An on-the-ground study of European production and marketing potentials for apples and pears will be undertaken this year. Exhibits of deciduous fruits along with sampling, demonstration and other promotional activities are planned at the International Food Fair, Cologne, Germany, in September and the U.S. Food Exhibit, Amsterdam, the Netherlands, in November. World situation WHEAT World wheat production in 1962 is estimated at 8.500 million bushels, 8 percent above the 7,875 million a year earlier and is exceeded only by the record output of 8,700 million bushels in 1958. The current crop is 22 percent above the 1950-54 average of 6,975 million bushels. Production increases were experienced in North America, Western Europe, and Africa. Almost double the small production of last year in Canada more than offset the smaller U.S. harvest due to acreage reductions. Wheat production in Europe reached an alltime high of 1,585 million bushels which exceeds the previous high produced in 1959 by 165 million bushels. Increase in production in the principal producing countries of north Africa raised the African production 39 percent above the poor 1961 harvest. Total export availabilities in the principal exporting countries are smaller than a year ago due to reduced supplies in the United States and Argentina. Supplies in the United States for 1962-63 total 2,405 million bushels, 247 million less than supplies for 1961-62. Argentine wheat supplies for the year beginning December 1, 1962, are estimated to be a little less than the below-average supply of 225 million bushels last year. Australia has a larger supply for 1962-63 than the near-record total last year. Sales to usual markets and mainland China drew these stocks down to a minimum and the large current season stocks are mostly new-crop wheat. Canada's reduced stocks were more than offset this year by heavier production leading to a 7-percent increase in supply for 1932-03 over 1961-62. A crop of 558 million bushels plus 396 million carryover stocks give a total supply of 953 million bushels. An assumed domestic consumption of 150 bushels leaves 803 million available for export or carryover. France may be expected to fill increased quantities of the requirement of the Common Market countries as well as the needs of outside countries from approximately 148 million bushels wheat surplus. This surplus is much above the export of 68 million (49 as wheat and 21 as flour in wheat equivalent) made by France in 1961-62. The world Durum wheat situation has experienced a marked change from the tight supply situation of 1961-62. Production is large this year and export supplies greatly exceed import requirements. The United States and Canada together have almost four times their small 1961 production. Spain, Argentina, Syria, Morocco, and Tunisia will also have available export supplies. Short-term outlook World wheat and flour exports in 1962-63 are expected to fall below the record 1,702 million bushels reached in 1961-62. A total 1962-63 shipment of about 1,550 million bushels is now estimated. Export during 1961-62 increased by 184 million bushels over the previous year. U.S. exports during 1962-63 are expected to total about 600 million bushels, a reduction of some 16 percent below the record 1961-62 volume of 718 million. Commercial sales during this period increased to account for over 220 million bushels of the total U.S. volume. World wheat exports are expected to decrease substantially to Western Europe, parts of Asia, and north Africa as a result of record crops in these areas. Strong competition is expected among exporting countries for existing markets. Exports from Australia and Canada to mainland China continue at a high level in spite of somewhat lower import requirements due to increased production this year. Long-term outlook Continued competition of the United States, Canada, Australia, U.S.S.R., Argentina, and France for the world wheat markets can be expected in the years ahead. As previously, several traditionally deficient countries are expanding wheat production by price support and other incentives. Small surpluses, usually of soft wheat, result from time to time due to these practices. Quality hard wheat must still be imported for milling purposes. A large part of the world's wheat trade continues to be carried on under bilateral trade agreements. These agreements, along with foreign government policies regard ing wheat production, trade, and prices will continue to comprise the most important considerations affecting the competitive status of U.S. wheat in the world markets. The grain trade policies adopted by the European Economic Community will tend to reduce future imports from traditional third-country suppliers. France, a regular wheat exporter, will have a preference in supplying the wheat needs of other member countries. However, large quantities of quality wheat will still be needed. Wheat consumption in the developing countries of the world is expected to continue to increase. Declining per capita consumption in more developed countries will be largely offset by population growth. Total wheat consumption should thus continue to grow in the future. Plans for fiscal 1964 A continued joint effort with U.S. producer and trade groups to promote