helps governments to make the necessary provisions for future contingencies, it will have fulfilled its purpose.

NORRIS E. DODD Director-General Ch I SUMMARY

Chapter I S U M A R Y

Totalagricultural productionin1951/52 in 1951/52, but the general level of raw material increased two percent.However, most of this prices in mid-1952 was still above the levelof increase was in non-food products ;total food two years ago.Also, prices of most foodstuffs, production was at the 1950/51 level and per caput with the exception of some vegetable oils and tea, food production Wa S lower than this andstill were still higher than in June 1950.The ratio below the prewar level in some areas.While the of costs to prices received, however, ismoving volume of total world trade expanded, the vol- unfavorably for farmers in a number of coun- ume of international trade in agricultural prod- tries. ucts remained unchanged. Increasingdefenceproduction and plant Changes in price relationships and greater expansion in most of the industrialized countries effort by some governments to expand production makes a continuation of the high level of economic of foodstuffs promise some improvement in 1952/53. activitiesin1952/53verylikely.In the less If weather conditions continue favorable, total developed areas, economic development programs, agricultural output in 1952/53 will equal and per- supported by expanding technical assistance and haps exceed that of 1051/52, with increa.sed food by international, bilateral and regional financial production.The trend towards expanded agri- aid, will continue to increase employment and culturalproductionislikelytocontinue into the demand for agricultural products. In the longer 1953/54. run, completion of defence programs may cause While some slight improvements in calorie a decline in economic activities, but present indi- levels have occurred in the past two years, the diet cations are that economic conditions will remain in the poorest-fed regions of the world isstillin- favorable probably until mid-1954, as many govern- adequate, particularly in the rice-consuming areas. ments have large-scale projects in reserve to " take Prospects for a marked improvement in the long up th.e slack " in the decline in defence expendi- run are rather discouraging.A more efficient ture. utilization of the world's limited food resources The full impact of the high level of economic is, therefore, one of the paramount tasks of inter- activities on the demand for agricultural products national co-operation in agriculture. has been reduced by difficulties arising in inter- Efforts to expand agricultural and primarily national trade.After the interlude due to the food production will be facilitated by a high de- post-Korean price rises, the problem of the dollar mand for the products of agriculture. In the past shortage became accentuated and consequently crop year, world industrial production and employ- the trend towards liberalization of foreign trade ment continued generally at high_ levels, generat- has been reversed.In 1951/52,restrictions on ingincreasingconsumer incomeswhich were international trade grew at an alarming rate, reflected in a slowly-expanding demand for food- affecting the demand for many of the non-basic stuffs. On the other hand, industrial demand for foodstuffs and forcing a continuation of austerity agricultural raw materials receded from the high in many parts of the world.While some alle- levels following the Korean outbreak,affecting viation of the difficulties was evident at the begin- particularly the textile industry throughout 1951/ ning of 1952/53, balance-of-paymentsdifficulties 52.Sinailarly,prices of most agricultural raw will continue to affect unfavorably the demand materials entering world trade declined sharply for agricultural products in 1952/53.

5 7. The lack of dollars in most parts of the world North America is an incentive for efforts to reduce the dependence of food-importing countries on .North America. Increasing rates of government expenditure and of business investment were decisive factors con- This requires considerable investment for expand- tributing to enlarged output and the maintenance ing agricultural production in the deficit regions. of full employment in North America. Private domestic investment in agriculture in the Favorable weather and the high domestic and underdeveloped areas remains very low, but gov- foreign demand accounted once more for an increase ernments and public institutionsare increasing in a,gricultural production in 1951/52. their activities in this field. Agriculture is assigned Similarly a major share in most of the plans for economic output of wood pulp improved, while lumber development but there is great need for stepping production declined slightly.Fish landings were up the flow of international capital funds for smaller than in the preceding year.Farm cash incomesincreased,reachingrecordlevels financing agricultural development.In addition, in discussions within the United Nations are under Callada and one of the highest in the United way to find ways and means of financing non- States. Crop prospects for the current season are good self-liquidating agricultural development projects through international grants. and great gains in production are expected, particularly in the United States' wheat and maize. Livestock output inthe United Statesisalso REGIONAL SUMMARY likely to be higher, but the Canadian livestock industry has been severely affected by the out- Europe (excluding Eastern Europe and break of foot-and-mouth disease.Demand for the U.S.S.R.) the products of agriculture, fishery and forestry The recovery of agriculture continued, but West- islikely to remain high in 1953/54, providing ern Europe's dependence on imports from over- the incentive for maintaining or if possible increas- seas did not diminish, and imports from the dollar ing agricultural producti.on. area increased as availabilities elsewhere declined Latin America Intra-European trade remained at high levels, although trade between Eastern and Western Unfavorable -weather conditions and the after- effects of the emphasis on industrialization reduced Europe was much less than before the war.Prices received by farmers improved, but net farm in- Argentina's agricultural production considerably come increased less since costs advanced more in 1951/52, and thereby reduced total production than prices.Crop production in 1952/53 can be in the region in spite of larger plantings and better expected to exceed the previous year's level and harvests elsewhere.This primarily affected Latin America's exp' orts of breadgrains, meat and oil- livestock production isalsolikelyto increase. Demand for farm products will probably remain seeds,while per caput food supplies remained generally strong in 1952/53 and the greater avail- almostunchanged.Largecapitalinvestments ability of coal,steel and - other raw materials and technological progress improved the output of should encourage high industrial activity. fisheries, and forestry production expanded also. With rising production costs, net farm incomes appear to have increased less than gross farm Eastern Europe and the U.S.S.R. incomes. New policies in Argentina may bring Collectivization in Eastern Europe has slowed substantial recovery in crop production, but farm down but the transfer of land and livestock to labor is likely to continue to be a major problem. collectiveownershipcontinuedinPoland and Further improvements in 1953/54 may, however, Eastern Germany.Yugoslavia is moving away increase export availabilities in livestock products. from the Soviet type of agricultural organization. Exchange difficulties may slow down further in- Agricultural production of the area is still below creases in food imports of the region.The supply prewar, although showing marked improvement situation of forestry products is expected to im- in recent years.The crop situation improved prove and to reduce the region's dependence on but livestock numbers showed little change in imports from abroad. 1951/52.Trade appears to have increased considerably within the region.Russian grain exports The Far East to Western Europe were higher but total exports Rice production in1951/52 was again below from the region declined somewhat. prewar levels but other grain production in 1951/

6 52 was higher.Output of non-food crops, with promise great improvement inthe immediate the exception of jute and rubber, as well as live- future.Trends since the war indicate that ad- stock, is still below 1934-38 production. The rapid ditional food supplies for export are to come main- population growth has changed the region from ly from tropical Africa, since increasing domestic a net exporter to a net importer of food, parti- consumption is absorbing most of the additional cularly of grain. Fisheries increased their produc- output elsewhere in the region.Difficultiesin tion in many countries and exports of forestry speedingup developmentprojects mayarise productscontinued athighlevels.The high rom the shortage of soft-currency capital goods, prices of the area's main agricultural export pro- higher prices and lack of financial means. ductsdeclinedsharply,particularlyreducing dollar earnings and depleting foreignexchange Oceania reserves in many countries of the region.New The decline in wheat production in Australia price relationships between non-food and food and the drop in export revenues, particularly from crops will encourageefforts for increasing food falling wool prices in both Australia and New production, but it is likely that available export Zealand, have led to strenuous efforts to encour- surpluses, particularly of rice, willstill be insuf- age greater output of exportable products through ficient for the food-deficit countries in the region. a variety of means.Inflationary forces due to Economic development projects are progressing the previous year's high export earnings are still but reduced export earnings may slow clown the operative and, with the declining export values, rate of development. import restrictions were introduced in Australia to counter a mounting deficit in the balance of The Near East trade. Under normal weather conditions and with The cultivatedareaexpandedconsiderably the progress of the Australian program to increase and trade increased. Most of the expansion was, output now under way, partly financed by a con- however,concentrated on non-foodcrops and siderable share of the $150 million World Bank severe droughts in the area held agricultural pro- Loans, total agricultural production in 1952/53 duction lower than expected, although bumper and 1953/51 islikely to surpass present levels. cropswere harvestedinTurkey.Percaput Net farm income, which decreased in 1951/52, consumption levels have shown little improve- may recover again aspricespaidto farmers ment since before the war, and in most parts of have been increased and subsidies havebeen theareafood suppliesareinadequate.Net introduced. exports from the regionfell.The immediate outlook for the region indicates a possible decline in food production with particular danger arising SUMMARY BY COMMODITIES from the threat of desert locust outbreaks and, in some areas, from the extension of cotton acre- Wheat age at the expense of foodcrops.Economic development plans throughout the Near East Exports of wheat and wheat flour were larger stressing agricultural expansion, however, promise in 1951/52 than in the preceding year, shipments improvement over present conditions. from Canada and the United States increasing considerably, but those from Argentina and Aus- Africa tralia contracted.Carry-over stocks in these four countries were lower on July 1, 1952, all countries Despitearecordproductionofoil-bearing except Callada showing a decline from the pre- crops,African agricultural production did not vious year.Prices tended upwards in the first show any appreciable increase over last season's. half of the year but were slightly lower at the The demand for imports, influenced by rising close than at the beginning.Over half the total domesticconsumption,consequentlyremained shipments, however, were traded under the In- high, and there is a gradual shift from subsistence ternational Wheat Agreement.Supplies will be farming to a market economy.Production and largerin1952/53 owing toincreased crops in exportsof forestry products increased but a most parts of the northern hemisphere.Pros- declining foreign demand may hamper further pects for improvement in exportable supplies in expansion. Argentina and Australia in 1952/53, however, are The outlook for agricultural production does not not good.

7 Coarse grains Fats and oils Total shipments of coarse grains, at about the Prices of fats, oils and oilseeds declined during same level as in 1950/51, were still short of the 1951/52.Incontra,stto1950/51, there wa,s prewar average.Over half the total was again widespread desire to reduce stocks accumulated supplied by the dollar exporters and the ina,bility the preceding year.Also, total world production of Argentina toshipsubstantial quantities of and e,xport supplies of oils and fats increased in maize is a serious feature.Supplies in North 1951/52.The principal increases were in coconut, America in 1952/53 are likely to be large with groundnut, cottonseed and olive oils.In 1952/53, anticipated good crops of maize in the United inventory demand for fats and oils will probably States and of barley and oats in Canada, and a be somewhat stronger than a year earlier.World la,rge carry-over alsoin Canada.Barleycrops production of fats and oils, particularly of lard in the Near East and North Africa are reported and olive oil, is also likely to decline but world to be very good.Increased prices to growers export surpluses may be as large as a year earlier in Argentina may result in better maize supplies because stocks of oils and oilseeds increased dur- in 1953. ing 1951/52 in several producing countries. Nota- ble instances were edible vegetable oilsinthe Rice United States, groundnuts in Nigeria, and olive oil in some of the Mediterranean countries. World production failed to expand in 1951/52 and the frrowth in world trade, which marked Sugar 1951, was checked in 1952.Uncontrolled prices of rice have risen, in contrast to those of most other The increase in world production by 1.7 million commodities, but national policies will determine metric tons in1951/52 as compared with the the extent to which this disparity is allowed to previous year was due entirely to larger crops in a,ct as a,n increased incentive to producers.In Central and South America.Since the largest some important areas, production will also depend increaSe in production occurred in exporting coun- on the course of political unrest.Demand for triesrequiring payment indollars,marketing rice may suffer some reduction owing to the di- problems have emerged which will probably result minished purchasing power of other South-East in addition to carry- over stocks of over 1.5 million Asian countries and the increased relative attrac- tons. tiveness of alternative foods. The outlook is for further increase in production in 1.952/53 in all areas except Cuba, where the Livestock products 1953 crop may be restricted by administrative measures.World consumption is expanding, and Production of milk and meat increased in 1951. th.e rise in production in 1951/52 did not result Butter output declined while production of cheese in a substa,ntial decline in wholesale prices.In- and preserved milk rose substantially.The utili- deed, retail prices were higher in most countries zation of milk for fluid consumption generally than during the previous yearA lowering of continued to expand.Also, production of pig- retail prices would encourage additional consump- meat expanded, mainly owing to continued recov- tion in most countries. ery in Europe, while shortage occurred inbeef and mutton supplies.World trade in butter and Citrus fruit meat fell but trade in cheese and preserved milk expanded.Prices of livestock products generally Production of oranges and mandarines increas- rose considerably in 1951 under the impetus of ed in 1.951/52 and international trade in citrus high consumer incomes.The outlook for 1952/53 fruit reached a new high level.Though OEEC is that production in the livestock industries gen- trade liberalization did not apply to European erally will expand, but that world trade, especially imports from Spain, that country increased exports in butter and beef, may continue to be adversely substantially.The United States continued to affected by small exportable supplies from Argen- grant export premiums and succeeded in market- tina and Australia, while hard currency stringen- inglargerquantitiesin Europe.The United cies ma,y continue to limit feed imports, and Kingdom still takes less citrus fruit than prewar consequently the exportablesurpluses,of the wherea,s most countries have inerea,sed their im- Western European exporters. ports.New plantings of trees are very large and,

8 though there is no immediate fear of a surplus, higher in soft currency countries.The produc- some concern has been voiced over the rapid tion outlook appears more favorable in 1952/53, expansion of citrus groves. but the upward trend in world demand seems likely to continue and it appears probable that Dried fruit the world will absorb at relatively high prices The output of the major varieties of dried fruit all the cocoa that is likely to be produced during in 1951/52 was larger than in 1950/51.Raisin the next few years. production in the United States increased about 50 percent while elsewhere smaller yields were Tobacco obtained.The pack of currants did not change World tobacco output in 1951/52 increased ap- appreciably. Production of prunes almost doubled proximately 3 percent above 1950/51.There was whereas fig, production decreased approximately a substantial increase in the major cigarette types, 20 percent.In spite of the absence of carry- in particular the flue-cured Virginia, but produc- overs of raisins from the previous season, buyers tion of other tobaccoes decreased.Total exports were rather cautious for most of the season and increased slightly and United States exports were the sale of the United States' surplus raisin pool the highest since the record of 1946 ;shipments of 30,000 tons to the United Kingdom weakened to the United Kingdom rose considerably in spite other markets until it became clear that stocks of reduced ECA ccrants.Exports of oriental leaf in other exporting countries were lower than as- alsoincreasedbut therearestillsubstantial sumed earlier in the season.The 1952/53 pack carry-overs from previous crops, mainly in Greece. may be slightly lower for raisins and prunes but Total supplies in 1952/53 are likely to increase larger for figs. further but exports from the United States and Canada are expected to decline as a result of the Coffee cut in the United Kingdom's dollar spending on The world coffee economy was probably more tobacco in 1952/53. prosperous in 1951/52 than ever before.Produc- tion increased as compared with 1950/51 ; imports Rubber rose by close to 10 percent ; prices remained remark- The ivorld output of natural rubber in 1951 ably stable at very high levels.Production out- was no larger than in the previous year, having look for1952/53isless favorable,clue to the declined from April onwards as prices fell.For severe drought in Brazil.On the other hand, 1952 areductionof 11percentisestimated. demandislikely to continue strong and there World consumption in 1951 was 12 percent less is little indication of production exceeding demand than in 1950, as a result, of the restrictions in for some years to come. force in the United States, consumption elsewhere having increased by about 5 percent.Both pro- Tea duction and consumption of synthetic rubber in Supplies in 1951/52 were larger than imports the United States increased, offsetting most of the for current consuniption for the first time since decrease in its natural rubber consumption.Pri- the end of the war.Prices of lower quality tea ces of natural rubber, which had receded almost consequently declined by more than 30 percent continuously during 1951, declined more steeply but 1952 prices were sti11150 to 200 percent above' in the early months of 19.52, but became more prewar. stable towards the middle of the year, when the Production in 1952/53 is promising, but the ceiling on natural rubber consumption in the Unit- increase in the United Kingdom ration is likely ed States had been removed, and private importa- to absorb the probable increase in production. tion liad been fully restored.In view of the price No serious surplus problems are anticipated for advantage which synthetic rubber enjoys, the re- the immediate future. moval of these restrictions is not, however, expected to have any appreciable effect on the relatively Cocoa low level of natural rubber consumption there. Cocoa production in 1951/52 at 679,000 tons Cotton was lower than at any time since the a,bandon- ment of international allocations in 1949.As a In contrast to the acute shortage and extremely result, prices rose to the "ceiling" level in the high prices of cotton in the preceding season, the U.S. (38.37 cents per lb.) and were 2 to 4 cents 1951/52 season has been characterized by an

9 increased supply, falling prices, and a contracting India slightly less than, in the previous season. demand.Total production, the second largest on The crop is expected to be adequate to meet the record, was 25 percent greater though, with the requirements of the industry, which last season much depleted carry-over at the beginning of the for the first time since the war was sufficiently season, the increase in total supply was of about well supplied to achieve a greater output than 4 percent.Consumption, which had been at a the market was prepared to absorb. A decided record level during 1950/51, declined as a world- reduction in the Indian export duty on jute goods wide recession overtook the textile trade and in- and the lower level of statutory minimum prices, dustries.Cotton prices which, at the beginning as well as export duties, in Pakistan should ease of the season, had adjusted themselves in accord- the industry's task of disposing of its products ance with the enlarged volume of supply,con- in the current season. tinued falling throughout the season in face of the textile recession.The decline still leaves cotton prices high in relation to those obtaining Fisheries products before the outbreak of the Korean war, but appears to have discouraged expansion in acreage Production of all fisheries commodities increased for the same 1952/53 crop.Available evidence about 4 percent in 1951, largely because of the indicates that production is unlikely to be as much successful reconstruction of war-damagedfleets as in 1951/52. and the introduction of technical improvements. Consumption recovery awaits a trade revival While outputformostediblefishproducts in textile industries, but meanwhile, excessive tex- declined, oil and meal and frozen fish production tilestocks arebeing, reduced.The revival in continued to increase. Where pressures of risina demand were felt, cotton textilesislikely to be postponed until cotton prices show more signs of stability, possibly indigenous production increased, 'out in Western after the new season's supply becomes available, Europe and North America, rising costs tended but in view of the continued expansion of rayon to limit production, although there was an overall capacity and the comparative cheapness of rayon, increase in fish prices. cotton is not likely to enjoy the full fruits of a The coming year will probably be marked by recovery in textile industries. improved fisheries resourcesinunderdeveloped areas, while demand in the developed areas may Wool be less stable.Demand for frozen fish should increase but more competition will probably devel- In common with other branches of the textile op in marketing of fish meal and fats and oils. industry, the woollen and worsted industry WELS Commercialized fishing industries will face discrim- affected by a marked recession in 1951/52.Wool ination in demand which may raise difficulties, consumption in 1951 was 16 percent lower than particularlywheremarkets are protected by in the previous year.The lower price of wool import regulations. provides a better basis for a more active consumer interest in wool textiles, and reduction in stocks at various stages of manufacture and distribution Forestry products promises a resumption in mill activity in the next few months.Whilst it is too early to form an Demand for forest products was very strong estimate of the weight of the 1951/52 clip, little during 1951.As a result production increased if any increase in production is to be expected and trade expanded even more, especially in sawn following on the adverse pastoral conditions last softwood and pulpwood.Unprecedentedprice season in Australia and South Africa.Govern- rises took place mostly in Europe but price ceil- ment stocks are now limited to relatively small ings were in effect in the United States. quantities held as strategic reserves, and trade Towards the end of 1951 and during the first stocks in consuming countries are generally low, half of 1952, a pronounced fall in demand and but there is a substantial accumulation of cross- in prices occurred as the result of balance-of- breds in South America. payments problems and a growing consumer resistance to high prices. Jute With a continued strong demand in the most Planting in Pakistan for the 1952/53 crop is important countries, however, a new rush on sup- believed to have been about the same as, and in plies is not to be excluded.

10 Chapter II

D REVIEW ANII OUTLOOK CHART I - INCREASE IN FOOD PRODUCTION ABOVE PREWAR. AVERAGE OF 1949 AND 1950 COMPARED WITH 1934-38 -.17E7 -c\,..o. »t A.\ ':,".., \\ \\:,,\,; \N ,,''\-'-. \ \,,- '1 () LLJI 7 DECREASEUNKNOV4 0N 9% 30%2010 19% AND OVER 29 % Chapter II-WORLD REVIEW AND OL TLOOK

AGRICULTURAL PRODUCTION, was 5 percent above the preceding year's.Fish TRADE AND CONSUMPTION IN production in 1951 continued the postwar increase 1951/52 1 with the total catch 4 percent above 1950.The world output of forest products as a whole increased substantially in 1951, although this was distrib- Production uted unevenly among commodities and regions. Despite unsettled world conditions and poor The output of woodpulp and pulp products ex- weather in such widely scattered areas as Australia, panded by 10 percent in North America, while India and Argentina, farmers produced nearly 2 that of sawn wood increased most in Europe, percent2 more than in the previous year and 11 with about 5 percent.The world output of fiber percent more than in the immediate prewar years building boards in 1951 was 36 percent above the (Table1 and Charts I and II).This increase 1950 level, the increase being greatest in Europe kept pace with the gain in population during the some 85 percent. past year, but not over the longer period as popu- Inmost regionsagriculturalproduction, lation growth has been 15 percent since before response to the earlier changes in prices and/or the war.Production per caput thus remained to government policies, shifted somewhat in fa- at a level below that of the immediate prewar vor of agricultural non-food items, whilefood period. production remained at the same level or showed The overall increase in production was distrib a smaller increase.In the Far East production uted unevenly among commodities and regions. of fibers and rubber increased 7 percent over 1951 Prices during the previous two crop years had and 32 percent over 1949/50, and food output incr- favored non-food crops as compared to food, and eased slightly and only equalled the immediate food production in 1951/52 showed only a slight prewar average despite a rise in population.Thus, change over the previous year, although fiber in Pakistan and India jute acreage expanded by production increased by 13 percent.The produc- two fifths between 1950/51 and 1951/52, whereas tion of rubber, cotton, jute and sunflower seed the rice area declined slightly, and the wheat increased 10 to 60 percent in 1951/52 over 1949/50, area remained virtuallyunchanged.In Indo- while the production of eight major food crops 3 nesia rubber production increased by 16 percent increased only 2 percent and 1 percent over 1949/50 and rice only about 7 percent.However, fiber and 1950/51 respectively and was still below the and rubber outputin the Far East was only postwar peak reachedin1948/49.Meat and 16percentaboveprewar,whereasinLatin milk production was slightly higher than in the America, the Near East and Africa, the increase preceding year.On the other hand, sugar produc- above that level ranged from 38 to 23 percent. tion in 1951/52 was the highest in histoly and North America continued to maintain itshigh level of food production andisthe only region where the increase in food production since before Excluding the U.S.S.R. the war iswell above therisein 2 These estimates have a downward bias, especially population for Europe, as no adjustments have been made for numbers. increased efficiency in feeding livestock. By a more intensive use of agricultural resour- Wheat, rye,barley-, oats,maize, rice,sugar, ces and labor, nearly all regions were able to main- potatoes. tain food production and increase that of raw

13 CHART II - POSTWAR INCREASE IN FOOD PRODUCTION. AVERAGE OF 1949 AND 1950 COMPARED WITH AVERAGE OF 1946 AND 1947 materials.This isespecially important in the TA13LE 1. INDEX NUINIBERSa OF VOLUME OF underdevelopedregionswherefarmproducts CULTURAL PRODUCTION 1949-51 provide the main source of export, income. (1934-38 100)

International trade in foodstuffs and fibers REGION 1949/501950/51 951/52 Total volume of' world exports of agricultural products was somewhat lower in 1951 than in 1950, with a substantial reduction in the export 7'utal);.oductionb of fibers although total food exports remained Europe (excluding U.S.S.R ) 90 97 101 about the same(Table 2).Nevertheless,sub- North America 142 1:17 141 Latin America 114 118 115 stantial gains in quantities exported in 1951 OVer Far East 95 99 101 1950 ranging from 5 to 45 percent are shown for Near East 111 12,4 124 fish, bread grain, rice, sugar, fats and oils, coffee, Africa 120 122 122 Oceania 119 114 tea and tobacco. World (-excluding U.S.S.R )i 106 109 The lower exports of cotton and wool are mainly an effect of the reduced activity of the textile industQT in Europe, Japan and North America. Food Pro(' lone Europe's slowly increasing food production made Europe (excludin 89 96 100 possible a further slight reduction of net imports North America 145 145 144 Latin America 116 120 116 in 1051/52(Table 3).But the heavy- depend- Far East 96 99 100 ence of Europe on overseas food imports has be- Near East 109 118 123 come a greater burden on her balance of payments, Africa 118 118 118 Oceania 120 114 110 since North America's preponderance as the world's World (excluding U.S.S.R.) 106 110 greatest supplier of foodstuffs has grown still further in 1951/52. As the .North American share in world trade Aroma( lc Cropsd increased, that of the two other major food export- Europe (excluding U.S.S.R ) 125 131 138 ingregions Latin America and Oceania North America 155 158 178 Latin America 99 96 98 declined.As indicated in more detail in Chapter Far East . 86 89 88 III,the main reason for the change in Latin Near East 164 155 147 America and Oceania in 1951/52 was the sharp Africa 142 154 154 Oceania 98 103 106 decline of grain exports and to a lesser extent of World (excluding U.S.S.R.) 106 107 110 meat exports.In particular, the heavy decline of Latin America's roleasa major source of Natural1bersand agricultural exports is due to a decline in exports Rubbere of coarse grains". to a-bout 20 percent of the prewar Europe (excluding U.S.S.R ) 106 106 113 volume ;maize, which_ used to provide the bulk North America 119 76 114 Latin America 120 129 134 of these exports, fell to less than 10 percent of the Far East 88 108 116 quantitiesexportedin1934-38. The growing Near East 115 127 123 Africa 123 131 138 sisare in world imports of the Far East -- a net Oceania 116 113 114 exporterbeforethewar ismainly due to World (excluding U.S.S.E, 107 104 118 higher import requirements of bread grains and a net deficit of rice in 1951/52. a These quantity indices are preliminar- revisions of previous FAO production indices.A general revision will be The total volume of world exports of forest completed and new revised series established before the next products in 1951, edition of this report. consisting almost entirely of b Indox numbers of agricultural production are based exports by North America and Europe, increased gross production data applying uniform prewar price weights. There is double noun! :Ng in the indic,, since no allowa me, by 7 percent over 1950.The exports of sawn were maim for ion of Teed. For example. grains may wpco :c4 production of grains ", and again in and round wood rose by 10 percent, and those of the form of ock. Agricultural products comprise time co modities ol below in the three aggregates. wood pulp and pulp products by 6 percent.The Food comprises wheat, rye, barley, oats, maize, millet and sorghum, rice, dry beans, dry peas, broad beans, chick increased demand for sawn and round wood in peas, lentils, un6pecified pulses, sugar, potatoes, sweet po- Europe led to an increase in this continent's net tatoes, vegetable oils, animal and marine fats and oils, and meat. imports, while the favorable marketing conditions cl Aromatic crops comprise cocoa, coffee, tea and tobacco. e Fibers and rubber comprise cotton,wool, jute, hard elsewhere rforwood pulpand pulpproducts fibers, hemp, flax and rubber.

15 TABLE 2. INDEX NUMBERS OF VOLUME OF TRADE IN AGRICULTURAL PRODUCTS,1949 - 51a

(1934-38 = 100)

Exports Imports REGION 1949/50 1950/51 1951/52 1949/50 1950/51 1951/52

A gricultural Product sb

Europec 56 68 65 90 91 89 North America, 171 183 200 126 143 139 Latin America 96 84 152 181 159 Far East 68 82 84 74 89 101 Near Ea t 111 129 107 216 234 241 Africa 192 197 125 125 131 145 0 ceattia 132 128 110 140 166 191

Worldd 97 105 102 96 103 103

Food

Europec 55 70 71 88 S9 SO North Amer ica 268 982 335 99 100 98 Lat in America 84 83 74 144 174 158 Far East 37 42 78 79 96 Near East,. 121 103 86 247 291 201 Africa 110 112 101 109 113 128 Oceania 116 118 95 143 163 140

WorIdd 90 96 91 91 95 91

Aromatic Crops

Europec 1 58 50 54 86 83 91 North America 116 117 128 154 138 144 Latin America 125 105 110 140 130 146 Far East 94 88 100 68 SI 86 Year East 217 156 160 161 146 155 Africa 147 158 166 130 145 147 Oceania . 90 100 74 119 131 142

Worldd 115 112 110 112

Natural 1' ibcrs and Rubber

Europec 56 64 53 03 96 88 North Amer ica 92 10:5 91 146 199 184 Litt in America 88 125 81 101 236 173 Far East 97 130 129 68 102 108

Near East ...... 96 135 108 350 351 454 Africa, 124 129 137 419 423 484 Oceania 148 138 124 173 238 365

Worldd 100 119 104 98 115 108

a In bmsio r1:::;, for trade indices the same commodities are included as forproduction indiees as far as internatio existed. andimy have been weighted by corre,pondingr appli,,sP1 e uniformprice weights ts,:at footnotes to Table lj. b Trade data relate to calendar years, with the exception os wheat, rye,barley, maize and oats where the data for trade season July-June beginning in the year stated han e hem: Use C. qttU ,Nports sud imports include trade bet tt...:1E:1 'IC 31!Europeand Western Europe but exclude trade between the Eastern European countries and the U.S.rt.ii. and bativemi them-elves f.g the most part.For some major commodities estimates 1w V'' been made of intra Eastern European trad,This:1 : y bins the European index.Unreported China tradeill 9-1 1151. partially estimated in the same way, may also aifeettheI'm' Eastern index.All other regions present a, full trade coverage. d Mi-t; of the inter trade between non-reporting countries is ex.Iui1,-,i footnote c).

16 resulted in a slight increase in net European ex- TABLE 3. INDEX NITAIBERS OF NET TRADE IN ports.In North America, on the other hand, AGRICITLTITRAL PRODUCTS, 1949-51a increaseddomesticproduction of wood pulp (1934-38 = 100) and pulp products resulted in a slight reduction in net imports. Net Exports -F = Net Imports Food consumption and nutrition During the past two years food consumption Remo x 1949/50 1950/51 1951/52 in most countries in nearly all regions showed some further improvement.However,gainsofan impressive character have been too few to suggest AgriculturalProducts that any change of fundamental importanceis Europe 100± 98± 96 occurringin the world food situation (Table 4 -1\Torth Americab and Charts III and IV). Latin America . 86 83 73 The improvement in food consumption levels Far East 60 74 63 Near East 69 88 54 in 1951/52 appears to have been smaller and less Africa 122 126 119 widespread than in the previous year.Slight Ocean.ia 132 126 104 gains were recorded in a number of countries in the Far East and Near East and some setbacks inother countries in these regions,especially Food Pakistan and Israel.There was some recovery in India following the conditions of acute food Europe 101 + 97 + 96 North Americab 8 991 9 259 12 058 stringency that prevailed in parts of the country Latin America . 72 65 57 in the preceding y-ear; serious shortages are, how- Far Paste Near East e ever, still reported from some areas in India.In Africa 86 Europe, except for Spain and Portugal, the past Oceania 115 116 93 year has witnessed no significant change in food consumption levels.For many years, due largely to a succession of droughts, Spain and Portugal Aromatic Crops were outstanding exceptions to the general postwar recovery in Europe's food situation.Aided Europe 90 87 96 North A_merica . . 172 147 151 by better weather conditions, the per caput food Latin. America . . 124 104 109 supply in these two countries substantially in- Far East. . . 99 90 102 Near East. ... 52 125 146 creased in 1950/51 and there was a further im- Africa 153 162 172 provement in1951/52.For thefirsttime in Oceania + 121 132 144 postwar years, food rationing has been almost completely abolished in Spain but low income prevents large numbers of people both in Spain Natural Fibers and Rubber and Portugal from obtaining adequate supplies. Elsewhere in Europe changes appear to have Europe 101± 103 95 North ..4merica . Difficulties been mostly of a minor character. Latin America . 73 109 68 in procurement, however, have led to some dete- Far East 143 173 163 rioration in the food supply in the United King- Near East . 93 132 104 Africa 115 120 126 dom, especially in livestock products.The rap- Oceania 148 136 117 idly expanding populations of the food surplus regions of North America, Oceania and Argentina a In basic data for net trade indices the same commod- continue to enjoy high per caput food supplies ities are included as for production indices as far as interna- and record levels of consumption of animal prod- tional trade existed, a.nd they liase been weighted by corresponding or applicable uniform price weights (see foot- ucts.Apart from one or two countries, notably notes to 'rabio 1). Brazil, there is no evidence of any further upward b Owing to the abnormally low exports of grains from the United States in the 1934-33 period the North American re- movement in consumption levels in Latin Amer- gion was a net importer of agricultural products in the base period.This also explains the very large percentage change ica in 1951/52. in food exports from North America. For the world as a whole, trends of the past c Changed from a net ex-porting region to a net importing few years suggest that the gradual postwar re- region between 1934-38 and the postwar period.

17 covery in the food situation may, for the time THE DEMAND SITUATION IN 1951152 being, be drawing to a close.Average per caput food supplies in the different regions appear to Although world industrial production and em- be becoming stabilized at lower levels than in ployment continued generally at high levels in prewar years, both in quantity and quality in 1951/52, the sharp upward movement in prices, many countries in the Far East as well as in some production, and market demand which had char- countries in the Near East and Africa, with less acterized the preceding year was no longer evi- animal products except milk in Europe, and more dent, and demands for farm products reflected and a greater variety of supplies in most of the thesechangedconditionsinvaryingdegrees, food surplus countries.Despite increased money especially in export markets.While production income generated by higher industrial production of military goods continued to expand, that of in the past few years, expansion in the effective civilian goods contracted somewhat, demand of demand for the more costly foods now also ap- purchasers was generally less strong for both con- pears to have slowed down, especially in Europe. sumption and stockpiling, and inflationary pres- Food prices, particularly at the retail level, have sures were reduced and even gave way to deflation- not fluctuated as sharply in the past year as raw arytendenciesinsomecountries. Pricesof material prices.Apart from minor pauses, the raw materials in the second half of 1951 and in trend in retail food prices in most countries ap- early 1952 generally declined relative to prices of pears to move steadily upwards.In a number finishedproducts.This, combined with lower of countries this tendency has been strengthened exports, reduced the dollar earnings of raw material by a reduction in food subsidies to the consumer exportingcountries from shipmentstodollar or bytheraisingof prices paid to farmers. countries and thus contributed to renewed dollar Poorer sections of the population consequently shortages. find it difficult to buy the more nutritious foods since these are often also more expensive.For Industrial production example, in many parts of Europe meat consumption has failed to reach the prewar level. In North America, despite a recession in some In the underdeveloped areas oftheworld, consumer goods industries, industrial output in cereals and starchy roots still constitute the bulk 1951 as a whole averaged some 10 percent above of a quantitatively inadequate food supply.For 1950.In the first quarter of 1952 the general instance, a recent survey in Ceylon shows that the level of industrial production was slightly below diet is often deficient in calories and that under- thatofthe first quarter of 1951, whileinthe nourishment is common among the population. second quarter production was seriously affected In an appreciable number of families surveyed by the steel strike in the United States. recently in India, the average dailycaloriein- However, manufacturing capacity in the United takes were below 2000 and, in a few, below 1500. States at the end of 1952 will be 50 percent higher Even in countries in which calorie levels are ade- than at the end of World War II.Incomes quate the diet often does not contain enough remained high as wage controls gave way to the protective foods.Such unbalanced diets have continued pressure for wage increases,reflect- deleterious effects on the health of the people ing high consumer prices. and are responsible for the prevalence of various The high industrial production and employ-ment deficiency diseases.In Egypt, for example, certain reflected the impact of expanding rearmament and deficiency diseases such as pellagra prevail both domestic investment.While actual spending on among rural and urban populations although the armaments is behind the original schedule, in- observed calorie intakes correspond reasonably well vestment in industrial plant continued at record with their estimated requirements.However, the levels.In the United States and Canada initial most serious state of deficiency now prevailing difficulties in raw materials supply were short- in many parts of the world isa sy-ndrome which lived and controls and allocations were relaxed. is associated with low protein consumption.This Civilian production, except of automobiles and syndrome is known to be largely responsible for private building, continued almost unrestricted. high mortality among children from six months The reduced output of many consumer goods such to five years of age in Africa, Central America, as refrigerators and textiles was caused by a and possibly insomeother areas, including slackening of demand rather than by a shortage Asia. of supplies.

18 TABLE 4. ESTIMATED ENERGY AND PR,OTEIN CONTENT OF NATIONAL AVERAGE FOOD SUPPLIES PER CAPUT IN 1951/52 COMPARED WITH 1950/51, 1949/50 AND PREWAR

CALORIES TOTAL PROTEIN ANIMAL PRO 1951/5'2 1951/52 1951/52 COUNTRY as per- as per- as per- Prewar 19-1./50 1950/51centagePrewar1949/501950/51centagePrewar1949/501950/51centage of of of 1950/51 195 0/5 1 1950/51

)1 Number per lay . Grams per day . .) % ( . Grams per day .. ) NORTH AMERICA Canada* . . . 3 070 3 140 3240] 85 93 95 48 56 57 U.S.A.*. . 3 150 3 170 3 210 89 91 92 + 1 50 61 61 1 SOUTH AMERICA a Argmtina 2 730 3 170 3 140 98 103 102 62 67 68 Brazil 2 150 2 440 2 490 68 65 67 32 25 26 Chile 2 240 2 340 2 440 C9 70 731 21 22 23 Colombia. . . 1 860 2 330 2 240 47 57 551 20 26 26 Honduras 1 980 2 0301 54 571 19 18 Uruguay 2 2 900 2 9301 90 91 921 61 59 60 Venezuela . 2 210 2150E 65 641 29 28 EUROPE Austria . . 2 990 2 600 2 740 88 75 791 39 29 33 E Belgium/Lux. 2 820 2 890 2 890 84 85 84 34 41 40 Denmark.* . . 3 420 3 230 3 130 + 2 91 103 97 + 3j 57 59 57 Finland . . . 3 000 3 020 321O 95 96 100 .44 51 48 France* . . . 2 830 2 -.50 2 790 + 2 93 92 91+ 2 39 41 41 2 Germany(Fed. Rep).* . . 3 070 2 700 2 810 84 78 76I + 42 33 36

Greece* . . 2 600 2 490 2 510 84 77 77 E 23 19 17 Ireland . 3 400 3 450 3 500 99 96 97 48 47 49 Iceland . 3 160 3 240 111 113 74 79 Italy* 9 510 2 2 400 + 3 82 74 76 + 3 20 18 20 Nether] ands* 2 920 2 970 3 090 5 80 Si 82] 2 41 39 39 Norway* . 3 200 3 150 3 180 1 90 104 104] 2 49 58 57 Sweden* . . 3 120 3 210 3 240 2 95 95 95] 1 59 61 60 2 Switzerland* . 3 140 3 180 3 250 + 1 96 98 97E+ 1 52 51 2 U. K. . . . 3 120 3 080 3 100 5 83 90 88 4 46 46 46 6 Portugal (cont. 2 230 2 63 67 20 20 FAR EAST Coy] on . * 2 140 2 010 2060E 48 48E + 9 11 12 + 1 China b 2 230 2 030 2 120 + 2 71 62 65 + 6 5 5 India e *. 1 970 1 620 1 570 + 2 56 42 42 + 6 6 Indonesia* 2 040 1 880 1 950 + 1 46 42 44 5 5 5 Japa,n* . 2 180 2 000 2 100 + 2 64 52 53 10 9 10 5 Pa.kistan* . 2 240 2 160 60 58 11 11 Philippines* 1 920 1 960 20501 1 45 44 47 11 10 11 NEAR EAST Egypt* . 2 450 2 300 2 400 74 66 68I + 9 13 14 Turkey* 2 560 2 670 2 710 78 85 88j + 12 17 19 = 3 Israel 2 680 2 520 81 Si 32 30 AFRICA Union S. Af.* 2 300 2 570 2 640 68 72 73 23 27 26 OCEANIA

Australia* . . 3 310 3 210 3 290 3 103 98 98 E 67 66 66 9 New Zealand. 3 260 3 400 3470E 96 101 104 64 66 70

a Figures refer to calendar year of the earlier year mentioned. h Excluding Manchuria and Taiwan. c India and Pakistan in the case of prewar figures. *REMARKS ON 1951/52 changes : CANADA, slightly less beef + butter more pork + milk. U.S.A., slight increase in meat milk slight decline in butter + sugar. DENMARK, more meat, cheese + fats, less potatoes sugar + milk. FRANCE, more meat, eggs + milk, slightly more fats, less potatoes. GERMANY (FED. REP.), more sugar, meat + milk, lesscereals potatoes. GREECE, more potatoes. slightly more sugar, pulses, fish, milk + cheese, less cereals. ITALY, more cereals potatoes, slightly more sugar, pulses., meat, milk + fats, slightlyless cheese. NETHERLANDS, less potatoes + fats, slightly less sugar -4-- meat. NORWAY, slightly more sugar + cheese, less cereals, potatoes, meat + milk. SWEDEN, less milk, slightly less potatoes, sugar + butter. SWITZERLAND, slightly more meat, cheese + fats. LTNITED KINGDOM, less potatoes, slightly less cereals, sugar, meat, eggs, milk, cheese butter. CEYLON., slightly more meat. CHINA, more rice and wheat. INDIA, more rice and sugar. INDONESIA, slightly more cereals, more starchy roots. .TAPAN more sugar, less fish. PAKISTAN little significant changes. PHILIPPINES, slightly less rice and corn. EGYPT, more wheat, less rice. TURKEY, more cereals, meat and butter. UNION OF SOUTH AFRICA, insignificant changes. AUSTRALIA., less wheat, meat fats.

19 CHART III - PER CAPUT FOOD CONSUMPTION PREWAR a ,

2200-2700BELOWUNKNOWN CALORIES 2200 CALORIES OVER 2700 CALORIES ,4 '`d CHART IV - PER CAPUT FOOD CONSUMPTION, POSTWAR (1950151)

1 I BELOWUNKNOWN 2200 CALORIES F 2200-2700OVER 2700CALORIES CALORIES In Western Europe totalindustrialactivity China (excludingTaiwan)reportedincreased remained high and shortages of coal and steel activity.The pace of industrialization of some are slowly disappearing.Beginning in the second Latin American countries slowed down. half of 1951, however, industrial expansion did Industrial production is the basic factor behind slow down considerably.In some countries, e.g. effective purchasing power for farm production. Belgium, Germany and especially Italy there is The slowing down of industrial expansion meant serious unemployment. An increaseof indus- thateffective demand for farm producealso trial production was reported in Eastern Europe stopped growing in1951/52.The ensuingef- in1951.For Europe asa whole (excluding fects were most noticeable in industries based on U.S.S.R.) industrial production in 1951 averaged agricultural raw materials, where slackening in 12 percent above the 1950 level. prices produces exaggerated contractions in man- Industrial activity in India and Japan continued ufacturers' purchases.In the leather and shoe to risein 1951/52 although at a reduced rate. industry and the paper and printing and textile

CHART V - INDUSTRIAL PRODUCTION IN SELECTED COUNTRIES

1948 .100 SEMI-LOGARITHMIC SCALE 300NIIMMMEIMIION=MENM ME MMEmi NI= IIIMMEMM MI MI fflEMEMUMMMIIMMIM 280EMEEMEE E MEE MMEMEMM ME MEE___EMEE 260=MEE EMEEEEEEEEEEE E MIME. MEE MEE. ME ME =ME MEE= EMEMEEMEEME MEE 240MEEEMENEEMEMEEMPAMMFEEMMEEMEE ME MMEMMEMEEMIEMINEMEE-----._,. / 220MM.MMEMEM=ME ME 1111MMUMM/immsME ME 200ME 1 ME=ILI E ME ME E 180MIME= Eu uuuuuuuuu MOMMMIME EMEW O M 160MOMMOMMO/--. MI MOOMM OM OEM tIII MO= MOMIME JAPAN - FRANCE1111.111111 140 UNITEDKINGDOM ...... Ill. .,...... Ill ..' CANADA MEXICO . 4 120 lp," .- - ...... 61/4 >, :--lx------AI. - . -/? . v i :A . - . 100 I I -Th\--> iNDIA Ic 90 N . I ., II

1 I 'sV I UNITEDSTATES \\,/ BELGIUM I II I 80 II

70III 11111111111 11111 JFMAMJJASONDJFMAMJJASONDJFMAMJJASONDJFMII I II II 19 49 1950 1951 1952

Notes : United Kingdom: including construction. France : adjusted for number of working days. United States :excluding electricity and manufactured gas. Mexico :quarterly averages. Belgium : adjusted for seasonal variation and number of working days. Western Germany : adjusted for number of working days. Chile :including building, excluding mining.

22 industries in many countries, stocks yore reduced increases in prices of metal products and of some and consumers were reluctant to buy, although foodstuffs.Reduction of stocks by private in- supplies were ample and prices declining.The dustry and governments, the easing of the supply trend became especially marked after the third situation, the strengthening of anti-inflationary quarter of 1951.Reduction of production and programs and the reluctance of consumers to buy, increased unemployment in the textile industry resulted in niarkecl price declines on international was widespread,affectingmajor producersin commodity markets of rubber, wool, most fats North .America, Western Europe and in the Far and oils, sugar, hides, jute and textiles and their East (Chart V). products (Table 5). Real national income showed the same rising Domestic wholesale prices on the AN'holecon- trend as industrial production in Western Europe tinued to rise during the first half of 1951 but and in North A.merica.In the former higher started levelling off or declining inthe second gross national production inallcountriesfor or third quarter. During the first half of 1952 which data are available was offset by the ef- prices stopped advancing in most primary produ- fects of the developments of the terms of trade cingcountries,anddeclinedslightlyinthe (and invisible items of the balance of payments) majority of West European countries.Canada., resulting in an average increase of less than 5 the United States and Italy had continuous though percent (except in Germany) in real national in- gradual declines in wholesale pricessincernid- come in 1951 above 1950.Countries which im- 1951.In Australia the general wholesale price proved their terms of trade throughout the year, level continued to increase, though at a decreas- e. g. the pulp exporting Scandinavian countries ing rate since September 1951. and Belgium as a steel exporter, increased their real national income around 7-8 percent (except In most countries for which data are available, Finland, with 14 percent).In Canada and the the cost of living continued to increase in the United States, relatively less dependent on foreign first half of 1951/52 although at a much reduced trade, real national income continued to increase rate.In the first months of 1952, the increase in 1951 by 5 and 7 percent respectively. slowed down still more and in a number of cases turned into a slight decline.The 1951 increases were mostly around or below 5 percent.However Prices in parts of South-East Asia, in Australia, Japan Price movements were varied as between com- and in Latin America, where the effects of the modity groups.Armament demands and gen- high_ export earnings of 1951 were still in force, erallyhighindustrialactivitycausedfurther and in Austria and France, where the repressed

TABLE 5. -- WHOLESALE PRICES OF MAJOR VVO D TR,ADE COMMODITIES IN SELECTED iNTARKETS Average price Peak price 1951 Most recent price 1952 COMMODITY 1,Tan. 1917- Jan.- Price 1937 1938 Aug. 1919 'June1950 Mouth Price Month

U.S. Dollars per lb. unless otherwise indicated

Wheat (-U.S.) $/bushel. . 1.20 0.78 2.37 2.25 Nov. 2.53 June 2.31 Rice (-U.S.) 3.60 3.30 10.86 8.10 March 10.54 May 10.55 Sugar, raw (Cuba) . . . 1.72 1.40 4.35 4.39 June 7.41 May 4.46 Coconut oil (Philippines) 5.93 2.95 18.26 14.82 March 21.09 June *9.50 Copra (U.S.) 3.70 1.95 10.94 9.52 Feb. 13.78 June *7.00 Coffee (U.S.) 11.10 7.80 26.77 47.73 Feb. 55. 50 (Tune *53.60 Cocoa (U.S.) 8.40 5.30 31.83 26.41 March 38.38 -May 38.37 Tea (Ceylon) . 29.80 26.50 61.20 50.50 March 64.90 May 40.30 Wool (U.K.) " 116 . 90 - 139.80 155.40 March 366.30 June 151.70 Cotton (U.S.) 11.80 9.00 33.50 32.40 May 45.20 June *620..34004 Cotton (Karnak) (Egypt) -- 60.00 45.20 March 102.90 June Jute (U.K.) ...... 14.10 1 4.10 16.70 14.50 May 28.80 May 15.00 Rubber (natural U.S.) . 19.40 14.60 20.30 23.50 Jan. 73.50 Tune c3800 Rubber (Malaya). . 18.60 13.70 17.90 21.00 Feb. 73.50 May 28.80

SOURCE :International Monetary Fund, International Financial Statistics; am+'AO food and agricultural sta is ics. * :Provisional. a 1934-35 average. b July 1937- June71938. e U.S. Government -fixed price.

