FAO/GIEWS - Food Outlook No.2 - April 2000 p. 11

CASSAVA

• Cassava production rose in 1999
• Cassava utilization expanded in 1999
• World cassava trade recovered in 1999
• Cassava prices weak or falling
• Production, trade and price outlook for 2000

Cassava production rose in 1999

Global cassava production in 1999 grew by 2.8 percent to 167.7 million tonnes in fresh root equivalent, sustained by increases in Asia and Latin America and the Caribbean, which more than offset a contraction in Africa.

In Asia, cassava output rose by 11 percent to 50 million tonnes as a result of an expansion in plantings and improved yields. Among the major producing countries, output in Thailand is estimated to have risen by over 20 percent to 20.3 million tonnes. Apart from favourable weather, almost half of the 1.2 million hectares under cassava cultivation were reportedly planted with improved strains, which contributed to the rise in land productivity. Production increases ranging from 2 percent to 5 percent were reported in China, India, Indonesia, and the Philippines. By contrast, in Viet Nam, production remained close to the previous year's level, as a contraction in plantings was offset by a rise in yields brought about by increased use of improved varieties. In Latin America and the Caribbean, the 1999 cassava output is estimated at 29.4 million tonnes, 5.6 percent more than the 1998 crop. The increase is mainly attributed to Brazil, the world's second largest cassava producer, where output recovered partly from the 1998 slump. Substantially larger outputs were reported in Colombia and Paraguay, while modest increases were recorded in Costa Rica, the Dominican Republic, Peru and Nicaragua. In Africa, the world's major producing region, cassava production fell by 2.5 percent to 88 million tonnes, reflecting poor crops in some major producing countries, including the Democratic Republic of Congo, Mozambique, Sierra Leone and Rwanda, where production activities were disrupted by population displacements and civil strife. In Kenya, Uganda and Tanzania, a prolonged drought seriously affected crop production. In Nigeria, official estimates put the 1999 output at about 30 million tonnes, 2.2 million tonnes down from 1998. By contrast, cassava production increased in Ghana and Benin by 8 and 3 percent respectively, following the implementation in both countries of the Roots and Tuber Improvement Programmes promoting the introduction, multiplication and distribution to farmers of pest and disease resistant planting materials. Modest increases were also reported in Cameroon, Liberia, Togo and Zambia.

World Cassava Production 1/

Source: FAO

1/ In fresh roots.

Cassava utilization expanded in 1999

Reflecting the increase in global production, world food utilization of cassava rose by two percent to 98 million tonnes in 1999, with most of the expansion being concentrated in Asia and Latin America and the Caribbean. By contrast, in Africa where cassava is a major staple and contributes significantly to food security, food utilization of cassava fell by 3 percent to 58 million tonnes. Feed utilization increased worldwide, with the major increases occurring in South America and in the EC. The volume of cassava processed into non-food products rose, boosted by low international prices for cassava starches and the economic recovery in Asian countries.

In Africa, the decrease in production in 1999 resulted in a decline in food consumption of fresh cassava and products (gari, attiéké, foufou, kokonte, etc.). The contraction affected mainly the rural populations, who rely to a larger extent on the crop for their livelihoods. The reduction in food consumption of cassava was especially marked in the Democratic Republic of Congo, Rwanda and Uganda where outputs fell substantially. By contrast, per caput food consumption of cassava grew in Benin, Cameroon, Mali, Ghana, Liberia, Sierra Leone and Togo. In some of these countries, roots and tubers are increasingly being used as a substitute for imported cereals. In Asia, larger crops in 1999 led to a 9 percent increase in domestic cassava usage. Its utilization in feed, alcohol and starch production expanded in Thailand and Viet Nam, supported by the economic recovery in the region. By contrast, the use of cassava in the Philippines, the Republic of Korea, Malaysia and Japan, which rely mainly on imported supplies, remained almost unchanged. In Latin America and the Caribbean, cassava is an important food staple in a number of countries, but a large share is used as on-farm feed in the producing areas. Industrial utilization of cassava in the region has been growing in the past decade, as the crop has moved from being a subsistence to a market-oriented crop, providing raw material for the manufacture of food products, feed and industrial applications. Thus, the recovery in production in 1999 is likely to have sustained a general increase in cassava consumption.

Among the developed countries, the EC's utilization of cassava for feed manufacturing increased in 1999, stimulated by competitive cassava pricing. Spain and Portugal, in particular, stepped up their usage to compensate for a shortfall in barley production. Italy also utilized large quantities of cassava chips and pellets for the first time. By contrast, the use of cassava fell in Japan and in the other developed countries, including Israel and Poland.

