BREAD TEST?

The beginning of the year was dampened by reports of a sharp rise in food prices in some countries, although this is not surprising if we remember what the past year was like for the harvest. The unprecedented heat in Russia and other "grain" countries, the long-term drought in Australia and the subsequent flooding which affected Western Europe etc. - all this could not but affect prices. During 2010, corn prices rose by 63 per cent, the price of wheat increased by 84 per cent, soybeans by 24 per cent and sugar by 55 per cent. In autumn of the same year, the governments of Kenya, Uganda, Nigeria, Indonesia and the Philippines warned of possible food shortages in 2011.

All this forced the UN Food and Agriculture Organization (FAO) to call upon the international community to closely monitor possible problems with food in 2011 and to prepare for them. Although in fairness, we should note that the organization is not rushing to talk about the onset of a new food crisis similar to the one in 2008, when the world was rocked by "food riots" whose impact can still be felt.

FAO warns

According to most experts, another food crisis may arise from the fact that supply and demand are so imbalanced on the world market for agricultural products that even small local disruptions to the system can seriously affect world prices for certain products, indeed the whole food chain.

In terms of demand, population growth, increased wealth and the use of grain for automobile fuel are to blame. In terms of supply, it is also soil erosion, depletion of the aquifer and the use of arable land for non-agricultural purposes. It is also worth mentioning the outflow of water into cities, declining yields, even in countries with developed agriculture, and the destruction of crops by the heat and melting of glaciers and ice sheets due to climate change. Similar climatic trends are likely to bring about even more damage in the long-term.

It should be noted that the FAO has revised its forecast for global cereal production. According to new estimates, volumes this year will drop by 2 per cent, although a growth of 1.2 per cent was projected earlier. Experts explain the new figures by a decline in the harvest due to unfavourable weather. The UN agency also predicts a sharp decline in cereal stocks and calls for an increase in production to meet existing needs. It is noted that only rice reserves will grow and therefore it is necessary to grow more wheat, corn and soybeans. The report says that more than 80 countries are recognized as poor and suffering food shortages. The FAO notes that because of rising prices, world food imports in 2011 will reach one trillion dollars. In the poorest countries, food prices will rise by 11 per cent and in countries with low incomes and food shortages - by 20 per cent.

The main issue today is to plan the 2011-2012 harvest; stability in the market depends on it. However, the UN believes that even with increased grain crops due to price increases, there may not be enough to stabilize the market.

Corn is enough

According to Lynne Miller, a representative of the UN World Food Programme, the food crisis may affect Azerbaijan, too. However, the Azerbaijani Ministry of Agriculture is more optimistic in this respect.

For example, according to Hikmat Karimov, deputy head of the Ministry of Agriculture department for the production and processing of crops and food resources and state regulation, Azerbaijan's agricultural policy aims to fully ensure the country's food security. The state programme to ensure reliable food supplies from 2008-2015 also aims to resolve this urgent problem.

And if we carefully review and analyze all branches of plant and animal production, we notice a significant increase in the production of vegetables, potatoes, melons, fruits and berries. This is while Azerbaijan, like many other countries, was struck by an environmental disaster - tens of thousands of hectares of crops were left under water during the spring floods. At the same time, bad weather did not allow crops to develop fully and, for this reason, the yield from the republic's cornfields fell almost to 20 quintals per hectare. Compared with 2009, the country's growers harvested 987,000 tons less grain. In 2010, about 2 million tons were produced. The remains of last year's harvest amounted to 1 million tons. According to the State Statistics Committee, by 1 November 2010, Azerbaijan had imported 1.095 million tons of grain. Currently, the country has enough grain in store to fully supply the republic's population with bread and bakery products.

This autumn, farmers allocated more than 900,000 hectares of grain fields for cereals. The Ministry of Agriculture plans to collect and procure 2.5 million tons of grain in 2011. The country's demand for grain is only 1.53 million tons. Hence, it is clear that the republic may well provide itself with bread.

Other branches of crop growing evolved steadily, and there is even an increase in the output of vegetables, melons, green tea leaves and tobacco. According to agriculture experts, the country is carrying out effective work and is doing whatever is necessary to mitigate the negative impact of the food crisis.

It is no accident that the boundaries of grain fields are expanding. Rising wheat prices on the world market had a positive impact and created great interest among Azerbaijani grain growers. "Agricultural production and the achievement of high yields in crop production largely depend on natural factors," says Hikmat Karimov. "During natural disasters such as floods or drought, farmers are powerless. This year we learned a lesson from the flood. Measures have already been taken to ensure that this does not happen again. As for the grain harvest, I am sure that Azerbaijan will have bread - a good foundation has already been laid for the future harvest."

As far as the prices of agricultural products are concerned, they have grown year on year by 4.2 per cent. However, experts have warned that rising prices should also be expected this year, especially against the backdrop of global processes, although much depends on weather conditions (by the way, a snow-free winter impacts negatively on farms). However, one thing is clear today - there should be no deficit of food products in Azerbaijan, at least in 2011. To this end, the government is taking additional measures. For example, a recent decree by the Cabinet of Ministers exempted some types of goods and equipment imported into the country from VAT and customs duties. So, there is no reason to worry, although, as experts note, Azerbaijan needs to strengthen its development of the agricultural sector and eliminate domestic market dependence on imports. That is when the world food crisis will definitely not concern us.