23 CHART VIAGRICULTURAL WHOLESALE PRICES IN SELECTED COUNTRIES (Devaluing in 1949 /50)

I948I0O SEMI-LOGARITHMIC SCALE 300 290 L ¡ 280 i ¡ L I I ¡ 250 JAPAN 240 -- I /.\T ZIO O_.._.e_/ ii i ,.---* I,,._: III...... _\ 180 / \/.\\ ° AUSTRALIA ' I60_/ I j, j ISO

I 40 / UNITEDKINGDOM 1.. 30 i:tJ iJlIllll NETHERLANDS 120 eç i, /11111 /SWEDEN IO 1 -- - I t ./ FRANCE 00°. -

80 JE M AM J JASO ND JE M A M J JASO NOUE M AM J JASO ND JF MA M J JASO 949 1950 1951 1952

Notes: Australia: July 1947 - June 1948 = 100. United KingdomPrices paid to farmers. CHART VIIAGRICULTURAL WHOLESALE PRICES IN SELECTED COUNTRIES (Not devaluing or devaluing slightly in 1949/50)

SEMI-LOGARITHMIC SCALE

CANADA- ITALY

jI.,......

UNITEDSTATES

il I I J F M AM J J A SON DJ FM AM JJ A SO N D JE M A M JJ A SON D J F M A M J JASO 1949 1950 1951 952

24 CHART VIII-GENERAL WHOLESALE PRICES IN SELECTED COUNTRIES (Devaluing in 1949750)

948 .100 SEMI-LOGARITHMIC SCALE 2903C°ininommMIIMMIMMEIMIIMMIIMMIMMIIIMMWIIIMMIMIMIMIIMIUMMIIIIIIIII 280 MMEININNIMMMMMIIIIIIIMI MIMIIIMIIMININ ...... 11..1.1..M.11111.11.1.,.=.-...... *--".."' ''''...-''.'"--.-.111..1 270 MIMMEMIIIIMME111...1.11.111..111111 I .*"'''.". EIMMEMEIMMI 26°MINEMEMINEEMINIEmmulimmim4_ El No rilmENIN 25°E.....Elmo=nuimminm./---JAPAN MINomiNMENINN 24° MEINIEMEMEN1MUM= I / 11MMINEINSEI 23°=EN .r.''i ME=MillMIMINNE 22,1MMffiNNIIIMMIN 1 ./. MIN EMIMIIIMIIIIMEIBMINI

I I 2002°MIMI MIME .I* .11111..111.1111. .. AUSTRALIA 118900mum....111111. ...,U umEl DENMARK / - ,... /...... 11 170MIMI '- i

. 1 1111 111111 160 'i / 1 I un 50 . .-./ / UNITEDKINGDOM .../ "

1 I :

140 1 1 .. Ill ll FRANCE NETHERLANDS 130 ...... 1111 , , INDIA 120 IIIII 111111_I .../ .... e , 10 .--...... "" .,,,!.... - - I a '" 7 '' '' i I f ...... 1 '

1 MIMI SWEDEN 90 H [ Hill i

80 Pill.111111111111r1111111111111 11111111 1=111111 1111111111111111111111111 JFMAMJJASONDJFMAMJJASONDJFMAMJJASONDJFMAMJJASO 1949 1950 1951 1952

Note :France :1949 = 100. CHART IX - GENERAL WHOLESALE PRICES IN SELECTED COUNTRIES (Not devaluing or devaluing slightly in 1949150)

94800. SEMI-LOGARITHMICSCALE 150 um i i 1

1 1 1 CANADA 130i4°MUIIIIIIIMI Emillilli r k.,:

.0 i 1 i 120M. #0'''' ...... UNITEDSTATES . 1 ...... s' ......

Ho ...° 4, I __,,,,,...-- , - --nr.-1-...... 1...i .n7:.....,...... ,,,A ,, I....=--.--,, ...... : .... :71,..1...: 1 oo 1 ... .-0 ...... '-- ... 1 . I i II . * 9 o ITALY '...... '' 1------:'..e SWilZEAND 80 111111111 J MA ONDJFMAM ONDJF AI ASO DJ F AMJ ASO 1949 950 1951 1952

25 inflationary pressures broke loose, the rise has food products generally remained firm, but weak- been 10 percent or more.Consumer prices for ened considerably for other agricultural products food generally kept pace with the overall cost of andfats andoils,continuing thedownward living in 1951/52. movement which started in March 1951. Cotton The slowing down of rises in retail prices was prices have receded in all markets since December partly due to a more general and more vigorous 1951 and most markedly in the case of non-dollar application of governmental anti-inflationary meas- cottons which previously had advanced above ures in addition to the pricedeclines on inter- the price of United States cotton.However, after national commodity markets.Such measures in- the sharp declinein March and .April1952, clude increases in bank rates (Austria, France, prices showed a slight recovery.Wool prices India, United Kingdom) a general tightening of fell sharply through most of 1951 and by May credit at all levels and reduction of public expend- 1952 were one third of the peak prices of a year itures.Measures to facilitate imports, levy of before and about 20 percent below the price special export taxes, and to a minor extent, direct prevailing before the Korean conflict.But al- controls, were also employed in various countries. though by June 1952, wool prices had risen be- As inflationary pressures receded curtailment of tween 15 and 20 percent over the March 1952 level, credit was relaxed in some countries while foreign there were still no definite indications of a per- trade difficulties forced reductions of export taxes manent upward movement.Jute prices dropped (India, Egypt) and the re-imposition of import rapidly with increased supply at the beginning of restrictions (United Kingdom, Australia). the season, then receded further during the first The recent divergent movement of domestic three months of 1952.Rubber prices in June prices as between countries appears to be a contin- 1952 were at their lowest level since the outbreak uation of an adjustment process that began with of the Korean hostilities, a decline of about 50 the devaluation of a number of currencies in percent from the peak in February 1951 but still September 1949. In the countries concerned whole- far above the pre-Korean levels.World market sale prices, including those of agricultural prod- prices of most oils and oilseeds have declined ucts, have since risen much faster than in coun- materially from the high levels reached around tries that did not devalue their currency (or March 1951, although by May and June 1952, those that devalued only slightly), generally suf- prices began to move upward.Throughout most ficientlytooffset any premium gained by the of 1951/52, prices of wheat, rice, sugar, meats and dollar immediatelyafter thedevaluation.Be- dairy products were generally steady or have tween September 1949 and April 1952 the whole- increasedsomewhat, butrecentlymostgrain sale price level rose by only 8 to 15 percent in the prices have declined on account of larger crop United States, Canada, Switzerland and Italy, prospects in the United States. while in the United Kingdom, Australia, the Neth- Current price relationships are tending to favor erlands, Denmark and South Africa,it rose by foodstuff production.Furthermore, upward farm 36 to 60 percent (Charts VI to IX). price adjustments were announced in early 1952 During 1951/52 wholesale prices of agricultural by the Governments of the United Kingdom,

TABLE 6. IN.DEX OF THE RATIO OF AGRICULTURAL WFIOLESALE PRICES TO GENERAL WHOLESALE PRICES, SELECTED COUNTRIES (1048 =.- 100)

1 950 1951 1952 LOUNTRY shalf Second First It IfSed Jan. Feb. Mar. Apr. May I half half

Australia a 106 123 133 96 91 87 84 84 87 Belgium 92 88 82 82 83 t3 84 84 Canada. 94 93 92 90 91 90 90 91 91 France b 101 92 85 88 89 82 88 88 Italy 115 113 106 108 110 Ill 110 110 Japan 110 102 92 101 102 102 103 103 Mexico 90 91 95 100 97 97 99 102 Sweden 100 96 87 86 5 85 87 90 U. S. A 91 94 97 95 95 95 93 94 94

a July 1947 - June 1948 100 b 1040 100. CHART X - WHOLESALE PRICE INDICES: RATIO OF AGRICULTURAL PRICES TO ALL PRICES IN SELECTED COUNTRIES

1948 lOO 160

150

140 I

130

120 ITALY ------, 110 I '--- --_-.. _- ... ..,..... 1. ------U ITED STATES ...... "... ,,... 100 ..impial.Alkup.i'llMillli 90

80NEE - L MEXICO ' CANADA

70IIIIIIII JF MAMJJ ASONOJFMAMJJ A 5 0 N 0 J FMA M JJA S ONDJFMAM 1949 1950 1951 1952

CHART XI - WHOLESALE PRICE INDICES: RATIO OF AGRICULTURAL PRICES TO ALL PRICES IN SELECTED COUNTRIES

19 4 8.100

i60

150 II i40 iliIAUSTRALIA III

130 11111 FRANCE 1 0ii ..^ ..' \s______-1' ' ------SWEDEN JAPAN 110III- I /' . ''' . ' /..._--___ 7-_ --- / ' --- ______.. \ -. 100_lair , 1 i I/ ---' G'"------. '----.!___:-,,-----'... i . /------, ------90 -1-12 N.,/ , i i''''.1.-/ \ ,\ .----- BELGIUM . 80 7

701111 11111 ,.: F MAM J SONDJF A MJJ ASON 0 A JJ ASOND F 19jir"49A 1950 1951 1952

Notes: Australia : July 1947 - June 1948 = 100. France : 1949 100.

27 Sweden, Norway, and Austria.In Australia dur- Terms of trade ing 1951/52 upward farm price adjustments have also occurred forallagricultural products ex- While volume of world trade increased appre- cept wool, and Argentina has sharply increased ciably in 1951, the change in price relationships price incentives to producers for export. between raw materials and manufactured goods, During 1951, prices of fish increased, important already discussed, resulted in a change in the exceptions being canned tuna and some fish oils. terms of trade.The terms of trade of the indus- The upward movement for nearly allfisheries trialized countries improved without reaching the commodities was somewhat reduced by the rela- pre-Korean level while those of the raw material tively abundant supply. exportingcountriesdeteriorated althoughstill Prices of forest products such as sawn soft- remaining more favorable than before the Korean wood, pulpwood and pitprops which had risen conflict. very substantially during 1951,especially outside North America, levelled off toward the end International trade of the calendar year and by April1952 had dropped sharply below the top 1951 levels. During the past year, the division of the world The prices farmers received for their products into two trading groups has become more marked, relative to those they paid for goods and services the firstconsisting of the major trading area during the past year,as measured by the ratio outside the Soviet Bloc, and the second of the between agriculturalwholesale prices and gen- Eastern European countries, the Union of Soviet eral wholesale prices (Table 6 and Charts X and Socialist Republics, and China. Although in 1951 XI) indicate that the relative position of farm- trade within the two groups of countries continued ersin1951/52 as compared with the previous to rise, trade between them in 1951 was less than year has improved somewhat in many of the one half of the prewar volume, and judging from countries of Western Europe and Latin America. present trends, difficulties are likely to be still In the Far East, :Japan and India were the only greater in the near future. major countries to show some improvement.The However, total value of world exports increased price ratio deteriorated in most of the other coun- by about one-third in 19.51 over 1950, although tries of the Far East, in Australia (due to wool quantity increased only between 10 and 1:5 per- only) and to a considerably lesser degree in Canada cent.The most marked expansion occurred in and the United States.In the regions where im- the United States,as Western Europe, Latin provements occurred they were due in part to America and the Par East increased their pur- an upward adjustment of maximum or supported chases, especially during the first half of 1951. prices.Where a deterioration occurred,it was World export values declined sligh tly in the first in the main due to a sharp drop in prices of agri- quarter of 1952. cultural raw materials, whereas prices of other goods, in many cases wholly imported, continued Balance of payments to climb,or at least showed a slower decline. In North America, the lower value of the ratio The continuing fall in raw material prices and in Callada was in part caused by the outbreak the somewhat lower level of United States con- of thefoot-adill-mouth diseaseinearly1952, sumption in 1951/52 reduced U. S. import values the resulting restrictions of movement of livestock, while expanded demand for its exports rapidly and a sharp break in livestock and livestock increased the positive net balance of trade and product prices.In the United States the p1-ice services in 1951/52.On the basis of eleven months changes reflected to a large extent changes in the this balance in 1951/52 would be about four times supply situationforindividual farm products, as large as in 1950/51. The United States' foreign e.g. .meat, poultry and dairy products andoil- economic aid and other transfers also declined and bearing crops.In addition tothe supply in- are insufficient to cover the world's dollar deficit fluence, there apparently was some weakening in in1951/52.Many European and some Latin consumer demand for fats and oils and for textile American countries had, therefore, to draw on products which contributed to the drop in wool, their gold and dollar reserves.While the rest cotton and oil-bearing crop prices.Demand for of the world had acquired from the United States stockpiling and speculative buying in general in the gold and dollar assets of more than 3,600 million first half of 1952 did not ha-ve the same price- dollars in 1950 and of more than 1,000 million making influence as in the first quarter of 1951. dollars in the firsthalf of 1951,the United

28 States again became a net recipient of over 650 number of smaller countries of the Sterling Area million dollars in the second half of this year and had announced quantitative traderestrictions. of over 550 million dollars in the first quarter Outside this area severe measures were also taken of 1952. by France and other countries including Argentina, The fall in raw material prices, as well as the Brazil, Chile, Indonesia, Israel, Syria and Uruguay. United States reduction in imports, were greatest Among the agricultural commodities directly af- for the three main sterling commodities, rubber, fected are fresh and dried fruits and processed tin and wool, and the Sterling Area was therefore foods.These restrictions may be severe enough the heaviest loser in gold and dollar assets.Its to create new problems in the balance-of-payments favorable balance with the United States of 324 position of Denmark, Italy and the Netherlands. million dollars on current accounts during 1950 On the other hand Belgium, Germany and Italy changed into an unfavorable one of 764 million were able to extend still further the liberalization dollars for the first9 months of 1951/52.The of imports. Sterling Area deficit with Western Europe could Besides quantitative restrictions, a number of not be eliminated, requiring gold payments of financial measures such as changes in exchange about 485 milliondollars up to the end of June rates, and increase of interest rates and of customs 1952.Since then, with her total quota exhausted, duties were applied.Other means adopted for the United Kingdom has had to pay all her deficit redressing the balance of trade included the rein gold as well as that of the rest of the Sterling duction of contractual prices for imports (wood Area arising from transactions with the OEEC pulp), and encouraging exports by either lowering countries. The total losses of gold and dollars to the export taxes (Ceylon, India) or by granting ex- Sterling Area in the second half of 1951 amounted port subsidies (France). to over 1,500 million dollars and in the first Some United States foreign trade practices also quarter of 1952 to over 600 million dollars, reduc- contributedtodisturbancesin trade.Among ing the combined holdings to 1,700 million dollars these are the import quotas on dairy products, at the end of the latter period.However, only the " Buy American " provision, the threat of small losses occurred in the secondquarter of action under the escape clause in reciprocal trade 1952, thanks to reduction of current deficit and to agreements, and the export embargo on a wide some acceleration in United States aid payments. variety of goods believed to contribute to poten- While the Sterling Area lost 50 percent of its tial armaments, with corresponding restrictions gold reserves in only nine months, Latin America on exports by many Western European countries. lost much less and still had over 3,300million dollars reserves at the end of 1951. The low level of the Sterling Area's reserves, coupled with the high The general economic positionofagri- rate of gold and dollar losses, explains the strong culture, 1951/52 measures taken by countries of this area to slow or to stop the drain on their assets. The farm labor supply was relatively tight, The effects on other regions were less marked. especially in the highly industrialized countries The dollar shortage has,however, slowed im- such asthe United States, United Kingdom, ports of manufactured consumers' goods into Canada and, to a lesser extent, in the group of Latin America in 1951/52.Brazil had to utilize countries where industrialization was being stressed, theInternationalMonetary Fund fordollars as in Argentina and Australia.The impact of needed to import wheat.Japan's trade with this supply situation on production was somewhat China and Korea has fallen still further and is greater in the countries where agricultural mecha- now only a fraction of its prewar volume. nization had not advanced to the U. S. or U. K. tempts to compensate this loss by higher exports level.In both groups of countries, the costs of to non-Communist countries inthe Far East hired labor increased as alternative opportunities have led to the accumulation of considerable in industry attractedlargernumbersofthe sterling balances in Japan. agricultural population. Contrary to fears at the beginning of 1951, no The growthofrestriction in international general shortages developed in agricultural machinery, although United States availabilities to trade such countries as Australia were reduced and By April 1952, the United Kingdom, Australia, particular types may not always have been readily New Zealand, th.e Union of South Africa and a available.Earlier, serious supply difficultiesin

29 important pesticides were remedied but the supply non-agricultural, but agricultural areas may be of superphosphates was below the greatly-in- invaded later in 1952. In the Near East, spring creased demand. breeding occurred mainly in desert regions and Farm income seems to have increased in most successful control campaigns have prevented heavy regions ;however, specific data are available for escapes in all areas, except perhaps Iran.The only a few countries.In the United States and swarms that spread into Pakistan from Iran in Canada cash receipts from farming in1951/52 June and July are likely, to penetrate into India increased by 15 and 19 percent respectively over and may result in extensive breeding during the 1950/51, (based on 10 and 9 months respectively). monsoon period. In Australia, the sharp fall of wool prices was The future trends of the plague will depend upon responsible for a 22 percent decrease in gross effectiveness of the campaigns and on the clim- value of rural production, between 1950/51 and ate, but unless theDesertLocustischecked 1951/52.The other countries for which infor- there is grave danger of an intensification of the mation isavailable showed smaller gains than plague in all areas already infested, and a spread North America.In the semi-industrialized and to West and North Africa later in 1952 and in underdeveloped countries there have been finan- 1953.Itis impossible to estimate what losses cial gains, but these have in many cases been might occur, but most crops in all countries from offset by rapidly expanding inflationary forces India to Morocco and south Turkey to northern and or by civil and military disturbances. Further- Tanganyika would then be endangered. more, the rapid rise in prices of farm products Foot-and-mouth disease broke out in 1951 in in these regions, followed by less sharp declines, a veryr serious form in Europe : since August 1951 has left producers in a somewhat uncertain posi- there have been tens of thousands of reported out- tion. breaks.Thedisease,which appearstohave In the fishing industry, although prices moved originated in Germany, has spread to Belgium, somewhat upward, the rate of increase was less Denmark, France, Greece, Holland, Italy, Lux- than thatof costs.Pricesoffueland gear embourg, Sweden, Switzerland and the United especially showed marked increases. Kin,gclom, and there is grave danger to all other European countries.The effect on milk, butter, PRODUCTION AND SUPPLY cheese and meat production has been great. PROSPECTS FOR 1952/53 On the South American continent the disease spread further into Colombia and is raging as an Agricultural production epizoblic over most of the country.Efforts are being continuously directed towards its control, Total agricultural production in 1952/53 will but losses have been very heavy and at present apparently equal or perhaps exceed that of 1951/52. it has defeated efforts at limiting its spread. A Northern hemisphere bread grain prospects are most serious outbreak of this disease occurred in better than a year ago.Both Australia and Callada in early1952.Control measures were Argentina have adopted vigorouspoliciesfor immediately instituted and the disease is now increasingwheatacreage.No majorchanges well under control. are expected in world meat and dairy production. The world wheat supply should be rather larger Among industrial agricultural products, rubber in 1952/53, due to an expected increase in pro- production may decline with lower prices, while duction of about 25 percent in the United States, production of wool and jute seems likely to be a good crop in Canada, and somewhat larger crops about the same as last year's. in Australia and Argentina if the newly announced Possible catastrophes resulting fromthe De- programs prove to be effective. sert Locust plague have so far been checked by In Western Europe the postwar trend of pro- effective control measures. A severe plague threat gressively improving yields combined with favor- has been building up during the past y-ear.The able weather conditions promisessome increase main infestation fluctuated between eastern Africa, inproduction.Some advance,althoughless especially Ethiopia, British Somaliland and So- marked, isalso anticipated for coarse grains in malia, and the countries of the -Near East, espe- most regions.Total coarse grains acreage in the cially south western Arabia, Jordan, Iraq and United States is the same as that planted last year, Iran.Up to July 1952 there liad been little crop but gains in yields are expected.In fact, the lossin Africa.Much of the infested area was forecast for maize is for an increase of about 14

30 percent over last year's output.In the Near The general trend toward expanding production East Iraq,Syria, Lebanon and Turkey are anti- as ndicated by national and regional gov- cipating good harvests, especially of barley.The ernment plans and policies is likely to con- maize planting target of 3.8 million hectares in tinue into 1953/54. Argentina, although over 50 percent above the It is likely that the heavy demand for forest acreage harvested in 1950, is still well below the products in 1950/51 which led to a general in- prewar average. crease in production in 1951/52 will result in a Provided that widespread crop failure is not somewhat reduced output of many forest products repeated in the major rice growing countries of in1952/53.Increased stocks at the beginning the Far East, production in 1952/53 may show of 1952 will temporarily reduce the demand, par- a considerable increase.The total area planted ticularly in Europe, Australia and South Africa. has increased 10 percent above the prewar level In North America, however, industrial and build- and mayr show a further increase in the coming ing activities are likely tomaintain thehigh year, but the yield per acre has been falling stead- level of demand. The demand for sawn wood ily in some major producing countries. is also likely to increase fromitslow level in Oil-bearing crops are likely to show a substan- 1951. tial advance in Latin America and Eastern Eu- rope.A 10 percent increase is expected in Cuba's THE DEMAND OUTLOOK, 1952-54 sugarproduction ;rapidlyexpandingacreages The expected generally in Eastern and smaller gains in WesternEurope sustained high level also promise larger supplies.Tobacco produc- of economic activity in the United Statesin tion is expected to remain unchanged in the United 1952/53 may have corresponding effects on the States and Canada. rest of the world by increasing the United States No major change is anticipated in cotton out- import demand, which lagged considerablyin put in the -United States while a sharp decline is 1951/52 as compared with the levels of internal expected in the Near East as a reaction to the activity.Such anincrease, plus the expected drop of world market prices for non-dollar cotton purchases and armament orders placed abroad, and of government measures to shift production would benefit the raw material countries by in- from export crops to food crops. creased dollar sales, and areas with still unused In so far as jute is concerned the Pakistan Gov- industrial capacity would increase employment. ernment has increased the licensed area by 10 Such alleviation of the dollar problem would percent to 836 thousand hectares for the 1952/53 directly and indirectly increase the demand for season.Last year 95 percent of the licensed area agricultural products in many parts of the world. was actually cropped, but it does not appear that In 1953/54, however, some slackening in demand as high a percentage will be achieved in 1952/53. may occur, as plant expansion for defence pur- It is likely that sowings are only about the same poses begins to decline. as last year.In India, sowings are expected to be less than last season. Industrial production, 1952/53 Natural rubber production will probably de- The projected high rate of production for decline by about 11 percent, and the estimated ex- fence in North America and Western Europe, cess of production over consumption in 1952 is while diverting still more energy and material from estimated to be smaller than in the previous year. civilian uses, will probably sustain high levels of Conditions are favorable for some increase in industrial activity and of consumer buying power livestock production in Canada and the United for farm products, even though possibly somewhat States, while the general good prospects for a further below 1951/52 levels. expansion in Western Europe are somewhat com- The scheduled rate of defence expansion has promised by foot-and-mouth disease outbreaks been reduced somewhat in the United Kingdom and by the current feed situation.The effects on and the -United States.Projected defence ex- production may become apparent only in 1953/54. penditure in1952/53, though somewhat lower A reduced output is expected in the Union of than the goals set earlier, is still above the 1951/52 South Africa as a result of this year's poor maize levels.In the United States the rate of expendi- crop.In Latin America the general trend to- ture for defence goods and construction is sched- wards expansion will be weakened by the new pol- uled to advance, by the end of 1952, to about icy adopted in Argentina designed to build up three times the average of 1951. A carry-over herds. of 90,000 million unexpended dollars from 1951

31 plus 46,000 million dollars new appropriations for Industrial expansion in Eastern Europe and the 1952/53, exceed by far all physically possible deliv- U.S.S.R. is scheduled to continue with rates of eriesfor the armed forces.Thisexpenditure, growth widely differing in the individual countries. combined with domestic business investments for Defence expenditures of the U.S.S.R. in 1952 are new plant and equipment estimatedtoexceed officiallybudgeted 21 percent higher(incur- still further those of last year, will provide the rent roubles), than in 1951. impetus for keeping the United States economy Progress of economic development programs in fully employed and possibly for expanding total Asia, the Middle East and Latin America will industrial output to a higher level in1952/53, Continue to expand industrial employment and although at a slowerrate of increase than that domestic demand for farm products over the next from 1949/50 to 1951/52. two years.The rate of economic development The outlookforthe Canadian economyis and industrial production has been generally quite generally promising.In March 1952 the value of rapid in Latin America, and seems likely to con- defence orders in progress was three times as tinueso.In the Middle and Far East (with high as twelve months earlier, the rate of spend- the exception of Japan), industrial development ing for military equipment and installations is has generally been moving much slower, and in expected to increase greatly, after lagging behind most countries little if any progress is being made the original plans in 1951/52, new investment in in absorbing surplus farm population in industrial durable physical assets in1952isexpected to employment.Politicalinstabilityin many of rise by about 10 percent, and higher exports are these countries is tending further to delay general alsoanticipated.A high level of employment economic progress.However, the check to eco- is expected to continue. nomic development which resulted from the sudden In the United Kingdom itis estimated that fall in demand and prices for raw material exports industrial output will be maintained with employ- during 1951 seems unlikely to be repeated during ment generally not falling much below the slightly 1952/53, while prospects for 1953/54 are more un- reduced level of the spring of 1952.It could certain. improve should the recession in the textile industry come to a halt, but this would require an early Trade and international payments, 1952/53 termination of the import restrictions adopted by some of the United Kingdom's best customers, The volume of international trade will be af- such as Australia. fected by the ability of nations to solve balance- The United Kingdom Government has indicated of-payments problems.The drain on the gold that it expects exports to increase during the year and dollar resources of the Sterling Area was al- beginning April 1, 1952, by 50 million pounds in most stopped in the second quarter of 1952 and terms of 1951/52 prices.The export target is the heavy debtor position of France (although not to be achieved mainly by larger sales abroad of of the United Kingdom) within the EPU has been machinery and other capital goods which the' Gov- considerably reduced.As isusually thecase, ernment hopeswill more than offset the decline international speculation first reinforced the trend now being experienced inexports ofBritish towards deterioration, and is presently reinforcing consumer goods. the trend towards improvement as the weakened InWestern European countries,afterthe currencies are regaining strength.The measures organizational phase of theEuropean Defence designed to curtail home consumption inthe Community has been terminated and afterthe United Kingdom, the import restrictions of the inclusion of Germany in the scheme, a faster rate of Sterling and French franc Areas and some special defence production can be expected.Some easing aid from the United States for both France and in the recession in soft goods industries is likely as the United Kingdom, as well as the disappearing prices remain stable and stocks need replenish- fear of a new sterling devaluation, may very well ing.However, the import restrictions of France sustain the initial recover3r in the short run. and the United Kingdom may adversely affect The -United States is continuing its postwar aid production for export of a number of European in 1952/53, although at a considerably reduced countries, thus retarding the overall production rate, as " defence support " for Europe and as and demand.In some of the Scandinavian coun- economic and technical aid to non-European countries some increases in national output are likely, tries.In addition there will be offshore purchases in spite of an expected deterioration of the terms and military orders. The prospective availability of of trade. foreign dollars, however, will not be sufficient to off-

32 set a continued United States balance of payment Europe, however, the present depression in the surplus on current account, as large as it was in textile industry is partly due to overexpansion af- 1951/52, of close to $6,000 million (annual rate ter World War II and may therefore continue based on eleven months).To correct the foreign into 1952/53, although to a lesser extent.Unless exchange shortages the first necessity is a reduc- general business conditions turn sharply down- tion of this surplus, which is likely to be achieved ward, consumption of cotton and wool may in- if the contemplated cuts of imports from dollar crease in 1952/53 to somewhat above the very areas are implemented.United States exports much reduced levels of 1951/52. in the first five months of 1952 still increased Rubber and wool, the two most important ex- by 12 percent while import value had decreased port commodities and dollar earners of the Sterl- 10 percent compared with the same period in ing Area, however, are facing particular problems. 1951. About one third of the increased export value While the long term trend of the world's rubber was due to greater shipments of grains and,cotton consumption indicates an increase of between 5 both of which may- decline later, and part was due and 10 percent a year, the actual market demand to increased shipments under the Mutual Security depends largely on UnitedStatespurchasing Program. policies.As the latter return to normal and if Agricultural demand, 1952153 synthetic rubber production expands no further, theinternational demand should besufficient Economic activity generally sustained at high to absorb the output of natural rubber at its levels in North America and Europe will probably current volume.Wool, too, has to compete in- maintain the demand for exportable supplies in creasingly with synthetic products but a growing foodstuffs and agricultural raw materials from the world demand connected with higher consumer Far East, Latin America and Oceania, as prices incomes and with defence needs should provide have been brought down from their previous a satisfactory market for the 1953/54 wool supply, excessive heights and stocks will need to be built bearing in mind that itwill consist essentially up again.Short of a deterioration in the poli- of a very slow rise in production, since the large tical situation, no sudden developments are likely postwar stocks have disappeared. but rather a slow reversal of the " wait-and see attitude of buyers accompanied by an equally The demand outlook, 1953154 slow improvement of prices. Over 1953/54 demand prospects are more doubt- The demand for farm products in North Amer- ful, and may be sharply influenced by political ica should remain high in 1952/53 even if not developments. A sustained high level of econo- quite at the boom level of the past two years. mic activity in the United States seems likely In Western Europe, other than the United King- with defence expenditures, other deferred public dom, the demand for farm products also seems expenditures and housing all contributing ;there likely to remain about the same as in the past is however some possibility of a recession begin- year.In the United Kingdom imports of basic ning during the latter part of the 3,ear, though foodstuffs suchaswheat, coarse grains, meat, probably less sharp than that of 1948/49.Govern- eggs, butter and cheese, oils and fats, which are ment expenditure for national security is sched- imported by the Government through bulk pur- uled to reach a peak in mid-1953 and remain at chase schemes, seem likely to remain approxi- this level through 1953/54.In spite of a very mately, the same, but imports of processed meats high rate of private home building since 1947, there and unrationed varieties of cheese will be curtailed appears still to be a backlog of demand for new sharply. housing (mainly due todeferred replacement) The success of attempts to shift supply sources which may continue into 1953/54 ;there are also of basic foodstuffs still more to the Sterling Area demands for extensive public non-defence con- will depend on the latter's ability to expand its struction, most of which had to be postponed dur- exports, which in the case of bread, coarse grains, ing the past two years.On the other hand, re- and meats is likely to continue to be insufficient. cent surveys indicate a possible 15 percent drop Textile prospects in the United States are some- in domestic business investment from 1952/53 to what more promising than a y-ear ago. Inventories 1953/54.Some declinein economicactivities accumulated in the hands of manufacturers and connected with the end of the build-up of the retailers are gradually being worked off and by United States defence forces is generally expected April 1952 were 10 percent below those of a not earlier than 1954,unlesspoliticalevents year before. In the United Kingdom and Western lead to a lessening of the existing tension.This

33 may be partially offset by consumers drawing on deflationary tendencies.There is little room for their heavy liquid savings. On the whole, the gen- further cuts in the volume of imports of basic food- eral levels of United States income and activity stuffsover those planned for 1952/53 without in 1953/54 are likely to remain somewhat higher an increasingly austere diet. than in 1951/52, while employment and disposable In Western Europe a steady increase of eco- income per caput willremain about equalto nomicactivity may beexpected.In August that of 1951/52. 1951 the member governments of OEEC issued Indications are that the Canadian boom will a declaration in which they agreed that th e continue into1953/54.Armament expenditure broad objectives of their policies will be to expand may rise somewhat further.Domestic investment total production in Western Europe by 25 per- has been steadily expanding since 1946 and reached cent over the next five years4. A major part of a record level of over 22 percent of gross national this intended expansion is,of course, identical product in 1951, (excluding G overnment expendi- with the increasing output for defence, but it is ture for defence but including defence construc- hoped that industrial expansion will progressively tion).Domesticinvestmentexpenditure may provide more houses and other consumer goods remain at a fairly high level as expenditure for for Western Europe as well as capital equipment resources development and public utilitieswill for export to underdeveloped areas.The high continue high during 1953 and 1954.On the employment that should resultis expected to other hand, for light manufacturing, retail trade absorb such unemploymentasstillexistsin and housing,capital outlays in physical terms some of the member countries except in cases of are declining.Most of the big development pro- structural unemployment (Italy) where emigra- jects such as the iron ore mines in Labrador, tionwould havetocontributesubstantially. construction of facilities for aluminium production Hence,to the extent thatthis declaration of in British Columbia, non-ferrous metals in Mani- intention is implemented, domestic demand for toba and the rapidly expanding oil industry in agricultural products should increase while im- Alberta are scheduled to continue up to 1954/55 port demand for foodstuffs should, under normal and should contributeto maintaining a high weather conditions, remain at present levels.As level of employment and high demand for agri- Western European agriculture keeps on expand- cultural products in 1953/54.If any recession ing,it should cover increased requirements for should occur in the United States in 1954, it better diets as well as population increase. would probably be reflected in Canada, but to Any serious industrial recession in 1954 or later a reduced extent. might again have exaggerated effects on demands The economic outlook for the United Kingdom and prices of world market products, and hence for 1953/54 is less clear.It may benefit directly on balances of payments.Bridging therecon- and indirectlyfromtheanticipatedgenerally version from defence activity to a more peaceful high level of economic activity in the United world without severe economic disturbances thus States and Callada.A largepartof indus- becomes a major goal for economic statesmanship. trialplantwill remainemployed becauseof The economic plans of the U.S.S.R. and the East- defenceproduction.However, the solution of ern European countries for 1953/54 envisage fur- the recurrent balance-of-payments difficulties will ther industrial expansion, continuing full employ- depend on the success of the measures to reduce ment and a demand for agricultural products at domestic demand as well as on the speed at which least as great as prospective available supplies. countries like Australia, NeW Zealand and South Africa are able to remove trade restrictions, and THE LONG-TERM FOOD SITUAT1ON the strengthening and maintenance of the demand Despite the greater ease in the supply situa- for such dollar earners as wool, rubber and tin. tions of some commodities, the need of the world The volume of exports in 1952/53 willbe deter- for more food so strongly stressed at the last mined by the scope of the armament program, the session of the FAO Conference has not yet begun restriction of home consumption, the availability to be met.In the least developed and most of raw materials and by foreign demand.There heavily populated regions, where the mass of the has been an extension of planned defence expendi- world's population lives, per caput food consump- ture by one year.This may make possible some tion levels still continue substantially below the increase in civilian output of the engineering in- OEEC : A Second Survey Prepared by the dustries but there still remains the problem of OEEC for the Council of Europe, p. 25, Paris, Nov. finding sufficient markets at a period of increasing 1051.

34 already inadequate prewar averages.The last In many underdeveloped arcas this trend man- year has shown few signs of significant iraprove- ifests itself more in terms of increasing requirement despite all the governmental programs to ments than of effective demand.The people in this end.This situation is most acute in much of these regions are changing their attitude on the South-East Asia, where it is aggravated by chron- acceptability of a low standard of living and are ic civil or military disturbances and lack of per- exerting an ever-increasing pressure on their gov- sonal security. ernments or on the governing authorities for more In reviewing some of the food and agriculture food, more clothing, and more and better housing. problems that have to be dealt with in the near Yet there is little sign of the solid overall ad- future, it is useful to review the trends in food vance in food production needed to achieve better consuraption which indicate the task that has world-wide food standards. Charts IV, XVII-XIX to be achieved and the trends in investment which show that per caput food output, though higher indicate the possible rate of expansion in food in nearly all countries than in 1946/47 -1947/48, production. is still substantially lower than prewar in most Far Eastern countries and in many parts of Trends in food consumption Europe, the Near East and Africa.Because international trade in food plays an important part, Even a moderate improvement in the low nutritional standards prevailing in many parts of although in volume only representing a fraction the world, especially the Far East, Near East of the world's food production'', these facts are reflectedincorrespondingchanges and Africa will require a substantial increase in inevitably mostly for the worse in the levels of food the supply of food.In the regions mentioned, consumption compared with prewar years.Food the rate of expansion for cereals would need to consumption levels have risen markedly in Latin be twice as large as the present rate of increase America, although they are still inadequate in in their population ;for pulses, meat, fish, milk, some countries ;this has been achieved chiefly eggs and fruit the increase must be still greater. by reducing the region's food export surplus In Latin America and Europe less expansion is (Table 3).In the greatfood surplusregions needed infieldcrops other than pulses,but of .North America and Oceania, food consumption livestock output would have to be pushed up has been maintained at high levels and, in soase beyond the estimated population increase.Sta- countries,itis even higher than before.Else- tistics for fruit and vegetables, though extremely where, however, consumption levels have mostly inadequate, indicate that supplies of these im- fallen and diets are poorer in quality.At the portant food groups should also be heavily ex- lowest end of the scale, the Far East has suffered panded. consumption The 6th Session of the FAO Conference con- the largest fall in per caput food and has become a net importer offood.The sidered a 1 to 2 percent increase per annum in world production of food and agricultural prod- proportion of the world's population not receiv- ing enough food large even before the war ucts in excess of the rate of world population yrowth has greatly increased (Table 7). (currently about one percent per annum) asa Some slight improvement, mainly in calorie lev- minimum necessary to achieve some improve- els, has occurred in the past two years, but not ment in nutritional standards.Furthermore, the enough to alter the general picture.Indeed the demands of this expanding population for agri- diet in the poorest fed regions has become, if cultural products are becoming more effective anything, even more unbalanced as indicated by since the end of the second World War especially the deterioration in consumption of animal foods in the industrialized nations where real income per (see also Charts III and IV). caput is increasing, and distribution of income is The possibility of a recurrence of a serious world In Europe,for tending to become equalized. shortage of food, particularly cereals, cannot be example, it has been estimated that food require- ignored.To avert this danger will require a main- ments will increase over the next five years by tenance and perhaps an increase in the present 1-2 percent per annum on account of changes in proportion of the world's total resources devoted income and by an additional 1 percent on account to agriculture and that a major part of existing of population growth.5 and potential agricultural resourcescontinue to OEEC Food and Agriculture Committee, Re- port of the Special Group on Agriculture (Ag. 51/40) Exporteclquantities representedlessthan9 Paris, Dec. 1951. percent of production in 1950/51 ancl 1951/52.

35 TABLE 7 DISTRIBUTION OF POPULATION ACCORIMS-G animals constitute the main form of draft power, TO NATIONAL AVERAGE SUPPLY OP CALORIES AND in the absence of which crop production would ANIMAL PROTEINS seriously suffer.Nevertheless livestock can a,nd do consume resources at the expense of human Percent of Total food, especially in the excessive feeding of grain Calories and Animal Proteins Population to livestock. Prewar Recent In the Far East and in many other less developed parts of the world, the energy value of the Calorie Levels diet has not even recovered to prewar levels. Over 2700 30.6 27.8 Even if account is taken of unrecorded production 2700-2200 30.8 12.7 such as subsistence fishing, consumption of animal Under 2200 38.6 59.5 protein is so low that were it doubled or trebled Animal Protein Levels in the next ten years, it would still remain far below the present standards in the advanced coun- Over 30 gms. 22.1 17.2 30-15 gms 18.9 24.8 tries.However, livestock production can be in- Under 15 gms 59.0 58.0 creased without drawing on additional grain supplies, by culling herds, reducing disease, and im- * Comprising about 50 percent of the world's population. proving methods of breeding and feeding.These can give results only in the long run.In the years immediately ahead it would be unwise to be utilized for the production of foods, especially attempt to expand livestock output by ways which those of high energy content. might diminish the supply of high energy foods. During the postwar years, industrial production However, while avoiding competition by animals has risen much more rapidly than agricultural for the human food supply, the supply of animal production.Thus, although production of food proteins can be, it is conservatively estimated, at in 1951/52 surpassed the prewar (1934-38) level least doubled in most countries by improved pro- by 11 percent, the volume of manufacturing and duction techniques without, detriment to the out- milling is estimated to be by the end of 1952 put of food crops.All possible means should more than 80 percent above the prewar level also be explored for expanding fishproduction (1937).These percentages are not strictly com- from inland sources, especially as many of the parable due to the different base periods, but fish resources of the region are still under-exploited. they do indicate the magnitude of the gap that In Europe, this problem is perhaps more sharply has developed in the postwar period between out- ocussed than in other regions.During early post- put in agriculture and in industry. war years, plans to restore the prewar consump- The steadily rising consumption of animal pro d- tion of livestock products had to be repeatedly ucts in some parts of the world where such con- postponed because of the inadequate level of the sumption is already very high poses the question total food supply and because of the high cost whether resources actually devoted to food produc- of imported feeds.The feeding of \vheat to live- tion are being used in the most effective way,in stock vas forbidden in some cases, and imported view of the low level of food supplies in other parts coarse grains had to be used for human consump- of the world.It has been pointed out on previous tion.Efforts to economize in feeding stuffs have occasions that, when crops are fed to animals, now resulted in many improvements inanimal they lose 80 to 90 percent of their calorie value husbandry in Western Europe. Livestock numbers before they re-emerge in the form of meat, milk have largely been built up again and yields per ani- and eggs.This of course does not mean that mal are frequently higher than before the war, with for every calorie produced in the form of livestock less reliance on imported feeds.But feeding stuffs products, four or five calories could have been are still in short supply and prices of crops have produced in other forms of human food.To a risen relative to those of livestock products dur- considerable extent animal and crop production ing the past few years.Some pasture can be are supplementary rather than competitive and converted to high yielding fodder crops and the under the climatic and other conditions prevail- quality of existing pastures can be raised, but ing in, many parts of the world, a system of mixed further improvement in the still unsatisfactory farming basedinparton grazingorgrass level of consumption of animal protein will require production gives best results for both crops and the most careful husbanding of resources.As re- livestock products.In some parts of the world gards other sources of animal protein, only a small

36 fraction of the whale meat taken by Europeans ent per caput consumption of livestock products is used for human food, thus making it necessary in the major food surplus regions might release to waste or grind into animal feed more than a large volume of food and fodder grains for the 250,000 tons of meat of a quality which, as is needy areas.From a nutritional standpoint too, done in Japan, can be used extensively for food. this might not be injurious.There is no indica- Both in Eastern Europe and the Soviet Union, tion that any further increase in meat consump- agricultural patterns are planned with greater em- tion among some sections of the population in phasis on livestock production than before the food surplus countries would be nutritionally es- war, but the need to safeguard lower and insecure sential.In the less developed and food deficient levels of calorie intake has retarded progress to- nations, steps to increase livestock output will wards these aims much more than in Western involve principally the improvement of grassland Europe. and the reduction of losses from diseases and par- The food surplus regions will probably continue asites.Such continued improvements in animal to be heavy consumers of animal products.In husbandry offer the safest hope of better diets the United States,steadily increasing effective without extensive use of grain for livestock feed- demand has raised per caput meat consumption. ing.Fish production, without encroaching upon In Australia, population in the last few years has existing agricultural resources, can provide a val- been expanding at a rate of more than 3 percent uable increase in the world's supply of animal per annum, and per caput meat consumption has protein.At present its contribution is only about been maintained at very high levels (Table 8). 10-15 percent. The possibilities for a large expansion are considerable and there is hope that, in the TABLE 8 MEAT C ONSUMPTION PER CAPUT IN THE futare, with improved marketing methods and UNITED STATES AND AUSTRALIA ( K G. PER HEAD) growing consumer acceptance of the product, a United greater proportion of the actual catches will be PERIOD States Australia used directly for human food.

