U.S. Drought and the World

Global supplies of food have been diminished as a result of the drought that has affected production in the United States and Canada, but, barring a repetition of the disastrous weather next year, reserves are adequate to meet basic demand.

That is the assessment of experts at the U.S. Department of Agriculture and the U.N. Food and Agriculture Organization. Their analysis is a timely reminder of the continuing importance to world food stocks of American farms, as well as the increasing global interdependence and competition in production.

There is some uneasiness regarding wheat stocks that already has led to plans for bigger plantings next year. The United States alone will increase its wheat plantings by at least 10 million acres. Year-end carry-over stocks of wheat will fall to 117 million tons, the lowest tonnage since the global crisis year of 1981-82. The ratio of wheat stocks to actual use of the grain is the lowest in 17 years, indicating a year-end reserve equal to only 2 1/2 months of consumption. But there is no cause for alarm, because of good prospects for next year, according to the Department of Agriculture.

The other major food crop, rice, has a growing surplus, with good crops coming on in both India and Thailand. Even corn, America’s No. 1 crop and the commodity that has been hardest hit by the drought, with a 37% reduction in harvest compared with last year, remains in adequate supply. Year-end corn stocks are expected to be at least 50% higher than in 1983-84, when the last major crop loss occurred.

Price increases triggered by reduced supplies may take a toll on supplies for some of the food-short poor nations, which will be forced to curtail purchases because of the higher prices. The price increases may also influence some food-aid programs, with assistance money buying less. Harvests in two critical nations, Bangladesh and Sudan, have also been seriously hurt by massive floods affecting production areas. Food credit programs are available for most food-deficit nations from the major exporters, including the United States, but the accumulated debts of many low-income nations are already so staggering that many will be discouraged from taking on further debt. This means that the major producers need to maintain a constant alert for crisis situations and to be ready with emergency food shipments.