World cassava trade recovered in 1999

World trade in dry cassava products (also called "tapioca") rose by 22 percent in 1999 to 6.0 million tonnes (15 million tonnes in fresh root equivalent), sustained by large export availability in Thailand. Of the total, 4.6 million tonnes were traded in the form of chips and pellets and 900 000 tonnes in the form of cassava flour, up from 3.9 million tonnes and 700 000 tonnes, respectively, in 1998. Shipments to the EC amounted to 4.3 million tonnes, or 48 percent more than in 1998. As in the past, the Netherlands, remained the main port of entry of cassava products, followed by Belgium, Italy and the drought-stricken Spain and Portugal. By contrast, purchases of cassava products by non-EC countries fell by 15 percent, mainly as result of smaller purchases by the Republic of Korea and Indonesia. Exports of cassava products by Thailand rose to an estimated 5.2 million tonnes, 30 percent more than in 1998 and close to the level reached in 1997. By contrast, sales of cassava products from China and Indonesia fell reflecting high domestic requirements.

World Trade in Cassava 1/

Source: FAO
1/ In product weight of chips and pellets. including starch and flour.
2/ Including Taiwan Province.
3/ Excluding trade between EC members.

Cassava prices weak or falling

International cassava prices dropped significantly in 1997 and have remained since then substantially below the levels prevailing in the early 1990s. Abundant supplies in Thailand combined with growing competition in the EC pressured prices further down in 1999. As a result, the EC import price for cassava chips and pellets fell to US$102 per tonne, 5 percent less than in 1998, and as much as 36 percent below the level in 1993, when the implementation of the CAP reform began. Prices of cassava pellets in the EC are influenced by the domestic prices of grains, especially barley, and the prices of protein-rich meals which supplement cassava in balanced feed rations.

Prices of Cassava, Soybean meal and Barley in the EC

Source: FAO, Oil World and Agra-Europe.
1/ F.o.b. Rotterdam (barge or rail) including 6% levy. 2/ Argentina (45/46% proteins) c.i.f. Rotterdam up to September 1999. From October 1999 Argentina (44/45% proteins) c.i.f. Rotterdam. 3/ Consisting of 80% of cassava pellets and 20% of soybean meal. 4/ Selling price of barley in Spain. 5/ January-February average.

Quotations for barley in 1999 in Spain, one of the major cassava users in the Community, were virtually unchanged at US$42 per tonne, while international price of soybean meal (c.i.f. Rotterdam) dropped from US$170 per tonne to US$152 per tonne between 1998 and 1999. As a result, the cassava/soybean meal mix was particularly attractive to EC feed users. Similarly, the international prices of cassava starches and flours, which are traded principally among Asian countries, followed a downward trend for most of the year, falling to an average of US$172 per tonne in 1999, some 30 percent less than in 1998.

Production, trade and price outlook for 2000

Prospects for cassava production in 2000 are still subject to a large degree of uncertainty, especially in Africa where the crop plays a critical role for food security. In that region, the roots are often left in the ground for over one year and are only harvested when food shortages arise, which makes an assessment of production particularly difficult. For these reasons, production is likely to expand in Madagascar where a poor 2000/01 paddy season is currently anticipated. Ghana and Benin are also expected to record some increases, mainly as a result of a renewed interest in commercial production. However, no indication is currently available regarding the crop in Nigeria, the world largest producer. In Latin America and the Caribbean, production is forecast to rise this year, mainly due to a further recovery expected in Brazil, where favourable prices have prompted farmers to increase plantings. Some initiatives have been launched in the region to promote the crop, for instance through the establishment in 1999 of an international consortium, CLAYUCA, composed of public and private institutions, which has the objective to support research and development of the cassava sector in the region. Production in Asia could increase somewhat in 2000, influenced by developments in Thailand where farmers have been increasingly adopting high yielding cassava varieties. Thai farmers have been facing extremely weak prices in 1999, which has induced the Government to intervene in support of the market by providing incentives to traders to buy and store dry cassava products. Notwithstanding those measures, producer prices have failed to recover, which might discourage plantings of the 2000/01 crop.

With exportable supplies in Thailand expected to be abundant during the course of the year little change in international trade in cassava products is currently anticipated. With EC grain intervention prices scheduled to be cut by 7.5 percent in July 2000, feedgrains prices may fall putting cassava prices under further downward pressure. Indications for the first quarter of 2000 point to a slide in international pellet prices to levels well below those prevailing in the last two years, with pellets prices, c.i.f. Rotterdam, down by 5 percent to US$92 per tonne compared to the same period in 1998. Although export prices for Thai tapioca flour/starch have also continued to slide, they might recover during the course of the year, as the economic recovery in Asian markets stimulates demand.

Cassava and Cassava Products

Prices in Thailand

Source: Thai Tapioca Trade Association, Market Review.