Prewar. 63.9 120.4 1948/49 74.1 110.4 AGRICULTURAL INVESTMENT 1949/50 76.1 112.6 1950/51 75.2 110.5 The continued expansion of agricultural production requires an ever increasing rate of private and public investment, particularly in the less The proportion of average calorie intake provid- developed, highly populated areas of the world. ed by livestock products is over 40 percent in the Where private investment is inadequate a greater United States and Australia, compared with about injection of public funds into the production pro- 30 percent in Western Europe and only between cess becomes necessary.Thisis not a simple 5 and 10 percent in the Far East.The amount matter and the problems and ramifications have of grain fed to animals to maintain the present already been dealt with in other UN reports. volume of livestock products in the United States What is pertinent is the current amount of invest- isapproximately 100 million tons per annum. ment and the plans for increasing the total. The raounting demand for livestock products has already reduced feed grain stocks in the United States in two successive years and may even force Private investment in agriculture a reduction in livestock numbers in the year ahead. In North Araerica,the United Kingdom and Whether feed grain production and other feed sup- some of the other Western European countries, plies can be stepped up in the coming y-ears to private investment has expanded markedly since meet the further increase expected in the demand the end of the war.This expansion has been in for livestock products without a serious reduction response to a greater farm income and in Western in the volume of grain exports is open to serious Europe also to the need to rebuild farm equip- doubt. ment destroyed during the war.In Oceania the For the world as a whole, until the entire scale flow of private funds into farming has also shown of food production has been substantially raised, a substantial increase. careful attention will have to be paid to the pos- In Canada, the United States and the United sibilities of maintaining and increasing the supply Kingdom the share of agriculture in total private of livestock products in ways that do not compete investment expenditure has corresponded in re- with calorie needs. A moderate reduction in pres- cent 3rears roughly to the share of agriculture in

37 the national income.No comparable figures are projects with a projected capital outlay of close available for underdevelopedcountries,butit to 236 million of which 27withacapitalof appears that privateinvestment inagriculture 17.3 million (48.3 percent of the total)arefor remained relatively small in these regions. Financ- projects in ag,riculture, fishery and forestry°. ingtheexpansionof agriculturalproduction The Caisse centrale de la Franced'Outre-Mer remained to a great extent the responsibility of andtheFonds d'investissementéconomique governments. etsocialdesterritoiresd'outre-mer have in What are the probabilities of an increased rate the period from April30,1946toJune30, of private agricultural investment in the develop- 1951 committed a total of 240,000 million frs. ed countries ?It is probable that the rate of for the economic development of the French over- investment will continue high as long as farm net seas territories (except North Africa, Indochina income remains at the current high level,enabl- and Madagascar) of which 12 percent was for ing these countries to maintainandeven to developing agricultural production as against 13 improve their position as importantproducers percent for mining and industry which, however, of agricultural products.In underdeveloped coun- includes food processing and hydro-electric power tries, private funds may become available in larger generation.Of the 5 percent allocated to research quantities in the future as the terms of trade move about two-thirds were for research in agriculture in favor of agriculture, as the differential in pro- and forestry.In addition, a great part of the ductivity between agriculture and industry tends 120,000 million frs. (about 50 percent) for improving to become narrower, and to the extent that price communications has been directly benefiting agri- stabilization schemes for major export commodi- culture". ties become a reality.Technical assistance and Under the Colombo Plan £595 million out of a government development projects may open up total of £1,368 million,or 32 percent, are alloca- new fields for private investment in agriculture. ted to agriculture, including multipurpose projects, However, in relation to the needs,the rate of but agriculture is also to benefit from the devel- private investment will continue to be inadequate. opment program for transportation and communi- cation (34 percent) and for housing, health and education (18 percent)11-. Under the United States Public financingof agricultural invest- Point IV program, of the 619 personnel in the ment field on Dec. 31, 1951, 253 or 41 percent were It is therefore encouraging to note that nation- working inagriculture,forestry and fisheries. al and metropolitan governmentsaswellas Among the 372 foreigners being trained in the international organizations areincreasingtheir United States under the Point IV program at activities in agricultural investment.7 that date 87 were under the supervision of the The share of agriculture (including forestry and United States Department of Agricultureu. fisheries as well as processing industries) in the Also within the Expanded Technical Assistance schedule of public expenditures in almost all devel- Program of the United Nations which is laying opment plans in underdeveloped areas is greater the groundwork for public and private investments than that of industry or public utilities 8.Simi- in underdeveloped areas,the biggest share has larly, metropolitan governments in dependent ter- been allocated to agriculture, as shown by time ritories are investing heavily in agriculture.The amounts of money allocated to FAO as one of BritishColonial Development Corporation,for the six international organizations" participating example, up to the end of 1951 had started 53 in the program(Table 9). 7 Unfortunately, available data on public financ- Colonial Development Corporation, Reports and ing of economic development are not of a nature to Accounts for 1951. Her Majesty's Stationery Office, present a clear separation between funds going into London, April 1952. agriculture and those invested in other sectors of " Caisse controle die la France d'Outre-Mer, 'Notes the economy.However, there are some indications et &Ludes docurnentaires, No. 1568,Paris, Feb. 1, providing a rough idea of the share allocated to agri- 1952. culture in th,e developmental activities of public 11 The ColomboPlan, Cmd 8080,H. M. S. O. bodies. London,1950. 8 The trend toward greater investment in agricul- " First Report to Congress on the Mutual Security ture is also referred to in Chapter III. Preliminary Program, Washington, March 1952. data from thirty-five countries provide the basis " The other organizations are the UN, ILO, tor this statement. UNESCO, ICAO, and \VHO.

38 TABLE 9. EXPENDITTJRES ON TECHNICAL ASSIST- ed by the Conference, may improve the present ANCE, AND PROPORTION OF FUNDS ALLOCATED unsatisfactory investment situation without, how- TO FAO ever, giving the promise of an early solution of Total I? A. 0 the problem. PERIOD mil. of 't,3:°Jtal OTHER FACTORS 1st financial period (July 1950- In many less developed regions farmers hesitate 31 Dec. 1951) to produce as much as they could with their allocated 13.463.8228.8 present knowledge and resources because of in- obligations inctu-red . 6.442.01 31.2 secure tenure on the land, inadequate rewards 2nd financial period (1952) to the actual producer, lack of farm credit at allocation(lessretained contributions account) . 19.175.36 28.0 reasonable rates, and lack of confidence as to markets for increased output at satisfactory prices. 3rd financial period (1953) Many of the economically advanced countries projected or requested . . 38.16 11.1729.3 havedevelopedworkablemethods ofgiving sou-rick: : ETAP, Fourth Report of theTechnical Assistance advance marketing and price guarantees to their Board to the Technical AssistanceCommittee UN document E 2213 (Vol. I). farmers.Inmany underdevelopedcountries, however, much still remains to be done in this The extensive Point IV and ETAP activities direction.These countries need to establish such in the field of agriculture foreshadow the necessity conditionsfor their working farmers and give for a much greater flow of public investment funds them suchassurance of markets that they will than heretofore. No comprehensive data are avail- expand production substantially. able, but Tables 10 A and B showing the activi- While it is generally recognized that the major ties of the major agencies for international lend- responsibility for stabilizing action must be at the ing indicate the insufficiency of the present vol- national level, much attention is also being devot- ume to meet the need for a vastly expanded pro- ed incurrentdiscussions to intergovernmental duction 14. commodity stabilization measures. The FAO Con- Even under the anticipated improved condi- ference re-affirmed at its Sixth Session its faith in tions for investment in agriculture, a considerable international commodity agreements and it stressed increase in the flow of foreign funds seems to be particularly the need for looking at these agree- required.Yet many of the projects contemplated ments as more than emergency devices for dealing in nationalplans and programsorsuggested with surpluses or shortages and for viewing them by TA experts are not suitable for financing by rather as basic stabilization instruments which can existing international financial institutions. Hence be applied in good times as well as bad. the proposal for a new International Development Itis sonaewhat less reassuring, however, that Authority now being studied by an expert com- while these principles have been more or less gen- mittee appointed by ECOSOC is of particular im- erally accepted for some time now and re-endorsed portance for an adequate future level of invest- on various occasions, they have so far not led to ment in agriculture. much in the way of tangible results. "Whether the new IDA comes into being or not, The present climate of economic opinion ap- the responsibility of channelling an ever increas- pearstobe very conducive to discussions on ing amount of private and public investment funds international commodity agreements. Consultations into agriculture will remain with national govern- are proceeding for the renewal of the International ments.The Gth Session of the FAO Conference Wheat Agreement ;a special committee of the outlined a number of measures governments may International Sugar Council has been functioning take to increase funds available for agricultural for some time to consider an international sugar investment.These, if ad.opted and implemented, agreement; the International Cotton Advisory Com- together with the international measures suggest- mittee has produced a very able technical report considering possible methods of drawing up an 14 An annual foreign investment of$10,000 million of international cotton agreementn ; and recently the which $2,000 million in agriculture has been estimated to be necessary in order to increase the national " International Cotton Advisory Committee : Re- income of underdeveloped areas by 2 percent per port of the Standing Committee to the Eleventh annum (UN, Measures for the Economic Development Plenary Meeting on an International Cotton Agree- of Underdeveloped Countries, New York, May 1951). ment, Washington, May 1952.

39 TABLE 10-A. - AMOUI,IT OF IBRD LOANS DURING THE PERIODI NOVEMBER 1951 TO 15 JULY 1952 (in million U.S. dollars)

DIRECT LOAN- TO AGRICULTURE LOANS AIDI-G AGRICULTURE All ' TOTAL Total COUNTRY I di Machin-Irriga-TimberProccs. Multi-Improve-Power other ' LoAxs lgrierrecti.cry and tion indu- purposetranspor_ment of t,ouarnasi` spareand floodeQuiP- dercloll-loans pa rts control ment strics loans tatiou mcnt

Australia. 50.0 a17.0 -- 17.0 ...... b 33 , c Brazil 31.5 - - 12.5 25.0 - Polombia 2.4 ---- 2.4 Finland 20.0 10.5 1.0 9.5 - 9.5 freland 1.0 1.0 - 1.0 - Nrexico. 29.7 - 29.7 - N-etherlands 7.0 -- - 7. C Pakistan 30.5 3.3 3.3 27.2 - Paraguay 5.0 5.0 5.0 - - - Peru 3.8 1.3 1.3 - 2.5 Rhodesia. . . 23.0 ------28.0-3outhern Purkey 25.2 25.2 25.2 -----

TOTAL . . 240.1 63.3 9.6 25.2 1.0 9.5 13.0 42.2 94.6 40.0

SounGES : IBM) - Memorandum relating, to the Financial Statement as of March 31, 1952. IBM) - Press Releases. a Approximate evaluation. b A part of this loan will be used for transportation and power.

TABLE 10-13. - AmouNT OF EXPORTJAIPORT BANK LOANS DURING THE PERIOD 1 JULY 1951 - 3 JULY 1952 (in, million, U.S. dollars) a

Total LOANS FO P.: COUNTRY loans to Agricult. Industrial country machinery Transport Pol-yer Import development Others

Austria 6. 0 -- - 6.0 Belgium 6. 8 6.8 - Bolivia 2.6 - 2.6 Brazil 66.7 5.0 15.6 41.1 - 5.0 -janada 0.7 - - 0.7 -- phile 11.1 - 11.1 - 3olombia 23.5 - 2.6 20.0 - 0 .9 Ecuador 1 . 8 1.0 - - - 0.8 Prance 245.0 - - 45.0 b 200.0 3 ermany (Fed. Rep . ) 60.0 - - 60.0 : ndonesia 4 . 5 2.6 1 . 9 - - T taly 4 . 7 - 4.7 - Tapan 40.0 - - 40.0 1Iexico 4 . 0 - - 4.0 - ?anama 1. 5 - - 1.5 'ern 0-7 - 0.7 ? hilippine 20. 0 - 20.0 - -- ipain 12.0 - - - 12.0 Thailand 1 . 0 - 1.0 - - - Jnion of South Africa . 26.5 - - - 26.5 - /enezuela, 4.0 - 4.0 -

TOTAL. . 543.1 7.6 24.2 63.7 183.8 54.6 209.2

SOURCE : Export-Import Bank of Washington: Statement of Loans and Authorized Credits. Tisis table does not include 2.5 millions to Saudi Arabia from previously authorized credits. Credit in view of off-shore purchases in France.

40 International Rubber Study Group has also set preciation of the need for an adequate balance of up a special working group to investigate the pos- producers' and consumers' interests. This principle sibilityof an international rubber agreement. is a highly- commendable one which should not Moreover, discussions are proceeding in various be departed from in any way. At the same time, it quarters on commodity agreements generally. is as well to realize clearly that the postulate of Despite all these consultative activities, however, such a balance of interests does mean a practical the International Wheat Agreement still remains need to achieve a balance of bargaining power be- the only fully inter-governmental commodity agree- fore an inter-governmental agreement can be con- ment in existence and its renewal is uncertain. cluded.It is often difficult to find this bargaining Nor are there any signs of consultations for any balance and also to agree when that point has, in other commodity having reached the immediate fact, been reached. pro-conference stage of final negotiations. Moreover, the problem may be accentuated by In some respects the very slowness of the pro- the fact that the risks are not the same for gov- gress reflects a growing understanding and realism ernments inthe sense that the disadvantages in the appraisal of problems connected with the which may result from theconclusion of an negotiation and operation of inter-governmental agreement tend tobe more obvious,generally agreements.The experience of the Wheat Agree- speaking, than those which may result if no such ment, in particular, has brought a number of these agreement is concluded ;it does not follow by any technical problems into clear focus16.Apart from means that theless obvious risks are the less problems of technique, there are certain other dif- serious ones in the long run. ficulties which result in some measure from ap- Much more active and positive measures than those yet taken by governments will be needed 16 Some basic aspects of international commodity before world food production begins to increase stabilization techniques were reviewed in an article at more than its recent inadequate pace.At the "Some Aspects of International Commodity Arrange- ments" in the FAO Monthly Bulletin of Agricul- same time, the arrangements for prices, markets, tural Economics and Statistics for July 1952, and a and marketing methods must be greatly improved full discussion of some of these problems is presented to assure confidence to producers, while maintain- in the FAO study "A Reconsideration of the Eco- nomics of the International Wheat Agreement", ing retail prices which the mass of the world's September, 1952. people can afford to pay.

Chapter III

REGIONAL REVIEW AND OUT

Chapter III-REGIONAL REVIEW AND OUTLOOK

EUROPE (excluding Eastern Europe and consumer goods industries.Some slackening oc- the U.S.S.R.) curred early in 1952 and the aggravated balance of payments difficulties led to increased trade Current situation restrictions.In most countries the cost of living rose during the period and food prices generally rose The restoration of agricultural production in more rapidly than those of other goods and services, Western Europe during recent y-ears has been facil- notably in Austria, Denmark, the Netherlands, itated by the strong effective demand for food, Western Germany and the United Kingdom. largely due to increasing industrial activity with In most countries wages rose with prices from full employment in most countries.Expansion of 1950/51 to 1951/52, but in some, such as Austria industrial production continued during 1951/52, and the Netherlands, a decline in real wages ap- but was, on the whole, slower than in the imme- pears to have taken place. diately preceding years.Industry still expanded In 1951/52, for the first time since 1948, there much faster than agriculture ;accordingly, the was no general increase in the average per caput relative importance of agriculture in the total consumption of food.In a number of countries economy of the region has been further reduced. meat consumption has not reached the prewar This trend means that the food supply has to level, and in Western Europe as a whole, total satisfy both the demand of a growing population meat supplies in 1951/52 were nearly 7 percent and the demand for a more diversified diet.Be- lower than before the war.Meat is still rationed fore the war, as urban purchasing power increased, in the United Kingdom, and elsewhere high prices additional food and feed could be bought abroad generally restrict purchases. atfavorable prices.Since prices of imported Signs of over-supply have appeared in the mar- agricultural products are 110W less advantageous, ket for liquid milk, and the availability of mar- terms of tradelessfavorable and the balance garine,cheap relativetobutter,has reduced of payments situation more difficult, the prewar European butter production and consumption. solution is no longer practical. On the other hand, demand for cheese has gener- General economic conditions. As indicated earlier, ally been well maintained. thelevelof economic activity remained high Agricultural production. Agricultural production, during 1951/52 except in the textile and other with the United Kingdom as the major exception, has generally returned to its prewar structure with For the purpose of this report, Europe (exclud- a few important changes : an increase in milk ing Eastern Europe) has been divided into the follow- production, a decrease in most countries of Con- ing regions tinental Europe of the area under bread grain, Western Europe : Belgium-Luxembourg, France, and an extension of the area devoted to sugar Ireland,Netherlands, Switzer- beetsandoilseeds.Farm productionnetof land, Saar, United Kingdom. imported feed in the region exceeded that of 1950/ .Northern Europe :Denmark,Finland,Icelan.d, 51 by about two percent representing an increase -Norway, Sweden. of about 12 percent above the 1934-38 average Central Europe :Western Germany and Austria. and exceeding the population increase, with the Mediterranean Europe :Greece,Italy,Portugal, result that per caput production exceeded the Spain.. prewar level (Table 11 and Chart XII)

45 CHART XII - EUROPE (EXCLUDING EASTERN EUROPE) :POPULATION AND AGRICULTURAL PRODUCTION PREWAR AND POSTWAR

PERCENT OF PREWAR SEMI-LOGARITHMIC SCALE

POPULAT ON

CSC.

corn" 1

TOTAL AGRICULTURAL PRODUCTION .20.0 AGRICULTURAL PRODUCTION PER CAPUT

1946 / 47 1947 / 48 1948 / 49 i949 / 50 1950 / 51 1951 / 52

TABLE 11. INDEX NUAIBERS a OF VOLUME OF TOTAL Milk production exceeded last year's total by AND PER CAPUT AGRICULTURAL PRODUCTION IN EUROPE (EXCLUDING- EASTERN EUROPE) 1946/47 2 percent and the 1934-38 average by 8 percent. TO 1951/52 This was due mainly to an increase in yield of milk per cow by about 10 percent above the pre- Agricul- tural Produe- war average.Total production, however, declin- YEAR produc-Populationtion per tion caput ed in Denmark, the Netherlands and Sweden, compared with last year.In Sweden and the (1934-31 100) United Kingdom, government policy now favors 1946/47 86 106 81 beef rather than milk production for which effec- 1947/48 84 107 79 tive demand seems to have reached a peak.The 1948/49 95 108 88 1949/50 103 109 94 reduction of horse numbers by 11/2 million since 1950/51 109 110 99 1938 as a result of greater mechanization, has 1951/52b 112 111 101 led farmers to increase barley production and decrease the production of oats.This in turn a These index numbers are weighted by values. They arepreliminary only.All FAO production indiceswill has contributed to the increase in production of be revised during the coming year. b Preliminary. pork, poultry and eggs.Pork production increased by 6 percent in 1951/52 and exceeded the pre- The volume of crops in 1951 WaS noticeably war level, with the greatest increase over 1950/51 smaller in the western and northern part compared in the United Kingdom and Western Germany. with 1950, while with more favorable weather However, because of the general deterioration of conditions,output increased markedly inthe the feed/livestock price ratio,pig numbers in Iberian Peninsula (Table 12). Denmark,Ireland and the Netherlandshave Gross output of livestock products in 1951/52 decreased somewhat while in Western Germany exceeded the prewar average by 7 percent and the stock of breeding SOWS has been reduced. was 3 percent above 1950/51.During the year, In general, the livestock output per unit of progresswas particularly marked inWestern feed nutrient input has increased since before the Germany, while some decline occurred in Scandi- war.This progress, together with more efficient navia (Table 13). utilization of grassland and of such by-products

46 TABLE 1 2. -- AGRICULTURAL AND INDUSTRIAL PRODUCTION A.ND POPULATION, EUROPE (excluding Eastern Europe and U.S.S.R.) (Prewar = 100)

MEDITERRANEAN WESTERN EUROPE NORTHERN EUROPE CENTRAL EUROPE EtmoPP, TOTAL OF COUNTI1IEI Agricul- Agricul- Po p- A!- Agrien!- Agrien)- ture P°V-In- titre In- re Pop- In- ture Poi)"In- ture Poi,'1,1- (1934.38 Ida-dus-(1113=ula- dus-(1934.38ula- dus-(1934.38ala- dus-(1934-33ula- dus- YEAR 100) tiontry Contry = 100)tiontry =00) tiontry = 1 00) tiontry ;2 --, 2 ra 2, -JD" "c73 II 7., ' II c,-, 11 '"I' ' 8-. P . .", II . ._, 1 = .-,3, ,. a) ,,, = , .0,,., c. ,-,:-. =c,.=0,-.."..- ._,,- vg,,, '-' c, SU = ;-P,8 ' , -=, r-- - v8 ,.- -, 8 `,`,:' e d _8' 8 - z

1948/49 110 87104122110 88113142 87 59 114 55 79 89110 105 95 81108 112 1949/50 105 103 105 130107 102 114150 97 81115 81 84 100111110 97 98 109 128 1950/51 109 108 106 141104107116 159 111 94116 101 91 99 112 125103 104 110 135 1951/52 101111107 149101104117 170 113102117 121 98 102 113137102 107111145

SOURCE POR INDUSTRY INDICES :Research and Planning Di-vision, Economic Conunission for Europe. NOTE :Major crops : includes all grains, potatoes and sugar converted to wheat equivalent. Livestock products : includes all meats, eggs and total milk production converted on basis of FAO price weights. Industry : Index numbers of industrial production cover in general manufacturing, mining, at1(1 gas, water and electricity supply, but not building. Industrial indices are on calendar year basis 1948, 1949, 1950 and 1951.

TABLE 13. PRODUCTICEs: OF LIVESTOCK PRODUCTS, EUROPE (excluding Eastern Europe and U.S.S.R.) (1934-38 = 1 0 0)

Total meat Beef Pork Milk, Eggs REGION 1949/1950/1951/1949/1950/1951/1949/1950/1951/1949/1950/1951/1949/1950/ 1951/ 50 51 52 50 51 52 50 51 52 50 51 52 50 51 52

VVesternlEurope . . . 100 104 107 102 109 ilL 96 99 105 106 111 113 118 123 121

N'orthern Mirope. . 95 110 108 86 101 102 109 122 112 100 104 101 121 118 11E

Central Europe. . . 79 91 102 77 86 90 77 92 110 86 95 101 73 98 112

Nlediterranean Europe . 91 90 91 88 91 93 87 80 84 102 108 110 86 93 9C

TOTAL . . . 94 99 103 93 101 103 91 98 104 100 106 108 104 112 11(

a Including goat milk. as sugar beet tops, has lessened the dependence of the same time, with the general restoration of the livestock production on imported coarse grain herds, the quantity of manure available is about feeds and oil cake. the same as before the war. As compared with prewar (1934-38)average The relation of change in fertilizer use to changes production average 1948-51 crop yields per hectare in yields is indicated in Table 15. are markedly higher in all parts of Europe ex- The short-term trend has been quite different, cept the -Mediterranean countries, with the largest with yields over the last 4 years showing a marked improvement in Central Europe. downward trend in Northern Europe, a slight This improve- downward trend in Western Europe, and marked ment in crop yields has been largely due to the upward trendsinCentral and Mediterranean increase in fertilizer consumption and mechaniza- Europe.How far these trendsreflectmerely tion.Application of fertilizer has increased by short-term changes in weather, and how far more about50 percent since1938(Table 14). At fundamental factors, is not yet clear.

47 Table 14. CONSTJMPTION OF FERTILIZERS, E TYROPE (excluding Eastern Europe and U.S.S.R.)

AmouNT1951/52 in 1.000 nt.t. of plant nutrient RELATION TO PREWAR(1938=100) REGION P205 N P205 ITC) 1950/51 1951/52 1950/51 1951/52 1950/51 1951/52

Western Ettrope. 780 1 080 940 162 174 152 152 161 163 Northern Europe 210 300 245 194 209 186 188 165 177 Central Europe . 410 490 725 110 118 97 116 110 118 Mediterranean Europe 280 550 80 150 154 140 153 135 152 TOTAL . 1 680 2 420 1 990 146 156 139 146 138 144

over1950.Norway had the largestincrease, TABLE 15. INDICES OF CROP YIELDS AND F ERT I - mainly due to her herring catches.There was LIZER USE also a noticeable strengthening of the fresh fish trade which has contributed to the unrest felt Fertilizer useCrop yields per hectare ;per hectare on the markets for certain canned fish products REGION average lastaverage last e. g. from herring species. 2 years 4 years The greatly increased demand for forest prod- (1938=100)(1934-38=100) ucts led to recordpostwaroutput in Europe. Western Europe . 172 114 Favorable market conditions made it possible for Northern Europe. 194 109 the main producing countries to dispose of wood Central Europe 132 123 pulp and pulp products at steadily rising prices during 1951.Consequently, at the end of the Mediterranean Europe . 150 92 year exporters' stocks were reported to be very low.Large-scale purchases by the United King- Tractor numbers on farms are about four times dom in the last quarter of 1950 had led to com- greater than in 1938. In the Mediterranean area, petition by importing countries for the available however, the number of tractors has increased by supplies and to an unprecedented rise in the price only 67 percent since 1938, whereas in the United of sawn wood.At the same time, efforts were Kingdomitis6timesthe prewarnumber made by European coal industries to.replenish their (Table 16). low stocks of pit props.However, by the end of 1951, a general resistance developed on the TABLE 16. TRACTORSaNFARMS, EUROPE. part of buyers to high prices.The United King- (excluding Eastern Europe and U.S.S.R.) dom curtailed its 1952 buying program for sawn 1951 as wood, and most importing countries have accu- REGIO 1939 1949 1950 1951 of 1939 mulated large stocks of sawn wood and wood pulp. Wood pulppricesin February 1952 declined 1( .thousands ofUSCs .. .) between 30 and 40 percent.By June 1952 sawn Western Europe. . I 103 415 470 523 506 wood prices broke and shippers, embarrassed by Northern Europe . 31 68 86 104 334 unsold stocks, offered deliveries at prices 25 to Central Europe . 37 SO 115 155 419 30 percent below previous peaks.Demand, how- Med iterranean Europe 52 66 76 86 167 ever, has been show to respond.Simultaneously with the fall in sawn wood prices, the United Kingdom set price ceilings for imports of wood TOTAL. . . 223 629 747 868 389 pulp 20 percent below ruling prices.In the sum- SOURCE : ECE, The European Tractor Industry, February mer of 1951 an impending shortage of pit props 1952. seemed to imperil European coal production programs.The Timber and Coal Committee of the With regard to other sources of animal protein, ECE called attention to the danger.Additional the 1951 fish catches for the most important Euro- supplies were forthcoming and this, together with pean countries show very significant increases advance shipments on existing contracts and early

48 closing of new contracts, carried Europe over the TABLE 17. TOTAL IMPORT OF SELECTED COMMODI- danger period.Prices of small roundwood have TIES FROM OTHER REGIONS AND PERCENTAGE IM- PORTED FROM DOLLAR AREA., ELTROPE(excluding fallen by some 20 to 25 percent from the price Eastern Europe and U.S.S.R.) level of autumn 1951. BreadCoarse FatsOilcake Trade. Western Europe has had to continue PERIOD graingrainSugar and and being a heavy importer of foods.Furthermore, oils d meal e

as exportable supplies became less available in (...... metric tons non-dollar areas, the region has had to continue Prewar 12.6 11.1 3.0 2.6 5.1 making heavy purchases in North America.Dur- 1949/50 12.4 8.3 2.8 2.7 ma ing the past three years, the annual average per- 1950/51 12.5 7.5 2.3 2.7 3.4 1951/52b 14.1 9.1 2.7 n.a 3.3 centage food supply in 'Western Europe obtained by imports from the rest of the world was 34 Percentage i.m)orted from r area percent for bread grains, 32 percent for sugar, Prewar 35 40 7 and, (if imported grain for feed is taken into con- 1949/50 SO 46 75 20 n.a sideration) 21 percent for meat and eggs.Between 1950/51 SO 45 195 20 17 1949and 1951 expendituresonagricultural 1951/52 n.a n.a n.a n.a 17 imports (excluding fibers) from outside the region a Dollar area comprises :for g,rains, U.S.A. and Canada ; by ten of the largest countries declined steadily for sugar, U.S.A. and Latin America, excl. :Brazil ; for fats and oils and oileake, North America, inel. Mexico and the from 70 percent of their earnings from total ex- Philippine Republic. b Provisional. ports to 55 percent.The reduction was due in e In terms of refined sugar.Net of re-exports. part to increased exports from expanding indus- d In oil equivalent. e From imported seeds and imported as such.Postwar try, and improving abilityof Europe tofeed figures are for 1950 and 1951 (calendar years). f If the quantity of sugar re-exported to other regions is itself.Food still represented the dominant import added to the import, the import from the dollar area amounts cost, however. to less, e.g. 77 % in 1950/51. In 1951/52 imports of grains were greater by increasedconsiderably.Most of these exports about 12 percent than in the previous year and went toWestern European countries. the main those of sugar by 10 percent, because of smaller do- exception being butterexports from Denmark mestic production. Many countries tried to rebuild and Sweden to Czechoslovakia, Eastern Germany stocks of grain from which they had drawn in and the U.S.S.R.. France changed from a net 1950/51, whereas some 400,000 tons of sugar exporter of bread grainin1950/51toa net were added to stocks in both years. importer in1951/52,andalsodecreased her While imports of bread grain and fats and oils exports of sugar and meat. have been exceeding the prewar levels, imports of Imports of coarse grains and wheat from Eastern sugar, coarse grain and oilcake have been consid- Europe and,in particular, from the -U.S.S.R., erably reduced.Thereductionin oilcakeis although very limited andstillfar below the due partly to the reduced demand, reflecting im- prewar average, showed some increase over the proved methods of pasture management and preceding year, Italy and the United Kingdom being utilization and also lack of foreign exchange. the main importers from the U.S:S.R.. Western Coarse grain purchases have been reduced, partly Germany, which before the war relied on eastern because of high prices in the markets for which countries for a substantial part of its foo'd imports, foreign exchange was available, and partly be- drew only 3.4 percent of its total from this regiOn. cause of the decrease in horse numbers which released feed for other livestock. Prices and income.Prices received by farmers The dependence on the dollar area for imports for the major crops, particularly cereals and sugar of essential foodstuffs and feeding stuffs increased beets, improved somewhat in 1951/52.In 1949 further in 1951/52, especially in grains, following and even after the outbreak of hostilities in Korea the curtailment of suppliesfrom the Argentine in 1950, these prices increased relatively little in and Australia (Table17). most countries, partly thanks to government pol- Intra-European trade in agricultural products icies,while industrial pricesrose considerably. remained at a high level during 1951/52.Total Prices of livestock products were sustained during meat exports from Denmark have been slightly 1951/52, particularly for meat, but did not keep reduced and the export of butter from Denmark pace with the increase in crop prices.Italy and and the Netherlands was below theprevious the Netherlands were the only countries where year's, while cheese exports from those countries livestock prices increased more during the year

49 than did prices of the main crops.The relation Long-term outlook remained the same in Denmark, Norway, and Switzerland but in France, Germany and the According to a recent OEEC estimate, total United Kingdom, for instance, prices of the major demand for agricultural products in the OEEC crops increased 21 to 31 percent, while prices of area might be expected to increase by 12 to 14 livestock products rose only S to 18 percent. percent within the next five years, if total eco- Price fixing and control programs have changed nomic activity were to increase by 25 percent. little.Norway, Sweden and the United Kingdom Although this estimate may be on the high side, have price agreements which aim at assuring their it has to be considered in relationto Europe's agricultural industries a minimum income. Fixed abilityto obtain larger supplies of foodand or guaranteed pricesfor some basic products feedstuffsnecessary for a growingpopulation remain in operation in Austria, Denmark, France, from other regions.As indicated in Chapter II, Italy, the Netherlands, Switzerland and Western itis not likely that dependence on the dollar Germany. area will diminish.At the same time, prices for Gross farm income in 1951/52 was higher than imports from this area are likely to remain high in previous years in most countries.Net farm and exchange difficulties will not easily be over- income, however, increased less, owing to substan- come. tial increases in wages and other costs.Prices In the long run, therefore, necessary agricultural of imported feedstuffs rose but in France, the supplies can only be assured by increased European Netherlands, Sweden and the United Kingdom production leading to the consequent reduction the increase was partly offset by subsidies. Some of imports from the dollar area of such products farmers found that fertilizer prices increased more ascereals, sugar and tobacco.Since thereis than crop prices. little scope for expanding the agricultural area the stress has to be laid on further intensification of production. Outlook 1952/53 Demand for farm products will probably remain generally strong and the greater availability of EASTERN EUROPE AND THE U.S.S.R. 2 coal, steel and other raw materials should encour- agehighindustrialactivity.Unemployment, Current situation which has been increasing in some countries such Collectivization in some of the Eastern European as the Netherlands and the United Kingdom, will countries has slowed down during the past year, havelittleeffect on the present average level of but the area in state farms continues to expand consumption.Structural unemployment contin- rapidly, especially in Poland and Eastern Germany ues high in Italy and Western Germany.Prices where land abandoned by farmers has been taken may remain more stable than in recent years, over for cultivation. largely thanks to the recent fall in prices of raw In Bulgaria, where the process of collectiviza- materials and to anti-inflationary measures taken tion is nearest completion, about one-half of the by various governments. total area of arable land was in collective farms Crop production can be expected to exceed by the end of 1951.In Czechoslovakia, Hungary 1951/52 levels.The area under cereals, including and Yugoslavia the proportion accounted for by wheat, shows a slight increase, and yields are collective and state farms appears to have reached generally reported to be good.The area under 20 to 30 percent and in Poland about 15 percent. sugar beet has been further extended by some In Romania the number of collective farms at 5-7 percent, the increase being most niarked in the beginning of 1952 was small compared with Austria, Finland, France, Italy and Spain, with neighboring countries.In Eastern Germany, al- decreases in Belgium, Ireland, Western Germany though the number of nationally-owned machine and the United Kingdom.Livestock production stations has increased, no deliberate policy of should benefit from the good condition of pastures, collectivization on the usual pattern appears to but in countries depending on imports of feedstuffs, have been introduced. supplies and prices in foreign markets will influence the rate of expansion of output.The after-effects 2 For purposes of this report Eastern Europe in- of foot-and-mouth disease on the output of live- eludes Albania, Bulgaria, Czechoslovakia, Hungary, stock products, especially milk, may become appar- Poland, Romania, Yugoslavia and Ea,sternGer- ent. many.

50 In the Soviet Union, more attention has recently were substantially greater than in 1950, except been paid to the transfer of livestock still in pri- in Poland, where some crops, especially potatoes, vate hands to collective ownership, and towards had poor yields owing to drought.In the Soviet the amalgamation of collective farms into larger Union the total grain harvest was smaller than farming units.There has been a change in the in 1950. policy of collectivization in Yugoslavia.The type The area under sugar beet and industrial crops of co-operative now being encouraged resembles (e.g. oilseeds, flax and tobacco) is rapidly expand- the Western more than the Soviet model, with ing in several countries.In Bulgaria cotton, hemp, peasants combining mainly for buying and sell- rice, and sugar beet all showed a considerable ing, the provision of credit and other forms of increase.In Poland and Czechoslovakia, however, mutual assistance.Existing co-operative farms the planned increases in sugar beet and industrial are changing their methods of paying workers to crops were not attained, though there was some provide more incentive for individual effort.Ma- increase in acreage. chine tractor stations have been dissolved and The improved crop situation in 1951 had not their stocks transferred to co-operative pools of greatly affected livestock numbers by the end of the western type or distributed among the col- the year.In Bulgaria there was an increase of lective farms.Compulsory state purchase of pro- 7 percent in livestock.In Yugoslavia livestock duce (except wool) has been abolished, freer prices numbers increased somewhat after the setbacks provide a new incentive for sales off farms, and caused by drought in 1950, but except for sheep, earnings above a level fixed by reference to the smaller numbers were recorded in January 1952 cadastral value of the land are not now subject than two years previously.The cattle popula- to tax. tion in Czechoslovakia and Poland is stated to Increased agricultural mechanization is also a have been about the same in 1951 as in 1950. major preoccupation in Eastern Europe.Apart In Poland pig breeding was reduced in the earlier from Bulgaria and Albania, which have no tractor part of the year but showed signs of recovery in industries,all the countries of Eastern Europe the fourthquarter.Pigs and sheep increased continued in 1951 their efforts to expand the appreciably in Eastern Germany and in Czecho- volume of tractor production.It is anticipated slovakia. that Czechoslovakia will produce heavy tractors for export to Bulgaria, Poland and other countries. Shortages of meat and fats were reported in several of the Eastern European countries.In Agricultural production. Agricultural production, Poland, the effects of the drought, combined with although showing marked recovery since the end the peasants' reluctance to meet the Government's of World War II, is still below that of the 1934-38 demands, led to reductions in fat stock deliveries average. from farms, and towards the end of 1951 a partial Throughout most of Eastern Europe the bread rationing of meat and fats was introduced.The grain harvest in 1951 was reported to be the best problem of feeding industrial workers in Poland, since thewar(Table 18).Yields per hectare 110W about double prewar numbers, is of critical importance because of its vital connection with TABLE 18. CROP PRODUCTION : EASTERN EUROPE a productivity, the key to the fulfilment of all the Government's planning.Compulsory delivery of 0,111101)1'n' 1931-35 1950 1951 slaughter animals and of some livestock products has recently been reintroduced, and to encourage ( .711 iIOoa metric tons .. ) Wheat 14.0 12.8 14.6 production and delivery of pigs there is a bonus Rye 11.8 11.1 11.4 payment for pigs sold under contract above the Barley 5.7 4.4 4.9 Oats . 6.9 5.1 5.4 quota.Such deliveries also bring some reduction Maize 12.2 9.0 12.3 in land tax and earn for farmers the right to Sugar 2.6 3.2 3.1 purchase certain quantities of coal and feeding- Potatoes 67.0 62.9 53.6 stuffs. TOTAL, wheat equivalent. 62.0 55.6 57.3 At the beginning of the year, following the drought of 1950 which had given rise to a shortage Wheat equivalent per caput (kg) 371 339 335 of feed, rationing was re-imposed in Hungary. After the good harvest of 1951 food prospects NoTE : Statistics are mostly derived from unofficial sources. began to improve and in December 1951 ration- a Bulgaria, Czechoslovakia, Eastern Germany, Hungary, Poland, Romania and Yugoslavia. ing was ended.In Czechoslovakia the production

51 of fat stock and milk fell short of the figure plan- and the United Kingdom)following the more ned, and in reviewing the year's achievements the favorable harvest of 1951. Government stated that "serious shortcoming had Poland's exports of bacon to the United Kingdom occurred" in the supply of agricultural products. in 1951 were at the 1950 level of 37,000 tons, A change in the system of food prices took place but reduced quantities were sent in the early in Romania in January 1952 and in Bulgaria in months of 1952.The trade ineggs has also May 1952, with food rationing abolished and a diminished. currency reform announced.The volume of sales Exports of pigs to Western Germany from of consumer goods, including food; increased there- Poland, Hungary and Czechoslovakia were much after.This move in Romania followed a period less in 1951 than in 1950, but exports of sugar of shortageoflivestockproducts.The Meat were greatly increased. Department of the Romanian Ministry of Food is reported to have delivered only 42 percent of the planned amount of meat for 1951. NORTH AMERICA 3 In Eastern Germany meat consumption was substantially greater than in 1950, but still much Current situation below the prewar level.Deliveries from farms Throughout 1951/52 defence activities and the were regarded as unsatisfactory in view of the expansion of industrial plant determined the pat- estimated production. tern of demand for farm products as well as other Trade.Trade within the region is reported to products.Stockpiling generally declined or stop- have been intensified and there were growing ped early in the crop year, and consumer purchases restrictionsontradewithWesternEurope. were relatively low during 1951 but started to Eastern Germany and Czechoslovakia continue to improve slightly in 1952.On the other hand, be supplied with grains in exchange for industrial the imbalance in foreign trade that developed in products, especially machinery and scientificin- 1951 continued into 1952 with an export surplus struments. of about 5,500 million dollars (annual rate). Man- In Eastern Germany the livestock numbers envis- ufacturing capacity in the United States expand- aged in the revised five-year plan for production ed under the impact of the postwar boom. (1951-55) and a trade agreement with the Soviet Agricultural production increased during 1951/ Union suggest that substantial supplies of coarse 52 over that in 1950/51.In the United States grains are expected to arrive from or by way of total volume of farm production advanced about Russia. 2 percent, and in Callada the advance was 13 per- The Soviet Union exported 300,000 tons or 27 cent.The gains in production are largely attri- percent more grain to Western Europe in 1951 butable to substantial increases in cotton, tobacco, than in1950, the increase going chiefly to the oilseed and truck crops in the United States and United Kingdom (coarse grain) and to Finland to large grain crops in Canada.Livestock and and Italy (bread grain).Poland, Hungary and livestock products gained moderately in the Unit- Yugoslavia, on the other hand, shipped less grain, ed States, the increase in pigmeat, poultry, and and exports from the region as a whole were eggs offsetting a slight decline in dairy products reduced 100,000 tons(6 percent).These ship- and other meat.In Canada, beef, veal and egg ments in 1951 made up 7 percent of Western production was reduced somewhat but produc- Europe's grain imports as compared with 10 per- tion of pork and poultry was larger. cent in 1950. Food and agricultural supplies of domestic and Exports of wheat from the Soviet Union includ- foreign origin were adequate to meet the domestic ed about 180,000 tons to countries outside Europe, and export demand.HOWeVer, the decline in po- mainly to Egypt, during the six months ending tato production in both Canada and the -United January 31st, 1952, and 180,000 tons to the Unit- States resulted in a shortage during the first half ed Kingdom during the first four months of 1952. of 1952, with prices rising sharply.By the end This was in fulfilment of the agreement concluded of 1951, agricultural stocks, with some changes in September 1951, under which the United King- in composition, were even larger than at the end dom would receive 200,000 tons of wheat, as well of 1950, assuring adequate supplies of most food- as 800,000 tons of coarse grains. stuffs for the balance of the 1951/52 year, but Early in 1952 Yugoslavia exported substantial quantities of maize (chiefly to Western Germany 'U.S.A. and Canada.

52 maize and wheat carr3-oversNvill remain lower Canada about 7 percent.Production for defence than a year earlier by the time the 1952 crops and related purposes was the major factor support- are harvested. ing the increased output.In contrast, production of many types of consumers' goods dropped with General economic conditions.Increasing rates of government expenditure and of business invest- the decline in individual demand which affected ment were decisive factors contributing to an chiefly purchases of durable goods and some types enlarged volume of output.Full employment was of non-durables at a -time when production was maintained and a larger number of persons were close to peak rates and stocks were rapidly accu- at work at higher wage rates than the year before. mulating.Price levels were affected by the reduc- Unemployment was reduced to less than 3.0 per- tion in the volume of sales and by the slowdown cent of the total labor force in the United States in stockpiling following the decline in consumers' and to 2.0 percent in Canada. demand. These trends continued into 1952. Whole- Total output of goods and services increased sig- sale prices of all products declined. by 1.5 percent nificantly in both countries during 1951.Gross between September 1951 and June 1952.In the national product in 1951 at current market prices United States, consumers' expenditure for non- increased 16 percent over the 1950 figure in the durables rose slightly in the first quarter of 1952 United States and in Canada 17 percent.For while thosefor durablesremained unchanged. the United States nearly half of the increase was However, relaxationofgovernment restrictions brought about by gains in real output and the on instalment buying and on financing of private other half by _higher prices.In Canada only about house construction are expected to affect favorably one third of the increase originated in gains in consumer spending on houses and durables during output and the other two thirds WaS due to higher the rest of 1952. prices.The rate of increase declined appreciably Government outlays for defence purposes were in the first quarter of 1952. substantially larger than in 1950 and their share The aggregate volume of industrial production within gross national expenditure rose in the Unit- for both countries WaS larger than in 1950, by ed States from 6.5 percent in 1950 to 11.5 percent about 10 percent in the United States and in in 1951, and in Canada from less than 3 percent

CHART XIII -UNITED STATES : POPULATION AND FOOD PRODUCTION PREWAR AND POSTWAR

PERCENT SEMI-LOGARITHMIC SCALE OF PREWAR 160 1 50 TOTAL FOOD PRODUCTION 140

130

Osey, 120 =WES ig.....42AMZ 10Z 00.0001St,Set

1 1 0

I 00 POPULATION FOOD PRODUCTION PER CAPUT

60 '1935-39 19 46 47 1947/18 1948/49 1949/50 1950/51 1951/52

53 CHART XIV - CANADA : POPULATION AND AGRICULTURAL PRODUCTION PREWAR AND POSTWAR

PERCENT SEMI-LOGARITHM'C SCALE OF PREWAR

TOTAL AGRICULTURAL PRODUCTION

oo ...... 0000o0O000000000000000000000000000000 ...... ''''''''''''''''''''''''' o 0000000000 ......

AGRICULTURAL PRODUCTION PER CAPUT

1935-39 1946 /47 1947/ 48 1948 / 49 1949 /50 1950 /51 1951/ 52 to more than 5 percent.In addition, total invest- TABLE 19. -- TOTAL AND PER CAPUT AGRICULTURAL AND FOOD PRODUCTION IN THE UNITED STATES, Ment for industrial expansion and development of 1946 TO 1951 strategic raw materials advanced for both countries though proportionately more in Canada than ITEms 194611947 1948 1949 1950 1951 in the United States.In 1952 the rate of military expenditure continued to increase.Deliveries of 1935-39 100 military goods were 21,A times as great in the first Totalagricultural half of 1952 in the United States as in the first production. . . . . 137136 138140137 40 half of 1951. This rate will again double by the end Food production.. . 140140 134 137138 138 of 1952. Population 110112 114 116118 120 Agricultural production. On the North American Per caput agricultu- continent total agricultural production continued ral production. . . 125 121 121 121 116 117 in the United States at a reduced to increase Per ca,put food pro- rate as compared to the war years and in Callada, duction. 127125 118 11S117 115 because of the bumper wheat crops during the past two seasons, at a very high rate.On the SOURCE : U.S. Department of Agriculture and United Nations. other hand, the rate of increase in population in TABLE 20. TOTAL AND PER CAPUT AGRICULTURAL both countries was almost the same, with the PRODUCTION IN CANADA, 1946 TO 1951 result that per caput production, both food and non-food, showed a downward trend in the United ITE)IS 916 1947948 1919 1950 1951 States since the end of the war, while in Canada, per caput production declined at first, with poor 1935-39 100 weather, then rose sharply in the past two years. Total agricultural pro- (Tables 19 and 20 and Charts XIII and XIV). duction. 126 116125 122140 157 Adverse weather prevented even larger produc- Population 114117119122 124 tion in the United States, where abandonment of Per caput agricultu- planted fields was greater than in recent years. ral production. . . 114102 107103115 127 With increased acreage, cotton production was SOURCE :Dominion Bureau of Statisticsand United Na markedly larger.In Canada, although weather Mons.

54 was generally favorable during the growing season, and the crop at 15.3 million bales was 53 percent extremely unfavorable conditions prevailing dur- higher than in 1950/51. ing the harvesting period in Western Canada Both countries realized a net increase in livestock prevented a large part of the grain crop from be- population, but total meat production declined ing harvested or threshed until the spring of 1952, slightly because reductions in beef and veal offset creating serious handling problems. increases in pork.Poultry products in general Although the 1951/52 crop production in the increased for both countries but eggs declined United States was among the highest recorded, somewhat in Canada. Dairy production remained only 32.6 million tons of food grains were produced about the same. as against 33.2 million the previous season.The In 1951 the United States and Alaskan catch vheat crop of 26.9 million tons was 8 percent of fish and shell fish was about 10 percent lower below the 1940-1949 average, the decline resulting than in 1950, while the value decreased by about mainly- from abandonment of planted acreage in 5 percent.The decline was due primarily to winter wheat due to bad weather. reduced landings of pilchards, herring and tuna. The rice crop, at nearly 2 million tons, was the Preliminary data also indicated that the 1951 largest on record and exceeded by 13 percent that pack of canned fisheries products was 18 percent of the previous year.Feed grains totalled 114 lower than in 1950.The largest decline was ob- million tons against 122 million tons produced served inthe packs of California and Maine in 1950/51.In spite of 6 percent decline in soya- sardines, tuna and mackerel. beans and of 21 percent in peanuts, total produc- In Canada, excluding Newfoundland, fish land- tion of oilseeds at 16.3 million tons exceeded by ings in 1951 decreased by about 3 percent for 7 percent that of 1950/51.The estimated in- all species.In Newfoundland, the market condi- crease of cottonseed is about 50 percent.The tions for the cod fisheries had shown some signs increaseinsupplies of oilseeds was, however, of improvement in 1951. The 1951 Canadian pack accompanied by a substantial drop in fats and of salmon increased 32 percent above 1950 with oils prices. a simultaneous upward trend in prices. Beet and cane sugar was estimated below 2 Owing to the very favorable marl:et conditions, million tons against the 2.6 million produced the production of wood pulp in North America rose year before.Potatoes and sweet potatoes were 11 percent during 1951 and that of newsprint 8 also lower and dropped by 24 percent and 43 percent. Consumption of wood pulp and pulp pro- percent respectively.Price support on potatoes ducts, particularly newsprint, however, rose less was discontinuedafterthe1950/51crop.In than one percent and consequently stocks both at December 1951 the price had more than doubled mills and with consumers were at record levels in the as compared with a year earlier and exceeded the first quarter of 1952. The increase in North Ameri- parity level for the first time after several years, can wood pulp production resulted in reduced im- on account of reduced acreage and yields per acre. ports from other regions and the area became a net The tobacco crop was very high, exceeding by exporter in 1951. Lumber production in North Amer- 12 percent that of 1950/51. ica during 1951 was about 1.5 percent below that In Canada, 1951/52 saw larger yields per acre of 1950, sawn softwood declining about 4 percent, and higher volumes than the previous year for and hardwood lumber increasing about the same. most crops.Declines occurred in potatoes; field This decline in the total output of lumber was roots, sunflower seeds and sugar beets, due mainly clue in large measure to the curtailment of housing to reduced acreages. and general construction in the United States. The significantly increased Canadian grain crops will provide larger export surpluses during 1952/ Agric7iltural trade.The volume of United States 53. The wheat crop of 15.3 million tons was 22 agricultural and food exports increased 19 percent percent above the year before.Supplies of feed during 1951, and the volume of agricultural imports, grains available from the 1951/52 crop plus carry- although increasing slowly for specific commodi- over were estimated at 20.3 million tons against ties, in general declined and was 4 percent less the 15.3 million during 1950/51.Forage produc- than 1950.In the first quarter of 1952 exports tion also increased with important gains in hay increased another 17 percent over 1951,while and clover. imports declined by 5 percent compared with the Cotton acreage was 50 percent larger than the first quarter of 1951.Canadian agricultural ex- preceding year when acreage allotments were in ports exceeded those of the previous year by 25 effect.Yields per acre were also slightly higher percent.

55 Prices and income.Retail food prices in the number at work and wage rates may tend to show United States by the end of 1951 were at the agradualincrea,se.Disposableincomesina,y highest level on record about 18 percent above show some gains and consumers' demand will be that in the early months of 1950 but declined maintained.Theseconditionswillfavorhigh slightly during thefirst months of1952.In levels of agricultural production, increa,sed market- Cana,da food prices reached their peak during ings and consumption of almost all kinds of farm the third quarter of 1951 and ha-ve been declin- products.Import and export demand for agri- ing steadily since then, while remaining a,bove cultural products is also expected to remain fairly the levels of 1950. strong.Foreign demand for North America,n Wholesale prices of farm products also declined. wheat particularly may be well sustained, 011 In the United States wholesale prices of food in account of the shortcomings of other important June 1952 were a,bout 3 percent lower than a year suppliers such as Argentina and Australia. For- earlier, and agricultural prices 5 percent lower. eign demand for machinery and other a,gricultural In Canada, wholesale agricultural prices in April requisites will continue to be strong.In 1953/54 1952 were 8 percent below those of a yea,r ago. however, termination of the expansion in defence While prices received by farmers in the United expenditures and the sharp reduction in capital States had risen more rapidly than costs during production for defence plants, may cause some the general inflation in the latter half of 1950, a decline in demand inboth countries.The de- price-cost squeeze has been developing since Febru- cline would probably be more marked in the United ary 1951. In the United States the parity ratio de- States than in Callada,. clined from 113 in February 1951 to 102 by June Officially estimated acrea,ges and reported plant- 1952, reaching a,gain the levels of the first half ing intentions indicate that the overall area pla,nt- of 1950. In Canada prices received by farmers ed to crops during this season and probably the were in April 1952 about nine percent lower than next will be at recent years' levels, although mi- in April 1951. Farm costs, however, increased. nor relative changes may occur in the area planted Farm cash income, as a result of larger market- to particular crops.If recent trends in yields are ings and the high prices prevailing throughout taken into account and normal weather conditions 1951, increased substantially in both countries. prevail, total agricultural output may be larger. In the United States farm cash income advanced The 1952/53 wheat harvest in the United States, by 14 percent over 1950 and in Cana,da the ad- itisestimated, may exceed by more tha,n 25 vance was 27 percent.The estimated gross farm percent the 1951/52 crop. .Acrea,ges for feed grains income in both countries in 1951 was also much are about the same as in the pa,stseason, but higher than in 1950.In spite of some further production is expected to be significantly larger rise in production costs during 1951, net farm than in 1951.A maize crop about 14 percent income rose 38 percent in Canada (including above last year'sisforecast.Hay acreage and undistributed earnings of the Canadian Wheat production may also be slighly higher than in Board), and 17 percent in the United States, the 1951/52 and the feed supply situation is there- highest on record for Canada and one of the high- fore estimated to be adequate for the increased est for the United States, but still some two thou- ntunberof livestock.Acreage and output of sand million dollars lower than in 1947. oilseeds,potatoes and sweetpotatoes,pulses, sii?-ar and tobacco are not expected to show substantial variations.The cotton goal of 16 million Outlook bales is the same as for the past season, although with planting, somewhat below the average, the The heavy influence of the large defence pro- full output may not be attained. gram on business activity might have correspond- In Canada, tinder favorable weather conditions, ing effects on the demand for farm products. crop productiOn in 1952/53 may be the same as On the basis of the program as it stands in mid- in1951/52.Favorable conditionsenabled the summer 1952, the high rates of defence expendi- whole 1951/52 crop to be successfully harvested ture and large private capital investment pro- in the spring of 1952, and the new season crops grams will again, as in 1951, sustain a high level Were well advanced and generally in good to excel- of demand.Productive capacity will be higher lent conditions by the middle of the year.If in 1952/53 than in previous years and, apart from those conditions remain unchanged until harvest- some frictional and spotty unemployment, total ing time, wheat, feed grain and forage crops may

56 be as high as or even higher than last year's 1952/53with some temporary decline possible bumper crops. duringlate1953/54.Duringtimenextseason With normal yields, potato production may farm prices on the average will probable be main- also be somewhat larger, stimulated by the reduced tained without major fluctuations at the levels production in the United Statesin 1951752 and prevailing during late 1951 and early 1952.Fur- theupwardtrendindomesticprices. The thermore,price support systems in the United outlook for oilseeds and tobacco isalso good. States as well as in Callada constitute a safeguard Production of livestock and its products in the against any sharp drop in farm prices.Farmers' United States is expected to be larger in 1952/53 cash income, therefore, will probably continue to thanin1951/52,beef having expanded faster rise but net incomes may remain below the high than dairy cattle.Slaughterings ofcattle and levels in 1951 due to increasing production expenses. calves and sheep and lambs are expectedto Present trends of economic activity and public be larger than in the last year.Hog slaughter- expenditure alsoindicatefor1953/61afairly ings however are expected to drop later in 1952 high level of demand for farm products.Although because of the unfavorable level of prices com- employment mal' be about the same as in 1951/52 pared to maize price which has reduced the 1952 the gradual rise in wage rates is likely to bring pig crop 9 percent and may bring a similar reduc- some increase in consumer incomes available for tion to the fall pig crop.Total meat production, spending even if the present tax structure contin- however, is expected to be slightly above last ues.With productionfacilitiesbecomingin- year's. creasingly available for civilian use the general The present forecast for the United States market price situation at time retail level in 1953/54 may during 1952 points to a peak in production of not be much different fromthat in1951/52. edible fishery products, with some slight adjust- However, prices received by farmers could be ment in prices. subjecttoconsiderable downward pressureif Canadian cattle numbers showed an upward supplies are heavy. trend in 1951/52 and hog producers were expect- The already tight farm labor situation ma,y ing a 2 percentincrease in the 1952 spring pig become more aggravated as more and better job crop.The general good prospects for the Cana- opportunities are created in non-faian occupations. dian livestock industry that prevailed at the be- Rises in farm Ivage-ratesare thereforeto be ginning of 1952 were, however, shaken by the an- expected.A continued decline in the number of nouncement in February of the outbreak of foot farm workers is likely, but more efficient use of and mouth disease in Saskatchewan.Measures those remaining and a larger use of mechanical WCYC taken by the Canadian Government to eradi- implements will continue to offset this decrease. cate the disease, but at the same time the United In Canada the immigration program will contri- States placed an embargo on Canadian livestock, bute little to relieve the situation, although the fresh meat and hay.If the embargo continues growing need for mechanically skilled farm work- it will mean a substantial loss of export trade in ers will continue.In the, .L.Tnited States the re- meat andlivestockwhichlastyearbrought cruitment of outside workers during harvesting Canada 138 million dollars.With largercattle periods will probably continue on an increasing and hog populations, the measure will also inev- scale. itably result in a large surplus of meat for 1952/53. iAlaterials required by farmers, such as equip- Increased meat salestothe United Kingdom ment, fertilizers, pesticides and fuel, may show under the new three-country agreement includ- some further price rises due to a relatively light ing New Zealand are, however, likely to absorb supply situation arising from world-wide short- part of such a surplus. ages and the allocations required for the expand- Supply prospects in North, America for forest ingdefenceindustries.Supplies may notbe products in 1952 give no reason for anxiety, as sufficientto meet the increased domestic and stocks for most forest products at the end of 1951 foreign demand. were at a high level ;current demand is therefore With farm prices declining relative to prices of likely to be met, particularly as an increase in goods farmers buy but partially offset by larger the output of sawn wood appears probable in volume of production, North American net farm 1952. incomes in 1952/53 may be slightly lower than Demand conditions for farm products are ex- a year earlier with a further decline possible in time pected to continue strong for both countries in following year.

57 LATIN AMERICA There was a sharp contraction in production of cereals and minor declines in potatoes,pulses, Current situation tobacco, cocoa, hard fibers and livestock products, which were only partially offset by a significant In Latin America greater emphasis isbeing increase in sugar and smaller gains in cotton, coffee, placed on agriculturalexpansion than during bananas and oilseeds. recent years.Industry has been expanding more The declineinproductionaffectedexports rapidly tha;n agriculture, and in some instances rather than levels of domestic supplies and be- agricultural investment was discouraged by price cause of increased imports food supplies in 1951/ policies.There is,however, a growing realiza- 52 were generally higher than the year before. tion that agricultural development must not lag In several countries,e.g.Brazil, total supplies behind progress in other sectors of the economy. increased by a higher proportion than population In most countries agricultural exports, which for growth and supplies per caput were therefore the area as a whole have declined during the also higher.For Latin America asawhole, postwar period, are essential for economic develop- however, supplies did not exceed the population ment as they constitute at present an irreplaceable increase and food supplies per caput remained source of foreign exchange with which to pay for almost unchanged as compared with the previous increased imports of capital and consumer goods. year. The area planted and harvested in 1951/52 General economic conditions.Industrial produc- was larger than that in the preceding year, except tion as well as other non-farm economic activities in Argentina where acreage dropped significantly continued to expand during 1951/52.The rate more farm machinery was in use in many countries. of growth of industrial production was accelerated Nevertheless, a heavy setback in Argentina's pro- in Chile; Mexico and Peru and remained almost duction, caused mainly by unfavorable weather, unchanged for the rest of the region as compared offset progress elsewhere and overall farm produc- with the previous year's. In Argentina, however, tion in Latin America during 1951/52 consequently there was a slowing down, mainly in the produc- declined about 2 percent from the previous year. tion of durable goods.For the region as a whole

CHART XV - LATIN AMERICA : POPULATION AND FOOD PRODUCTION PREWAR AND POSTWAR

PERCENT OF PREWAR SEMI-LOGARITHMIC SCALE

160 150 POPULATION 140 ...... ; 130 ...... 120

110 TOTAL FOOD PRODUCTION

100 gyepN.0Ol...I .... 90 FOOD PRODUCTION FER CAPUT 80

60 1934-38 1946/47 947/48 1948/49 949/50 1950/51 1951/52

58 CHART XVI LATIN AMERICA (EXCLUDING ARGENTINA) : POPULATION AND FOOD PRODUCTION, PREWAR AND POSTWAR

PERCENT SEMI-LOGARITHMIC SCALE OF PREWAR

160

150 TOTAL FOOD PRODUCTION

140 0..4100 ...... 130 .0000¢,9100t,i ....71.11.1.0.1S. .4102116NO 120 POPULATION assa..10 =FS 110 SatliOIDO SIfirenseesa..¢1.0. ¡Isprafla 100

90 FCOD PRODUCTION PER CAPUT

60 1934-38 1946/47 1947/48 1948/49 1949/50 1950/51 1951/52

the increase in the volume of non-farm production exchange reserves.As a result, exchangeand more than offset the decline in agricultural pro- import restrictions, whichhadbeen generally duction.In several countries the share of agri- relaxedinlate1950andearly1951,were culture in gross national production was almost again tightened in early 1952 in several instances. unchanged but in Argentina, Brazil, Chile, and Mexico it was further reduced. iyricultural production.Total agricultural pro- External and internal factors contributed to duction has been increasing somewhat each year the inflationary pressures and pushed the general sincetheendof World WarII,although level of prices upward, particularly during the therewasasetbackin1951/52.(Table21 first part of 1951.During the second half, price and Charts XV and XVI). Food production in increasesslowed down considerably.Forthe 1951/52 was about 22 percent above the prewar year as a whole, however, price levels in nearly level.Nevertheless, population growth exceeded every country were substantially above those this increase, so that per caput food production of the preceding year.By the end of 1951 and has declined 10 percent below the prewar level. during the early months of 1952, price increases However, excluding Argentina, it is obvious that had levelled off in most countries.In a few coun- considerable progress has been made in the region, tries, e.g. Chile and Paraguay, where inflationary with 1951/52 food production 47 percent above forces were mainly of internal origin, inflation the 1934-38 average and exceeding the rate of continued although ata reduced rate.Early growth of population, and per caput production in 1952 the cost of living was higher than a year consequently increased by 8 percent.The drop previously in all countries of Latin America ex- of about 17 percentin cereal production in 1951/ cept Colombia, where it was about the same. 52 is accounted for by a declineof 44 percent The domestic demand for agricultural products, in bread grains and 4 percent in rice against an especiallyfoodstuffs, continued to be firm,as increase of about 3 percent in coarse grains.Re- indicated by the sharper rise in food prices than duced production of wheat and corn in Argentina, in prices of other consumer goods. and wheat in Mexico and Brazil,was due to Increased and more expensive imports result- bad weather.The 1951/52 Latin American wheat ed in a net decline of $ 300 million in foreign production declined by more than 3 million metric TABLE 21. -- INDEX- NUMBERSa OF VOLE-ALM OF TOTAL PER CAPuT AGRICULTURAL AND FOOD PRODUETION IN LATIN AMERICA 1946/47 TO 1951/52

ITEms 1940/47 1947/48 1948/49 1949/50 1930/51 1951/52d

1934-38 100 Total agricultural product ion 109 114 114 117 120 117 Food production 116 122 121 199 127 122 Population 122 125 127 130 133 136 Per caput agricultural production 89 91 90 00 90 86 Per caput food production 95 98 95 94 95 90

LATIN AMERICA, ExcL. ARGENTINA

Total agricultural product ion 114 118 124 130 132 135 Food production 125 129 135 142 144 147 Population 122 125 128 130 134 136 Per caput agr. prod 93 94 100 99 99 Per caput food prod. 102 103 105 109 107 108

ALL LATIN AMERIcA, PrtoDucTioN BY COMMODITIES Food Crops . 120 127 123 122 130 127 Cereals . 102 107 99 94 104 87 Potatoes 129 158 156 163 175 173 Other roots and tubers 184 181 194 195 201 203 Pulses 128 130 144 150 150 149 Sugar 157 161 159 165 171 191 Oilseeds (for edible oils)b 160 189 213 206 234 242 Bananas 125 133 135 116 151 155 Cocoa 97 96 106 118 105 95

AninbalFoods Meat 108 114 115 120 120 117

Aron-Food Prochwis 91 92 94 101 102 104 Coffee 78 81 86 SS 87 91 Wool 114 120 114 118 120 118 Cotton . 86 88 102 117 130 141 Hard fibers 144 151 159 167 180 172 Tobacco 151 141 141 149 145 136 Oilseeds (for non-edible oils) e 67 66 44 57 52 42

NoTE :This index is not fully comparable with that shown in Table 1, because of a somewhat different commodity coverage. a These index numbers are weighted by -values. They are preliminary.All FAO production indices will be revised during, the coming, year. bSunflower seed, groundnuts, sesame and cottonseed. e Linseed and eastorseed. d Based on preliminary data. tons from the 8.6 million metric tons produced progress in these two countries is significant be- the yearbefore.Despite unfavorable weather cause they, together with Puerto Rico, are the the increased maize acreage made possible a gain largest importers of rice in the region. of about 1.2 million tons over the 14 8 million Production of potatoes was about 3 percent produced in 1950/51 with increases of 700 thou- less than a year ago, mainly as a result of a sub- sand tons in Mexico, 300 thousand in Brazil and stantial drop in Argentina's crop and a somewhat about 150 thousand inArgentina,the major smaller crop in Peru. producers.Decreases occurred in rice, rye, oats The area planted to cotton was larger and produc- and barley production.However, the success- tion was 9 percent above the 815 thousand tons ful drive for increased production of rice in Cuba of 1950/51.Gains occurred principally in Argen- and Venezuela during 1951/52 resulted in gains tina, Mexico and Peru. of 50 percent and 60 percent respectively.Such Total production of oilseeds in 1951/52 increased

60 because of higher cottonseed and groundnuts It has been estimated that 60 to 70percent output which more than offset significant declines of the increase of sawn wood production in the in Argentina's linseed and sunflower. whole of Latin America went tomeet the de- The 1951/52 output of sugar was a record one mandsof domesticconsumersand that only in many Latin American republics and the gain 30 to 40 percent was exported, either to countries for the whole region represented a 12 percent in- within the region,oroverseas.The domestic crease over the 12.4 4 million metric tons produced prices of sawn wood were higher than the export in 1950/51.Increases were as high as 24 percent prices which in 1951 reached a record. in Cuba, 13 percent in the Dominican Republic and 8 percent in Puerto Rico.With the new Agricultural trade trends. During 1951 exports high level of sugar production Latin America's of agricultural products were lower than in 1950, share in the world total moved from 33 percent because of reduced shipments of grains, meat last year to 40 percent this year.The coffee and wool.However, sugar,coffee and cotton crop also improved by about 5 percent over the were exported in greater volume than the year before. 1,839 thousand tons produced in 1950/51.The gain came mostly from an increased Brazilian The reduction in net exports is a continuation output, which was S3 thousand tons larger than of the downward trend that began in the war a year ago. years, with the sharp fall in net exports of grains Persistent drought and heat have been impair- and significant decline in those of meat and oils ing the production of meat since 1949, and the (Table 22). total 1951/52 production was lower than that of 1950/51. In Argentina, particularly, reduced produc- TABLE 22. NET TRADE IN MAJOR AGRICULTURAL tionispartlydue COMMODITIES, LATIN AMERICA :1934-38,1950 to reduction in livestock AND 1951 numbers, mainly cattle and hogs, which are closely = Net Exports related to the pasturage and feed situation. = Net Imports The fisheries industries of Latin America are Average passing through a period of large capital invest- COMMODITY 1914-33 1950a 1951" ment and technological improvement which should bring significant changes in the patterns of pro- ( ... thousand metric tons duction and consuniption of fisheries products. Sugar 3 790 6 570 7 050 The year 1951 has been characterized in several Cofil ee 1 370 1 394 1 490 Maize 6590---- 330 570 Latin American countries, e.g. Brazil and Chile, Vegetable oils and oil- by the fulfilment of established plans for the ex- seeds 549 447 551 pansion of primary and secondary fisheries Meat 8241 538 468 in- Cotton (ginned). 265' 231 285 dustries and the introduction of new and more Barley 380 + 15 285 modern transport and market facilities.Coun- Cocoa 196- 216 185 Oats. 400 230 170 tries like Peru, forexample, are even entering Hard fibers 109 79 140 international trade in fisheries products as impor- Wool (greasy) . 216 280 109 tant exporters of certain commodities, on equal Rye 120 200 100 Afillet and sorghum 50 90 80 terms with many ofthetraditional European Tobacco 46 58 58 producer countries. Jute . 37 -- 95 The volume of forest products output as a whole Rubber 7 33 + 41 Dry beans 6 14H- 50 increased somewhat in 1951.Wood pulp produc- Animal and marine oils 70 _1_ 60 + 120 tion rose by less than 1/4 percent and remained Potatoes 156 "7" 230 + 160 Rice. + 290 180-l- 950 below its relatively high level in other regions. Wheat 1 700 500 + 2 100 The increase was almost entirely accounted for by the production of mechanical wood pulp in a Trade data re/ate to calendar years with the exception of wheat, rye, barley, maize and oats, where the data for trade Argentina.With demand exceeding production, season July-Tune beginning in the year stated have been imports of wood pulp from other regions rose 13 used. percent over the1950level.Encouraged by increased building activity,production of sawn Imports of foodstuffs and other agricultural wood particularly in Brazil also expanded. products generally increased under the influence of increased consumption and the greater avail- 4 Refers only to production of sugar at raw value ability of foreign exchange arising out of the and excludes panela. largerexportsurplusof1950.Rice was an

61 exception, mainly due to higher production in the limiting the number of slaughtering days in each importing countries. week is in force.Progress made in other countries is not likely to offset the expected decline Prices and income. Because of higherprices, in Argentina's meat output next season.HOW- reflecting a strong domestic ami foreign demand, ever, in 1953/54, if the increase in stock in Argen- gross farm income was higher in 1951/52 than in tinais a.chieved, total meat production in the 1950/51,exceptpossiblyinArgentina.With area may surpass the levels reached during the production expenses rising, net farm income in- last two years and perhaps exceed the record creased less tha.n gross income.The trend in the attained in 1949/50. ratio of agricultural prices to general wholesale Expansion of Latin American forestry products prices, however, suggests that in some countries w 11 contribute to the improvement of the supply (Venezuela and Costa Rica) farming benefited situation in this region and make it less dependent from price increases more than did other activi- on imports, particularly of wood pulp and pulp ties, while in others (Mexico and Chile) itgained products. less. Totala.griculturalexportsduring1952are likely to he reduced and exportable supplies are Outlook even lower than in1951.Some commodities, however, such as coffee, wool and sugar, may be During 1952/53 and 1953/54 the overall rate of exportedinsomewhatlargervolumes.Meat agricultural progress in Latin America will be exports may- increase through the efforts being influenced largely by changes in Argentina's pro- made by Argentina to keep her export levels high duction.Due to the new price policy of stimul- even at the expense of reduced home consumption. ating agricultural production in that country a For 1953 total agricultural exports may be above substantial advance toward the official goals of the volume of the two preceding years, but if greater output of cereals and linseed may be Argentina should not succeed in improving her expected in1952/53.These goalscallfor an production of grains and meat, exports may be increase of slightly over 20 percent in the area below the low levels expected during 1952. planted to these crops above that in1950/51 Food and agricultural imports will probably and an estimated 45 percent over the area in 1951/ continue to increase although at a slower rate 52. than in recent years, mainly as a result of exchange Assuming normal weather and the same rate of difficultiesbeingfacedbyseveralcountries. increase in output as in recent years in the region During 1952 at least, these imports will require a outside Argentina, total production of grains may higher expenditure in hard currencies than in exceed by approximately 3 million metric tons previous years on account of the present short the 29 million metric tons produced in 1951/52. supplies in Argentina. With a significant increase in the area planted to Industrial production during the coming year linseed in Argentina, oilseed production is likely may continue to expand more rapidly than agri- to increase substantially.In 1952/53 sugar may culture,except perhaps in Argentina.Income a.gain show another advance as the Cuban produc- and employment will probably, also show some tion may increase somewhat over that of the pre- gains.The demand for food will continue to be ceding year,if no administrative measures are strong but supplies will probably not keep pace taken to reduce output.Production of coffee with increased population and consumer income. may make some gains, particularly in 1953/54, In some instances food exports will have to be as a result of new plantings in recent years in reduced in order to maintain the level of domestic almost every producingcountry.Cottonout- consumption.Total consumption of food during put is likely to be somewhat higher in 1952/53, the next two years may be above that in 1951/52 since larger crops are expected in Brazil, Mexico but on a per caput basis it is not likely to show and several of the minor producing countries. any significant change. Livestock slaughter and output of livestock Several programs for expanding South America's products during 1952/53 may declinefurther, forest industries are under way. By 1952/53 the mainly as a result of recent measures adopted supply situation in this region may begin to im- by Argentina in order to increase cattle numbers. prove.The probability is that this region will, Argentina's meat output is likely to fall to about particularly as regards pulp and pulp products, 80 percent of current production while the measure graduallybecomelessdependent on imports.

62 AFRICA' TABLE 23. INDEX NUMBERS OF TOTAL AND PER CAPUT AGRICULTURAL PRODUCTION IN AFRICA a 1946/ 7 TO 1951/52 Current situation

ITEms 1946/1947/ 1948'119491195011951/ Although this review deals with Africa as a .17 49 50 51 52 whole and not with specific countries, the continent should be considered in three broad regions. 1934-38 100 These are North Africa; which forms part of the Total agricultural pro- Mediterranean economy, the intra-tropical colo- duction. 104108 116 122122 123 nial territories which are complementary to those Food crops b 06109 113 118118 118 of the administering metropolitan countries, and Population . 113 114116 119 120 South Africa, which is the only partly industrial- Per caput agricultural ized region. The nature and rate of development production . . . . 92 95 co 104 103 102 for each of these regions varies of course with its Per caput food pro- economic relationships with other parts of the duction. 94 95 97 1CO 99 08 world and with its resources. Agricultural food crop production showed a a These index numbers are weig ited by values.They are preliminary only.All FAOi roduetion indiceswill steady risein the postwar period,percaput be revised during the coming year. b Commodities included in food crops production are production reaching a peak in 1949/50, the only wheat, rye, barley, oats, maize, rice, millet, sorghum, dry year when it reached the prewarlevel.During beans, dry peas, broad beans, chicle peas, lentils, potatoes, the last two years food crop production was sweet potatoes, groundnuts, and raw sugar. maintained near the 1949 level,but a further population increase slightly reduced per caput Production. Production in 1951/52inAfrica, production. (Table 23 and Chart XVII). which accounts for 5 percent of total world agricultural output, did not show any appreciable increase over last season.Some important chan- Excludes Egypt, Anglo-Egyptian Sudan, Eritrea, ges in the agricultural situation have taken place, Ethiopia and the Somalilands. however, the most important of which were the

CHART XVII - AFRICA : POPULATION AND FOOD CROP PRODUCTION PREWAR AND POSTWAR

PERCENT SEMI-LOGARITHMIC SCALE OF PREWAR 60 150 140

130 POPULATION 120 ...... o TOTAL FOOD CROP PRODUCTION

1 00

90 FOOD CROP PRODUCTION PER CAPUT 80

60 1934-38 1946 / 47 1947/48 1948 / 49 1949 / 50 1900/01 1951/ 52

63 almost, record high production ofoil crops. an to a fall in Nigerian output, whereas the Belgian increase of approximately 25 percent over the Congo registered a slight increase.A near-record previous year, and a 14 percent drop from last olive crop was harvested in 'Morocco and the over- year's cocoa production (Table 24). all gain for the region as a whole is some 20 percent compared with last year. TABLE 24. AGRICULTURAL PRODUCTION IN AFRICA The total output of raw cotton at about 213,000 tons increased by 21/2 percent over 1950/51 with Average COMMODITY 1934-3S1919/501950/5 a decline in the East African crop balanced by larger crops in the Belgian Congo, French Equa- ( .. thousand?IIeirietons . . ) torial Africa and, above all, in Nigeria. Cereals a 18 810 22 010 21 800 21 200 Cocoa production in West Africa is estimated Millet andSor- at about 450,000 tons, 14 percent less than la,st ghum 7 7707 8208 1308 100 year and also less thanthe prewar average of Maize 4 4906 0405 5604 850 -Wheat 2 5202 8103 130;3 040 484,000 tons.The crop suffered from excessive rainfall and, in the Gold Coast and Ivory Coast, Groundnuts(unshel led basis) 1 4761 9081 8312 228 yields dropped 20 percent and 25 percent respec- Palm oil b 300 420 430 440 tively, whereas the Nigerian crop declined 5 per- Palm kernels 670 730 770 e670 cent. Olive oil 67 155 75 91 Cotton 137 196 208 213 The coffee crop of 257,000 tons shows an increase Cocoa 484 487 521 450 of 3 percent against la,st season with a decrease Coff ee 119 204 249 257 in Angola and the Belgian Congo more than off- Tea 9 16 20 e20 Raw sugar. 1 0341 3001 4551 350 set by increases in Kenya, Uganda and the French West African territories.The production of tea a Includes also rye, barley, oats and rice. b Calendar year, from export data. has also slightly increased.The plantations in c Estimate. Nyasaland are making steady progress owing to the improved methods of cultivation and, to a Cereal production in Africa during the crop year lesser extent, to expanding acreage.Raw sugar 1951/52 was 21.2 million tons, 3 percent below production in Africa this year registered a decrease that of the previous year, but above the prewar of 7 percent. A good yield in Mauritius and in average of 19 million tons.The pattern of produc- all the smaller producing areas has been cancelled tion within the region was not uniform ;in North by a 22 percent fall in the Union of South Africa, Africa, reduced yields due to local droughts in the other large producer. Algeria and Tunisia were offset by very good crops Several postwar projects for the development in French Morocco. An average harvest in South of fisheries on the continent of Africa were still Africa yielded a small exportable surplus that in progress during 1951.It is too early yet for offset somewhat the 40 percent deficit in Rhodesia,, any significant resultsto have been achieved. caused by drought in March 1951.In East Africa Figures available for South Africa show the entry heavy ra,ins during the early harvest damaged the of this country into international markets for fish crop, about one quarter of which . was spoiled.In meals with a considerable volume of exports. West Africa, the crop year under review WaS exceptionally good owing to favorable weather condi- Trade and prices. The demand for imports remain- tions, and the territories will be self-sullicient in ed at a high level, although new import restrictions sta,ple food crops.There are no marked changes were imposed in sterling countries.In the Union in the relative position of the different cereals of South Africa, for example, the allocation of within the group, except for an increase in rice foreign_ exchange to importers ha,s been cut by production. £70million or 15 percent.The prewar export- Last year's poor groundnut crop was followed able margins of cereals a,nd sugar in the 'Union of in 1951/52 by an above-average crop estimated at South .Africa and of cereals in French North Africa 2.23 million tons, an increase of just over 25 have in the postwar period been progressively percent.In Nigeria,the cropwa,s more than absorbed by increasing domestic food consump- double that of last year, whereas in Senegal the tion, due to population growth and higher levels increase wa,s only about 20 percent.Production of employment. of palm oil and of palm kernels shows a decrease Export crop prices were maintained, with some of 2 percent and 13 percent respectively, compared notable exceptions, during the first half of 1951, with the previous season ;this was mainly due whereas a more general slackening was noticeable

64 in the first quarter of 1952, reflecting internationa ling the coming winter will be adversely affected market developments. by a widespread failure of the maizecrop due South African wool prices dropped to about to drought.It is estimated that the crop will be one half of the previous season's, which led to a one-third below that of la,styear. considerable reduction of the country's farm income. Prices of vegetable oils and oil seeds have been Long-Term Production Trends and Outlook,.A gradually declining since their peak in early 1951, review of production trends over the last two dec- and a further fall in the spring of 1952 brought ades indicates that, throughout the thirties,the them down to almost half of the earlier level. A emphasis was on production for export.During tendency to reduce stocks and a good harvest the war this uniform pattern became differenti- have both contributed to this trend.Coffee sisal, ated into three main regional trends; in French and tea have maintained their high prices and North_ Africa, there iras a drop in the general cocoa prices, as a singular exception, are even level of agricultural production, due to political rising owing to a tight world supply situation and military conditions.In tropical Africa, there cau,sed by this season's short crops. was a switch from export crops to staple food Both production of and trade in forest products crops for domestic consumption because of the increased in 1951.Imports of sawn wood, mainly difficult shipping situation.In the Union of South by the Union of South Africa, rose 13 percent in Africa, rapid general development and further di- 1951 largely clue to an accelerated buildingpro- versification of the economy resulted in increas- gram.Some of the imports went to replenish ing both production and domestic consumption of' stocks so that at the beginning of 1952 the Union food crops. of South Africa was able to ease its purchase The recent postwar period has not restored the program.The capacity of the pulp andpaper prewar pattern.In French North Africa the pre- industries expanded and consumption and stocks war production level has only been reached by increased.Good market conditions, particularly 1951 but has been overtaken by a 33percent in Europe, increased African exports ofivood, increase in consumption.In tropical Africa, the notably hardwood, the 1951 volume being about emphasis is again on export crops andprewar 30 percent, larger than that of 1950.With the levels have been surpassed.Simultaneously, an decline in demand, particularly that of the United attempt is also being made to maintain domestic lilfingdom, which started towards the end of 1951, food production at a higher level.In the Union the production as well as exports of African hard- of South Africa, the ivartime trend continues and wood are expected to decrease in 1952. domestic eonsumption is rising slightly faster than The high export earnings have in many instances production. been matched by a rise in the prices of domestic In the long run, additional food supplies for food and consumer goods and have thus been export are most likely to come from tropical Africa partly absorbed.In South Africa, however, food (generally the area between the tropic of Cancer prices are subject to Government regulation and and the tropic of Capricorn) through theopera- the rise was relatively smaller than in territories tion of long-term governnaent development plans. oliere a free market operates.In British West Their aim is to create a basis for further productive Africa, on the other hand, the various Product investment, by the provision and extension of Marketing Boards absorb part of the increased basic equipment and of administrative and social incomes generated by exports and they have in services. Numerousagriculturaldevelopment this sense some anti-inflationary effect.Domestic schemes are in operation, such as the large Niger food and consumption goodsare, however, not Irrigation Scheme in French West Africa and the subject to price control and their rising level tends Gonja Development Scheme on the Gold Coast. to restrict the rise in the real income of thepro- In their implementation, particular attention is ducers. being given to the expansion and diversification of domestic food supplies (rice, sorghum andleg- umes are being introduced into new areas) together Outlook with expansion and improvement of the quality of export, crops and the introduction of mechaniza- In French North Africa, a somewhat increa,sed tion.The growing agricultural processing indus- acreage of bread grains is expected owing to the tries (pilot palm-oil mills in British West Africa higher prices fixed by the Government.In the and larger plants in 13elgian a,nd French territo- Union of South Africa, livestock production dur- ries) are likely to contribute to this trend.

65 There are, however, two factors that do not 6 percent of the region is cultivated, and a large encourage optimistic expectations.One isthe part of this is left fallow each year.While the shortage of capital goods in soft-currency coun- region as a whole has ample land for increasing tries and their rise in price in metropolitan coun- its cultivated area, lack of water is the main limit- tries,due to rearmament, which is making it ing factor.Moreover, the basic weaknesses in the necessary to slow down the implementation of social and economic structure of the Near East, the government plans.This is in turn reflected such as unsuitable systems of land tenure, primi- in the difficulties encountered by investors who tive cultivation methods, widespread illiteracy and have to shoulder heavy initial development costs. poverty, and unstable governments, tend to slow- At present, prospects of substantial investment in down food and agricultural development. agriculture do not appear to be particularly favor- General economic conditions. In most of the Near able.The growing internal markets for agricultural products, created by .the expanding mining East, recent progress of industry has been greater industries in the Belgian Congo, the Rhodesias than that of agriculture.The improvement in and the Union of South Africa, ancl by the emer- farm income resulting from larger crops during gence of secondary industries producing consumer 1950 and 1951 stimulated industrial production, goods in Southern Rhodesia, the Belgian Congo notably in Egypt, Iraq, Syria and Turkey.In and, of recent years also in Kenya, are likely to Israel, output rose considerably owing to high help expand domestic consumption. investment levels and continuing strong domestic Viewing the tropical pattern of development as demand as a result of large-scale immigration. a whole, two complementary trends emerge: broad, Government policies frequently encouraged the gradual improvement of African peasant agricul- establishment of new industries through granting special subsidies and other measures.There is ture,Nvhichisin the difficult transition stage from subsistence farming to a market economy, evidence, however, that in some instances the and European-managed research stations, develop- existing plant capacity isin excess of present ment schemes and plantations which point the requirements ; in Egypt and Iran for instance, the way to the better use of modern techniques. textile industry has gone through periods of severe recession since the end of the war. Output of crude petroleum reached the record THE NEAR EAST 6 level of 98 million metric tons in 1951 compared with 89 million in 1950, and 71 million in 1949. Current situation Investment in the industry continued at a high level ;the pipeline from the Arabian oilfields to Agriculture remains the basic economic activity the Lebanon is now in use and a pipeline from of some 90 million peopleintheNear East, Iraq to Syria is nearing completion. despite the rapid expansion of industry during Important investments have been made in the the war and the postwar period.In no coun- Egyptian fishing fleet which now includes more try,exceptIsrael,cinesindustry(excluding than 300 motor vessels.In Israel15 trawlers oil) account for more than 15 percent of the na- are to be added this year to the existing fleet of tional income and in most of the region its con- 25.More than 60 craft of other t3Tes are also tributionissubstantiallylower.Sofarboth to be put in commission this year.In Turkey, public and private investment have tended to important equipment, including boats and cold- favor industry at the expense of agriculture, but storage equipment, has been imported. thereisevidence that in shaping development In most countries, prices showed an upward policies governments are increasingly aware of the trend, reflecting higher costs of imports, inflation- need for a more balanced approach, stressing food ary pressures at home generated by high rates and agricultural expansion, not as an alternative of investment in Israel and Turkey, budgetary to but as a necessary basis for industrialization. deficits in 1951152 in Iran, and the considerable Agricultural development, however,isseverely increase, in revenue in some of the oil-producing restricted by limitations of soil and climate.Only countries.At their peak in 1951, wholesale prices were generally 10 to 20 percent above the average 6 This term is taken to include the countries from for the first six months of 1950, and the cost Turkey in the .North to Ethiopia and the Somali- of living was up about 10 percent. However, in no lands in the South, from Egyptin the West to country of the region, except Egypt, did whole- Afghanistan in the East. sale prices or the cost of living in1951reach

66 the annual average of 1948 or 1949, the postwar Agricultural production. In food a.nd agriculture, peak period.Prices, however, were rising at the the outstanding development of 1951 was the end of 1951. significant expansion of area cultivated, largely In countries with short grain crops in 1951, grain due to favorable prices for farm products and the prices went up sharply, especially in Lebanon and increa.se in the number of tractors and irrigation Syria, where wholesale prices increased by almost pumps used.Most of it, however, took place in two thirds over 1950 levels.As a.result,the countries like Turkey,Iraq,Syria, and Saudi Syrian authorities banned all exports of wheat Arabia, where the pressure of population on resour- during the past season.To counter the increas- ces is relatively light and, except in Israel, there ing cost of living, a variety of anti-inflationary was little increase in area in the countries with measures were adopted.In Egypt, the 1951/52 the more intense population pressures. Moreover, budget included increased appropriations for food the expansion tended to be concentrated on non- and other subsidies to check the increase in prices food commodities like cotton at the expense of to consumers.In the Sudan, import duties were food crops (Table 25). abolished on cotton piece goods, flour and coffee TABLE 25. AGRICULTURAL PRODUCTION IN THE and were reduced from 15 to 10 percent on food- NEAR EAST stuffs.In Israel, the Government has taken special measures for subsidizing food and other vital consumer goods.Similar measures to maintain CaMMODITY Prewar 1940 1950 1951 control of prices of at least a minimum range of essential commodities have been applied with thousandnetric tons varying degrees of success in other parts of the Total grains a 9080021 80024 20025 400 region. Wheat 9500 9 200 10600 1 700 The terms of trade, which had improved consid- Barley. . 200 4 400 5000 5- 300 Maize 2300 2 300 2200 2 500 erably since the outbreak of war in Korea for Rice 1600 2 300 2500 1 700 cotton and wool producing areas in the Near East, became less favorable toward the end of 1951 and Pulses 900 1 100 1 000 1 000 the beginning of1952,as international prices Sugar 220 360 410 460 dropped and import prices of manufactured goods Citrus fruits . 770 640 750 800 rose.The terms of trade also moved against Cotton (ginne,d). 550 600 680 640 countries whose a.gricultural exports consist mainly of citrus and other fresh or dried fruits, vegetables Tobacco 85 130 125 115 and tobacco, as their prices did not share in the a Including rye, oats, millets and sorghum. advance. In their trade policy, most governments are Counter-balancing the effects of the expansion continually trying to limit imports to essentials, on agricultural production were the serious drought especially from hard-currency areas, and to im- conditions in 1950/51 in Cyprus, Israel, Jordan, prove both the quantity and quality of their ex- Lebanon and Syria, and parts of Iraq and Saudi ports.Most countries have entered into bi-lateral Arabia.Consequentreductionsinyieldwere trade agreements, some of which are on a barter greatest in Israel, Jordan and Syria, where grain basis.At the regional level, Near East trade crops declined 40 percent from the 1950 level. continued to suffer from such impediments as the With heavy insect infestation and low water sup- disruption of traditional trade patterns following plies the cotton crop in Syria failed, with the the Palestine conflict, repercussions of the Kashmir 1951 output hardly larger than that of 1950, conflict on Afghan trade,the cessation of the although acreage planted was three times as great. customs union between Lebanon and Syria, and Bumper crops were harvested in Turkey.Out- the decline in Iranian oil exports.In February put of grains rose to a record 10.2 million tons 1952, however, Lebanon and Syria signed a com- in 1951, an increase of more than one-third over mercial and financial agreement, thereby putting 1950.Cotton, certain oilseeds and sugarbeet also an end to the trade deadlock which had prevailed showed substantial increases.In other parts of since March 1950.At present there is a tendency the region production levels were either similar for improvement in the region's balance of trade, to or somewhat below those attained in1950. while the gradual shifting of trade to soft currency In Egypt, output of wheat and maize was higher areas, Eastern Europe, and Asia still continues. than in 1950, although still below prewar, but

67 declined to under half the average postwar output, TABLE 26. INDEX NIM.IBERS OF TOTAL AND PER owing to shortage of irrigation water.Cotton CAPUT CROP PRODUCTION aIN THE NEAR EAST, output also fell off sharply. 1946/47 TO 1951/52 On the whole, total volume of food and agri- ITEMS 611 017-194S/ 1949/11950f 1951; cultural production in 1951 for the Near East " 50 51 52 increased only slightly over the previous year. Grains rose to 25.4 million tons in 1951 or 5 per- 1)34-38 100 prewar, cent over 1950 and 22 percent above Food crop product ion 109104 11S 106 116 123 due mainly to the increase in Turkey.Production of sugar, citrus and vegetable oilseeds and oils Population 114115 116 119 121 also increased. Output of pulses remained un- Per caput foodpro- changed, while that of cotton and tobacco decreas- duction. 97 91 102 97102 ed.The fish landings for Israel for 1952 have a These index- numbers are weig lted by values.They are preliminary only.All FAO productionindiceswill been estimated at over 14,000 tons, i.e. roughly be revised during the coming year. double those of 1950.In Egypt, the fish output b Includes total grains, pulses, potatoes, sugar and citrus was 60,000 tons in 1950 against 42,000 tons in fruits. 1948. oil, the purchasing power of certain population Consumption. In spite of some 20 to 25 percent groupshasincreased,thereisevidenceof increase in total food production in the region some improvement during the past two years in since before the war, the rapid population growth average consumption levels.Such improvement, of 23 percent for the same period leaves only a however, isfar from general.In most of the narrow margin of improvement in per caput pro- Near East, food supplies for human consumption duction. (Table 26 and Chart XVIII). continue to be inadequate, both in quantity and However, with greater imports of grains in recent composition.Moreover, in many instances, sub- years, the total and per caput food supply within stantial increases in the cost of living during the the region increased by 35 percent and 12 percent past year made it difficult for large sections of respectively.In countries where as a result of the Near East populations to obtain more satis- greater activity in trade and industries such as factory diets.

CHART XVIII - NEAR EAST : POPULATION AND FOOD CROP PRODUCTION PRE- WAR AND POSTWAR

PERCENT SEMI-LOGARITHMIC SCALE OF PREWAR

160 150

140

130 POPULATION TOTAL FOOD CROP PRODUCTION 120 ...... o ... 100 /. 4.0,0 Za 90 FOOD CROP PRODUCT ON PER CAPUT 80

60 1934-38 1946 / 47 1947/48 1948 / 49 1949 / 50 1950/ 51 1951/52

68 Trade. Despite the somewhat larger volume of in 1951.In Turkey, earlier hopes for another production in 1951, net exports of food and agri- bumper crop of grains were dimmed by a prolong- cultural commodities from the Near East as a ed drought inthecentral Anatolian Plateau. whole were smaller than in 1950 (Table 27). Late rains have eased the situation and it is likely that the temporary ban on grain exports announc- TABLE 27. NET FOOD A 'D AGRICULTURE TRADE ed as a precautionary measure against crop failure OF THE NEAR EAST will soon be lifted. Exports + = Imports In Egypt, the area sown to wheat is almost 45,000 hectares smaller than in 1951, and a decline in grain output is expected.Owing to the insuffi- COMAIODITY Prewar 1949 1950 j 1951 cient flow of the .Nile, the area under rice thousand metric toas not exceed some 180,000 hectares, as compared with approximately 300,000 hectares in 1949 and Total grainsa . 520 +160 + 640+860 wheat +1000+1200 +1300 1950.Output islikely to be sufficient to meet barley 340 600 500 250 local requirements, but will leave no surplus for maize +160 + 90+ 40 rice 50 310 130 255 export.In this country where the situation is Sugar +210 + 410 +590 +580 particularly serious,far-reaching measures have Citrus fruits . 340 200 200 190 recently been taken to counter the danger of food Cotton (ginned 470 460 570 460 Tobacco 25 65 40 45 shortage resulting from an extension of cotton cultivation at the expense of food crops.The a Including rye, oats, millets and sorghum. cotton area. for the next three years has been restricted to one-third of the total cultivated area The relatively highcottonpricesin Egypt and minimum acreages to be SOAVn tO wheat have slowed down its exports and other cotton-produc- been established.At the same time, guaranteed ing areas like Turkey and Syria also experienced prices to wheat growers, beginning with the 1953 marketing difficulties.As a result,the region crop, have been raised appreciably. Similar meas- exported some 100,000 tons less than in 1950. ures are reported to be under considerationin Exports of grains from Turkey, partly to neigh- other Near East countries. boring countries where crops had failed, amount- Owing to the abundant rainfall, forage crops ed to almost 800,000 tons. Imports into grain defici- have been plentiful and livestock are recovering ent countries like Egypt, Israel and Lebanon contin- rapidly from the effects of the drought of last ued at high levels, thus accentuating the shift season, when, in some areas, up to 25 percent which has taken place in the .Near East during of the herds WCFO lost. recent y-ears toward greater dependence on grain Indications are that the cotton boom is subsid- imports in contrast with the prewar period when ing following a. sharp decline in prices of non-dollar the region was a net exporter. cottons on world markets, and the disappointing crops harvested last year in some Near East countries.In Syria., measures have been taken Outlook to regulate cotton cultivation through the crea- In the Near East as a whole, food production tion of a Cotton Board with powers to control in 1952/53 is unlikely to exceed that of the preced- the areas sown and the varieties used, and, in ing year and may even decline should the serious collaboration with the Agricultural Bank, to sup- invasion of locusts over large areas in Iran, Jordan ply farmers with chemicals and spraying equip- and Saudi Arabia not be checked by the active ment for pest control.The area under cotton control measures already under way. will probably not exceed some 100,000 hectares as Most of the region received unusually high against over 200,000 hectares in 1951. Reductions precipitation in the form of snow and rain during in area are also reported from Egypt and the winter and early spring of 1952, but in some areas, Sudan, where theearly 1052harvest showed floods caused considerable damage to agricultural a decline of 40 percent fromthe exceptionally property and installations.Crop prospects are high crop of 1951. favorable in Israel, Jordan and Syria, which suf- The short-term outlook for food and agricultural fered from severe drought during the past season. expansion beyond 1952/53 is not encouraging.For Present expectations in these countries are for the next few years, Near East agriculture is likely the new grain crops to be over twice as large as to remain subject to severe annual fluctuations

69 in volume of production, under the impact of is foreseen in Egypt and Israel.Developments such factors as weather conditions and plant pests will also take place in Turkey when the equipment and diseases.Stabilization of output at perman- recently acquired has been put in use.Iraq, entlyhigherlevels will only be possible after Saudi Arabia, Syria and Yemen have decided to implementation of the major flood-control and develop their fisheries and positive results of these irrigation schemes now in progress in various development programs should be apparent in a parts of the region, some of which, however, may few years. take as long as 25 years to complete. While the economy of some areas on the fringe of the Near East seems almost stagnant, in other THE FAR EAST parts of the region more or less comprehensive plans and programs for development of food and Current situation agricultural resources are under way.The most Agricultural Production.:Although unfavorable recent is that initiated last year in Iraq, which weather in the Indian subcontinent and civil is to be financed from the country's oil revenues. unrest in parts of South-East Asia impeded 1951/52 Development programs in Iran, especially the sev- production, total crop production in the Far East en-year plan, are at a standstill due to reduced region reached the average prewar level.For the oil revenues.The speed with which plans and postwar period this was the highest point in a programs are put into effect varies widely from continuous though gradual upward trend since one country to another.In many instances, im- 1946/47, except for the setback in 1949/50 harvests plementation is considerably slowed clown by the on the Chinese mainland.Excluding China the physical obstacles to be overcome and by social, volume of the region's food production in 1951/52 economic and political factors such as the unequal was the same as in the preceding year, 3 percent distribution of property and income, lack of tech- above prewar average.On a per caput basis, nicians and skilled labor, poor health conditions food production in the region (excluding China) and unsatisfactory tenure systems, and frequent increased steadily from 1946/47 to 1949/50, but changes of government. since then has declined slightly.(Chart XIX For 1953, new progress in the fisheries industry and Table 28).

CHART XIX - FAR EAST (EXCLUDING CHINA) : POPULATION AND FOOD CROP PRODUCTION PREWAR AND POSTWAR

PERCENT SEMI-LOGARITHMIC SCALE OF PREWAR 180

150 140

130 POPULATION

IZO ...... 110

100 TOTAL FOOD CROP PRODUCTION 90

80 FOOD CROP PRODUCT ON PER CAPUT 70

60 1934-38 1946/47 947/ 48 1948/49 1949/50 1950/ 51 1951/50

70 TABLE 28. - INDEX NUMBERS OE VOLUME OF TOTAL Production of non-food crops suffered a greater AND PER CAPUT CROP PRODUCTION IN TFIE F.AR setbackduringthewar,buthas progressed EASTu1946/47 TO 1951/52 morerapidlyinrecentyears,stimulated by more favorable price relationships.Only rubber 1946/1947 948/1949/1950/1951/ andj ute,however,haveactuallysurpassed ITEMS 47 41 49 50 51 52 prewarproduction,thoughotherfibersand 1934-3S - 100 tobacco are stillincreasing. Livestock,which represents only a small percent of the region's All crops b 89 93 98 95 99 101 Food crops 92 94 99 96 99 101 foodproduction,isstillwell belowprewar Non-food crops . . 73 84 90 86 99 104 output,withthepossibleexceptionof milk Population 108110 Ill112 112 113 (Table 29). Per caput all crops . 82 85 88 85 88 89 Per caput food crops 85 86 89 86 88 90 _Despite increased efforts to grow more rice, the staple food of the Far East, production has failed FarEastexcludingt to expand in anything like the same proportion China as the arca planted.Since 1942 a substantial All crops 87 94 99 103 104104 expansion of area under food crops generally and Food crops 91 96 101 105 103103 rice in particular has taken place ni the Indian Non-food crops . . 71 84 91 91 107110 Population 113115117118 119120 sub-continent, but in the absence of adequate meas- Per caput all crops . 77 82 85 87 87 87 ures for improvement of soil fertility and water Per eaput food crops. Si 84 86 89 87 86 resources in the expanding food areas, average yields have tended todecline throughout the e These index numbers are weigmted by values.They are preliminary only.All FAO productionindiceswill decade.With the growth of population at rel- be revised during, the coming year.The figures include estimates for China which are approxiinationsonly since atively high rates the region, which had a sizable 1949/50. b Food cropsinclude cereals, sugar, root crops, pulses, edi- export surplus of grains before the war, has be- ble oilseeds, tea, coffee and cocoa.Non-food cropsinclude come increasingly dependent on imported grain fibers, linseed, tobacco and rubber. supplies, particularly from the Western Hemisphere. In 1951theregionalnet importsofcereals reached the record total of 7 million tons. TABLE 29. CROP PRODUCTION IN THE EAR EAST Although the intra-regional trade in rice reach- 1934- ed its postwar peak at about3.3million tons 38 194S/ 949/ 1950/ 1951/ in 1951, the food supply situation in several coun- -Timms (Aver- 49 50 51 52 age) tries remained precarious and local droughts and near-famine conditions were reported in various million metric tons parts of India and Pakistan. Ora in crops _Many fisheries development projects were con- Rice(cleaned basis)00.699.698.297.5 98.3 tinued throughout the area. These include biolog- Wheat. 34.835.232.636.638.1 Coarse grainsa . 65.062.761.061.363.1 icalresearch and management ininlandand marine fisheries, the improvement and extension TOTAL: . 200.4 197.5191.8 195.4 199.5 of fishculture,the mechanization and improvement of fishing craft,the introduction of car- Other crops rier launches, the training of personnel and var- Potatoes and root ious schemes for improving distributive methods. crops 41.053.251.852.9 53.5 Vegetable oils and In spite of political unrest in some arcas, progress oilseeds - oil was made and fish production increased.Where equivalent . . 8.1 7 7.5 7.9 8.0 figures are available they reveal significant in- Sugar - raw equiv- crease over the 1950 levels of production - e.g. alent . . . . . 7.3 5.1 5.9 6.5 6.8 Tea 0.7 0.6 0.6 0.7 0.1 South Koreaover 25 percent, and Philippines Tobacco 1.5 1.4 1.2 1.2 1.1 over 30 percent.Japan's more highly developed industry expanded rapidly to achieve a production Raw materials of 3.8 million metric tons in 1951 which was Cotton . 1.9 1.1 1.2 1.4 1.6 by far the largest in the world.The overall Jute. 2.0 1.4 1.3 1.5 9.1 Rubber 0 . 0 1.5 1.4 1.8 1.8 expansion of fishing operations in the region indicates that the total catch in 1951 was near a Includes maize, barley, oats, millets and sorghums. the prewar level of 8 million metric tons.

71 Political instability in many parts of the region varying degrees of success.They comprised impo- also continued to hamper the production of for- sition of heavy export taxes on goods in high est products in 1951.Exports of timberover- world demand and liberalization of imports of seas in general continued on a rather high level, a wide range of consumer goods.Governments exceptinThailand,whereexportsdeclined also maintained control over prices and distri- somewhat from the 1950 level.High prices for bution of staple foods which constitute the main exported timber tended to increase domestic prices item of the cost of living in all countries of the in most countries. region.With subsequent decline in export prices Forestry output in Japan continued to expand the inflationary pressures also declined somewhat and accounted for one half of the total Asian in several countries of the region.

TABLE 30. QUARTERLY INDICES OF EXPORT PRICES OF SELECTED ColusroDITIEs IN FAR EASTERN MARKETS 1950-52 (1949 100)

1950 1951 1952 COMMODITY Market III IV II III IV II

Copra Singapore 119 122 137 145 179 144 1221 124 100 84 Groundruits . Bombay. 102 110 115 106 121 127 1041 101 85 73 Sugar Manila 101 104 109 105 100 105- 1021 97 -- Tea Colombo 121 90 107 112 123 95 871 91 92 781- Tobacco a . . Guntur 100 100 108 1081 108 106 1061 104 108 103 Cotton, raw . Karachi 87 87 104 1511 199 190 1591 147 144 128 Jute, raw Chittagong 70 78 71 691 160 1091 100 97 73t Rubber Singapore 136 198 326 567 446 389 382 323 2581- 4681 aBase period first six months of 1950. b Base period average of 5 months in 1919 January, February, May, June July. tTwo-month average.

wood production and 90 percent of the Asian In the absence of sufficient inflow of foreign wood pulp.Japanese production of wood pulp investment capital,several underdeveloped coun- increased nearly 50 percent in 1951.In spite tries have continued to resort to deficit financing of an increased production of sawn wood in Japan, of their agricultural and industrial development there was a severe shortage for domestic purposes projects.In the immediate future production of in 1950.U.N. purchases for Korea further ag- food and supply of consumer goods are unlikely gravatedthisshortage.Japanesefellings were to expand sufficiently to offset the resultant in- accelerated in anticipation of severe restrictions flationary trends although some countriesare on forest exploitation which became effective in attempting to strike a balance between govern- January 1952. ment spending on necessary economic develop- Prices and Demand.The greatly increased in- ment and the need for checking inflation. come due to the expanded demand and higher prices (Table30)for export raw materials in Trade. By the end of 1951 several countries in 1950/51, lasting about a year, was only partially the Far East had -substantially exhausted the utilized for increasing the pace of economic de- foreign exchange reservesbuilt up in thefirst velopment, and generated rising inflationary pres- half of the year and some developed appreciable sures.These tended to reduce real farm income. deficit in their balance of trade, especially with Expectation of continued high returns led farmers the dollar areas.The most striking development in India to transfer rice lands to jute-growing, was the reduction of more than 20 percent in while high wages or profit sharing caused diver- the second half of 1951 in the value of the United sion of labor forces from intensive rice production States'importsof suchregionalproductsas to increased tapping of rubber trees in Indonesia. rubber, tin and jute goods. Anti-inflationary measures in the last few years In the latter part of 1951 and early 1952, with were applied generallyintheFarEastwith the slackening of foreign demand for, and fall in

72 prices of, raw materials and textiles, there has been the sharp fall in export prices for the region's some tightening of import controls, particularly raw material exports in 1951/52decreased the on luxury goods, and a reduction of export taxes. foreign exchange earnings of the raw material Export of timber, particularly overseas, contin- exporting countries, particularly in dollars.With ued at a high level, exceptin Thailand, where the rising prices of imported foods, capital goods there vas a drop from the 1950 level. Although the and certain categories of consumer goods, the proportion of timber exported was small, exports terms of trade of these countries also became in- did have an inflationary effect on domestic prices creasingly adverse.These changes particularly in most countries,particularlyforhigh-grade affected the economies of Ceylon and Malaya, timber.Exports to some countries within the both of which depend heavily, on the exports of region, notably Pakistan, Hongkong and Arabia, a few specialized crops and import two-thirds declined, mainly because of the high prices. of their basic food requirements.In view of the postwar scarcity of rice supplies and the rapid Rice surplus countries of South-East Asia.In growth of population (2.8 percent per annum in the major rice surplus producing countries of Ceylon and 2.5 percent in Malaya) both countries Burma, Thailand and Viet Nam, rice production are giving increasing attention to expanding do- in 1951/52 increased appreciably over the previo-as mestic production of rice.Some of the hand re- year.Export availabilitiesin1952 fromthis clamation and irrigation projects undertaken in crop,however,are expectedtobe somewhat Ceylon are reported to be nearing completion. lower than the previous year's high exports of In Malaya, rice production in 1951/52 has been 3.3 million tons.Early in 1952 the Thai Govern- maintained at the relatively high levels of the ment announced its intention of withholding a last three years, around 35 percent over the pre- substantial quantity of the country's ricesur- war average. plus for building up internal stocks and of program- In Indonesia agricultural production \ MS at a ming an export of some 800,000 tons in the period higher level in 1951 than in any previous postwar January-September 1952.The announced maxi- year.Production of various export crops on mum export target of 1.3 million tons for 1952 estates, however, is not showing progress.Rice as compared with total exports of 1.5 million tons production is said to have reached the prewar in 1951 may- be reached if by the end of Sep- level but per caput supplies remained well below tember the situation in South-East Asia does not this.Local shortages due largely, to disorganized deteriorate and if the prospects for the coming internal marketing and dislocated transport caused crop are favorable.Exports from Burma are a steep rise in prices of rice and other foods and also expected to be below those of 1951.This led the Government to plan increased imports of would mean a decline of at least one-eighth in rice in 1952.The Government also decided to the region's total rice available for export.At pay, heavy subsidies on imported rice and to con- the same time export prices of rice in these coun- trol domestic prices in the interest of consumers. tries were raised while prices to producers N'ere With favorable price relationship, production held at previous levels. and exports of rubber rose to a record high level Seven years after the war a quarter of Burma's in 1951. Smallholders produce three-fifths of Indo- prewar rice area still remained abandoned to jun- nesian rubber and all of the copra.The benefits gle growth.Partly, as a result of land national- to them of increased income from exports were, ization, private capital is not available for financ- however, largely offset by rising prices and costs. ing the rehabilitation of the industry,.The con- Assured markets in the United States for copra tinuing shortage of work-animals also constitutes and sugar from the Philippinesgave a strong an important limiting factor. impetus to the expansion of the former and reha- Under comparatively- peaceful conditions Thai- bilitation of the latter industry-. The peak level land has been able to expand its rice production of copra production, reached in 1947/48, two thirds and at the same time begin to bring about some aboveprewaroutput, wasalmostregained diversification in its agricultural production.The in1951/52.Sugar output reached the prewar economy of Viet Nam is at present dominated level but exports have not yet reached the United by the political and military situation.Under States quota of 850,000 metric tons.Food pro- stimulus of highprices rubber production in duction, though well above prewar levels,suf- Cambodia and Viet Nam has more than doubled. fered a slight setback in 1951/52 from typhoons 1?aw material exporting countries deficient or self- and floods, and imports of rice continued to be sufficientin food.The decline in demand and necessary to check rising prices.

73 Under the stimulus of high prices early in the The acreage under food crops as well as cash season production of jute in Pakistan in 1951/52 crops has expanded in recent years, though the increased 40 percent over the previous y-ear's rate of increase has varied from crop to crop and low output.A reduction in export demand for from State to State. Production of fibers pro- jute in the second quarter of 1952 led to the fall gressed more rapidly, due partly to internal price in prices below the minimum level established by policies and partly to world market forces.Do- the Government. Production of cotton also increas- mestic production of jute supplies the bulk of ed, though with the general fall in prices of raw the mill consumption requirements.Cotton pro- cotton abroad the demand for the Pakistani production,which also shows marked expansion, duct slackened and carry-over stocks increased. consists mainly, of short-staple varieties.About Lower production of riceand wheat was due one-fourth of the total mill consumption require- tounfavorableweather,necessitatingan em- ments, which consist of long and medium staple bargo on grain exports and intensive internal cotton, is met by imports. procurement for distribution to the deficit areas. IndustrialproductioninIndiaroseby 15 The Government continued to develop bilateral percent in 1951 to a postwar peak 20 percent above trading in raw materials for manufactured goods 1946 and IleNN' engineering and chemical fertilizer and at the same time to expand the productive industries began operation during the year.Com- capacity of the newly established textile industries pared with the previous year's favorable trade under a two-year program. balance there was a deficit in foreign trade. To stimulate trade, export duties were reduced in the Food and raw material importiny countries.With latter part of 1951 and early in 1952.The anti- high population density and limited agricultural inflationary measures adopted by the Govern- resources, Japan has to import some of its food ment contributed to the downward trend of do- and virtually all of its raw material requirements mestic wholesale prices.The sudden break in in exchange for its industrial products.In 1951/52 internal prices toward the end of the first quarter it produced almost 83 percent of its total food of 1952 is attributed mainly- to freeing of spec- supply compared with 85 percent prewar, despite ulators' hoarded commodity stocks in the face a 30 percent increase in population in the course of increased availability of supplies. of the last decade.This has been made possible Despite drought in1951/52, procurement of mainly through slight undermining of rice,res- grains was more successful in 1952 than in the trictions on industrial uses of food and a some- previous year.With increased paynients on in- what lower consumption level.The upsurge in in- ternally procured grains and reduction or aban- dustrial activity- after June 1950 called for pro- donment of subsidy payments on imported staple gressivelyr heavier imports of raw materials.Al- foods. and higher prices for farmers, marketable though trade expandedconsiderablyin1951 supplies and stocks in the hands of the Govern- and Japan re-emerged as the largest exporter of The fall in free market prices cotton textiles, the trade deficit was larger than ment increased. in prewar years.Buy-ers' resistance in the face of grains below the controlled prices for rationed of falling prices of raw cotton caused the Japa- supplies has led the Government to decontrol food nese textile industry, to effect a heavy cut in grains in several deficit States.The food import production early in 1952. target for 1952 is likely to be revised downwards from thetargetof 5 million tonspreviously In India,food grain production in1951/52 fixed(including unshipped balance of the last suffered from drought in some important areas. year's United States grains loan). Production of groundnuts and tobacco also declined, but on the other hand increased acreage and favorable growingconditionsresulted in Outlook bumper harvests of sugar cane,tea, jute and cotton.Food grain imports in 1951 of 4.7 mil- The economic outlook for a large part of the lion tons, twice the volume of the preceding year, Far East continues to depend heavily on the raw eased the internal supply, situation and the year- material demand of the highly industrialized coun- end stockswerelarger.Although percaput tries of the West.With the fall in prices of raw grain availabilities increased in 1951-52, the prob- materials and relative increase in grain prices, lem of providing adequate purchasing power to greater efforts will be devoted to production of populations in the drought affected areas re- food crops.The reduced foreign exchange earn- mained acute. ings may, however, have serious impacts on the

74 financing of agricultural and industrial develop- The country's agricultural development programs ment programs upon which many of the under- are designed to increase domestic food production developed countries of the region have embarked. in step with the population growth. Prices of several export products of the Far The annual rate of population growth in India East under the prospective supply and demand at 1.25 percent is relatively moderate but this conditions may be stabilized at or near the levels rate applied to 357 million makes the task of prevailingin thefirstquarter of 1950.Food providing adequate food supply for the nation prices on the other hand are tending to rise both truly gigantic. absolutely and relatively in many countries and The Indian Planning Commission has given governments are finding it increasingly difficult high priority to development of agriculture through to subsidize imports or to control domestic pri- completion of various large and small scale irri- ces in the interests of the consumer.In several gation projects in the first Five-Year Plan.The countries prices paid to producers of rice and other goal of the agricultural programs is to secure by grains are being raised in order to provide the 1955/56 additional production of 7 million tons necessary incentives for increased production. of food grains, 1.2 million bales of cotton, 2 million bales of jute, and a substantial increase in In the present unsettled conditions in South-East output of sugar and oilseeds over the 1950 levels. suppliesis Asia any major expansion of rice If these goals are achieved, domestic food produc- highly problematical.Rice surplusesavailable tion would be increased by 1955/56 by 16 per- for export are therefore expected to remain short cent above that of 1949/50, while population is in relation to import demand.Even if the short- expected to increase only 9 percent over that term programs for agricultural development in period. Ceylon and Malaya are fully implemented, their Although the demand will remain unsatisfied import demands for rice are unlikely to show for some time, the projected large expansion of declineby1953/54.Indonesia's any material Asian forest industrieswillgradually tend to agricultural program continues to concentrate on lessen the gap between demand and supplies, those measures most likely to bring immediate though little immediate change is anticipated. improvement in the production of food and export crops.Provided that this program achieves some success,and theinternal transport and OCEAN A' marketing facilities are improved, imports of rice may be scaled down somewhat by 1953/54.Given Current situation average weather conditions for grain production The two most important factors in the agricul- and effective control of food distribution,Paki- tural situation for the 1951/52 season in Oceania stan may once more have a surplus for export were the serious decline in wheat production in in 1953/54 after meeting the expanding require- Australia, which reached a point where that coun- mentsfordomesticconsumption.Per caput try could no longer meet her current commitments food availability in the Philippines has exceeded under the International Wheat Agreement, and the prewar level and the country, aided by finan- the recent sharp drop in export income in both cial and technical assistance from the United Australia and New Zealand, particularly from States, is on its way to achieving a position of rel- the sale of wool, from the previous exceptionally ative self-sufficiency inrice, andrehabilitation high levels established in 1951.As a result the of its agricultural production and trade in export Australian Government introduced measures to crops. encourage greater output of primary products, The high rate of population growth in Japan, on the sale of which the export income is dependent. estimated at 2.16 percent per annum, requires In New Zealand food output has been increasing that the industrial progress be maintained at a since the war and exports have also continued to high level and that an increasingly higher pro- rise.Declining export surpluses from Australia portion of its foreign exchange earnings is spent were offset by increases from New Zealand ; the on imports of raw materials than on food.Al- ratio of agricultural exports to agricultural produc- though the Korean rehabilitation program may tion and per caput exports of agricultural goods provide additional impetus to Japanese industrial for the region averaged slightly higher in the 1948- progress, a balanced development of the national 51 period than prewar. economy may be difficult to attain without promotion of trade with the other Asian countries. 7 Australia and New Zealand.

75 General economic conditions. The sharp fallin of imports increased considerably on account of wool prices contributed to a moderation of business heavy purchasing by Australia of motor vehicles, expectations and by the end of 1951 the index of textiles and machinery, mainly from the United pastoral share prices had dropped in Australia to Kingdoin. The result was a mounting deficit in the 127 (1948 = 100) from a peakof169 during balance of trade with the Sterling Area and other April of the same year.A less marked decline parts of the world.This forced the Australian was experienced in industrial share prices.In Government toimpose severerestrictionson New Zealand the index of industrial share prices imports from all sources.In New Zealand, al- also declined steadily throughout the year from though a general cut of 20 percent in the allocation 115 in January to 96 in December.Although of foreign exchange to all importers was imposed industrial activity has increased slightly over last in April 1952, there has since been some improve- y-ear's high levels, the inflationary pressures releas- ment. ed by the high export income of the two previous Further measures to combat inflation in Aus- seasons were stillin force during 1951/52.In tralia included heavier direct and indirect taxa- Australia during 1951, the index of wholesale tion and budgeting for a surplus in 1951/52.In prices rose 24 percent and the cost-of-living index NeW Zealand the new budget provides for highnr 22 percent over 1950, while in New Zealand they Government expenditures, but even greater reve- rose17 and 11 percent respectively.In both nues, less direct taxes and more subsidies. Mean- countries the cost of food increased more than while, proceeds of the wool levy established last any other item in the consumer's budget.Al- year are to be returned to farmers in Australia. though there has been an increase in the effective Regulations freezing one-third of the proceeds of demand, the rise in food prices is also due to the the wool sales were suspended as of 15 August 1951 easing of price control on some basic foodstuff's in New Zealand.At the same time the rise in and to the fact that the prices of a number of the cost of living forced new increasesin basi.c basic foodstuffs were adjusted in accordance with wage rates in both countries. the movement of the production costs. After the middle of 1951 the unit value of ex- Agricultural Production. Total food production ports declined sharply, whereas the total value which increased rapidly between 1946 and 1950

CHART XX - AUSTRALIA AND NEW ZEALAND : POPULATION AND FOOD PRODUCTION PREWAR AND POSTWAR

PERCENT SEMI.LOGARITHMIC SCALE OF PREWAR

160

150

140

130 PRODUCTION TOTAL FOOD ------120 POPULATION

110 ...... ------

100

Mama. am00 Mvam. SA. 90 es,

80 FOOD PRODUCTION PER CAPUT

60 1934-3e 1946/47 1947/48 1948/49 1949/50 1950/51 1951/52

76 declined in the following two years mainly due Australia were estimated at about one million to developments in Australia.With population head, and Australian milk production declined 16 increasing rapidly the per caput food production percent during the first eight months of 1951/52 dropped by 1951/52 to 84 percent of the prewar as compared with the same period last year. level(Table 31 and Chart XX).Thisde- Some of the factors contributing to a slower cline was due mainly to the substantial reduction rate of development and even a decline in Austra- in the areas sown to wheat which dropped 10 lian agriculture are the great emphasis placed percent to 4.3 million hectares, while production on development of secondary industriessince fell13percent.The dropin wheat acreage World War II ;price policies and arrangements reflected theprevioushigherrelativereturns regarding agricultural products, particularly wheat; from wool and from cereals other thanwheat. high freight rates and inadequate transportation facilities ; taxation incidence on farm production TABLE 31. INDEX NUMBERSa OF VOLUME OF To- and lack of sufficient machinery, materials and TAL AND PER CAPUT AGRICULTURAL AND FOOD PRODUCTION IN AUSTRALIA AND NEW ZEALAND farm labor.Long-termfactors affectingagri- 1946/47 TO 1951/52 cultural exports are the rapid growth of population, the increase in real income and the resulting ITEMS 11946f1947/1948/1949/1950/1951/ increase in domestic consumption. 47 49 50 51 52. Production of soft and hard sawn wood in

1934-38 100 Australia in 1950/51 was 1,234 million super feet, 76 percent over prewar production.Softwood Total agr. productionb 92107 los 115 111 105 Population 110112 114 117120 124 production has been increasing annually and in Per caput a.gr. prod 84 96 95 98 93 85 1951 constituted nearly 17 percent of the total. Food production. . . 91 107108 115Ill 104 Per caput food prod. 83 96 95 98 93 84 Trade. Because of higher world prices,total value of agricultural exports in 1951 surpassed Production by major groups all previous figures, although the volume did not increase.Wheat exports from Australia at 3.5 Food crops e . Si 137 124 138122 109 million metric tons were about 7 percent larger Cereals a . . . 79145 124 140122 109 Meat ancl milk e. 95 99 104 108108 104 than the year before, but shipments of dairy Fats and oils. . 87 92 99 103 97 products, which constitute an important propor- Wool (greasy). . 103107105 113 114 113 tion of agricultural exports of the area, were NOTE :This index is not fully comparable with that given somewhat lower.Net wool exports amounted for Oceania on Table 1, becahse it refers only to Australia and New Zealand and covers a somewhat different group of to 734 thousand metric tons as compared to a commodities. record of 781 thousand in1950.Total meat * Preliminary a These index numbers are weighted by values.They exports from both countries also declined about are preliminary.All FAO production indices will be revised 24 percent. during the coming year. b All groups below. Early in 1952 it became apparent that wheat c Cereals, potatoes, dry peas and sugar. d Wheat, maize, barley, oats and rice. exports would be much lower than last year's. e Meat on calendar year basis.Production of meat for one year is combined with production of milk for the season Meat exports on the other hand will probably beginning at the middle of the same year, i.e. production of meat in 1946 with production of milk in 1946/47. be maintained at the 1951levels with lower shipments from Australia offset by increased ex- In Australia the areas sown to barley and oats ports from New Zealand. were respectively 9 and 20 percent greater than The improved balance-of-payments position of last year's, but with yields 10 percent lower total the Sterling Arca in 1951 led to increased imports production did not increase correspondingly.Pro- of forest products, particularly sawn wood.Be- duction of sugar was about 800 thousand metric cause of increased needs for buildingmaterials tons or about 15 percent below last year's crop. arising out of immigration and industrial expan- In New Zealand, except for peas, the area planted sion, imports of sawn wood into Australia in 1951 to basic crops and the corresponding output were increased 55 percentoverthe previous year's less than the year before.Total production of record level. A large part of these imports, mainly miLk, meat and wool showed little decline from from Europe and North America, was used to 1950/51, which saw high records for milk and wool replenish stocks.Towards the end of 1951 the due to increased production.The severe drought balance-of-payments situation of the Sterling Area in Australia affected some of the most important deteriorated and Australia, like other Common- grazing areas in the country.Cattle lossesin wealth countries, was forced to curtail her imports.

77 Prices and income.The adverse effect of the jobs are getting scarcer in the cities and immi- decline in wool prices after the boom conditions gration policy is being re-directed to bring into prevailing during 1950/51 was strongly felt in both the country more -%s-orkers with farming experience. countries after mid-1951.In Australia the index A large part of the two World Bank loans of US of wholesale prices for farm products, which dur- S150 million has been allocated for imports of ing the calendar year 1951 was 60 percent above agricultural equipment and materials.Prices for the 1950 average, dropped sharply from a peak agricultural products willbe revised to make of 259 (1948 = 100) in March to 163 in Sep- them attractive to farmers.Following a review tember. By December the price of wool was of movements in the index of wheat production US 876.4 per 100 lbs as against US 8134.6 for all costs over the preceding year, the growers' guar- sales during the year.The average price of sales anteed pricefor the 1951/52 wheat crop has been from the 1951/52 wool clipisexpected to be fixedat 10/ perbushel 8 bulkbasis,f.o.r. about 60 percent of the 1950/51 price.In the ports, an increase of2/2 per bushel over the calendar year 1951 Australia'stotal farm in- 1950/51price.A furtherincentivetowheat come, amounting to ¡A 800 million, was the lar- production is the suspension of the Wheat Ex- gest on record, and farmers' share of the national port Tax.The State Acts covering the 'Wheat income was 26 percent as against 21 percent in Stabilization Scheme have been amended, with a 1950 and 6 percent in 1939.In 1951/52,be- view to allaying some of the growers' dissatisfac- cause of falling prices and reduced output, total tion with the guaranteed price, by providing two farm income will decline and with rising costs net separate prices for wheat sold in Australia.Wheat incomewillprobably show aproportionately for stock feed up to a total of 26 million bushels greater decrease. will be sold at 2/ per bushel above the guaranteed price.In addition, the Commonwealth Govern- ment has agreed to pay growers a subsidy on Outlook feed wheat sales equal to the difference between feed wheat price and the maximum price under Total agricultural production in 1952/53 and Under a 1953/54 may surpass this year's levels, assuming the International Wheat Agreement. normal weather conditions and progress in the new contract of 15 years duration recently signed fulfilment of the Australian program now under withthe'UnitedKingdom,minimummeat prices after 1 July 1952 were guaranteed at the way.The object of this program is to increase agriculturalproduction by 20 percent over the 1950/51 levels for some years and will also be relat- average for the five years ended June 1950.The ed to costs and other considerations, and an in- targets for 1957/58 call for such increases as 12 crease of 23 percent in the price of beef andof percent for meat, 13 percent for milk, and 30 15 percent in the price of mutton was negotiated percent for wheat over current levels of production, under the previous contract. The supply outlook for forest products in 1952 as well as increases in the production of oats, existing stocks of barley, sugar and wool.At the same time the appears satisfactoryas the imported sawn wood have been reported to be Government hasclassified agricultural products far beyond the ability of the building industry asequallyimportanttoAustralia'ssecurity with coal production and the defence industries, to absorb. "Australia is continuously develop- OW11forest industries and is also actively and it has been recommended that State priority ing her be given to primary production in the allocation of engaged in expanding timber operations in East- materials and the accomodation of farm labor. ern New Guinea. Some taxation concessions on capital investment in agriculture have also been made.The farm laborsituation has improved somewhatsince 8 One bushel of wheat = 60 lb. = 27.216 kg.

78 JalciDLID AI

L AS arid

Chapter IV -REVIEW AND OUTLOOK BY COMMODITIES

WHEAT average production of 1934-38. This is the highest figure reached in postwar years and was exceeded onlyin1938/39.Aboutfour-fifthsof Current situation the net gain occurred in North America. Produc- tion in Europe, which had dropped to drastically The year 1951/52 was characterized by a slight low levels by the end of the war, just regained the increase in the aggregate world wheat production prewar level in 1951.Among the other regions, over 1950/51, by a high level of wheat exports and only Latin America showed a lower level of pro- by some reduction at the end of the year in the duction thanbeforethe war, but this deficit, carry-over stocks of the four major exporting coun- brought about by a serious drop in Argentine pro- tries.Though prices of wheat exports outside duction,WaSof serious consequence for other Wheat Agreement quotas were generally firm, the parts of the world, because it caused a significant movements were not spectacular and at the end loss in exportable supplies.Asia showed a gain of the year they were somewhat lower than at on the previous year and on the prewar level, but the beginning. With reduced supplies in Argen- the increase is inadequate when set against the tina and Australia, importing countries depend region's increased food requirements.Good crops still more on purchases in Callada and the United in some African areas brought the total for the States.This accentuated dependence on North continent to about 10 percent above prewar, but America may not be greatly mitigated in 1952/53. the cultivated area has not increased correspond- World wheat production in 1951/52 (e,xcluding ingly.Production in Oceania was slightly above the U.S.S.R.) again increased slightly to about the prewar level, but compared poorly with other 147 million metric tons,14 percent above the postwar years (Table 32).

TABLE 32. - WHEAT PRODUCTION BY REGION'S, PREWAR AND 1947-1951

1934-35 REGION average 1947 1948 1949 1950 1951

million metric torts ) Europe 42.3 23.4 36.8 40.6 41.5 42.4 Western Europe a (28.2) (15.9) (24.5) (27.5) (28.6) (27.7) Other Europe (14.1) (7.5) (12.3) (13.1) (12.9) (14.7) North America 27.0 46.9 46.8 41.7 40.9 42.6 South America 8.2 8.8 7.6 7.2 8.0 4.4 Asia. 43.0 41.1 44.6 40.5 46.0 48.7 Africa 3.8 3.3 3.8 4.1 4.3 4.4 Oceania 4.4 6.1 5.4 6.1 5.2 4.5

TOTAL(excl.U.S.S.R.) . . 128.7 129.6 145.0 140.2 145.9 146.9

a Includes Austria, Belgium, Denmark, Finland, France, Federal RepublicofGermany, Greece, Ireland, Rai!, Luxembourg, Netherlaiads, Norway, Portugal, Spain, Sweden, Switzerland and the -United Kingdom.

81 The gain in world production over 1950/51 was TABLE 33. - WHEAT AND WEIEAT FLOUR EXPORTS, PRELEVIINARY ESTIMATE FOR 1 951 /52 WITH brought about by good harvests in a very small COAIPARISONS number of countries. Canada produced the second largest crop in its history, the increase exceeding JULY/JUNE thenet gain in theworldtotal.In Europe, 1934/35 1951 EXPORTER 193S/391948 1949 1950 /52 there was a bumper crop in Spain, good results aver- /49 /50 /51 esti- age mated in the Danube countries, Germany, and Poland and limited gains in some other countries.France, mil/loa metric tons Argentina . . 3.301.662.422.830.82 Italy, Sweden and the United Kingdom, however, Australia . . . . 2.843.303.073.492.64 experienced significant decreases, totalling over Canada 4.706.136.326.129.25 United Stales a . 1.80 13J08.65 10.25 12.79 2 million tons.Consequently, European import TOTAL, 4 countries12.64 24.89 20.46 22.69 25.50 requirements were greater than in the preceding Other countries. . 5.042.092.392.732.00 year. Similarly, the better total for Asia was TOTAL 17.68 26.98 22.85 25.42 27.50 mainly due to the marked improvement in Tur- Includes estimates of shipments to U. S. Territories and key's crop, other countries showing only modest Possessions as well as exports of flour milled from wheat not changes. wholly U. S. wheat. Poor crops were harvested in Argentina and in Australia.In the former, where many producers Canada, with a significantly increased carry- appeared to be dissatisfied with the prices they over and a large crop, held a considerably increas- received, farmers reduced their sowings by 25 ed export surplus in 1951/52, though the Canadian percent ;due to an unusually adverse season of Wheat Board had to contend with a severe trans- heat and drought, they reaped an arca only half portation problem and to cope with large supplies of that of prewar days, and production was only of poor quality grades and a large demand on dry- just over 2 million tons, less than one-third of ing facilities. About one quarter of the crop could the 1934-38 average.In Australia the sown area, not be gathered and threshed until the spring of owing to the competition of other forms of farm 1952, but good weather enabled thispart of production, was over a million hectares or 25 per- the crop to be saved in good condition.About cent below the postwar peak(1947) and the 50 percent more wheat was exported than in harvest; despite good yields per acre, was ba- 1950/51. rely equal to prewar.On balance, therefore, the The two North American countries together year 1951/52 proved less favorable than recent supplied about SO percent of thetotal wheat years, and one in which the trade difficulties of exports, as compared with about 65 percent in importing countries were accentuated. the two preceding years.Exports from Argentina World shipments of wheat in 1951/52 (1 July scarcely exceeded 500,000 tons and virtually came to 30 June) were again at a high level. Prelimi- to a standstill at the beginning of 1952. The last nary estimates suggest that gross exports from Argentine cropwas inadequate even to meet all sources may have exceeded 27 million tons domestic requirements anclspecial measures - and thus reached the highest level on record. drastic in an exporting country - such as high Exports from the United States As'ere maintained milling grades and mixing of substitutes in bread at a consistently high level, just exceeding one flour have been applied ;it is also reported that million tons per month, and totalled about two wheat is to be imported from the United States. million tons more than in the previous year. The deficit in Argentina will still be felt in world Supplies in that country were somewhat lower trade in 1952/53 and can only be relieved if a than in the previous year owing to a smaller more normal harvest becomes available in De- crop and some reduction in carry-over, and the cember 1952.In Australia the 1951/52 crop was high level of exports has scaled down the carry- reduced to 4.4 million tons as against 5.0 mil- over stocks by a further 4.1 million metric tons. lion tons in 1950/51.Its total exportsin 1951/ On July 1, 1952, the carry-over was tentatively 52 reached about2.6million tons compared estimated at 6 9 million metric tons, about half with over 3 million tons in recent years.The of the quantity now regarded as a desirable year- reduced supplies compelled Australia to apply end carry-over.The current good crop prospects, for a reduction of about 450,000 tons in its quota however, give promise of reinforcement in 1952/53. under the International Wheat Agreement and (Table 33). to reduce its sales outside the Agreement.As

82 in the case of Argentina, the shortage will con- thereafter until the end of December. By the tinue to affect exports in 1952/53. latter month Chicagoquotations liad regained The carry-over of wheat on July 1,1952, in the peak of $2.60 per bushel set in February the four major exporters was reduced to about 1951.The strength of wheat prices during this

TABLE 34. - ESTIMATED WHEAT STOCKS IN PRINCIPAL EXPORTINGl COUNTRIES, 1 JULY 1948-1952

YEAR United States Canada Argentina Australia Total

metric tons (million bushels in parentheses) 1948 5.3 (196) 2.9 (105) 3.5 (130) 2.9 (105) 14.6 (536) 1949 8.4 (308) 3.7 (135) 3.4 (125) 2.6(95) 18.1 (663) 1950 11.6 (427) 3.7 (140) 2.7 (100) 3.3 (120) 21.3 (787) 1951 10.8 (396) 6.3 (230) 2.3 (85) 2.6 (95) 2L9 (806) 1952a 6.9 (254) 8.2 (300) 1.4(50) 2.0 (75) 18.5 (679)

Souncp :Official data and estimates of the United States Department of Agriculture, Office of Foreign Agrien al Relations, and FAO estimates. Preliminary.

18.5 million tons (679 million bushels) as com- period reflected the sustained export movenient pared with 22 0 million tons (806 million bushels) and the continuing poor crop news from Argen- a year earlier, Canada alone showing some increase tina and Australia..After the turn of the year, in stocks (Table 34). markets were more hesitant and became weaker. Exports from sources other than the four major There was a general weakening in commod- countriesare only partially known. They may ity markets early in 1952, but the good progress prove to have been a little smaller than those of of the United States winter wheat crop was un- 1950/51.France, though an exporter of a small doubtedly also a factor in U.S. wheat prices and quota under the International Wheat Agreement, later became the dominating influence.With the was a net importer of about half a million tons. continuing good crop reports prices declined fur- Turkey, though reappearing as an exporter, ap- ther until in early July the Chicago price stood pears to have held much of the increased supplies at $2.27.At such a level, the commercial price resulting from the bumper crop of 1951 to increase WaS below the price corresponding to the rate at its stocks.Exports from the U.S.S.R. appear to which farmers could pledge their wheat under the have been somewhat larger,but exports from price support arrangements, and it was to be Pakistan appear to have been quite small, and it is expected that, after the initial pressure of new reported that imports have recently been necessary. crop supplies had abated the loan level ($2.22 per The quantity of wheat traded under the Inter- bushel national farm average) would become effec- national Wheat Agreement in 1951/52 I.was 15.5 tive as a support to the market price. million tons, which is the total of the guaranteed In Canada, the inital price to growers for 1951 transactions for the year following the reduction wheat was raised from Can. $1.40 to 51.60 per in Australia's quota of 450,000 tons and the in- bushel (No.1 Northern in store William Port crease in the Canadian quota of 150,000 tons. Arthur).For export sales outside theInterna- This represents some 57 percent of the estimated tional Wheat Agreement, the Canadian price has world shipments for the year.Trade under the followed the same trend as the United States Agreement was more active than in the preceding market, averaging Can. $2.17 in June 1952 against two years. Can. $2.32 in June 1951. Wheat prices on United States markets showed In Australia, following the review of movements the normal harvesttimeweakeningin June in the index of wheat production costs prescribed 1951, but there, was a consistent upward trend by the Wheat Stabilization Scheme, the growers' guaranteed price for the 1951/52 crop was fixed The Wheat Agreement year runs from 1 August to 31 July and thus differs slightly from the trade at 10/- (US $1.12) bulk basis, delivered at ports, year adopted in this review. an increase of 2/2 per bushel (27 US cents) on the

83 1950/51 price.In addition, with a view to allay- In Australia the improved payments for 1951/52 ing some of the growers' dissatisfaction with the have been followed by a series of measures design- guaranteed price, the Stabilization Scheme has ed to bring about a reversal of the recent declin- been amended to provide a higher price for wheat ing trend in wheat acreage.Thus for the year sold for stock feed, supplemented by a subsid.y 1952/53 no deductions are to be made from ex- which will bring the returns on feed wheat up to a port proceeds for payment into the stabilization level equivalent to the maximum price(16/1 per fund.Other and more general provisions have bushel) under the International Wheat Agreement. been made to encourage agriculture. Neverthe- less, the target set in the Government's produc- Outlook tion programisnot unduly ambitious asre- gards wheat, since the aim for 1957/58 is only Wheat crop prospects in the Northern Hemi- 5.2 million metric tons, a figure which, while it is sphere in mid-1952 gave promise of increases over 24 percent over the prewar average is substantially the previous year in many of the important produc- lower than the actual yields in 1947 and 1949. ingcountries.The July estimate of the U.S. crop was 1,250 million bushels (34 million m.t.), On the whole, the preliminary crop indications an increase of one-fourth over 1951.This was suggest that there may be some reduced pressure due to an increased acreage of winter crop which in deficit regions for imports in 1952/53, though survived the winter with rather less than the the general pattern of 1951/52, notably the high de- usual loss, in distinct contrast to the preceding pendence on North America, is likely to be repeated. year.The spring crop, however, covered a reduced The year 1952/53 will be the fourth and last area and was reported in some areas to be suf- year of the current International Wheat Agree- fering from drynes,s.The Canadian crop was ment.Discussions aiming at a renewal began in sown on about the same acreage, but in unusually April 1952 and will be continued early in 1953. good sub-soil moisture conditions.Western Eu- The first stage closed with a wide gap between rope also enjoyed a generally good wheat season, the prices proposed by exporters and importers. and it appeared that there would be larger crops During the operation of the current Agreement, in France, Germany, Italy and the United King- non-agreement prices have been generally signif- dom. A still more marked improvement has ap- icantly above the maximum stipulated in the parently occurred in the Near East and French Agreement, and the exporting countries took the North Africa.India reports a somewhat better view that the maximum of the price range of a wheat crop, but there has been some decline in new Agreement should make allowance for the Pakistan. generally higher levelof prices now ruling in In the Southern Hemisphere, the first reports commodity markets as a whole, and proposed as from Argentina indicated an improvement in weath- the new maximum approximately the price for er conditions at sowing time after a long period free wheat ruling in the spring of 1952 before of drought.This came at an opportune moment, the good prospects for the new crops began to since the Argentine Government policyis now affect the commercial markets.Importing coun- placing greater emphasis on the expansion of tries regarded this proposal as being so far from agricultural production. A number of meas- their own ideas that no workable basis for price ures have been introduced with the aim of re- negotiations could be found at the April-May storing agricultural production and export capac- meeting, and it was agreed to adjourn discussion ity.The most important of these measures is an until later in the year.Consideration is also being increase in the prices to growers of the main given to the introduction into the price arrange- crops ;for wheat the price to producers for the ments of a formula whereby the agreed prices crop year 1952/53 has been fixed at 50 pesos per under the Agreement could undergo subsequent quintal compared with 34 pesos for wheat of the adjustments corresponding with movements in last harvest, and this increase is believed to be general world price levels. proving effective in securing an increase in wheat The more remote outlook is indeterminate, °W- sowings.Other measures with the same objec- ing to the numerous relevant factors concerned. tive are the passing on to producers of the profits The supply situation should not, in itself, become obtained from export sales, priority in the alloca- burdensome :the North American wheat acreage tion of foreign exchange for purchases of agricul- is unlikely to show any further marked expansion ; tural machinery,revisionsin laborregulations Australia does not envisage any drastic increase and the favoring of rural immigration. in its production ;a considerable rise in the Ar-

84 gentine grain output is indeed possible, but the TABLE,' 35. - EXPORTS OF COARSE GRAINS," PRELIM - relative price position may induce farmers to INARY ESTIMATE FOR 1951/52 COMPA_RED WITH grow coarse grain rather than wheat.Prospects 1948/49,1949/50 AND 1950/51 of supplies from Eastern Europe remain uncertain. On the demand side, the OEEC countries expect JULY/JUNE their requirements of bread grain, i.e. wheat and EXPORTER 1934- 1951/ 38 1948/ 1949/ 1950/ 52 rye, might expand by 2.5 million tons by 1956/57, aver- 49 50 Si esti- but that this increase could be provided by an age b mated expansion of indigenous production.The mark- million nietric tons ed rise in the wheat imports of non-European Argentina. 7.342.31 1.940.661.12 countriesislargely due to a rise in populat- Callada 0 48 1.24 1.09 1.13 2.67 ioncoincidingwithafallinriceproduc- United States 1.10 3.454.426.054.90 tion and an adequate provision of foreign funds. TOTAL 8.927.007.457.848.69 The degree of the persistence of non-European Other Countries 5.88 3.225.394.04 demand will depend on the politicalsituation in South-East Asia and on the financial and social TOTAL 14 80 10.22 12.84 11.88 policies of governments. a Includes shipments of rye, barley, oats, maize and products.The last three postwar years include grain sorghums. COARSE GRAINS b Calendar year average. Current situation The most serious aspect of the general situation Preliminary estimates of world shipments of is the drastic shrinkage in Argentine exports, a coarse grains in1951/52 indicated atotal not postwar feature which has become accentuated in greatly different from that of the two previous thepast two yearsby unusually unfavorable years, or approximately 12 million tons as compar- growing conditions.Before the war Argentina ed with the prewar movement of over 14 million supplied half of the world exports, but in the past tons.As in 1950/51, the bulk of the exports was two years it has provided only a fraction of the supplied by the United States and Canada, the total and is not likely to ship very much in 1952/ latter showing a considerable increase following 53, unless the next crops are considerably more its large 1951 crops, and the former some reduc- abundant. tion.Argentina exported some 1.1 million tons The importing countries - mainly those in compared with less than 700,000 tons in 1950/51. Western Europe have thus had to depend on Exports from sources other than these three have dollar sources for a substantial part of their sup- in the last three years approximately equalled plies, and this has prolonged the stringency in the prewar quantities but, though this is satisfac- animal feeding stuffsfirst imposed by the war tory from the standpoint of the importing coun- and postwar shortages. Importers have also altered tries, the development cannot yet be regarded as the nature of their purchases, taking barley and assuring regular supplies, since in several of these sorghum to replace maize. sources exports are dependent on fluctuating crop Prices rose sharply towards the end of 1951, yields.The failure of East European countries but by July 1952, they had receded in North to recover their prewar regular export capacity America to a level only slightly above that of deprives the importing countries of an important a year ago.In Europe, this recent fall has been and regular source of supplies (Table 35). accentuated by the drop in freight rates (Table 36).

TAI3LE 36 - COARSE GRAIN PRICES, 1951/52

CoAr1s1. GRAINS 3/VII/51 27/XII/51 8/VII/52

Chicago Maize, spot (U.S. cents per 56 lbs.) 174 200 182 Winnipeg Barley, spot (Can. cents per 48 lbs.) 112 140 118 Australian Feed Oats (In E. c.i.f. U. K.,per metric ton) 341A ($ 96.6) 391/2 ($ 110.6) 251/2 ($ 71.4) Iraq Barley- (In E c.i.f. U.K., per metric ton) 321/2 ($ 91.0) 451/2 (8 127.4) 301/s ($ 84.7)

85 Outlook The outlook for supplies from the Danube/ U.S.S.R.. region remains uncertain. These countries The large stocks of coarse grains built up in could no doubt export substantial quantities of the United States in 1948/49 and 1949/50 have coarse grains, but their own development plans been scaled down considerably in the past two are believed to favor the utilization of such crops years, and at the end of 1951/52 they are probably for livestock products within their own region. no larger than a normal carry-over. In view of In the main European importing countries, the the generally sustained domestic demand for live- outlook was quite fair until the long drought and stock products, supplies for domestic and export heat wave raised fears concerning the growing purposes are very dependent on the 1952 harvest. coarse grain.The OEEC countries hoping to in- Looking beyond 1952/53, however, itis possible crease their output of livestock products, expect that United States consumption may fall sharply to require 15 to 22 percent more feeding stuffs in 1953/54, since the maize/hog price ratio has by 1956/57. In the absence of additional imports become much less favorable to hog production this would entail an additional1.25 million hec- and fattening. tares under coarse grain by 1956. If the July estimates prove to be fulfilled, the 1952 United States maize crop will be the RICE second largest on record,namely 85.5million metric tons.The total United States feed grain production is expected to exceed last year's by Current situation 8 percent. In contrast to most other commodities, rice has In Canada, carry-overs of coarse grains are con- become increasingly scarce during the past year, siderably larger than those of a year ago. Intend- and its price has risen.The world area under ed sowings in 1952 are smaller, but conditions rice continued to increase gradually to a record for seeding were very favorable.Very good crop total in 1951/52(Table 37).Total production prospects were also reported from some of the did not expand, however, because of a further other exporting areas, particularly those of the fall in the yield per acre in some important areas. Mediterranean and the Near East, and a good The recent sharp fall in the price of Far Eastern export supply of barley seems to be assured.The exports has not been reflected in a lowering of prospects of the new Argentine maize crop will the effective demand for rice.The price of rice not be known for some time, but substantially in international trade has continued to rise, and increased growers'price and official encourage- the price spread between rice and wheat has wid- ment is expected to produce a significant increase ened.Developments in China, the world's larg- in cultivation. est rice producer, and events in Korea have reduced

TABLE 37. - WORLD AREA AND PRODUCTION OFRICE

AREA PRODUCIION : PADDY

COUNTRY 1931-38 195102 1934-38 1951/52 (average) 1950/51 (provisional) (average) 1050/51 (provisional)

117 ion lactares ) ( mil/ion metric tons China " 19.8 18.5b 18.9 b 50.5 47.0b 48.3 b India 25.2 30.5 29.8 34.2 31.1 31.3 Pakistan 8.6 9.1 9.1 11.2 12.5 11.8 Japan 3.2 3.0 3.0 11.5 12.0 11.3 Thailand 3.4 5.3 5.9 4.4 6.8 7.2 Burma 4.9 3.8 3.8 7.0 5.2 5.5 Other Asian Countries 16.9 17.0 17.4 26.0 25.9 24.7

TOTAL :Asia J 82.0 87.2 87.9 144.8 139.8 140.1 Other Continents 3.8 6.7 6.9 6.4 11.4 11.2

World Total (exel. U.S.S.R.). . J 85.8 93.9 94-.8 151.2 151.2 151.3

a 22 Provinces and Manchuria. b Unofficial estimate.

86 the reliability of global statistics of rice acreages Europe and North. America wil thus be doubly and crops.Most of the more important Asian welcome; the United States and Italy are expected producers report lower yields, particularly Japan to increase their exports and Spain and Portugal and Pakistan, whilst Thailand has recently sharply have recently joined the ranks of exporters,if reduced its crop estimate and increased its stock- only on a modest scale.Thechief unknown pile requirements. India's rice harvest was indeed factor on the supply side is the extent of Chinese slightly better than last year's, but as that had exports in the second half of 1952. been an exceptionally low one, the result remains The main increases in demand have come so disappointing.In Asia, only Burma and Indo- far from Japan and Indonesia ;the Philippines china report any marked improvement.The most have raised their import requirements by 35 per- severe fall in production occurred in Egypt, where cent.Indian needs remain high, although unev- the crop was halved by the failure of the Nile enly distributed, for in some rice districts the

TABLE 38. - INTERNATIONAL TRADE IN RICE (MILLED )a

1934-38 Average 1950 1951 15.55 Forecast AREAS

'Ports Imports Exports Imports Exports Imports Exports I Imports

million metric tons Thailand 1.4 . 5 1.6 1.3 Burma 3.1 1.2 1.3 1 1.2 U.S.A. 0.1 0.5 0.5 0.6

Indochina 1.3 0.1 0.3 0.5 1

Japan 1.1 i 0.6 0.8 0.8 India 1.8 0.4 0.8 0.7 Malaya 0.5 i 0.5 0.5 0.5

Indonesia 0.3 1 0.3 0.5 0.5 Other Asian Countries 1.6 I 0.1 1.0 0.3 LO R 1.2 2.3 Others 0.3 2.0 0.6 1.2 0.8 1.2

WORLD TOTAL 4.0 4.0 4.8 4.8 1 4.8 48

1 "Covers about 90% of world trade in rice. floods.In Brazil; the greater attractiveness of monsoon has failed for the fifth consecutive year. cotton reduced the acreage under rice. Although the rise in purchasing power has been On the other hand Europe, the United States checked in Ceylon, Indonesia and Malaya by the and Cuba had good rice crops, the latter country sharp fall in the price of their main export products, in particular continuing its rapid rise and thus their effective demand has not, so far, shown an37 enabling the United States to export increased sign of falling. quantities to the deficit areas of Asia. In contrast to most other commodities, the Although the dis'appointing yields in some of value of rice has continued upward.In the main the main rice importing countries are intensifiying Asian countries, the internal procurement price demand, world trade in rice is unlikely to expand has been controlled and has remained nominally in1952(Table38).Of themainexporters, unchanged.India, however, allowed a 3 percent Thailand is pursuing a cautious policy and has increase at the beginning of 1952 to the equivalent reduced its official estimate of available supplies. of U.S. S 94 per metric ton. In Indochina, the Burma's liberal shipments in 1951 reduced her price at Saigon rose by 40 percent between March carry-over considerably, so that this year's increas- 1951 and March 1952, whilst Japan raised its ed crop will not be reflected in greater exports. price to internal producers by 15 percent.In Pakistan has announced that it will have no export- the United States, the average price received by able surplus, but is bartering some rice against farmers has fluctuated considerably, but at S 118 wheat with India; nor can Egypt be looked to per metric ton in March 1952 it was 10 percent forsupplies.Thesustainedlargeoutputin lower than that recorded last year.Whilst prices

87 to producers werein some countries prevented future supply of rice.Political considerations, too, from rising by government action, there has been will probably determine the amounts of rice which a constant rise in the prices exporters have asked China will be willing to export. and received at the ports.This was particularly The remarkable degree to which the demand noticeable at the regular sales by tender to allocat- for rice has been sustained, in spite of its relatively ed destinations, which Burma has instituted for high price, is a clear sign of the great preference one third of her exportable surpluses. As contrast- it enjoys amongst the vast, growing number of ed with the£443.0 ($123.6)atwhich Small habitual rice-eaters, and this factor is unlikely to Mills Specials, 42 percent Brokens, had been sold change rapidly.On the other hand, the sharp f.o.b. Rangoon in 1951 on a government to gov- drop in the incomes of some of the chief importing ernment basis, f.o.b. prices for the same quality countries, due to the fallin other commodity haverecentlyrangedfrom£ 59.10.0($166.6) prices, may reduce effective demand.Japanese to 64(---$179.2)accordingtodestination. demand will depend more on industrial activity, For a better quality, with only 20 percent Brokens, but the annual increase in its population alone Spain recently obtained $184 f.o.b. Spanish Medi- constitutes an equivalent rise in requirements of terranian ports.In the United States, high qual- over 100,000 tons a year if present rice consump- ity Gulf rice sold during May at $242 for No. 2 tion per caput is to be maintained. Rexoro f.o.b.Houston, whilst Californian rice was The smaller, but absolutely large section, which exported at $220 for No. 1 Pearl f.o.b. San Fran- does adjust its consumption by relative prices, cisco.It was not surprising thatunder these will continue to be able to rely in 1952/53on conditions,every normallyrice-eatingcountry wheat imports under the prices of the current took up its full wheat quota under the Interna- International Wheat Agreement. The future of tional Wheat Agreement. this Agreement is, however, still under discussion The effect on consumers of these rises in f.o.b. and great doubt prevails concerning the f.o.b. prices was, however, somewhat cushioned by the price-levels that any fresh Agreement may pre- general fall in freight rates. scribe.No furtherrelief appears tobe likely from any renewed sharp drop infreight rates. Outlook On the other hand, the tendency to allow prices to the internal consumer to reflect costs seems The prospects for rice production have recently to be spreading, as in the case of the Indian gov- improved.Costs have not risen as much as was ernment reducing food subsidies. feared,nor have alternative demands brought Viewed somewhat narrowly, the demand for about as serious a shortage of capital goods and rice seems likely to absorb all available supplies, agricultural requisites as seemed probable a year even at prevailing prices.Should price-levels of ago.The severe fall in the price of rubber, copra, other products continue to fall, the price of rice palm-oil and oil-seeds will tend to shift some land is unlikely to remain insulated from consequent and labor back to rice-growing.The degree to adjustments amongst producers and consumers. which this occurs will, however, be greatly influenced by the extent to which the actual producer is allowed to reap the benefit of the relatively SUGAR high prices prevailing for ricein international trade.Taking the internal price in Burma as Current situation 100, internal prices elsewhere are roughly Thailand 230Japan . 440 Following the war time decline in production, Egypt 280Indochina 460 the prewar average was first passed in 1947/48, India 310Pakistan 550 and since then it has continued to grow, exceeding the prewar average also on a per caput basis. Italy 330Brazil. 740 U.S.A...... 390 Production (excluding the U.S.S.R.) during the decade preceding the outbreak of World War II These indices are not strictly comparable since vas comparatively stable at 26 million tons per they refer both to varying qualities and varying year. This was equal to about 13 kgs. per caput, conditions ;nevertheless,the rangeisstriking. as compared with 10 kgs. before World War I. The extent to which order and peace will prevail, The crop of 1951/52 was equal to 14.4 kgs. per e.g. in Burma, Indochina, Korea and Malaya, is caput, 10 percent higher than prewar.But the clearly a factor of the utmost importance to the great increase in production in dollar countries

88 has in 1952 engendered new problems for the Production islikely tocontinue to expand in world free market supplies (Table 39). importing countries and future growth in consumption is likely to depend increasingly on domestic TABLE 39. - CENTRIFUGAL SUGAR PRODUCTION 131' production or on productioninsoftcurrency CONTINENTS a countries.A return to prewar per caput consumption in countries where sugar is still rationed would 1951/ 59 create a market for an additional 1.5 million tons. Prelim-as per- REGION 1934- 919/ 1950/ in9a57e ntage Imports to the United Kingdom aild Japan alone 38 50 51 of 52 1934- would have to rise by 1.2 million tons, but postwar 38 economic and political dislocations are likely to million 'metric tons .... retard such a return to prewar consumption.The Europe 6.5 6.8 9.0 8.8 135 great increase in exportable supplies has taken North America . 2.5 1.9 100 place in countries which require payment in dollars. F Central America 5.1 8.8 9. 1 10.8 212 Cuba alone will have for export in 1952 over a South Auaeriea 1.8 2.9 3.1 3.4 189 Asia 7.4 6.0 6.3 7.0 95 million tons more than in 1951while supplies Africa 1.2 1.4 1.6 1.5 125 from non-dollar exporting countries are still sub- Oceania 1.8 2.0 1.9 1 8 100 stantially lower than before the war. Prices remained remarkably stable during 1951/ World (excl.USSR)25.729.933.535 2 137 52 except for the decline from the artificial price boom during the first part of 1951.Cuban world 1 U.S.S R 2.3 2.1 2.2 1 2.3 market prices have fluctuated between 4.5 and a Includes gur in India and istali in terms of raw 4.2 cents a lb.While the appearance of the large sugar. 1952 Cuban crop tended to weaken prices not only of dollar supplies, but also of sugar from soft Larger supplies, rising national income, and com- currency countries (except from the British Com- paratively favorable sugar prices in relation to monwealth, where the price was fixed in negotia- other foods have made possible a substantial tions at the end of 1951), it has not yet greatly growth in per caput consumption in most countries affected current market p1-ices.The Cuban Gov- as compared with the prevarlevel.Increases ernment has established a single seller for " Spe- areespeciallypronouncedinunderdeveloped cial Quota, " sugar for the world market, and a countries, particularly in those which had the " Sugar Stabilizing Reserve " of 1.5 million tons lowest per caput consumption in prewar years. to be marketed over a period of not more than 5 In many territories in Africa and Latin America, years.Until now, these measures have met with consumption has increased by 100 percentor a high degree of success and have prevented a more.Only in Asia and Europe has consumption steep decline in prices, but it is too early to judge declined. thelong-termeffects,especiallyif,asseems Although the bulk of the increase in consump- probable, production in importing and other export- tion has been made possible by larger domestic ing countries increases substantially during the production, imports have also increased during 1952/53 crop year. the postwar period and in the last two years reached high levels.In 1950 and 1051, about 11.5 million tons of sugar entered world trade as com- Outlook pared with 9.8 million tons in the prewar period. In 23 of the leading importing countries, produc- Early indications point to a further increase tionincreased 33percent from prewar to4.3 in production in 1952/53, but weather conditions million tons in 1950/51, while their net imports can still affect final output by as much as 1.0 per- rose 10 percent to10.1 million tons.In 1S of cent.There is also the possibility that the world's the chief exporting countries, production in 1950/ largest sugar-producing country may restrict next 51 was 15.1 million tons, as compared with the year's crop.The great increase in postwar produc- prewar average of 11.S million tons, an increase tion has been unevenly distributed between coun- of 28 percent.Their exports increased to 10.6 tries.Indeed, the marketing problems which su- million tons in 1951, and domestic consumption gar is likely to encounter in the near future must increased 88 percent from 2.2 million tons to 4.2. be considered in the light of the changes in the There are indications that the rate of increase world production pattern.Asia's production was ininternationaltradein sugar may diminish. still 5 percent below prewar in 1951/52, due to

89 the great decline in Java and Taiwan.Produc- Denmark entirely offset this.The export pri- tion in Central America, however, has more than ces the Danes received for butter developed doubled.It expanded inallcountries of that unfavorably compared with those for cheese area, but the major increase was in Cuba where and especially for beef and veal.While butter production rose from a prewar average of 2.8 in 1949 fetched 13 1/3 times the price of lin- million tons to about 7.2 million tons in 1952. seed cake, in 1951 this ratio was 8 2/3.Den- Adverse weather conditionsduring1951/52in mark de-rationed butter and increased domestic North America, Europe and Oceania gfive a some- consumption.So did Australia, whose exports what distortedpictureof thechangeswhich fell from 83 to 34 million kgs. have taken place, and during the forthcoming In the western world considered as a whole, year their production is likely to show an increase butter production fell a little owing to smaller of an additional 5 percent over the prewar period. output in the exporting countries of Europe With sugar prices in most markets showing much and to decreases which were very heavy in less increase above prewar than most other foods, absolutefiguresin the United States and and with demand growing with population and relatively large in the United. Kingdom.But buying power inthelessdeveloped countries, more butter was produced in Western Germany, , continued expansion in the world consumption which almost reached the prewar output, and of sugar seems likely.However, the effectof in France and Italy, both of which had at- these trends on prices, particularly for supplies tained that goal a year earlier.World exports for the free world market, will depend on special of butter rose between 1947 and 1950 from measures which may be taken either on an inter- 330 to 490 million kgs.The year 1951 marks national basis or by the major exporting country. a break in this upward trend. 2. The demand for butter is very elastic, depending mainly on the ratioits price bears LIVESTOCK PRODUCTS to that of margarine.Cost of production per unit of fat is lower in vegetable than in milk Current situation fat.Measures to raise butter prices to consu- Major developments in the livestock produce mers are of no avail if not coupled with marga- to which governments could situation in 1951 and early in1952 included rine restriction (1) a shrinkage in butter production and a much not very well afford to turn after the invasion of South Korea. more considerable decrease in the volume of world trade in butter ;(2) a very great expansion of Oilseeds and seed oils, the main raw mate- margarine production ;(3) increased utilization of rials for margarine, had risen in price after milk in the form of fluid, canned and dried milk, the middle of 1950, but early in 1952fell and of cheese ;(4) a shOrtage of beef and mutton below their pre-Korea level. Cheaper vegeta- and (5) an increase of pigmeat, largely due to ble oils favored margarine in its competition recovery in pig numbers in Europe. with butter, and so did government measures. 1. In 1951 butter imports fell from 341 to 313 In 15 leading margarine countries, produc- million kgs. in the United Kingdom and from tion in 1951 rose to 2,066 million kgs. as against 46 to 26 in the German Federal Republic. 1,812 in 1950 and 876 in 1938.More marga- The latter in mid-1951 raised the import duty rine was produced both in North America and (DM 30 per metric quintal since April 1950) in Europe, but North America, producing 50 to DM 75 without diminishing imports notably, million kgs. more of margarine, had 90 mil- but as of October 1, 1951, changed the rate lion kgs. less of butter.In Europe, margarine to 25 percent ad valorem, which worked out production expanded mainly in the United at about DM 110.After this second increase, Kingdom and more in Western Germany. importspracticallyceased and duringthe The margarine/butter price ratio, about one- winter stocks, belonging mostly to the Govern- third in Norway and Switzerland, dropped to ment,were halved.The United Kingdom a similar level in Germany and Austria ;it conceded a 7 14 percent increase of the prices rose from 42 to 47 percent in the United paid under its long-term contracts with Aus- Kingdom ;it fell from 46 to 40 in the United tralia and New Zealand and with Denmark. States.It was higher, and still rose, in Den- Itattracted much more butter from New markand Sweden, butremainedlow Zealand,but a reduction in imports from in Belgium (between 32 and 30 percent).In

90 most national price systems the ratio(loes Thus various factors combined to reduce not offer a bright prospect for butter. exports from the three great surplus areas of the Southern Hemisphere in 1951, and this While demand for butter is very elastic, the reduction seriously affected the United King- milk supply is not.Several promising out- dom whose imports fell from 1,220 to 940 lets for mili have, however, been opened by million kgs.In the beginning of 1952 im- the growing demand for fluid milk and cheese. ports from New Zealand increased, greatly A shift of preference from " visible " fats to surpassingthe level of the precedingyear, fluid milk and to cheese, i.e. to food richer in and very considerable quantities arrived from protein,is reported from the United States the Argentine. and other northern countries, and it seems that the old mistrust, so powerful in warm Trade restrictions of hnporting countries espe- ciall3r affected live cattle.In February 1952 regions, against fluid milk is breaking down the outbreak of foot-and-mouth diseasein before the achievements of the modern tech- Canada caused the United Statestoclose niques of refrigeration and preserving. itsfrontiers for Canadian cattle and fresh Milk preserves and cheese absorb about as meat ;iii-111,7 an agreement was concluded much milk as has been set free by the reces- under which Callada replaced New Zealand sion in butter.In 1951 not only Western meat in United Kingdom supplies and New Germany but also leading European cheese- Zealand replaced Canadian meat in United exportingcountriesincreasedtheir output States imports.In the United Statesthe notably.Cheese replaced butter and meat output of beef and veal fell by 388 million to a large extent in the United Kingdom, kgs.Imports, especially canned meat from which increased imports from 156.5 to197 Argentina, rose from Si to 133 million, the million kgs., buying almost one-fifth in the United States taking the second place among United States. beef importing countries.Average prices for Commercial policy affected the cheese mark- steers rose 21 percent in the United States ets by two measures :the United States, the (31 in Canada and 36 in Argentina) ; numbers largest producer and for short periods during of cattle increased, promising a recovery in and after the war the largest exporter of cheese, beef supplies.The pig/maize price ratio was subjected imports to quotas in August 1951, 12.4 in the spring of 1951, and pigmeat output and Western Germany increased import duties rose by 372 million kgs. or 10 percent.In to 30 percent ad valorem. March 1952, the ratio was from 9 to 9 1A. Beef prices did not share in the decline which The year 1951 brought great progress in the many commoditiesunderwentin1951/52. reconstruction of the pig industry of Europe For this year more abundant meat supplies which is the more remarkable as it was achieved might have been expected, because the ratio with less maize from other continents.In 12 of meat to wool prices rose from the low level European countries pigmeat productionin- to which it had fallen in the great run on raw creased 10 percent in 1951.The greatest in- materials after the invasion of South Korea. crease took place in Western Germany where In August 1951 when Australian export prices December pig numbers between 1947 and 1950 for cheese and butter were raised, meat had had already risen from 5.5 to11.9 million. increased still more whereas wool in the United In December 1951 the figure was 13.6 mil- Kingdom declined until in April 1952 it was lion and pigmeat output for the whole year 16percent below the pre-Korea price level. rose from 830 to 1,040 million kgs. (as against The exceptionally high wool prices had re- 985 in 1938).The price ratio of pigs to feeds ducedslaughteringsandgreatlyincreased liad remained favorable in the first half of the stocks, preparing a recovery in meat supplies. year ;it deteriorated towards the end. - Such an increase, in fact, ean be reported for Among the traditional exporters, Denmark NeW Zealand, where meat output has risen and the Netherlands increased output by 11 by one fourth.In Australia and Argentina and 16 percent.Both shipped more bacon however, continued droughts reduced output. to the United Kingdom which got almost none In Argentina the price policies of the Govern- from Canada and much less pork from Argen- ment favoreddomesticconsumption tina. Western Germany had taken 360,000 live Januarv 1952. pigs and 580,000 quintals.of pigmeat in 1950 ;

91 it reduced such imports by 60 - 70 percent Owing tolossesof cattle from the1951/52 in 1951. drought itwill take a number of years before Pig numbers and pigmeat production, espe- beef production in Australia fully recovers.Some ciallyin Europe, showed most progressin increase in the output of lamb may be expected 1951.Cattle and sheep numbers increased for 1952/53, while higher feed prices and farm only slightly.In world trade inlivestock wages make any appreciable change in pigmeat products shrinkages were greater than ex- production unlikely.Exports of meat from Aus- pansions :while world exports of cheese in- tralia during the coming season will be very small. creased a little, meat exports fell 10 percent The new 15-year agreement with the United and butter exports 12 percent. Kingdom and the overall agricultural expansion The development of world trade in livestock program of Australia should, in the long run, products does not, however, mean an overall improve itsexportable supplies.In New Zea- lowering of the degree of international division land, on the other hand, livestock numbers are of labor.The butter trade is shrinking mainly at a high level, and both production and exports because of the expansion of margarine which of meat are likely to expand. is almost wholly produced in the countries The aggregate meat output of the United States which consume it,but mostly from imported isexpected to show an increase in1952/53, cattle numbers having reached a record level at oilseeds.The meat shortage had transitory causes, namely, the preceding great rise in the beginning of 1952.Hog production, however, wool prices and the great droughts in the will probably decline in 1953 as a result of the Southern Hemisphere, and itis hard to be- sharp reduction in recent hog prices compared to lieve that the quantitative restrictions of im- maize prices.The future of the Canadian exports announced in the spring of 1952 by port market will depend to a large extent on how the United Kingdom, which at the same time long the embargo which the United States has cut down food subsidies, will be permanent. placed on livestock and fresh meat from Canada continues, but it is anticipated that the Canada/ New Zealand/United Kingdom agreementwill Outlook enable the expected surplus of meat in Canada in 1953/53 to be disposed of. In Western Europe some increasein meat The prospects for the 1952 harvests of feeding production, mainly pigmeat, is expected in 1952/53. crops are generally favorable in most of the North- Feed and crop prices to farmers have advanced ern Hemisphere.Summer pastures appear to be sharply during the past season compared with in good condition and satisfactory surpluses of meat animal prices, however, and this may limit home-grown fodder are likely to be available at the increase in meat production or bring about a the end of the year.In the Southern Hemisphere, decline in some countries.The 1952 review of grazing is improving, the droughts in Argentina, farm prices in the United Kingdom encourages Australia and the Union of South Africa having the rearing of calves for beef and the production been broken by rains. of additional domestic feeding-stuffs by the plow- Barring a substantial fall in consumer income, ing up of grassland.Given no deterioration in demand for livestock products at current prices feed-grain imports, European meat exporters are is likely to continue strong throughout 1952/53. expected to niaintain shipments of pigmeat at On the other hand, some of the factors limiting the level of the previous season. livestock production in 1951/52 the shortage During 1951/52 most countries have been con- of dollars to pay for feed imports, the increase centrating on the expansion of beef herds.This in costs of livestock products, and foot-and-mouth will tend to curtail milk output and any increase disease may be felt more strongly in the com- will largely depend on higher yields per cow.It ing season.The year may, however, see an im- is likely that total output of milk in Western Europe provement in exportable supplies of feed grain in in 1952 will rise by one to two percent over the some non-dollar areas. last year's level, whereas in North America it In Argentina, meat output in 1952 may decline, may not change substantially.Depleted dairy owing to the introduction of measures limiting herdswillretard recoveryinAustralia.New cattle slaughterings,buteffortsto reduce the Zealand, however, is expected to show a steady high domestic consumption may contribute to increase during the coming season, provided rain- larger meat exports. fall is adequate.

92 Trade in cheese in1952/53 will be seriously This production reflects an overall increase in the affected by the import limitations of the United fishing effort achieved mainly by the restoration Kingdom and by the continued restrictive im- and reconstruction of war damaged fleets, includ- port policy of the United States.The markets ing the introduction of more powerfulvessels for cheese are,however, more diversified than with a high degree of technical efficiency and by those for butter and in general production as the steady progress of development and mecha- well as consumption of cheese will continue to nization projectsin technically underdeveloped increase.The upward trend in the production countries.In 1951, however, while the continuing and trade of preserved milk is likely to continue. strong demands of populations in underdeveloped Egg production in Western Europe may con- areas stimulated the growth of indigenous pro- tinue to feel the impact of feeding-stuff difficulties, duction, the heavily capitalized industries of West- and is expected to rise only slightly.In North ern Europe and North America were facing mar- America, on the other hand, further considerable keting problems which, in the light of rising costs increases are expected for 1952. Reduced supplies and prevailingrestrictions on capitalexpendi- ture, tended to limit production at a level which of feeds may check egg production in both Argen- was inconsistent with the potential world de- tina and Australia. mand. Exports of eggs from Western European countries in 1952 are likely to be maintained or even Fisheries commodities review slightly increased over the previous year's level, as smaller supplies are expected from Australia In the pattern of postwar utilization, while tech- and China.The upward trend in exports of eggs nological development encouraged a swing away in shell from the United States is also expected from curing to marketing in the fresh and frozen to continue during 1952. state,the emphasis was on the distribution of edible fish products.In 1951, however, the output of most edible fish products, except stock- FISHERIES PRODUCTS fish, frozen fish, salted herring and canned salmon fellbelow thelevelachievedin1950. This Current situation was due to the attraction of the market for oil and meal where demand was firmer and to the Fish production increased in 1951 and continued uncertainty which prevailedgenerallyinthe the upward trend recorded since the end of World marketsforediblefishproducts.The steady War II. The figures in Table 40 are based on increase of oil and meal production was made records and estimates of landings in 60 countries. possible by the slackening in the demand for edible The catches actually reported by 30 of these fish products, especially in the case of herring and countries totalled14,227,400 metrictons and similar species whose production is concentrated show an increase of 4 percent over 1950. over a relatively short period of time.

TABLE 40. TOTAL LANDINGS OF 60 COUNTRIES BY REGIONS, 1938, 19471950 AND 1951

REGION 1938 1947 1950 1951

thousand metric tons a Europe (excl. U.S.S R) 5 350.1 5 551.2 6 C67.6 6 771.6 Asia b 4 149.8 3 269.1 4 013.0 4 073.6 North America 3 250.1 3 272.8 3 671.5 3 378.6 Latin America 265.0 460.2 556.7 563.0 Africa e 109.5 223.4 508.7 521.8

TOTAL 13 124.5 12 776.7 14 817.5 15 3'8.6

SOURCE: Official publications and communications and FAO estimates. a Round fresh weight for most countries. b Japan and South Korea only. Union of South Africa, French Morocco and Angola only.

93 TABLE 41. - PRODUCTION OF CERTAIN FISHERIES COMMODITIES a,1947 TO 1961

No. of COMMODITY countries 1947 1948 1949 1950 1951

thousand metric tons b Fish, frozen 14 361.3 427.6 375.8 451.7 Cod, hake and similar species, saltedc 14 255.3 221.3 261.0 322.6 301.9 Cod, hake and similar species, dried (stockfish) 3 17.4 16.5 10.6 21.1 37.7 Herringandsimilarspecies, saltedd 19 511.9 538.9 609.3 473.0 532.0 Salmon, canned 4 156.6 133.9 151.9 124.2 150.5 Herringandsimilar species, canned 20 239.5 252.5 327.9 397.4 320.0 Tuna, true mackerels and similar species, canned 14 107.9 124.0 116.8 155.3 153.2 Cod liver ode 11 38.1 37.6 38.0 35.9 46.9 Herring and other clupeoid oil 10 114.1 127.3 105.4 158.7 182.0 Herring and other clupeoicl meal. 10 236.8 313.9 280.2 385.9 433.3 Other fish meal 1 13 150.0 181.5 230.1 263.7 315.9

SOURCE :Official communications. a The number and identity of the reporting countries are not the same for each commodity, but in some cases the figures are close to world totals. b Product weight. e Dried basis. d Includes smoked herring for some countries. e Body oil may be included. j Includes herring meal for Germany, Netherlands, Spain and United King,dom.

Freshfish.The wartime disruptionoffish In the United. States, the largest producer of production increased the dependence of belligerent frozen fish, production increased from 130,000 met- countries on imported supplies and caused some ric tons in 1950 to 148,000 metric tons in 1951, countries, traditionally engaged in processing, to due chiefly to the growth of the ocean perch develop a larger fresh fish trade,In Western Eu- and the whiting trade.The United States is also rope exports increased from 340,000 tons in 1938 the principal customer for the frozen tuna exports to 540,000 tons in 1949.The revival of indigen- of Angola, Japan, Mexico, Peru, etc., and her im- ous production caused acorrespondingdecline ports of frozen tuna and similar species increased in this trade which in 1950 was below the 1938 from 6,620 metric tons in 1939 to 28,567 metric level.In 1951, notwithstanding a remarkable re- tons in 1951. covery, which in S selected European countries amounted to an increase of 5 pereent over 1950, Stockfish(cod (tnd similar species dried without the total production of fish marketed fresh drop- saffing). In Norway, the most important producer, ped to 38 percent of the total catch as compared postwar production hassteadily increased and with 42 percent in 1950, and further reflects the now exceeds the 193Slevel.In 1951exports increased production of oil and meal. amounted to 20,800 metric tons compared with 16,500 metric tons in 1950 and 26,000 metric tons Frozen fish. The steady postwar development of in 1938.There is still a firm demand in Italy and frozen fish production continued during 1951.In West Africa. the Americas, Asia and Europe, production was Salted cod, ha/ce, etc. In 1951 the world output 20 percent higher than in 1950 and, in Iceland, (excluding U.S.S.R.) of salted cod dropped by 6 per- Norway and the United Kingdom the sharp decline cent to 302,000 metric tons owing mainly to de- which had occurred in 1950 was reversed.The creases in Callada (S percent), Iceland (37 percent), main increases over 1950 were Japan (33 percent). Norway, however, which produces 15 percent of world supplies, increased its Denmark. . 34 percent .Norway . 63 percent production by 51 percent to 54,200 metric tons, Iceland . . 64 » U. K. . . . 169 ,Tapan . 13 » U.S.A.. . . 13 based on the increased exploitation of the Green-

94 land grounds which supplied 20,000 tons.Fur- Oils and meal.Production continued to expand ther increases are forecast in1952.Iceland and in 1951 and in 13 selected major producer coun- the Faeroes have also directed more salt-fish voy- tries absorbed a further 2 percent of fish supplies ages to the Greenland grounds.In the five main and accounted for 20 percent of the total catch producer countries(Callada, Denmark, Faeroes (excluding offals).This trend is shown in the fig- Iceland and Norway), exports increased by 16 ures below, which show the output of oils and percent to 181,700 tons (dried weight) in 1951. meal commodities in selected countries (1948 -- Although exports of wet, salted cod dropped by 100) : 19 percent this was offset by a revival of the " klippfish " trade. COMMODITY 1949 1910 1951

Canned fish (salmon and similar species). The world, pack (excluding the U.S.S.R.) increased from 124,000 An fishcrustacean andmollusk metric tons in 1950 to 150,400 metric tons in meal 10 129 149 1951.Although the United States pack of 104,600 All fish oils 91 124 141 metric tons showed an increase over the very low 1950 pack it was still only equal to two-thirds of the 1938 pack. Prices are higher as a result of Although the United States accounts for 30 the reduced pack. percent of world production, her output fell by In Canada the pack increased to 42,800 metric 22 percent in 1951 owing to reduced landings of tons and there is some sales resistance which may herring and pilchard.South Africa achieved a disappear owing to the lighter pack expected in conspicuous increase inits productionviz. 124 1952.Japan did not produce a pack of commer- percentinthe case of meal and 50 percent in cial significance in 1951. the case of oil.In the United States the market for meal, although fairly stable, may weaken as a Canned tuna. The significant features of produc- result of heavier production and imports, and the tion in 1951, as in 1950, were the emergence of Japan demand for body oils, stimulated by the war in as the second largest producer and the continued Korea in 1950, has later shown a sharp recession. predominance of the United States.The United States' industry sought protection against increas- Trade ing competition from imported tuna.The lapse While the total volume of exports in 1951 was of the United States-Mexico trade agreement re- someAshat higher than in 1950, analysis reveals stored the ad valorem duty to 45 percent, so that a re-distribution of trade and some significant total United States imports of tuna canned in reductions in the export of the main commodities. oil dropped from 20,000 metric tons in 1950 to The export of fresh and frozen fish continued 7,000 metric tons in 1951.The future of the to expand in 1951 chiefly because of improved United States market is uncertain owing to heavy communications and rapid advances in technique. supplies although at the lower level of wholesale Significant increases were recorded, for example, prices ruling in the latter half of 1952, there is a in France (69 percent), Iceland (83 percent) and chance that all available supplies will be absorbed. .Norway (30 percent). The export trade in cured fish is gradually ap- Canned clupeoidae (herring and similar species). proaching its prewar level although notable ex- Production in the 12 main producer countries fell ceptions were Iceland, the Netherlands, and the by 26 percent in 1951.Sharp falls in the Cali- United Kingdom which were respectively 29 per- fornia and Maine sardine packs were characteristic cent, 35 percent and 74 percent below their 1938 of the overall decrease in United States production levels.In the United Kingdom there was a reduc- which at 95,400 tons was 48 percent lower than tion of 4 percent between 1950 and 1951. the heavy 1950 production.Production, although The sustained demand for canned products in fairly stable elsewhere, increased by 43 percent the war and postwar period has given way to an in Callada and 11 percent in French Morocco but unstable situation characterized by increased com- fell by 29 percent in Portugal, both of the latter petition and uneven balanceof trade between countries finding considerable resistance in their the major producer countries, especially since the traditional export markets in Europe and North appearance of new and growing productions such and South America. as those of French Morocco and Peru. The industry

95 has suffered from the growing demand for fresh improved techniques, are attracting demand away and frozen products on the one hand, and by- from canned products.In the United States, for products such as oil, meal and fertilizers on the example, the index of wholesale prices of fish and other.Portugal, ill-equipped for the frozen trade shellfish increased by nearly 3 percent, but this and the manufacture of by-products, has been masks the significant adjustment in demand sug- unable to adapt her production to the shifting gested by the fact that fresh and frozen fish prices world demand so that her canned products were advanced by nearly 10 percent while the price being quoted at 20 percent below price levels pre- of canned products fell by 8.5 percent during the vailing before the Korean war. same period.In Western Europe, white fish retail In several other European countries the cann- prices advanced 30-45 percent above 1950 levels. ing trade in 1951 was lower than in 1950 e.g. Where canned products were concerned this Denmark (54 percent), France (18 percent) and shifting of demand was accompanied by the increas- Norway (6 percent).In countries with few altered competition of new producers, so that Portu- native outlets this has meant stockpiling the 1951 gal, for example, was forced to quote canned pro- pack which with the other factors may compli- ducts at 20 percent below 1950 prices. cate still further the distribution of canned goods Meanwhile the sustained demand for oil and in 1952. meal and the incentive of higher quayside prices The trade in oil, meal and fertilizers continued encouraged more craft tofishexclusively with to expand during 1951 and in some countries this production in view. achieved very large increases over the 1950 produc- The capacity of the markets in technically under- tion ; notably Denmark (768 percent), Iceland (117 developed countries is expected to absorb local percent) and Norway (89 percent).In South Afri- production and to encourage the development of ca, exports of fish meal in 1951 reached 20,000 fisheries resources for some years.In other coun- metric tons, thus placing this country among the tries, however, producers in more commercialized major producers. industries are facing a critical slackening in demand which suggests that markets are becoming over- supplied at present price levels and under exist- Prices ing restrictions on imports. Generalizations are difficult because of the wide range of fish products which, during the process Outlook of distribution, often have very little in common beyond their origin. Moreover, owing to the perish- The competition which has characterized the able nature of the bulk of fish products, prices are marketing of canned products during 1950 and particularly sensitive to the availability and price 1951will probably be intensified by the carry- of other commodities and to purely local conside- over of stocks accumulated in these two years. rations of quality, variety, season, discrimination The expansion of trade in frozen fish products and abundance.Price movements asa whole in 1951 will continue through 1952 although fur- need to be considered against the background of ther development may need to recognize a some- steeply rising costs of production and distribu- what lower level of prices.The increasing pro- tion, and it would be misleading to draw compar- duction of saltfish may become more difficult isons when prices have been subject to varying to sell at a price which is consistent with the rising degrees of commercial or governmental control costs of long-range trawling operations. and where no significant correlation exists bet- It is difficult to appraise the demand for fish ween consumer prices and production costs. Within meal which, during the postwar years has never very broad limits, however, it is possible to trace been seriously tested, but new high levels of pro- an overall increase in fish prices in 1951.This duction suggest that marketing will become more increase was not so much due to any sustained competitive and more responsive to fluctuations increase in the consumer demand as to the efforts in livestock production.The demand for body of producers and distributors to recover the rising oils is expected to be weaker ;these profited from costs of manpower and materials and to the occa- the wide demand for fats and oils which was in- sions when seasonal shortages coincided with a tensified in 1950, but there was a sharp recession demand stimulated by shortages of alternative in 1951 and keener competition isexpected in foodstuffs.It was More marked in the case of the coming year owing to the anticipated large fresh and frozen products which, as a result of production of olive oil in 1952.Medicinal oils

69 too,willmeet more competition owing to the TABLE 42. WORLD INDIGENOUS EXPORTS aOF increasingproduction ofsyntheticVitamin A FATS, OILS AND OILSEEDS IN TERMS OF OIL, 1938, which is already competing in price and is ex- 1950 and 1951 pected to overtake and eventually replace fish- liver oil. COUNTRY OR AREA 1933 1950 19.51 b In general, the highly commercialized industries must expect to face more discrimination in consu- (thousandmetrictons) mer demand which will give increasing effect to Europe 495 367 363 import restrictions resulting fromthe protection United States and Canada 135 942I 091 Argentina, Brazil ancl Uruguay 658 599 618 of some markets and the exclusion of others by Africa, South of the Sahara . 9481 2351 052 balance-of-payments problems. :India, sea-borne trade . 676 ,172 164 Indonesia 637 332 472 Malaya, Ceylon, and Pacific Islands 420 328 396 FATS, OILS AND OILSEEDS Philippine Republic 384 511 565 China (including Manchuria) 580 215 197 Australia and New Zealand. 254 216 208 Current situation Antarctic 566 344 347 The acute world shortage of oils and fats that Other areas 366 218 141 characterized the early postwar years has been WORLD TOTA 6 089 5 479 5 613 relieved.World production of fats and oils in 1951 is estimated at about 7 percent larger than a " Indigenous exports " comprise oilseeds grown within the exporting country, and oils or fats derived from oilseeds a year earlier and more than 10 percent above or animals produced within the country. Minh, oil produced fronf whales caught in the Antarctic Oca,, is counted in this the prewar average.Production per caput has table as an export from the Antarctic. Production Indigenous exports from European countries consist mainly nearly recovered to the prewar level. of butter and slaughter fats going to other European coun- of oils and fats continued at a high level in early tries. Butter is included in terms of fat content (calculated at 1952. 51 % of product weight).Sperm oil and fish-liver oils are excluded where reported separately. World indigenous exports of fats and oilseeds b Preliminary. in 1951 were still below the prewar level (Table 42). The apparent contradiction between increased world production and reduced world exports is The pattern of world trade in fats, oils, and oil explained by the fact that consumption has in- seedshas changedconsiderablysinceprewar. creased materially in some of the major prewar Exports from Argentina, China, Eastern Europe, exportingcountries,includingIndia,partsof India and Indonesia have declinedmaterially. Africa, and Argentina. Production of whaleoil inthe Antarctichas

TABLE 43. FATS, OILS, AND OILSEEDS IN TERMS OF 0m: RETAINED IMPORTS aAND IMPORT BALANCE: PRINCIPAL IMPORTING COUNTRIES, 1938, 1950, AND 1951

193S 1950

COUNTRY Retained ImPort Retained. Import Retained Import imports balance imports balance balance

thousand metric tons -United Kingdom 1393 1393 1464 1464 1562 1562 Germany (Federal Republic). e 1157 e 1157 761 761 684 684 France 515 506 333 327 502 495 Other Western Europe d. 791 558 915 642 959 663 United States 710 659 582 *309 512 *552 Canada 124 100 164 109 136 109 Cuba 45 45 96 96 97 97 japan 171 166 113 107 148 139 * Export balance. a "Retained imports" comprise fats and oils imported and not re-exported, and the estimated oil irr imported oilseeds that is not re-exported in the form of oilseeds or as oil.The "import balance" is the difference between total imports and total exports of all fats, oils, and oilseeds in terms of oil.Whale oil of Antarctic origin bronght into a country and retained for consumption is counted in this table as 'in import, even if produced on ships flying the countryflag.Butter is included in these totals in terms of fat content. Sperm oil and fish-liver oils are excluded where SIIONVR separately. b Preliminary. e All Germany (1937 frontiers). d Norway, Sweden, Denmark, time Netherlands, Belg,ium and Luxembourg, Switzerland, and Italy.

97 declined.These reductions have been partl-y, but Kingdom apparent consumption was about as not entirely, offset by increases in exports from largeas prewar or slightly larger.Nearly all the United States, the Philippine Republic and Western European countries showed a sharp im- Western Africa.Exports from Argentina were provement over 1950. temporarily large in 1950 and 1951, and those Prices of fats, oils and oilseeds in international from Africa temporarily low in 1951. markets advanced rapidly after the outbreak of The import balance of 10 leading industrial hostilities in Korea in June 1950 and by March countries in Western Europe in 1951, at 3.4 mil- 1951 most had reached peaks only slightly below lion metric tons (including the oil equivalent of those of early 1948. A declining trend began in oilseeds), was 5 percent less than in 1938.This the spring of 1951, however, and continued through reduction, however, was more than accounted for April 1952.There was a moderate recovery in by the Federal German Republic(Table43). May and June 1952.In contrast to a year ear- The import balance of Sweden was also materially lier, there was a widespread desire in 1951/52 to lower than prewar, reflecting increased production reduce the relatively large stocks builtup in of rapeseed in that country.The import balan- the previous year (Table 44). cesof Italy, the Netherlands and the -United Prices of most of the oils and fats used princi- Kingdom in 1951 were considerably larger than pally for food or soap were lower in June 1952 in 1938, and those of Belgium, Denmark, France, than in June 1950.Total world production and Norway and Switzerland were at the 1938 level export supplies of these oils and ats were larger or slightly higher. in 1951/52 than a year earlier.The leading in-

TABLE 44. PRICES OF SPECIFIED FATS, OILS AND OILSEEDS, JT_TNE 1952, WITH COMPARATIVE DATA

Currency 15 :,11 in whi eh 1950 1952 ITEM originally quoted June a March b June Tune

( U. S. dollars per metric Ion

Dliye oil, North African, 1% f.o.b. . . . E st. 4!)6 1 047 882 623 3roundnut oil, Indian, driuns V st. 397 601 e 612 364 lroundnut oil, American, crude, bulk . U.S.$ * 352 ... * 437 424 -ioybean. oil, American, crude, bulk.. . . U.S.$ 310 * 495 * 404 * d 264 Lard, refined, 37 lb.tins, N Y U.S.$ * e 310 * 486 * 415 * 276

Joconut oil, Straits, 3 or 34%, bulk. E st. 322 526 414 244 Palm oil, Belgian Congo, bulk B. fr. 260 548 359 209 "'allow, fancy, bulk, N Y U.S.$ * e133 * 352 * 317 * 160 í,insecd oil, Belgian, drums, f o b B. fr. 337 530 448 / 400 -Jastor oil, Bombay firsts, drums . . . . V st. 315 686 820 482 3oy-beans, Manchurian bulk V st. 116 150 156 127 ioybeans, American, No. 2 yellow, bulle. . U.S.$ * 102 ... 113 -Jopra, Straits E st. 227 366 261 176 Dopra, Ph,ilippines, bulk U.S .$ 190 323 213 152 Palm kernels, French West Africa . . F. fr. 168 283 204 155 inseed, Bombay Bold V st. 182 251 993 201

Compiled from The Public Ledger (London.) Prices are international market prices, for prompt or early shipment, c.i.f. or c. and Î. European ports, except as otherwise noted.Original quotations are converted to U.S. dollars at the official rates of exchange. a Last month before prices were affected by the Korean crisis. b Peak month since June 1950 for most items. c Chinese, bulk, plus $40, the difference in June 1950 between the Indian and the Chinese quotations. d Drums. e Estimated from Chicago quotations. f Bulk. * F.o.b. American port.

Apparent consumption of fats andoilsper creases were in coconut, groundnut, cottonseed, caput in 1951 (total food and nonfood) was less olive, and whale oils. than 90 percent of prewar in Denmark, Germany, Prices of linseed and castorbeans, and of lin- Italy and Norway.InBelgium,France, the seed, castor, and tung oils- declined less in 1951/52 Netherlands, Sweden, Switzerland and the United than prices of other fat-and-oil -items.The Ar-

98 gentine linseed crop, which is harvested late in the 1951/52 crop totalled about 400,000 metric the year, amounted to only about 300,000 metric tons of kernels, compared with only 145,000 tons tons in 1951 compared with 559,000 metric tons a year earlier and an average of 296,000 tons in a year earlier, and 1.7 million metric tons prewar. the 1945/46-1949/50 period.Because of limited Also, large surplus stocks of Argentine linseed transportationfacilities,however,only about and linseed oil, which had been accumulated in 280,000 tons will be exported before the new 1946-49, were nearly exhausted by the beginning crop season.Hence there will be a carry-over of 1952 as a result of relatively heavy exports into 1952/53 of about 120,000 tons compared with in the two preceding years.Exports of linseed no carry-over a year earlier.Unless weather con- and linseed oil from Argentina in 1952 are not ditions are unusually unfavorable for the 1952 likely, to total more than 100,000 tons, in terms of crop, Nigeria in 1952/53 Avill have an exportable oil,compared with 345,000 tons in1951 and surplus of groundnut kernels, including carry-over, 524,000 tons prewar.Droughts in Brazil and at least as large as the 280,000 tons being ex- India prevented an increase in world production ported in. 1951/52. of castor beans in 1951, and the demand from Prospects for other major world oilcrops in the United States for castor beans and oil re- 1952/53 are mixed.The area planted to ground- mained strong.Exports of tung oil from China nuts in French. West Africa may be smaller than in 1951/52 were much below average. ayearearlier.Growers were apparentlydis- couraged by the sharp reduction in prices for the Outlook for 1952/53 1951/52 crop from the high levels of a year earlier. In India, average growing conditions in 1952/53 According to indications on July 1, total world should result in an increase in groundnut produc- export supplies of fats, oils, and oilseeds in 1952/ tion, which was impeded by drought in 1951/52. 53 will probably be about as large as in the pre- A reduction in 1952 in total Philippine and Indo- vious year.World production may decline slight- nesian production and exportsof copra from ly, but stocks of oils and oilseeds in several lead- last year's high levels is forecast, partly because ing producing countries will be larger at the be- of the severe decline in prices since mid-1951 ginning of the 1952/53 marketing year than a year and partly because weather conditions for setting earlier. the new crop in Indonesia were less favorable in The total quantity of lard and edible vegetable 1951 than a year earlier.World palm oil pro- oils available for export from the United States duction and exports, however, are rising in 1952- islikely to remain approximately the same in reflecting restoration of order in Sumatra and 1952/53 as in1951/52.Reflectinga record pro- more favorable weather for the oil palms in Ni- duction, stocks of edible vegetable oils havein- geria in 1951 than a year earlier. creased substantially since the fall of 1951.This Consumer and industrial demand for oils and increase in stocks is a little larger than the de- fats in 1952/53 is likely to be wed sustained by a cline in lard production in 1952/53 expected as high level of economic activity.Also, demand a result of a 9 percent reduction in the 1952 or stockpiling will probably be somewhat stron- pig crop. Production of edible vegetable oils may ger than in 1951/52.These are price-supporting be slightly smaller than in 1951/52 with declines factors, but with prospects for large world export in cottonseed and groundnut oil nearly offset by supplies as favorable as they were in July, a major an increase in soybean oil.Edible vegetable oils rise in 1952/53 in the general level of fats and oils and lard compete strongly- with each other in prices in world markets is not probable. the United States because " shortening " is manufactured mainly from vegetable oils and is widely used for the same purposes as lard. FRUIT: (a) CITRUS FRUIT The 1951 Mediterranean crop of olives set a new record and largeolive crops are usually Current situation followed by small ones.Although there was a good " set" of olives in the major Mediterranean Total supplies of citrus fruit in 1951/52 Av-ere olive-producing countries in 1952, the crop was about the same as in the previous season.In the damaged in some by unusually hot summer weath- two main producing regions, the United States er.Thecarry-overof oliveoil into1952/53 and the Mediterranean, oranges and mandarines AA-ill be substantially, larger than a year earlier. continued their upward trend whereas the lemon Commercial sales of Nigerian groundnuts from crop was smaller, particularly in the United States

99 and Italy.Grapefruit production in the United quantities than prewar.In spite of the increase States declined as a result of frost. In the South- in United Kingdom imports that country took ern Hemisphere, whichsuppl.iesthe European only 402,000 tons as against the 1934-38 average market with "summer" oranges, Brazil had excep- of 543,000 tons.The United Kingdom market is tionally low yields. now second to that of France, which with a 1951 Compared with thefive-yearperiodbefore import of 498,000 tons of oranges and mandarines World War H there was a substantial increase has doubled imports since prewar.Lemon and in all citrus fruit production, 50 percent for oran- grapefruit imports to the United Kingdom in 1951 ges including mandarines, 40 percent for lemons were only 50 and 66 percent respectively of the and 30 percent for grapefruit (Table 45). prewar averages.Western Germany's import of

TABLE 45. PRODUCTION AND EXPORTS OF CITRUS FRUITS BY 1\1,1/2.J-on PRODUCING AND EXPORTING COUNTRIES, PREWAR AND 1949-51 PRODUCTION EXPORT COMMODITY AND REGION 1934/35- 1938/39 1949/50 1950/51 1951/52 1934-38 1949 1950 1951 average average

thousand me rie tons Oranges and Mandarines.

Mediterranean Region . . 2 315 2 177 2947 3 045 1 259 1 026 1 100 1 451 USA 2284 4 173 4701 4 810 150 179 187 261 Mexico 139 411 350 365 9 32 ... Brazil 1 172 1 195 1252 1 100 148 70 85 76 Union of South Africa . 132 196 204 213 85 108 147 144 Tapan 465 318 437 375 63 4 5 ... Other countries 1 393 1 930 1909 2 092 115 51 14 40 WORLD TOTAL. 7 900 10 400 11800 12 000 1 820 1 440 1 570 1 980*

Grape f rant

WORLD TOTAL. 1 200 1 400 1800 1 600 110 130 110 110

Lemons and Limes

WORLD TOTAL. 1 000 1 200 1400 1 400 280 220 220 230*

Estimate.

International trade in citrus fruit continued to 248,000 tons of oranges exceeded prewar imports expand and reached a new high level in 1951, to all Germany by 30 percent. favored by the progress in trade liberalization in The decline in citrus fruit supplies in the United the OEEC countries of Western Europe and a Kingdom has not been compensated for by in- strong consumer preference for citrus fruitas creased supplies of other fruits.The per caput a supplement to home-grown fruit in the im- consumption of all fruit (including tomatoes) was porting countries.It is noteworthy that Spain in 1951 only 90 percent of prewar, whereas most and the United States also increased their exports other European countries haveincreased per to Western Europe though they did not benefit caput fruit consumption substantially. from thetradeliberalization.Spanish orange The United States has as in previous years exports, practically exclusive to Europe, rose from encouraged citrus fruit exports to Europe (excl. 421,000 tons in 1950 to 730,000 tons in 1951, an Eastern Europe) and other overseasterritories increase of 309,000 tons against a total increase by substantial subsidies.The export promotion for Mediterranean orange eXports of 350,000 tons. program in 1950/51 provided for payments up to The United States increased exports of all citrus one-half of the export price f.a.s. U.S. port for fruit to Belgium and the Netherlands and found fresh and processed oranges and fresh lemons. a new market in France. The program for 1951/52 provided for payment Nearly all European countries increased imports of 40 p`ercent of the f.a.s. value and grapefruit of oranges in 1951,taking substantially larger were included in the program.

100 Spain is encouraging orange exports by a favor- darinesandthismay affectprices ofwinter able exchange rate to exporters and Greece stim- oranges. ulates exports of mandarines by granting import There is no immediate prospect of substantially rights covering a certain percent of the export larger supplies of summer oranges though demand value.Israel and Lebanon are granting direct for this fruit is apparently increasing. subsidies. At the Second Mediterranean Citms Congress, Prices of oranges and grapefruit were generally held in Spain in May 1952, a resolution recommend- lower in the 1951/52 season than in the previous ing the stopping of new plantings in the region season, but lemon prices increased. for some time was not approved.The Congress however recommended the establishmentof a joint advertizing program to stimulate consump- Outlook tion in the European markets. Crop prospects for 1952/53 are favorable.Early June estimatesinthe United Statesindicate (b) DRIED FRUIT an average yield of oranges and lemons, but a lower than average yield for grapefruit though Current situation higher than in 1951/52.Spain expects an orange The output of the major varieties of dried production of some 1.3 million tons against 1.1 fruit in 1951/52 was larger than in 1950/51, the million tons in 1951/52. size of the pack being affected by the expectation New plantings of citrus trees have been sub- of a strong demand (Table 46). stantial during the last five-year period in Florida, TABLE 46. DRIED FRUIT, PRODUCTION AND U.S.A., as well as in the Mediterranean region, EXPORTS, 1934-38 AND 1949/50- 1951/52 and these young trees are now reaching bearing A. Production in the Major Producing Countries age.The citrus area in Israel which at present is approximately 12,000 ha. against 29,000 ha. COMMODrrY 1931-381919/50 1950/51 11951152 in prewar Palestine is expected to increase by 10,000 ha.in the next few years.The rapid thousand metric tons expansion in French Morocco isbeing continued. Raisin- 447 455 389 449 The present area of 20,000 ha. is expected to be doubled by 1960.Greece, also, expects a further Currants 181 108 93 98 increase in area. Dried prunes. 270 193 107 209

The revocationof tradeliberalizationwith Dried figs. 261 230 927 184 regard to mandarine imports to the United King- dom in November 1951 and of all citrus fruit im- 13. Exports from Major Exporters ports to France in February 1952 may have some limitingeffectontotalEuropean importsin COMMODITY 1934-38 9/501950151 1951/52 1952/53, but Western Germany has since April 1952 put all citrus fruit on the free list from OEEC housand nutrir tons countries. Raisins 185 198 140 147 Whereas most consumption in Europe isstill Currants 80 65 62 69 in the form of fresh fruit, the United States is Dried prunes b 87 72 95 c26 expanding the consumption of processed citrus fruit,particularly concentrated frozen juices. Of Dried figs. 65 42 43 41 theFloridacropof orangesandgrapefruit a Preliminary estimates subject to revision. b U.S.A. only. about 62 percent and 55 percent respectively went e September-February only. into processing in the 1950/51 season.Process- ing is becoming an important outlet also for Cali- The absence of carry-overs and the rearma- fornia oranges which were previously marketed ment programs then under way suggested that the mainly as fresh fruit. demand for storable foods would be at high levels. In spite of the increasing supplies of winter Moreover, since the small packs of the previous oranges in the Northern Hemisphere the trade does season resulted in working stocks being lower not expect any major surplus marketing problems than usual in the importing countries, a concen- within the next few years.The situation may tration of purchases in the early part of the season be somewhat more difficult with regard to man- was expected.

101 The tendency towards larger packs did not of competing commodities could reverse the trend. affectallvarieties and allproducing countries. The American packers are expected to enter Raisin production in North America increased 50 the 1952/53 season with very small carry-overs percent, while elsewhere smaller yields were ob- and the Mediterranean countries at the end of the tained.The pack of currants did not change season will have only a few thousand tons of the appreciably in size, but part of the Greek product old raisin crop. was diverted to industrial use because of poor United States production of dried fruit in 1952/ quality. The production of prunes almost doubled 53 is expected to be slightly- smaller than in the owing chiefly to the recovery of the Californian current year. A shorter grape crop is forecast industry and the return of the Balkan product. which may lead to a smaller pack.The latter, The output of dried figs contracted severely in however,is dependent not only upon the size Italy-, Portugal and Spain owing to adverse sea- of the crop but also upon the demand for grapes sonal factors,but increased in other countries. by wine manufacturers.The carry-over of wine The production of minor dried fruit (dried apples, islikely to be substantial.On 31 March 1952 pears, peaches and apricots) continued to decline California stocks amounted to 177 million gallons from the peaks reached in the1940s. against 138 millionat the same date of 1951. The expected demand forthe major dried These circumstances are likely to lead to reduced fruits failed to materialize in spite of the relaxa- activities by the wine producers, but on the other tion of import controls in some countries.Buy- hand they are trying to obtain Federal aid to ers were rather cautious throughout most of the set up a marketing scheme which would allow season and chiefly during itsfirst months.In them to maintain the scale of their operations. the United States, to avoid the full impact of The outcome of this scheme may have decisive increased supplies on growers' incomes, the export effects upon the size both of the wine output subsidy program for raisins and prunes was rein- and of the raisin pack.The size of the pack troduced.At the end of March, 1952, the Govern- of prunes is forecast as smaller than last year's. ment had paid S5 million in subsidies on sales Early estimates of .Australian raisin and currant abroad.The largestsingledealtaking place production in 1952 place the pack at 70 to 7;5,000 under the program was the sale in December of tons.This would leave a surplus for export of the whole surplus pool of seedless raisins 30,000 30 to 40,000 tons, which the British Ministry tons tothe United Kingdom.Itappears of Food has agreed to purchase except for some that the American program had some depressive quantities to be sold to other Dominions and on effect on raisin export prices of Greece and Tur- the international market.The prices to be paid key.When the United Kingdom purchasein by the United Kingdom are t 98.10.0 per short California was announced those prices fell consid- ton,f.o.b.,forsultanas and raisins and £80 erably,but they recovered toward the end of for currants, i.e. $286 and 8224 respectively. the season, as the Californian supply was near In Turkey, severe frosts are reported to have exhaustion and the demand for the Mediterranean reduced the April estimate of the raisin crop to product became more active.The recovery: of 60,000 tons. Turkish prices, however, was also affected by a late While no great change is expected in the Cali- realization that the actual size of the stocks at fornian pack of figs, a larger Mediterranean crop hand were far smaller than previously estimated. is likely, though no estimate of its size is available. Outlook COFFEE No change of particular importance is expected in the demand for dried fruit.The demand of Current situation the American consumer is expected to be main- The world coffee economy was probably more tained, and some advance in pricesis expected prosperous in 1951/52 than in any previous year. in the United States.However, it appears likely Production increased nearly everywhere as com- that subsidies on exports willbe maintained, pared with 1950/51 ;imports rose about 10 per- unless the contraction in output is more drastic cent ; and the strong import demand kept prices than expected.In Western Europe, consumers' remarkably stable at a high level.The problem tastes are moving away from dried fruit.Only of the world coffee industry appears to be one of a drastic change in their price relative to those supply rather than of markets.

102 Favorableweatherconditionsincreasedthe On the demand side, there is no reason for anti- 1951/52 crop by about 5 percent above that of cipatingasubstantialdecline.UnitedStates 1950/51.Production was higher in Brazil, which imports may stabilize at the 1951/52 level, but still contributes about 50 percent of world supplies, imports to Europe are likely to show some im- in Africa and in most of the minor producing coun- provement.Latin American producing countries triesin Latin America.However, total world are endeavoring to increase exports to the European output is still below prewar, due to the decline in market, which absorbed only 28 percent of total production in Brazil and Indonesia from the high world imports in 1950, as compared with 43 per- level attained in the nineteen-thirties. cent in prewar years. A large number of trade The rise in population, income and demand for agreements have been signed with European im- coffee in the chief importing countries, with pro- portingcountries.Indicationsarethatmajor duction still below the prewar level, resulted in a changes in prices are not likely to take place. substantial rise in prices.Demand would have In the long run, and taking into account the been even stronger but for the restraining influence agricultural development and improvement pro- of financial restrictions imposed for balance-of- grams in Latin American and African producing payments reasons as well as of high taxes and regions, some expansion in coffee production may import duties.Hence, European imports remained be anticipated.In Brazil, the greatest increase in 1951 substantially below prewar and increased is likely to take place in Parana, whereas in the only 2 percent as compared with1950.On the old regions of Sao Paulo the decline in the tree other hand, United States imports increased 10 population over the last decade has not yet been percent in1951.The United States absorbed compensated by new plantings.Efforts made by almost 60 percent more coffee than in prewar years, Colombia, Mexico and the Central American coun- and 1101V takes about 65 percent of total world tries to improve both volume and quality of their imports, as compared with 49 percent in 1934-38. output are likely to produce satisfactory results The strong demand sustained prices in1951 over the next few years.The outlook appears and the first part of 1952 higher than at any favorablefortheAfricanproducingregions level sincecoffee became an article of general where labor costs are relatively low, and produc- consumption.TheUnitedStatesretailprice tion in Indonesia can be expected to recover once of about 87 cents a lb. was higher than at any internal conditions have become stabilized.At timesince1913.Consumer resistancetothe the same time, world demand seems likelyto price rises which took place with the exhaus- continue its upward trend with little indication of tion of the Brazilian stock in 1949 and, sub- production tending to overhaul the growing de- sequently,with the outbreak of hostilitiesin mand. Korea, appears to have diminished in 1951/52. However, the 8 percent decline from the record 'mports of 1949 and the marked increasein TEA consumption of solublecoffeeproductswhich produce more cups of coffee per lb.of beans, indicates continued consumer sensitivity to prices. Current situation Indicativeof the strong demand forcoffeeis thedifference between the behavior of coffee For the first time since the end of the war, prices during 1951/52 and those of most other exportable tea supplies were in 1951/52 larger than agricultural products important in foreign trade. imports for current consumption.Production increased in all the main exporting countries with the exception of Japan, where the crop was reduced Outlook by unfavorable weather conditions.The slightly lower harvest in Northern India was more than Production in 1952/53 is not likely to exceed counterbalanced by an exceptionally large crop that reached in 1951/52.The Brazilian crop suf- in the southern part of the country.Ceylon, Which fered from drought during the flowering season in 1950/51 produced a crop 42 percent larger than and the expansion of production in Colombia, the prewar, again increased production by 3 percent, Central American countries and in Africa is not and Pakistan harvested a record crop.Indonesia's yet sufficiently great to counte,rbalance an impor- production rose to 62 percent of the prewar level, tant decline in Brazil.No stocks of significance notwithstanding labor difficulties and the spread have been accumulated in producing countries. of blister blight disease.

103 Although exports in 1951 from the main produc- prices declined froin 38.7 pence on 28 May 1951 ing countries were 13 percent above those of 1950, to 23.3 pence on 24 March 1952.Even so, 1952 marketing encountered some difficulties, especially season prices were still 150 to 200 percent higher of lowe,r quality teas (Table 47). than prewar. TABLE 47. - TEA EXPORTS FROM MAIN PRODUCING Outlook COUNTRIES Production in 1952/53 is promising.In North

COUNTRIES ,1931-35 1959 1951 inenhse India, weather conditions have been favorable and overPia total Indian production islikely to exceed the 1951./52 crop.In Ceylon, the campaign against (.thousand si etric tons.) blister blight is proceeding with a high degree of India li ,-, 9h177.31 196.6+ 11 success.In Japan, production islikely torise. Pakistan -'-`h-"IÌ7 31 '15. L 218

Ceylon., 99.61:.=A;138.i 1 On the consumption sitie,the most important Indonesia i (17.6 31.6 m.c 29 development is the increase in the United Kingdom Japan. 1.6 7.2 8.6 + 19 China,/ 40 13.6 14.51+ 7 ration which will raise import requirements by Other Far Eastern . J 12.72 9. 10.51+ 15 about 30,000 tons a year.Indications are that Brit, East Africa. . 3.11 5.6! 5.94 5 further relaxation of United Kingdom control of Nyasaland . 3.4 6.91 7.L+ 3 Othersb 0.41 3.71 3.71 - consumption and imports might be announced if production expands and prices do not advance TOTAL 397.11 398.5 450.71+ 13 unduly.The efforts of tea-producing countries to expand consumption in the United States and in * Preliminary. European countries are likely to show slow but e Estimates of the International Tea Committee. b Including 'Mozambique, Iran, Brazil, Turkey, Southern steady results. Rhodesia, Union of S. Africa, Mauritius.

Imports and consumption were higher in 1950 COCOA and 1951 than in prewar years in the United States, Canada, most South American and African coun- Current situation tries and in Oceania, but increases in consumption have been very small and no new markets have Cocoa production in 1951/52 at 679,000 metric emerged to absorb larger supplies.In the United tons was lower than at any time since the aban- Kingdom, which before the war absorbed about donment of international allocations in 1949.The half of the total supplies entering international decline was clue to lower crops in almost all the trade, rationing continued and total consumption major producing areas, the Gold Coast,Brazil., was about 10,000 tons lower than prewar, despite Nigeria and French West Africa, which_ normally the increase in population.Imports rose in 1951 contribute 75 to 80 percent of the total world to almost prewar levels, but most of the increase production.In the other 25 countries, total pro- went for rebuilding stocks and did not enter cur- duction remained practicallyunchanged(Table rent consumption.Imports by othe,r European 48). countries averaged 17 percent below the prewar TABLE 4,8. -- WoRLD PRODUCTION OF COCOA BEANS volume.The Eastern European market has been PREWAR AND 1941/42-1951/52 reduced to a fraction of prewar ; consumption has

not yet returned to prewar levels either in Ger- N-E.ARS GoldNige- Bra- TOT- Coastria zil ers I AL many, or in the _Netherlands which were before CC the war the largest importers of tea on the Euro- thousand metric tons pean mainland. 1934/35-1938/39 . . 283 96 83124 144 730 Following the rise after the outbreak of hostili- 1941/42 255 99 62 132 113 661 ties in Korea, prices declined in all the main auc- 1942/43. 211 113 55109 112 600 1943/44. 199 75 44125 123 566 tions, especially of lower quality teas.The aver- 1944/45. 232 88 74109 116 619 age for all teas at the London auctions fell from 1945/46. 213104 76110 124 627 43.68 pence a lb. during the 1951 season to 35.51 1946/47. 195 113 78148 128 662 1947/48 211 77 78 97 139 602 pence in 1952, or 19 percent.The price of Ceylon 1945/49. 283110 05128 148 767 tea declined relatively less, but those of South 1949/50. 250103 02 161 157 775 India, Africa and Malaya relatively more, between 1950/51. 266112 15 131 157 755 1951/52 214107 95110 153 32 and 42 percent.On the Calcutta auctions, 676

104 The demand for cocoa products has increased for the decline in the yield of senile trees, the in Latin America, Africa., Asia and Oceania and al- inroads of swollen shoot disease, and other factors though per caput consumption in underdeveloped which are tending to reduce yields.Production countries isstill a small fraction of the average will expand in French and Belgian territories of consumption in Western countries, consumption Africa and in most of the 25 countries which 11011' has been rising.Until World War I, 70 percent contribute about a quarter of world production. of world net imports went to Europe, and 26.6 Plantings are also taking place in countries which percent to the United States and Callada.The have not previously produced cocoa.Still, the rest of the world absorbed only 3.4 percent.The total increased contribution from these sources big change between the two world wars was the during the next 5 or 6 years is likely to be compar- increase in United States and Canadian imports ativelysmall, and no major increase in world to about 39 percent while the share of Europe supplies of beans over the average for the 3 years declined to 57.7 percent.Since the end of World 1948-50 can be anticipated during this period.The War II, cocoa-producing countries of Central and increased world buying power and demand for South America have retained for domestic con- cocoa products, with supplies no larger than pre- sumption a much larger proportion of their crop war, have resulted in the high postwar price rise. than before, and imports into countries outside The upward trend in world demand seems likely Europe and North America have risen from 3.7 to continue over the years ahead, and all the cocoa to 5.2percent. that can be produced in the next few years is The average price of "spot" cocoa on the New likely to be absorbed at relatively high prices. York Cocoa Exchange will probably be close to 35 cents per lb. for 1951/52, as compared with TOBACCO 32.1 cents in 1949/50, and with the average of 33 U.S. cents per lb. during the 5 years 1947-51. Current situation Prices in non-dollar countries were from 2 to 4 centshigher.Thesepricescompare withthe Production of manufactured tobacco increased average of 6.1 cents during the last five prewar in most countries during 1951/52 and the demand years.The rise is impressive even after current for leaf tobacco was strong as the industry made prices are deflated by the general United States efforts to increase stocks which generally, since wholesale price index (1926 100), the price be- the war, have been below the normal relation to ing about 20 U.S. cents per lb. for the postwar annual requirements(Table 49). years, as compared with the 1935-39 average of World leaf tobacco production in the 1951/52 7.5 cents.Unlike most commodities, cocoa prices crop year was approximately 100,000 tons(3 showed no decline after the collapse of the post- percent)above the1950;51level.Production Korean boom. in Asia and Latin America decreased but this Soine countries have established high export was more than offset by increases in North America duties on cocoa beans, and revenue from this and Africa. source has been used both for general administra- The tobacco area in the United States and Can- tive expenses and for special developm.ent projects. ada increased substantially as a result of larger The British West African territories, where the area quotas.There were some increases in area cocoa crops are marketed by official bodies, have in Asia and Africa but yields were lower. built up large reserves to stabilize prices if they World production of flue-cured Virginia cigarette decline. tobacco increased by 184,000 tons but the total production of other tobacco types decreased.The United States flue-cured crop increased by 15 per- Outlook cent and reached a record high level of 659,000 tons, 43 percent higher than the average of the There is no reason for anticipating a recurrence last ten years.Canadian flue-cured production during 1952/53 in all the major cocoa-producing was the largest on record. areas of the unfavorable weather conditions which Amongst other major cigarette tobacco types were largely responsible for the poor crops in the United States Burley crop reached a record 1951/52.However, long-term prospects for a sub- level of 24 percent above the 1950 figure.Produc- stantial increase in production are not promising. tion of orientalcigarette tobacco increasedin New plantings in Brazil, the Gold Coast, and Greece and Yugoslaviawhereas Turkey had a Nigeria will be barely sufficient to compensate slightly lower production.

105 TABLE 49. PRODTJCTION AND EXPORTS OP LEAS, TOBACCO, PREWAR AND 1949-51

PRODUCTION EXPORTS REGION 1934-38/39 1934-3S average 1949/50 195 0/5 1 1951/52 average 1949 1950 1951

thousand metric tons Asia and Oceania a 1 485 1 213 1 229 1 172 116 55 79 804 North America b 618 958 976 1 129 203 233 228 249 Earopec 335 441 455 462 129 150 Ill 104* Latin America . 209 312 304 281 58 73 72 784 Africa 70 130 130 150 31 63 75 69

WORLD TOTAL d 2 717 3 054 3 094 3 194 537 574 565 580*

* Unofficial estimate. a Excluding Turkey. 1, United States and Canada. c Including Turkey. d Excluding U.S.S.R.

Tobacco exports in 1951 reached 580,000 tons, imports to the United Kingdom increased only by only 15,000 tons above those in 1950.The United 22,000 tons, mainly a result of reduced shipments States exports of 236,000 tons were the highest from Indiaand Southern Rhodesia.Common- since the record of 1946 and about 20,000 tons wealth countries supplied 37 percent of the total above the previous year.Most remarkable was as against 48 percent in 1950.United Kingdom the 101,000 tons export to the -United Kingdom, imports in thefirstquarterof 1952 continued 66 percent over 1950, although the value of ECA very high, withheavyimportsofflue-cured paid shipments to the United Kingdom was less tobacco from the United States and Callada. than one-third of the previous year.United States Imports of other leaf types were practically un- exports to Western Germany were only 22,000 changed and Commonwealth supplies accounted tons, a decline of 40 percent from 1950 although for only 50 percent as against 70 percent in the ECA paid shipments to that country were at least same quarter of 1951.The announced cut in dol- two-thirds of the previous year. lar spendings on tobacco imports in 1952 have not Total ECA paid shipments from the United affected imports in the first quarter of the year. States in 1951 amounted to $72.6 million against Western Germany's imports in 1951 were almost 8149.8 million in 1950 and 8153.4 million in 1949, unchanged from 1950 in spite of the decrease in so that the expanded exports in 1951 have been supplies from the United States, but France and mainly based on the regular dollar earnings of Belgium had increases of about 50 percent over the importing countries. 1950.The United States also increased her im- Exports from Brazil, Cuba and India were at ports of oriental cigarette tobacco for blending. the same level as the previous year.Southern Stocks of unmanufactured tobacco in the United Rhodesian exports in 1951 fell 25 percent below Kingdom increased in the latter part of 1951 and those of 1950 because of the smaller crop. reached the highest level since 1938. Exports of oriental tobacco from Turkey and In the United States as of April 1952 there Greece increased in 1951 but Greek exports were were substantial increases in the holdings of flue- still only two-thirds of prewar whereas Turkey's cured, Burley and Maryland tobacco, slight in- have doubled. creases in stocks of Turkish tobacco and slightly Leaf tobacco imports into Europe (excluding East- lower stocksoffire-cured and dark air-cured ern Europe) in 1951 increased to 410,000 tons tobacco.Stocks of flue-cured and Burley tobacco 11 percent above 1950 but only 5 percent higher were substantially higher than prewar in absolute than the prewar level.This region accounted for quantities but only slightly higher in relation to approximately 70 percent of world imports.Total the increased requirement.

106 By the end of April 1952, Greece still had a United Kingdom and a lower consumption.The 22,000 ton carry-over of tobacco from the 1950 Marketing Board of Ontario has set this year's and earlier crops.This is the equivalent of more area at two-thirds of the base area or 35,400 ha. than two-thirds of 1951 exports and 70 percent against 43,000 ha. in 1951.Area allotments for of the 1951 crop was still in the hands of produc- Burley and cigar tobacco have been cut. ers.The stocks held by the Turkish Monopoly The 1952 plantings in most other countries are are not known, but they are no longer assumed not yet known but the strong demand for tobacco to exceed requirements for domestic use. payable in soft currency islikely to stimulate Tobacco prices in 1951 were slightly lower on further expansion in area. an average than in 1950 but there was no uniform The United Kingdom has announced a £22 mil- trend.Prices paidtofarmersinthe United lion cut in 1952 imports from the United States States for the 1951 flue-cured crop averaged about and Callada, a 30-40 percent reduction compared 52.4 cents per pound against 54.7 for the 1950 with1951.HowevertheUnitedStateshas crop.This declineispartly explained by the granted some credit facilities through the Com- larger proportion of lower-priced grades in 1951. modity Credit Corporation to finance asizable Burley prices increased from 48.9 cents to 51.0 amount of flue-cured tobacco held under option cents per pound.Average prices of dark air-cured for United Kingdom manufacturers.Itisnot and fire-cured tobacco increased substantially but yet clear to what extent the financing of tobacco mainly because of an improvement inquality exports will be included in the Mutual Security compared with the previous year.Average prices Administration's activities, but it has been in- of flue-cured as well as of Burley tobacco exceed- dicated that tobacco may be included because ed the support prices. of itsvital importance to the fiscalpolicyof The average price received for the Southern Rho- European countries.Itisprobable,however, desian flue-cured crop sold during 1951 WaS 34.6d. that any support given after June 1952 will be per lb., 3.1d. per lb. less than for the 1950 crop. more limited than under the ECA program. The 1951 crop, however, contained a higher proportion of low-grade leaf for which there was only a limited demand. COTTON The average value per lb. of United Kingdom hnports of unstripped leaf consisting mainly of better grades increased to 56.1d. in 1951 as compar- Current situation ed with 52.2d. and 41.6d. per lb. in 1950 and 1949 respectively.The average value of imports Total cotton production for the season,esti- to the United Kingdom of flue-cured tobaccos mated at34.5millionbales,isthe largest in from all countries rose, but those of Nyasaland postwar years and the second largest on record. dark fire-cured and Greek Oriental leaf showed The very high prices prevailing at planting time a further decline. were a greatincentivetoacreage expansion. Although a ceiling was provided by the official maximum price in the United States, prices receiv- Outlook ed by farmers in April 1951 at time of planting averaged 50 percent higher than in April 1950 Total supplies of leaf tobacco in 1952/53 are and were 28 percent above theparit3rprice. likely to increase further and supplies in the hard Acreage restrictions being lifted, area planted in- currency countries may exceed demand. creased by 50 percent to 28 million acres.The The area allotments for flue-cured and Bur- yield improved slightly and production increased ley in the United States are practically the same by rather more than half to over 15 million bales. as last season.If yields are approximately the In other countries, the area planted to cotton same asthe averageforrecent years, United has generally increased gradually during the post- States production in 1952/53 will be close to last war period ;the need to maintain and increase year's.Price supports forthese types are being food crops has limited the expansion in many continued in 1952/53 and the support levelis countries.Nevertheless, with uncontrolled prices only slightly lower than last season. for non-United States cottons relatively high, the Canadian producers have however undertaken incentiveto plant tended tobe even greater a drastic reduction in the area under flue-cured outside the United States.It is not surprising, tobacco,anticipatingreducedexportstothe therefore, that the scale of expansion last season

107 in many countries was greater than in any preced- percent and mill margins by a half.Meantime, ing postwar season.Increases in the cotton area mill activity continued to contract, the rate of were specially marked in theNear Eastcoun- cotton consumption in March 1952 being about tries,e.g. Syria (130 percent), Turkey (43 per- 20 percent lower than a year earlier.Over the cent).Mexico increaseditscotton area by 28 whole season, consumption may be 12 to 15 per- percent and Argentina by 20 percent.Food_ pro- cent lower, which represents a significant drop duction policies prevented any expansion in Egypt, since the United States accounts for about one- but were less restrictive in India, where the cotton third of the global consumption. area increased 10 percent. Other major cotton manufacturing industries, Despite efforts to expand production, farmers in (excluding U.S.S.R. and China) have also suffered many countries were not fully rewarded.Yields the recession.It is not clear whether the reces- generally were affected by the extension of produc- sion will have any great effect in India where the tion into marginal lands and by the employment industry operates under relatively low controlled of unskilled labor.In the Year East, there was domestic cotton and cotton textileprices and very heavy insect damage.Drought adversely enjoys an advantageous competitive position in affected yields in Mexico, and weather was unfa- export markets.In Japan, as in India, recession vorable in Egypt, the Sudan and Pakistan.Only came rather late in the season.A large unsatis- in India was there an increase in production nearly fied domestic market for textiles (rationing was commensurate with the expansioninacreage. only abolished in Japan in 1951) and, in Japan, As a result, production increased only 2 percent substantialmilitaryorders,offsetthefallin outside the United States apart from the Soviet exports.From March, Japanese output of cotton Union and China,where strenuouseffortsare textiles became subject to an officially enforced reported to have resulted in an increase of 20 reduction to 40 percent below capacity level.In percent in cotton production. view of substantial earlier expansion, however, the The contraction in1951/52 in textile opera- volume for the entire season may not show any tions and in cotton consumption folloivs a period reduction. of unprecedented activity caused by the Korean European textile industries were affected by conflict and by fears of scarcity.Cotton and the recession later than the United States, but cotton textile prices liad been carried to extra- before the industries of the Far East.The im- ordinary heights and there was an accumulation of pact ivas particularly severe in those dependent textile and apparel stocks at all levels from man- upon textile export markets.Curtailment com- ufacturerto consumer.With the trend towards menced at the turn of the year in the United more stringent monetary conditions and the pros- Kingdom andthe Low Countries.By mid- pect of increasingfibersupplies, trailers during 1952,it had spread to practicallyall Western the past year have tried to niove excessive textile Europe.In the United Kingdom, the decline in stocks.Moreover; since the denfand on military output was as steep as 40 percent, and elsewhere account has proved to be smaller than expected, production fell in varying proportions up to 20 acute competition has developed and textile prices percent, as compared with a year earlier.Euro- have been falling steadily in the face of a pattern pean consumption of cotton in 1951/52 will there- of civilian consumer expenditure which has before be considerably less than in the preceding come unfavorable to apparel and textiles.Traders season. reduced theirorders ontextile manufacturing The declineincotton prices from the high industries and the latter reduced their commit- level reached during 1950/51 began in April 1951 ments for cotton,the decline in cotton prices ivith better supply prospects.Since prices and inducing caution. exports of American cotton had been subject A feature of the recession has been that cotton to a maximum, the shortage had much more textile industries operating under quite different effect on the prices of other growths..Neverthe- conditions have been affected.In the United less, with the prospect of a very large crop in the States, although cotton prices werestillrising, United States, prices there fell sharply to only a mill margins for cotton textiles began falling as few cents above the support level.Following a early as the beginning of last year.By April temporary recovery, the trend has been generally 1951, cloth prices were under pressure.The re- downward.The decline of prices of non-United cession was continuous throughout the follow- States cottons was much more marked.Short- ing twelve months, textile prices falling by 30 age and United States export restrictions had

108 CHART XXI - COTTON PRICES AT VARIOUS MARKETS POSTWAR

U.S. CENTSFEB. LB. SEASONAL AVERAGES MONTHLY AVERAGES 1i0

1 1 1 1 1 1 1 1 1 ALEXANDRIAKARNAKGOOD

100

90 ALEXANDRIA ASHMOUNIGOOD A1 BO \ i\

1 \ ..---1 70 ..._\... ."t

S'AO PAULO TYPES Fi, s. k 60 ; \--\ 1 1 \; ' i/\\ /--\.N.\\ I i/ t.--4.N. 1 \ 1 */ \_,__ 50 \v. 1 ..1 / 1 // \ /\\ L. A, / : i 1 . \ \ 1 \,../ P./ :::..-.1------/1 \ ''s,: / i.,, ---7 ---- -..\- --..., 40 ,../- ';'\ Ii i 1 % \ -- s ...,/ N.. e se."-I -...... ------'-itr-C7:4 KARACHI289 .. - PUNJAB 30 ---,e. . %...... TORREONMIDDLING15/16.:.5--f ...... ; ...... ',.. 1 I - ..... - U.S.A.10SPOTMARKETSMDDLING15/16

I I 1 20

BOMBAY JARILLA FINE

0 1946Ill1947 1948 1949 ASONDJ FMAMJ JASONDJFMAM -47-48-49-50 1950-51 1951-52 forced them to extraordinary- heights, and heavy Outlook export taxes had been in force. With an ample Even assuming that the textile recession has no United States supply, at relatively, low prices, the deep-seated economic cause, there is little to indi- demand for non-United States growths subsided cate what the timing and scope of recovery, will and prices were reduced.As a result,Brazil, be.Available information suggests a further eas- Egypt, Pakistan and some other countries have ing of the overall cotton supply situation, produc- been undertaking price support operations.As tion continuing in excess of consumption and both the season progressed, however, there was a move possibly subsiding somewhat. to sell cotton below earlier support levels and to Supply andconsumption inthelastthree reduce export taxes, in order to stem the accumu- seasons, as recorded by the International Cotton lation of cotton stocks (Chart XXI). Advisory Committee, are as shown in Table 50.

109 TABLE 50. COTTON :SUPPLY AND CONSUMPTION tion chain. A larger movement of textiles into consumers' hands is,of course,also dependent ITEMS 1949/50 1950/51 1951/52 on increased real incomes, particularly in areas where clothing standards are relatively low. ( boles of 478lb.set..) As far as the textile industry is concerned, manu- Opening stocks . 15.1 16.7 11.2 facturers will feel more inclined to accelerate their Production 31.2 27.8 34.5 operations when cotton prices show more signs of stability.The level at which this is achieved TOTAL SUPPLY 46.3 44.5 45.7 will, of course, also effect to some extent manufac- 00/1Sumption 29.6 33.3 32.5 turers'choice between cotton and rayon.In CLOSING STOCKS. 16.7 11.2 13.2 majortextilemanufacturingcountries,rayon continues to be the cheaper, and displacement oil a greater scale than in the earlier postwar years Thus, the 1952/53 season may open with a carry- is now possible as a result of the great expansion over of 13.2 million bales.Given a repetition of in rayon production capacity. Consequently, un- the 1951/52 volume of production, total supply less the price relationship changes, cotton is not in 1952/53 would be about 48 million bales likely to enjoy the full fruits of recovery in textile a record postwar supply.It appears however that industries. production is unlikely to be as large as in 1951/52. Rayon is now the second most important appar- Priceisless favorable tocotton planting.In el fiber, accountingfor 17 percent of total con- some countries crops less susceptible to the pests sumption in 1951 as compared with 11 percent in affectingcotton may be grown.With govern- 1939.Until the Korean outbreak, which injected ments committed to supporting prices at near cur- large-scale military requirements, much more im- rent levels, plantings may be restricted to smaller portant in cotton than in rayon, into the demand areas. situation, cotton consumption was still 4 percent Much depends on the United States crop which below the prewar volume whereas that of rayon accounts for from 40 to 50 percent of the world was 20 percent above it.The recession in demand, total.Acreage controls are not in force and the being largely civilian, will tend to have a greater official view is that a crop of up to 16 million bales impact on rayon (Table 51). ispossible.However,thefirstofficialreport indicates that the area planted is 7 percent smal- TABLE 51. INDICES OF COTTON CONSUMPTION ler than last season.On the other hand, acreage A.ND RAYON PRODUCTION abandonment was unusually heavy last season and yields were no higher than the postwar aver- YE AR Cotton Rayon age.Given normal weather conditions the 19521 53 crop may be 15 million bales. Elsewhere, reduced cotton areas have been 1938/39 100 100 reported from the Middle East and Mexico. Al- 1948/49 92 though the area in Egypt may show little change, 1949/50 96 120 yields llave been falling steadily for the last few years.In India and Pakistan little expansion is 1950/51 108 150 to be expected because of food production priority 1951/52 105 177 and technical reasons, but yields may improve. In Africa, immediate prospects for expansion are a Calendar year. limited.On the whole, last year's production outside the United States may well be taken as a WOOL maximum for the 1952/53 season, especially because of the recent exceptional harvests in the Current situation Soviet Union and China. Consumption recovery awaits a trade revival The gradual increase in world wool production in textile industries. Greater scope for a fall in over the last few seasons virtually came to a halt textile prices is provided as the replacement value in 1951/52.Drought caused some decline in the of raw materials declines.As tisis takes place, Australian clip, and adverse pastoral conditions it should quicken the disposal of excessive tex- prevented any further significant recovery in the tile stocks in the earlier stages of the produc- Cape clip.Argentine production declined slightly.

110 There has been some increasein sheep num- rent needs and reserves), particularly in the Unit- bers in the socialized sector of the economy in the ed States where apparel wool consumption was Soviet -Union, but it is not known to what extent reduced much less than in Western Europe.It this has been at the expense of the private sec- is estimated that military orders accounted for tor.In the other main wool-producing countries as much as 45 percent of -United States apparel New Zealand, the -United States, Uruguay wool consumption in1951.Among the major production remained virtually unchanged. wool-consuming countries, the only one remaining On a clean basis, the 1951/52 clip is estimated unaffected by the general downward trend was at1,040,000metrictons.JointOrganization Japan.Japanese consumption not only contin- stock wool was not a factor in the supply situa- ued to increase, but was as much as 60 percent tion as it had been in earlier postwar seasons, greaterin1951thaninthepreviousyear the United Kingdom-Dominion wartime accumu- (Table 52). lation having been practically all disposed of by mid-1951.Therewere,however,considerable TABLE 52. WoRLD CoNsuMpTioN OF WOOL commercial stocks in producing countries ; in particular, about one-third of the previous season's NOW Zealand clip, which had remained unsold COUNTRY 1943 1949 1950 1051 on account of the waterfront strike in the autumn of 1951.There was also a substantial accumula- (.thou and m. t., clean basis . .) tion of wool in Argentina which hasnot yet United States 320 232 289 222 United Kingdom. . 219 223 235 180 come on to the market. U.SS . R 75 90 90 100 Both the woollen and worsted branches shared France 116 119 115 90 Germany(FederalRepub- fully in the recession which overtook the entire lic) 21 41 58 53 textile industry in the 1951/52 season.Although Italy 62 54 57 44 the relatively high demand for wool textiles since Japan 5 7 23 36 Belgium 28 27 33 25 the war wa's unlikely to continue, the downward Other countries . . 304 307 304 276 adjustment was accentuated by the results of the Korean conflict.When the immediate buy- TOTAL 1 1501 1001 2101 020 ing movement which followed the outbreak of the Korean war ended, consumers and distribution channels were exceptionally well stocked from After the third quarter of 1951, the decline in purchases on a rising market.The effects of this worked their way back to the mills, leading to a wool consumption was at least halted, but there precipitous decline in both home and export de- isas yet no real evidence of general recovery. Over the 1951/52 season, consumption has been mand formillproducts.Thesituationwas further aggravated by the decline in raw mater- about 25 percent below the level of the previous ial values which occurred in the spring of 1951 season, and for the first time since the war, less than current production. and which made consumers and traders even more hesitant to buy. Trade in wool also diminished by about 25 percent in the 1951/52 season.Exports from Aus- The decline in mill operations was accompanied tralia have been running at a lower rate than in by a proportionately greater reduction in wool the previous season.On the other hand, New consumption in1951.The exceptionallyhigh Zealand exports have been substantially higher price of wool in the 1950/51 season had caused a since they included shipments from a carry-over significant increase in the use of materials other enlarged by last season's waterfront strike.But than virgin wool in the manufacture of wool the most striking development has been the dras- textiles.It was not until the second half of 1951, ticdeclinein South American exportswhich, when wool had become much cheaper, that the in the first half of the season, were only one tenth trend towards a greater use of other materials was of the volume usually exported.Prices of South halted. American wool have been high in relation to those Wool consumption fell by 16 percent in 1951 to prevailingintheworldmarket.Government 1,020,000 metric tons, clean basis the lowest licensing policy and fears of devaluation have in- level since the war.The decline would have been terfered with shipment.It was not until May even more severe but for the large volume of that the South American markets began to show orders for military requirements (both for cur- some signs of animation (Table 53). TABLE 53. EXPORTS OF WOOL FROM CHIEF EXPORT- of the industry and in view of the lack of confi- II,TG COUNTRIES dence in values.Trade stocks in consuming countries had generally been run rather low towards July - December COUNTRY the end of the season. 1950 1951 After a very irregular market early in the sea- (thousand int. actualweight) son, prices again moved downwards at the beginning of 1952.The need to cover requirements Australia 216 167 New Zea land 42 83 led to some price recovery as the season was draw- South Afr lea 48 41 ing to its close.Average prices appear to have Argentina 46 4 been not much more than half the exceptionally 50 Uruguay high values of the 1950/51 season.At the end TOTAL 402 301 of the season they were below the level existing before the Korean conflict.The differential between qualities widened as prices declined, but Imports intoall major importingcountries, towards the end of the season the pie-Korean with the exception of Japan, have been reduced relationshipbetween Dominionwoolqualities both in accordance with the lower requirements vas re-established (Chart XXII).

CHART XXII - WOOL PRICES AT DOMINION AND UNITED KINGDOM AUCTIONS POSTWAR

PENCE PER POUND OF CLEAN WOOL 320 300 280 260 240 220 200 180 160 140 120 100 80 60 40 20 o SONDJFMAMJJASONDJFMAM 464 47/48 48/4949/50 1950/51 1951/52

112 The 1951/52 season saw the final liquidation of present recession in wool-manufacturing indus- theJoint Organization stockpile.Intergovern- tries will be short-lived. The public has generally mental negotiations for an Inter-Commonwealth held off buying for about a year and traders hold- Organization to continue operating the reserve ing high-priced textile stocks have been reluc- price scheme, which had been a feature of the tant to order ahead.With the current lower wool J.O.disposalsplan,had been proceedingfor values and textile prices the prospects of a re- some time, but the joint plan was abandoned, vival of buying by consumers and traders are now after having been rejected by the Australian decidedly more favorable.The prospects for the wool growers in a referenchun in August 1951. industry and the wool market depend basically South Africa decided that it would not be prac- on how soon this will be realized and in what tical to operate a reserve price scheme without measure particularly as the government sec- the participation of Australia ;but New Zealand tor of the market promises to be less important introduced a scheme of its own covering New Zea- than in the last twelve months. land wool (except slipes) sold at auction in the While stocks both of textiles and raw wool in Dorninion or the United Kingdom.The scheme consuming countries are being progressively re- came into effect in January 1952 at an average duced, any substantial resumption in buying may reserve price of 24d per lb., greasy, ex-store New well cause a temporary pressure in some sectors Zealand.The New Zealand Wool Commission of the market.Though raw wool stocks are supported the market during the second half of generally low in consuming countries, there are the season by buying small quantities of wool in substantial stocks of crossbreds in South Amer- New Zealand and London, which failed to reach ica, notably Argentina,which a rise in world the Commission's reserve price. prices would be likely to bring on to the market. Meantime the United States 1952/53 price support program on the basis of an average p1-ice JUTE of 54.2 cents per lb. greasy basis became operative in February 1952. Support prices especially for Current situation finer wools proved to be high in relation to p1-ices prevailing in world markets in subsequent months. A sudden transition from severe shortageof Consequently United States demand was attract- jute to relative plenty- occurred in the 1951/52 ed to overseas sources while United States supply season. Throughout the postwar era, jute and jute was entered to some extent in the Government products have been in short supply, particularly loan. in the first half of 1951 when prices were 12 or Government programs, therefore, in the United 15 times above prewar level. With the advent of States and New Zealand and in the United King- much larger crops in 1951/52, prices fell and except dom, where the acquisition of a stockpile of 22,000 for the best qualities of white jute and good tossa tons was in progress, strengthened the wool mar- supplies became plentiful.Demand for jute goods, ket, especially in the later part of the 1951/52 however, fell towards the middle of the season, season. and imports of raw jute were reduced.On the basis of Indian consumption and overseas exports from Pakistan, total absorption of raw jute will Outlook exceed production in 1951/52 by 15 percent.This Estimates of the coming clip are not yet avail- will be the first increase since the end of the war. able, but after the unfavorable weather conditions Moreover, stocks of jute goods have accumulated of 1951/52 in Australia and South Africa, there in the Calcutta mills (Table 54). seems little prospect of an3r significant increase in Both Pakistan and India expanded their jute production.It generally takes a season or two acreage by 35-40 percent in 1951/52,resulting after a drought before wool production begins to in a crop of over 10 million bales. This was the recover.Efforts to increase production may very first time since 1940 that production exceeded well continue, however, in view of the lesser in- the prewar level. Yields in Pakistan were about centives provided by alternative products.The average.In India yields, although slightly higher level of production is still somewhat above the than last year, are still markedly lower than in prevailing rate of consumption. earlier postwar years.This is probably largely due With real incomes in the main wool-consuming to the extension of acreage outside West Bengal countries and in wool textile export markets re- into areas less suited to,or less experienced in, maining high, there is reason to believe that the jute cultivation.

113 TABLE 54. RAW JUTE : PRODUCTION AND DISTRI- appears to have been comparatively short-lived, but BUTION a lower level of demand persisted for non-weaving 1934/ yarns, largely due to the reduced operations of 35- 1938/ 1919/ 1950/ 1951/ carpet weavers.Similar conditions prevailed in PrEms 39 50 51 52 aver- the United States where yarn production is almost age entirely for purposes other than weaving.

( thousandmetric tons . .) Because of the largedomestic crop and the Production state of demand for their finished products, the 808 Calcutta mills have not been taking up their full Pakistan 860 605 I 148 India 560 597 819 quota (2 5 million bales for the season) of Pakistan

TOTAL 1 8601 1651 405 1 997 jute.Shipments from Pakistan overseas, which in 1950/51 regained the prewar level of exports Exports from undivided India, have also been smaller in From Pakistan 1951/52. to India 305 460 400* With falling exports, prices in Pakistan receded Overseas 760 317 773 650* sharply in the early months of 1952. In March, the From India 109 Pakistan Government announced for the interior TOTAL OVERSEAS . 760 426 773 650* a new schedule of minimum prices for loose jute, while the Jute Board expressed its willingness to Consumption buy jute at the minimum prices.In the Calcutta India 178 905 966 950 market, prices showed signs of falling further.At the end of June 1952, the Pakistan minimum price Estimated. was reduced by about 26 percent.

With more raw jute, mills in Calcutta extended their operations in December 1951.Hessian was Outlook then relatively unprofitable and 121/2 percent of the Hessian looms remained sealed.This was The Pakistan Government has increased the attributable mainly to a continued fall in the Unit- licensed area by 10 percent.Last season, 97 per- ed States demand, by far the largest market.The cent of the licensed area was planted, but this fall was particularly marked in 1951 when a high season's jute prices at planting time were far less rate of export duty was in force.The extension favorable as compared with rice prices and plant- of operations by the Calcutta mills was short-lived, ings are reported to have been no higher than as larger output of sacking was not absorbed, and in the previous season.In India, the area plan- at the end of March they reverted to the421/2 ted is expected to be rather less than in 1951/52. hour week. There is a feeling in Indian Government circles To encourage exports, the Indian Government that jute cultivation should encroach no further on halved the export duty on Hessian in February foodproduction, and increased outputshould and subsequently abolished quotas on exports of come through higher yields. gunnies to soft currency markets.Even after the Given favorable weather,productionshould cut in the export duty, the Calcutta industry was again be adequate to naeet the requirements of jute being undersold by European mills which increas- industries, and a recurrence of the very high ed their exports significantly to the United King- prices of previous years seems unlikely.Such dom, the United States, and other markets.In prices had greatly encouraged the displacement the United Kingdom, where notable improve- of jute, at both the raw material and manufac- ments have taken place in the productivity of tured goods stages. Illustrative of this is the in- the Dundee industry and where the more ample creasing use of paper as a packing material in supply of raw jute has made possible the abandon- the United States. ment of rationing, domestically produced goods The quantity of material used in the manufacture llave made headway against Indian. Consequently, of bags increased 62 percent between 1939 and there was a further reduction in Indian export 1950, but whereas paper expanded fourfold the duty on both Hessian and sacking in May 1952. usage of jute burlap declined 17 percent.A similar The general recession in demand also affected development, if to a less marked degree, has been the jute industry in other centers, notably Dundee. taking place in other countries.Meanwhile, the In the weaving section, the decline in activity production of substitute fibers, although still quite

114 limited, is being expanded in the Belgian Congo, production in Malaya, the fallin rubber prices, French Equatorial Africa and elsewhere. coinciding with advancing costs of production and As regards jute manufactures, the market for of living, was unfavorable to production.The these is becoming more competitive.The Calcutta only significant advance in output was in Indonesia, industry is still predominant, but a good deal of chiefly in smallholdings and in the earlier part re-equipment has taken place in European mills. of the year when prices were relatively favorable. Ten jute mills are being set up in Pakistan with Indonesian output was 16 percent larger than in an aggregate of 6,000 to 7,000 looms.These are 1950, offsetting the decline in Malaya and elsewhere. to have a capacity for processing about one million World consumption of natural rubber declined bales of jute a year.In the 1951/52 season the by 12 percent in 1951, the drop being accounted first Pakistan jute mill came intooperation and for by the United States where restrictions were the first exports of hessian were made to the in force with a view to accu/nulating strategic United States. The effect of the Pakistan indus- stocks. Consumption elsewhere increased by about trialization program will not be seriously felt for 5 percent and there was strategic stockpiling in another three years, but since manufacturing ca- countries other than the United States. pacity is already much in excess of the highest Production of synthetic rubber increased con- levels of output that have ever been reached, it tinuously throughouttheyear in the United will ultimately have a considerable effect upon the States, as did consumption, while consumption of jute industry in other countries. natural rubber fell.Despite restriction, consump- Since raw jute is a large element in the cost of tion of both kinds of rubber in the United States the goods produced, Pakistan and India with their declined only slightly in 1951, but the natural rub- ample supply of domestic raw material are in an ber proportion dropped from 57 to 37 percent. advantageous position.Moreover, the export tax Natural rubber prices, which had receded almost in Pakistan in effect provides a subsidy to the local continuously in 1951, declined more steeply in the industry.If carried too far,itwill serveto early months of 1952 with_ the fall in the United intensify the search forsubstitutefibersand States stockpile purchases and the continued re- alternative packing materials. strictions on imports and consumption.By the middle of the year, however, private importation RUBBER was fully restored, the New York market was about to re-open and the ceiling on United States Current situation rubber consumption had been removed.Natural rubber prices were then more stable at the pre- Production of natural rubber in 1951 showed Korean war level of about 28 U.S. cents per lb. a trend similar to that of prices. During the first which is 5 cents above the United States Govern- four months output exceeded the volume produced ment fixed price for GR-S synthetic rubber. in the corresponding period of 1950.After April output declined until the end of the year.Thus, Outlook whereas world output in the year ending April 1951 was about one-third larger than in the preceding The world and United States supply/demand twelve months, that for the year 1951 showed no situation in 1952, as forecast by the International advance on 1950. While insurrection interfered with Rubber Study Group, is shown in Table 55.

TABLE 55. RUBBER : PRODUCTION AND CONSUMPTION UNITED STATES AND WORLD TOTAL

PRODUCTION CONSUMPTION YEAR AND ARE Natural Synthetic Total Natural Synthetic Total

thousand 'metric tons 1951 United States 859 859 462 771 1 233 World 1 910 923 2 833 1 524 828 2 352

1952 United State 838 838 472 803 1 275 World 1 717 925 2 642 1 473 889 2 362

115 A drop of some 200,000 tons(11percent) is FOREST PRODUCTS: (a) ROUND WOOD expected in natural rubber production, chiefly on smallholdings in Malaya, Indonesia and Thailand, Current situation as a result of the discouraging price trend and The 1951 world production (excluding U.S.S.R.) conditions affecting yields.As regards synthetic rubber, little change inthe volume of output of all categories of roundwood, both coniferous and -broadleaved,istentativelyestimatedat is foreseen.In this connection it may be noted that the United States Reconstruction Finance slightly over 1,080 million m3,asagainst some Corporation has been directed to produce GR-S 1,020 million in 1950.While production of saw- rubber at an annual rate of no less than 600,000 logs declined from about 365 million m3 in 1950 tons until, in addition to satisfying all other re- to some 360 million, the decrease in the United quirements, a Government stock of at least 75,000 States not being offset by increases in other re- tons has been accumulated.When this point is gions, the expansion in the production of pulp- reached, production of GR-S may be allowed to wood was particularly pronounced in all regions. fall, but to no less than 450,000 tons annually, The heavy demand for pulpwood and other and only with a corresponding increase of GR-S roundwood in 1951 resulted, notably in Europe, stocks up to at least 122,000 tons.Limited ex- in an unprecedented rise in price of 100 percent ports of synthetic rubber from the -United States or more.This was mainly due to the conditions are now taking place. prevailing in Europe, where the locations of pulp World consumption is expected to be about the mills and other consumers of roundwoocl, such as same in total in 1952, although smaller shipments coal mines, are not always the same as those of to China will reduce consumption of natural rubber. roundwood supplies, and industries therefore in The removal of restrictions on the use of rubber many countries have to rely permanently on im- in the United States was not expected to have ported raw materials.Consequently, the com- any appreciable effect on the relatively low level petition between the users of different categories of natural rubber consumption there, in view of of rounclwood, such as pulpwood, pitprops, and the price advantage which synthetic rubber en- sawlogs, has a much greater importance in Europe joyed early in 1952 and which had been increased than in most other regions, where the supplies with the advent of oil-extended rubber. However, are more evenly distributed, or not even utilized the sharp fall in natural rubber prices has nar- to their full extent (Table 56). rowed the margin, while the extent to which competition between the two products can take place TABLE 56. IMPORTS OP FOREST PRODUCTS is limited by a requirement which supports the 1950 AND 1951 above-mentioned production directive, that at least Sawn softwood Pulpwood Pi tprops }legion 510,000 tons of synthetic rubber (450,000 GR-S 1950 1951 1950 1951 1950 1951 and 60,000 butyl) must be consumed. The estimated excess of production over Con- in 1,000 stds in thousand m3r sumption in 1952 at 275,000 tons is considerably By smaller than in the previous year.For natural Europe . . 2 300 3 0002 9265 4771 2 4342 623 rubber, it is 240,000 tons as against 380,000 tons. On the other hand, the United States stockpiilng o f which program is nearing completion and purchasinig U K 8001 640 is on a decreasing scale.(Lower grade rubber is gradually being rotated out of the stockpile). More- U.S.A. . . . 1 5971 1423 6146 401 over, the prevailing price trend is unfavorable Australia. . 134 208 to commercial imports and the holding of stocks in importing countries. Prices in Canada and the United States through- In view of the uncertainties in the rubber si out 1951 showed only minor fluctuations.In tuation, the International Rubber Study Group North America the decline in the consumption of resolved to establish a Working Party to con- sawn softwood arising from the reductionin sider whether measures designed to prevent bur- building activity also reduced the demand for densome surpluses or serious shortages of rubber are necessary and practicable ;to prepare drafts softwood sawlogs and made it easier to meet in- of any agreements required to implement such creased requirements of pulpwood.This absence measures ;and to report back to the Study Group of competition between differentcategoriesof as soon as possible. softwood in North America, together with the

116 establishing of price ceilings for sawn wood in replenishing.In the United States where restric- the United States, were the main factors contrib- tions on financing housing have been greatly uting to stable prices. eased, construction expanded in the second quar- Towards the end of 1951 a pronounced fall in ter to above the level of a year earlier and recent- demand occurred.This was partly the result of ly starts of new houses have increased.Simi- accumulated stocks and reduced consumption of larly in Europe (excluding Eastern Europe) itis some forest products and, in Europe, partly the anticipatedthatthe demand willstrengthen result of the buyers' increased resistance to high with the increase in building activity and mili- forest products' prices.The falling demand for tary construction.As the production of forest finished products had also an immediate down- products, however, lags behind changes in demand, ward bearing on the output of roundwood, par- the possibility of a new rush for existing supplies ticularly of sa.wlogs, in the main exporting coun- is not to be excluded. tries(Chart XXIII). Output of broadleaved roundwood in 1951 was 4 per cent higher than the previous year, due to (b) SAWN WOOD some substitution of broadleaved sawn wood for saNvn softwood because of excessive prices for Current situation the latter, and to increased purchases of tropical The world production of sawn wood (excluding broad leaved woods by the British Commonwealth the U.S.S.R.) was estimated at some 175 million sterling countries at the beginning of 1951.The cubic metres, about the same as in 1950.Pro- efforts to promote the utilization of forest resour- duction of sawn hardwood rose by 4 percent to ces in the underdeveloped areasforboth saw- 39.1 million m3 (s) while softwood production fell mills and pulping also contributed to this increase. about one percent to139 million m3 (s)(29.7 Towards the end of 1951, with the balance of million standards).The decline in sawn softwood payments position of the Commonwealth countries production was due to marked reduction in the deteriorating,substantialcuts were planned for United States output, which was not fully offset 1952 imports.This consequently led to a decline by increases in other regions (Table 57). in the output of broadleaved roundwood during the first half of 1952. TABLE 57. PRODITCTION OF SA)ArN WOOD 1950 AND 1951

Outlook Sawn softwood Sawn hardwood REciox While output in1951showecl record figures 1950 1951b 1950 1951b in most regions for many categories of roundwood, in thousand stds in thousand the outlook for 1952/53 is less promising.The .North America 18 945 18 279 18 833 19 583 weakening of the market for wood pulp and pulp Europe a 8 388 8 6118 299 8 678 products which was already strongly felt towards South America. 520 5501 2001 300 the end of the first half of 1952, is likely to reduce Africa . 20 20 650 700 Asia 8201 900 3 800 3 900 temporarily the volume of new pulpwood sup- Oceania 290 3001 9001 900 plies, particularly as industries prefer in a falling market to dispose of their existing stocks before TOTAL 29 983 29 660 34 682 36 061 replenishing them.The high level of sawn wood a Excluding U.S.S.R. stocks in most countries at the beginning of 1952 Estimates. and a somewhat reduced consumption considerably decreased the requirements for 1952.Pro- There was a pronounced upward trend in trade duction of sawlogs in the main exporting coun- of sawn woods all over the world.The main tries has already declined and sawn wood availa- factor in this development was the great increase bilitiesfor1953willdeclinecorrespondingly. of sawn wood purchased by the United Kingdom If the present reduced demand for finished prod- and other Commonwealth countries, notably Aus- ucts continues towards the end of 1952 and pro- tralia, which practically doublei the imports of duction is adjusted to the existing requirements, sawn wood from allsources of supply(Table there is a likelihood of a price rise in 1953.Most 56).In the United Kingdom, imports rose to of the consuming countries will by that time have 800,000 standards (3.7 million m3) in 1950, and met their requirements by having drawn largely to 1.640,000 standards (7.7million m3) in1951. upon their stocks which consequently will need These increased purchases by the United King-

117 dom contributed to an extraordinaryincrease not fully compensated by increased requirements in the export prices of sawn softwood in all mar- for military purposes and industrial packaging, kets. This rise in prices, particularly for Northern and stocks of sawnwood in practically all coun- European softwood, which during 1951 amounted tries were therefore higher at the end than at the to 50 percent, was however met by a growing beginning of 1951 (Table 58). buyers'resistance andledtowardstheend of 1951 to a slackening of demand in most con- Outlook suming countries.In the United States and Can- The world sawn wood trade is likely to show ada, however, prices remained stable throughout some decline in 1952, 1-vith consumption in general 1951, as ceiling prices were fixed for sawnwood in drawing largely upon the existing stocks. However, the United States and Canadian prices are more by the end of 1952 the situation will probably influenced by price conditions in the United States be completely reversed, and new supplies will be than elsewhere.In addition to this general re- needed in most countries, both to satisfy the sistanceto high prices,the United Kingdom current demand, and to replenish stocks.As al- because of its balance-of-payments difficulties an- ready pointed out, the production of forest pronounced cuts in its 1952 imports.As a result, ducts does not follow easily the changes in de- the main exporting countries, particularly those mandandtherefore, ifthepresentweak in Northern Europe, reduced their production demand and standstill on the sawn wood market schedules for 1952.During the first two quar- continues until the last months of1952,there ters of 1952, the sawn wood market was unusally may be considerable difficulty in the main pro- quiet and was characterized by the buyers' con- ducing and exporting countries in meeting any tinued resistance to high prices and by sellers' substantial increases in the demand immediately; effortsto maintain the prevailing pricelevel. there is,therefore, a possibility of price increases However, at the beginning of June, 1952 prices in 1953. declined and a new price level for international sawn wood trade was established, at 25 to 30 percent below the previous top prices.However, the demand did not show any particular response. (C) WOOD PULP Stocks were high in most countries.Since they had been acquired at a time when prices were Current situation much higher than those prevailing toward the The wood pulp and pulp products situation, end of 1951/52, they represented a considerable which during 1949/50 WaS characterized by a slack- capital investment and as prices continued to fall, ening in demand and a consequent slowing down buyers remained reluctant to enter the market. of production, improved after June 1950, and By thelatespring,however.United States both production and trade moved at high levels lumber stocks of softwood had been slightly re- until the end of 1951.Production was 11 percent, duced with production, by April, about 10 per- imports 4.5 percent and exports 6.5 percent above cent lower than a year previously. the 1950level, and consumption increasedin In general, the total consumption of sawn wood 1951 by 8.5 percent.The United States sub- in 1951 was somewhat below the level of 1950. stantially increasedits demand for wood pulp The considerable decline in the civilian consumption and pulp products for civilian and defence rein most countries, particularly for housing, was quirements in 1951 and for stockpiling.Many countries in Europe and elsewhere shifted their TABLE 58. STOCKS OF SAWN SOFTWOOD imports of wood pulp and pulp products from 31 December31 December North America, because of dollar shortages, to REGIox 1950 1951 European, notably Northern European pulp industries ; this shift consequently brought about an in- thousand standards crease in the production in that area (Table 59.) Western Europe a 709.6 1 281.0 As the world demand continued on a high lev- USA I. 739.9 1 938.3 el throughout 1951, pulp industries were work- Canada 530.0 545.1 ing at full capacity even with the addition of new mills in 1951.Stocks at mills, which at the be- a Including only :Austria,Belgium, Denmark, Western ginning of 1951 liad been large, had fallen to un- Germany,Greece,Iceland, Switzerland, Turkey, and thn United Kingdom. usually low levels by the end of the same year, in

118 TABLE 59. - WORLD PRODUCTION AND CONSUMP- Conference.The extraordinary demand for wood- TION OF WOOD PULP pulp and pulp products also led to a substantial 1950 1051 increase in international pulpwood trade, some SO percent above the 1950 level, as mills drew REGION Pro- Con- pro_ Con- sump- Icluctionsump- ductiontion tion heavily upon stocks in order to be able to maintain the high level of production (Table 60). . million metric tons TABLE 60. - EXPORTS OF WOODPULP North America 20.821.323.222.9 Latin America 0.2 0.4 0.2 0.4 EXPORTED BY 1950 1951 Northern Europe a 6.1 2.6 6.5 2.9 Western and Central Eu- rope 2.5 5.2 2.7 5.4 (...million metric tons Eastern Europe USSR b .... 3.4 3.5 3.6 3.6 United States 0.09 0.18 Asia, Pacific and South Canada 1.66 2.02 Northern Europe. . . . 3.69 3.76 Africa . 0.9 1.0 1.3 1.4 Other Europe° 0.20 0.92 TOTAL 33.934.037.5 36.6 TOTAL 5.64 6.18 a Finland, Norway and Sweden. bEstimated figures. a Excluding Eastern Europe and U.S.S.R. spite of increased output.The sulphur shortage whichwas hamperingpulpindustries during As a result of this greatly increased activity, early 1951, particularly in Callada., was eased by export prices of wood pulp in some cases rose close allocations made by the International Materials to 250 percent in the course of 1951 (Chart XXIII) CHART XXIII - PRICES OF VARIOUS FOREST PRODUCTS 1949-52

DECEMBER 1949 =100 600

1 1 1 500 FINLAND: CHEMICAL WOOD PULP EXPORT UNIT VALUE

400

FINLAND: NEWSPRNT EXPO T UNIT /°. VALUE 300

200

SWEDEN : SAWNWOOD EXPORT PRICE 150 1 UNITED STATES : CHEMICAL WOOD PULP WHOLESALE PRICE

too - DEC J J FM Am 950 1951 1952

Notes: Finland : Chemica, Wood Pulp : unbleached sulphate United States :Domestic and Canadian sulphite (ex-dock Atlantic sea- Sweden : 2 1/2 " 7 " redwood battens f. o. b. Härnösand. board) Bleached No. 1, book f. o. b. mill. 119 With this strong upward trend in pulp prices in and by efforts of many countries to increase the all parts of the world except in North America capacity of pulp industries in order to eliminate (as priceceilings for domesticpulpswerein the apparent shortage,there seemed toexist effect in the United States), wide price differentials during the first half of 1952, with a decline in appeared between markets and between pulps demand, a possibility of over-produci ion of wood being sold in the same market but originating pulp and some prilp products, for imtance news- from different sources, particularly between do- print.This is likely to lead to a somewhat re- mestic and imported pulps.The rise in the pri- duced production in 1952 in many countries or ces of imported pulps was particularly marked a mere maintenance of current production because duringthefirsthalf of1951.However, the of the needs of the mills to replenish stocks, buyers' growing resistance to the high prices and which were generally very lowat the beginning a noticeable weakening in demand caused by an of 1952. accumulation of stocks towards the end of 1951, led to a temporary stabilization of prices, which during the first months of 1952 changed to a FERTILIZERS generalfall, exceptin North America, for all categories of wood pulp. By June 1952 prices were Current situation 30 to 40 percent below the previous top level The world-wide trend towards increasing the quoted for Scandinavian pulps.Thisfall was use of fertilizers continued in 1951/52.Not only accelerated when the European buyers' stopped does the total production and consumption of buying imported pulpsof otherthanNorth fertilizers continue to rise,but the increaseis American origin, which by the end of 1951 had particularly marked in the many regions of the reached a level far above that of domestic and world where commercial fertilizers are relatively North American pulps.In spite of this pronounced less used.Governments in many countriesare decline in prices no strengthening in demand was showing an increasing interest in promoting the noticeable by the summer of 1952.This slack- production and a wider and more efficient use ening in the general market situation for wood of both inorganic and organic fertilizers, and spe- pulp and also for pulp products led to a marked cial measures have been taken towards this encl. slowing down in production and in the summer Much remains to be done, especia,lly in the less of 1952 some pulp mills in the main exporting industrially developed areas. countries, notably in Scandinavia, were tempo- Production. The total production of nitrogen rarily closed. (N),phosphoric acid (P205) and pota,sh(K20) amounted to 14,988,342 tons in 1951/52, an in- Outlook crease of 4.9 percent overthe previous year (Table 61). While the wood pulp and pulp products situation Nitrogen. T WO new plants were put into operation in 1951 was characterived by a growing demand in 1951/52, a calcium nitrate plant in Egypt and TABLE 61 TOTAL WORLD FERTILIZER PRODUCTION AS N, P205 AND K20

°A CHANGE REGION 1950/51 1951/52 195 2/5 3 1950/51 tO 1951/52 10 195 1/5 2 1952/53

thousand metric tons ) Europe 8 080 S 435 8 879 + 4.4 + 5.3 North America 4 505 4 658 5 215 + 3.4 + 12.0 Latin. America 383 373 380 2.6 +1.9 Near East 17 51 63 + 200.0 + 23.5 Far East 683 819 916 +19.9 + 11.8 Africa 124 136 138 + 9.7 + 1.5 Oceania 490 516 457 + 5.3 11.4 IATORLD TOTAL 14 282 14 998 16 C48 +4.9 +7.1

120 a sulphate of ammonia plant in India (Sindri). erlands, North Africa, the United Kingdom and Thus, for the first time in history, synthetic ni- the United States.However,sinceelemental trogen is being manufactured in every continent. sulphur is required in many of these plants, it The largest nitrogen production increases oc- ispossible that this increased capacityis not curred in the Near East (frora 588 to 28,740 tons) being fully utilized. and the Far East (18.3 percent).In Europe and Potash. The production of potash is principally North Americanitrogenproductionincreased centered in Europe and North America.In both 7.7 percent and 9 percent respectively.Although regions there has been an increasing trend toward still at a high level, nitrogen production in Latin the production of potash materials containing a America declined slightly.For the worldas a higher concentration of K2O.Increasing quan- whole, the supply of nitrogen in 1951/52 increased tities of potash, as potassium nitrate, are being by an estimated 8.5 percent over 1950/51. produced in Chile in connection with the new Phosphoric Acid. Reflecting the continued short- solar process for producing nitrate of soda. The increase in world production of potash in age of sulphur, the productionof phosphate fertilizers (superphosphates, basic slag, fused phos- 1951/52 over1950/51was3.6percent.The phate and other forms) increased by only 3 per- outlook, however, is for a world increase in consumption of 8.8 percent in 1952/53 over 1951/52 cent in 1951/52.There was, moreover, practically no increase in the production of superphosphate which is the largest increase for any of the three -which represented some 76 percent of the world's plant nutrients. supply of iihosphoric acid in1951/52.This is Consumption. The consumption of commercial a vital factor in the overall supply problem.On plant nutrients in 1951/52 is estimated to have the other hand, basic slag - an important source risen 5 percent over the previous year.However, of phosphoric acid supply in Europe, increased the rate of increase varied greatly from region to by 33,000 tons P205 in the six principal producing region, 2.7 percent in Europe, an expansion of ap- countries. proximately 10 percent in most underdeveloped An increasing interest in phosphate fertilizers regions and an exceedingly large increase of over other than superphosphate isbeing shown all 100 percent in the Near East (Table 62). overtheworld.Among others,forinstance, Particular interest is attached to the consumption fused phosphate is now being manufactured in of phosphates.Although thetotalsupply in Taiwan and " soda phosphate "is being manu- 1951/52 was much higher than estimated in June factured in Kenya.In general, there is a trend 1951, it will still be insufficient to meet the needs towards the increased production of these kinds fully, particularly of those countries chiefly de- of phosphatic fertilizers which require little or no pendentuponsuperphosphates.Rationingof sulphur in their manufacture. superphosphate was adopted in some states of Plant capacities for the production of triple Australia.In the Union of South Africa super- superphosphate have been substantially expanded phosphate was diluted with rock phosphate, in in recent years, for example, in Greece, the Neth- .New Zealand with rock phosphate and serpentine.

TABLE 62. - WORLD CONSUMPTION ALL FERTILIZERS. PERCE1`..+TAGE CHANGE BY REGIO-2,_TS IN THE CONSTJMPTION OF N, P205 AND K20 1951/52 OVER, 1950/51

TOTAL TONNAGE PERCENT CHANGE 1951/52 oVER 1950/51 REGION All N P205 1950/51 1951/52 fertilizers K. 0 tho sand tons....) Europe 6 977 7 166 + 2.7+ 1.8 - 1.9+ 7.9 North America 4 700 4 867 + 3.6+ 9.1 --0.2 + 4.6 Latin. America 276 310 + 11.9+11.8 + 11.0 + 14.1 1 Near East 98 206 + 109.7+ 162.0 + 23.1 + 43.4 Far East 1 015 1 168 +15.1 +13.0 + 11.9 + 34.3 Africa 186 204 9.2+14.8 + 9.7+ 3.4 Oceania 526 552 5.2 - 8.6 + 4.5 + 49.5 1 WORLD TOTAL 13 778 14 473 5.0 8.6 + 0.6+ 7.8

121 The chief phosphate-producing countries helped lizers, e. g. Brazil, Ceylon, Colombia, Egypt, India, to meet the needs of other areas, to some extent Mexico,andPakistan.Fertilizer subsidies are at the expense of lower home consumption rates. paid in Austria, Germany, Norway, Portugal and In Europe, the reporting countries showed that the United Kingdom.Some countries such as the net exports of phosphoric acid increased 60 Colombia purchase and importthenecessary percent while consumption declined by 1.9 per- fertilizermaterials ;others, such as Uruguay, cent.In North America, largely through the pay part of the freight for fertilizer shipments to need for substantial quantities of elemental sul- the farmer.In the United States, assistance is phur for industrial purposes and the need to meet given in the purchase of fertilizers for certain crops. exportrequirements,theavailablesupplyof Many countries are also improving credits for the phosphoric acid in 1951/52 was slightly smaller purchase of fertilizers. than in 1950/51. Despite the increase in fertilizer production in the Far East, imports of nitrogen, phosphoric Outlook 2 acid and potash were larger by about 25 percent, 100 percent and 40 percent respectively in 1951/52 Reports from governments indicate that both as compared with those of 1950/51. The largest production and consumption of fertilizers may percentage increase was in the Near East. Large beexpectedtoriseconsiderablyin1952/53. percentage increases in potash consumption are The aggregate of production estimates gives a to- evident in Oceania (50 percent),the Near East tal of 16 million tons, an increase of 7.1 percent (50 percent) and the Far East (35 percent). over 1951/52.Consumption is expected to ex- In line with commodity prices generally, the pand by 8.6 percent but will, of course, be limited prices of fertilizers were higher in 1951/52.This by production, apart from small reductions in was partly due to the relativelyshortworld stocks. suppl3r of phosphates.In several European coun- The largest increase in consumption, in per- tries fertilizer prices, particularly those of phos- centage terms, is expected in the Near East where phates, increased in varying degrees. estimates for the consumption of potash and phos- More countries are becoming interested in the phoric acid for the coming year are particularly use of commercialfertilizers.In 1951/52,for high. All regions, with the exception of Oceania, instance, nitrogen consumption was reported in expect a substantial gain in fertilizer consumption 88 countries or telTitories located in all parts of in 1952/53.The position in Oceania is dominated the world, and that of phosphoric acid and potash by the unsatisfactory outlook for the production in 70 countries or territories.The total number of sulphuric acid and superphosphate (Table 63). of consuming areas is even larger, as dependent The anticipated expansion in world production overseas territories are not all listed separately. of all phosphatesisnearly6 percent.While Government interest in the many difficult prob- data for the proposed production of superphos- lems associatedwith thesuccessful production phate in 1952/53 are not sufficient, indications and distribution of plant nutrients is growing. are that some of the overall increase will be in the It includes a wide range of activities in the con- form of superphosphate. In Oceania, however, a servation and marketing of natural organic ma- decrease is expected. terials often the cheapest source and in The prospective overall improvement inthe the production,distribution and utilizationof total phosphate supply is due, in part, to the spe- commercial fertilizers. cial measures being taken by many countries to For example, in India millions of tons of com- overcome the current world shortage (about one posts have been prepared under the Town Ref- million tons) of elemental sulphur by such means use Composts Scheme involving over 1,000 urban as a greater use of pyrites and a more complete areas and under the Village Compost Scheme utilization of all other industrial sources of sul- covering over 100,000 villages.The conservation phur.The outlook is also improved by the lar- and more efficient marketing of guano in Chile, ger prospective production of phosphatic fertili- Ecuador, Mexico and Peru, are other examples zers which require little or no sulphur. in this field. Many countries, either by direct assistance or through appropriate agencies, are helping in the The outlook. for1952/53isbased on official present or planned futureproductionof ferti- government information.

122 TA B LE 63. OUTLOOK FOR WORLD CONSUMPTION, throughout the year.So that orders placed by ALL FERTILIZERS importers in other countries may be met fully o and on time, it is important that they should be 1952-53 TOTAL TONNAGE over placed well in advance and at a time permitting REnioN 1951-52 their being filled during the slack months of the late summer and autumn.While this is not the Fertilizers only factor in improving the supply situation for 1(thousand '»zetric tons) pesticides, it will stabilize the situation. Europe 7 166 7 745 + 8.1 .North America 4 867 5 388 +10.7 Outlook Latin A_merica 310 321 + 3.6 Supplies of most pesticides, especially chlorin- Near East 206 234 +13.6 ated hydro-carbons, are likely to remain ample Far East 1 168 1 321 +13.0 for the needs of agriculture during the1952/53 Africa 203 209 + 2.7 season.However, temporary shortages may oc- Oceania 552 501 9.2 cur in areas distant from the basic supplies,if

1 WORLD TOTAL 14 472 15 719 8.6 orders are not placed far enough in advance. As in the case of fertilizers, sulphur iscertain to remain in short supply for several years and copper is PESTICIDES also likely to be short.There are, however, possibilities for use of substitutes, such as methyl Current situation bromide in fumigants to replace those using chlo- The supply situationfor nearly all pesticides rine, which require sulphur in the manufacturing was very tight in early 1951.However, there- process, and some of the organic fungicides in- sultant increase in prices led to considerable ex- stead of Bordeaux mixture, thus saving both pansion of production, principally in the United sulphur and copper. States which is the major producer, exporter and consumer of pesticides.After mid-1951 when the domestic demand in the United States declined FARM MACHINERY seasonally, some supplies were made available for export, but the situation remained tight up Current situation to the end of the year.Howe-ver, by mid-1952 Production, sales and exports of farm machinery supplies of most pesticides, with the notable ex- in1951 were generally at record levels.The ception of sulphur, were readily available. expectation, in early 1951, that the United States Owing to the difficulties which had been expe- farol machinery industry would not be able to rienced by some consumers in obtaining supplies equal the production levels of 1950 turned out to during 1951, an important meeting on the demand be unfounded ;in the United Kingdom production and supply situation of two principal pesticides, of tractors and implements increased markedly DDT and BHC, was held in Geneva in February and 1951 tractor exports by the principal Euro- 1952.These consultations revealed that there pean producers indicated a higher level of produc- had been significant increases in production capa- tion than in1950.However, some decline in city, especially in the United States, and that no production, at least in the United States, occur- significantshortage of these pesticides existed red towards the end of 1951 and in early 1952. Im- at that time.It also became plain,however, ports of tractors into underdeveloped countries that difficulties do occur in filling orders owing increasedalthoughlargelyconcentratedina to the fact that consumers often fail to put their limited number of countries. orders in sufficiently far ahead or to pay attention to the seasonal trend in the production of pesti- Production and exports. Production in the United cides.These considerations apply to other pesti- States in 1951 exceeded the 1950 level by nearly cides as well as DDT and BHC.Considerable 7 percent and even passed the 1948 record.Trac- time is required to move raw materials, and to tor production amounted to 62,000 units more manufacture, formulate and ship pesticides.Fur- than in 1950 and reached 1949 levels.However, thermore, production in the United Statesis in the final quarter of the year the allocations of geared principally to the domestic market and at metals kept production below capacity and out- present the potential capacity is not fully used put of tractors in the first four months of 1952

123 was 21 percent below the corresponding period its1950 imports, and Argentina, Uruguay and of 1951.The continueddecline in agricultural several other countries had a significant import manpower and the high demand for farm products volume.Imports to Australia and New Zea- led farmers to continue to buy farm machinery. land increased slightly. Most European countries, Production of farm machinery in the United including some which manufacture tractors but Kingdom reached a record value of £106.8 mil- exceptilig France and the United Kingdom, show- lion, compared with4'84 7 million in1950. Pro- ed higher imports in 1951. Callada continues to duction of agricultural tractors was 17 percent be the world's principal importer of tractors. above the 1950 record and output of nearly all In general the increase in tractor imports by types of implements exceeded that of the previous the minor users is equally striking in percentage year.More than half the farm machinery pro- terms.TheaggregateimportsintotheFar duced was exported (Table 64). East, the Near East and Latin America by countries not mentioned above, increased by 62 percent, 22 percent and 44 percent respectively.In TABLE 64.- TRACTOR PROD UCTIO1,T IN THE -UNITED Africa a decline in imports into French North STATES AND THE UNITED KINGD OM a (Exluding Garden Tractors) Africa more than offset slight tendency to rising imports in Africa south of the Sahara. Aft-

1950 1931 er allowing for old tractors going out of use, it COUNTRY is evident that tractor numbers inunderdevel- thousands oped areas are increasing rapidly (Table 65).

United States . . . 508.8 570.8 TABLE 65. - TRACTOR IMPORTS BY REGIONS a United Kingdom. 120.2 140.2 (Excluding Garden Tractors)

IMPORTED BY 1050 1951 At the time of writing, production data were not available for Canada, the European conti- thousands nentalproducersand Russia.However,the North Americo 58.1 58.7 German industry made further gains in 1951 with Europe 42.7 55.4 Latin America 26.0 41.0 exportsof tractorsat22,000, compared with Far East 5.2 9.0 12,000 in 1950 and 1,400 in 1949.France, Italy Near East . 8.1 10.8 and Sweden also sharply expanded exports, while Africa. 16.3 23.5 Oceania 34.8 38.4 those from Canada declined slightly.Production Destination unknown. 10.0 21.6 in Russia is estimated at 137,000, in terms of 15 11.p. units, as compared with 180,000 15 h.p. units in 1950. TOTALS 201.2 258.4

a According to destinatioa of exports. Imports ami tractor numbers in underdeveloped b Mainly Canada. arcas. Imports of tractors increased in all regions and in most countries in 1951, indicating expan- , Utilization and servicing . Even where actual eco- ding mechanization. However, the increment in ab- nomic conditions are favorable for the use of power solute terms is as yet small in most countries.In machinery and largescale implements,mech- the Far East, India is rapidly becoming the ma- anization must proceedslowlyintheearly jor importer of tractors, even by world standards. stages if serious waste of resources is to be avoided. Over 7,000 tractors were imported in 1951 as Facilities must be built up for the regular and against approximately 4,000 in 1950 and 2,400 economic supply of fuel and replacements,for in1949.Indian imports comprised 80 percent the servicing and repair of machinery and for the of imports into the region, excluding China, which training of operators and mechanics.It is par has apparently been purchasing tractors from ticulayly important therefore to watch to what the U.S.S.R. for use in North China.In the extent countriesin underdeveloped regionsare Near East, Turkey (over 6,000) and Egypt (over taking measures along these lines either by direct 3,000) accounted for 90 percent of the total.In government action or through facilities establish- Africa three-quarters of the tractors went to the ed by private enterprise. Union of South Africa, which has nearly doubled In India the Government has established re- its imports.Brazil (over 12,000) nearly doubled gional workshops and the technical assistance ex-

124 perts there are instructing and helping in the TheBrazilianGovernmentiscarryingout organization of modern 'workshop practices.Field several plans to promote mechanization of agri- service engineers are being recruited under the culture.One of them consists in the formation of Expanded Technical .AssistanceProgram to in- mechanized patrols ' or groups, official machinery struct drivers and machinery operatives in hand- pools which hire their services to farmers, assist- ling, care and maintenance. The Government of ing them in ploughing, planting and other tasks. India has also given attention to the introduction The farmers have to pay a reasonable rate for of hand tools and small implements and to fur- these services.,Another important plan provides ther this policy they have sent young men to study for training; in rural engineering of agronomists, abroad. who in turn train men as tractor operators.The The Government of India has a Central Trac- plan was started in 1947 in collaboration with tor Organization which owns fleets of tractors, the United States Department of Agriculture and used mainly for reclamation operations, working the first center was established at the Ipanema on a non-profit basis.This organization assists Experimental Farm.The plan calls for creation various State Governments in land clearing, deep of two regional centers for training tractor oper- ploughing and eradication of weeds.Each State ators, 23repair centers and 120 demonstration owns tractors and agricultural machinery ; Uttar farms. Pradesh, for instance, has some 400 units, and In Chile the Corporación de Fomento, an offi- several of the States have a machinery import- cial agency, provides assistance to farmers rent- ing program.We11-equipped workshops with ma- ing mechanical equipment at rates which include chine tools and tractor servicing tools have been amortization interest and operational cost, and established in some States. has established several regional repair shops for the maintenance of the machinery belonging to On the request of the Pakistan Government, the Corporation. FAO has made available an expert to give overall assistance in operating the machinery and in TABLE 66. ESTIM ATED TI ACTOR POPULATION IN organizing maintenance workshops.The Govern- ECONOMICALLY UNDERDEVELOPED REGIONS ment has further requested FAO to provide three (Excluding Garden Tractors) or four field service engineers for similar duties % In- in various provinces.The FAO Technical Assist- crease REGION 1939 1950 1951 1951 ance Mission in Ceylon, in conjunction with the over agricultural engineeringstaff of the School of 1950"

Agriculture,are studying and designing small ( 17t( Isands ) machines and hand cultivating tools for Ceylon Latin Arnerica 35 90 118 31 farming conditions. Asia 8 31 46 48 In Turkey itis estimated that approximately Africa. 17 63 77 22 20,000 tractors will be on the land in 1952, as well as the equipment that goes with them, includ- a Based 011 a 15 percent write-on of the 1950 tractor strength. ing combines, as compared with the 2000 units in use less than four years ago.The servicing Important work has been done in Peru, mostly potential,however, has not risentoanything through SCIPA, an agency to which the Peruvian like the same degree.The Government, through and the -United States Governments both contrib- the Ministries of Agriculture and Education, and ute.This agency OW11Sa seriesof machinery with the assistance of ECA and later MSA has pools, repair shops and training centers for instruc- taken certain steps to initiate training of tractor tion in handling and operating all types of farm drivers and mechanics.13oththe Government machinery. and machinery dealers have reasonably equipped workshops in which training could be undertaken. The Department of Agricultural Machinery in Outlook Iraq owns several hundred tractors and related machines, as well as workshops.To assist the There is eveiy indication that production of farm Government in its mechanization program FAO machinerywillbe lower during1952/53 than and the United States Technical Co-operation Ad- during the period under review.The combined ministration are both providing experienced per- effects of the rearmament programs of the two sonnel. major producers, the United States and the United

125 Kingdom, and the prolonged steel strike in the waters.In Canada, as part of the 1949 develop- United States, will curtail the supplies of steel to ment plan, the issue of licences was extended to firmsmakingfarmmachinery.Evenbefore cover British-built trawlers as well as second-hand the steel strike it was estimated that production vessels from the United Kingdom and United by the United States industry would suffer at States.The Atlantic coast trawler fleet has been least for the remainder of 1952 and output had increased and modernized and 10 more vessels been stabilized at around SO percent of capacity. are under construction.In Latin America, de- With reduced production in both these countries velopment in both production and distribution it is probable that fewer tractors and less farm proceeded steadily,especially inBrazil,where machinery in general will be available for export. larger vessels have been acquired and a new quick With the newly awakened interest in farm machin- freezing plant is planned. ery inthe underdevelopedareas, it may well In the Far East there has been further mecha- be that during 1952/53 the demand for imports nization of fishing fleets and a start has been made will exceed deliveries.It is possible thatthere on the improvenient of processing and distribu- may be no fall in the volume of machinery exports tion.In Ceylon, the Colombo Plan includes the from the United Kingdom, since the Government consideration of distribution, harbor facilities and puts a high priority on exports.However, in the mechanization and improvement of the fleets. the United States, the outlook is for a continuing In Hong Kong the number of mechanized junks high demand for farm machinery, and it is prob- increased from 81 in 1949/50 to 112 in 1950/51. able thatthe domestic demand will exceed the In Indonesia, EGA has financed the purchase of supply, leading tosevere competition between 75 vessels of various types and 100 small motors domestic and export demand. Japan now operates about 1,000 vessels of over 20 tons and in 1951 several tuna fishing operations FISHERIES EQUIPMENT were undertaken using mother-ships.The coastal fisheries, however, have had to face a steep rise The expansion and technological development in operating costs following the lifting of price of modern fisheries undertakings involves heavy controls.In Singapore the Fisheries Loan Board capital expenditure.In view of the prevailing has allocated M$250,000 for the support of off - restrictions on capital investment programs, the shore fishing and M55,000 for materials and equip- fishing industry has 110W to be considered in terms ment.'Mechanization has been extended by the of its significance in the economic structure of use of outboard motors. the country concerned, so that its needs, either In the development of the European fleets the of capital or of materials and manpower can be emphasis is now on vessel size and technical equip- fully appraised and integrated with those of other ment. New and larger trawlers are being added basic industries. to the cod-fishing fleets of Spain and Portugal ; This is one important reason why the steep rise in Spain more cod is being caught by the larger in costs tends to retard the expansion of the fish- parejerosfollowing the successfulintroduction ing effort, which in certain countries may even of thepareja '(pair) trawl to this fishery.In fall short of the consumer demand for fisheries Germany, despite rising costs, the rebuilding of commodities.These high costs present a serious thefleetisproceeding steadilyand,allowing problem, especially in countries where the uncer- for scrapping, the construction of 92 new steam tain balance between production and distribution trawlershasincreasedthetrawlerfleetto tends to discourage the investment of further about 220 vessels of approximately 96,000 GRT capital. as compared with a fleetof 373 craft with a In the United States, expansion continued with tonnage of approximately 123,000 GRT in 1939. little or no restriction of the availability of equip- In Belgium the depression suffered throughout the ment and materials, although a few shortages of industry has virtually halted construction and packaging materials were reported.New carrier restricted the operation of the fleet.In the United vessels equipped for freezing and packing were Kingdom, although new building is in progress, engaged in the Gulf of Mexico shrimp fishing, while the effect of steeply rising costs has been to restrict experimental tuna fishing was carried out there, and the fullest utilization of the fleets and to discourage in New England, South Atlantic and Central Pacific further capital expenditure.

126 T1POGRAFIA FAUSTO FAILLI - ROMA FAO AGRICULTURAL ST7..7)-

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