increased demand for U.S. wheat by (1) assisting flour millers and bakers with technical matters relating to problems of quality improvement, (2) continuing with cooperative nutrition education programs, (3) continuing the efforts to improve quality and acceptance of bakery products, (4) participation in international exhibitions, and (5) carrying out research in all areas of marketing and foreign competition and other activities to further the acceptance of U.S. wheat in world markets. World situation RICE World rice production, excluding the Communist countries of Asia and the U.S.S.R., in 1962-63 is forecast at a record 153.2 million metric tons as compared with 150.4 million in 1961-62. This continues an upward trend in world output. This year's gain is due principally to acreage increases and generally good weather in many countries. A strong demand for rice in world markets was a probable important factor in increased plantings. The principal production gains are in Asia, Africa, and North America. Current figures indicate exports in 1962 to be the lowest in several years, even lower than the reduced level of 1961. This low level is a result of poor crops and reduced availabilities in several exporting countries. Stocks of rice at the beginning of the year in the hands of major rice exporting countries were at the lowest point in almost a decade. U.S. rice exports of 947,300 metric tons in 1961-62 were only slightly below the near record level of 1960-61. Most notable in 1961-62 exports were the cash sales to Africa (22 percent of the total compared with 2 percent in 1957-58) and to Europe (21 percent versus 1.8 percent in 1957-58). Short-term outlook The international trade in rice should be relatively strong in 1962-63, but with less fluctuation in prices than in the past year. As a whole, average prices for 1962-63 will likely fall below the average of last year. While world rice production is expected to reach a record, high consumption demands will continue to utilize the additional supplies in 1962–63. U.S. rice exports will likely increase over those of 1961-62 and will slightly exceed 1 million metric tons of milled rice. This increase will be partially a result of increased 1962 production, from a 200,000-acre increase in harvested area and a 271-bushel-per-acre gain in yield. This potential gain in supplies will be balanced against a 47-percent reduction in stocks at the end of the marketing year as compared with the previous year. Cash sales for dollars will undoubtedly fall below those of last year when the world supply situation favored the marketing of U.S. supplies. These commercial sales will, however, be an important factor and there may be some gain in exports to individual areas. Sales under Public Law 480 will be up, offsetting a loss in cash sales. Sales under title IV, Public Law 480, will be noticeable in volume for the first time this year, while title I sales will be up over last year's level. Long-term outlook Assuming no new major restrictions affecting sales of U.S. rice, the pace of our shipments in the world market should continue at a substantial level. New cash markets have been developing, and international tensions may be more of a factor in requirements to such areas as Indonesia and India. Common Market policies concerning rice are still undetermined. However, to the extent that initial regulations might tend to restrict rice imports from outside the Community, U.S. cash sales could be sharply affected. Plans for 1964 The U.S. Rice Export Development Association has continued to make substantial progress during the past year in promoting the consumption of rice in a number of countries. This association represents the entire rice industry of the United States. They are now operating in the United Kingdom, the Netherlands, Switzerland, Belgium, Luxembourg, Republic of South Africa, and Scandinavia. Work is planned to get underway in West Germany, the Middle East, and several other African countries. The project has been well received in all areas and appears to be a promising factor in developing a strong consumer demand for U.S. rice. FEED GRAINS World situation World feed grain production in 1962-63 is estimated at 316 million metric tons, slightly above the 1961-62 total. A record barley crop accounts for the slight increase. World production of oats was smaller. World production of 7,310 million bushels of corn is 100 million bushels below the 1961-62 crop, but still sharply above average. A moderate reduction in the United States, together with smaller crops in France, Italy, and the Soviet Union account for most of the decline. Barley production is at an alltime record in 1962-63. The world total of 3,720 million bushels exceeds the previous record in 1960 by 160 million bushels. The largest single increase was in Western Europe, where expanded acreage and high yields combined to bring total output to 1,100 million bushels, 300 million above the 1955-59 average. This year's world production of oats, estimated at 3,375 million bushels, reflects a continuing decline in oats acreage. An estimated total of 85.6 million acres in 1962-63 contrasts with the 1955-59 average of 118.4 million. The acreage reductions have been fairly general in all major producing regions and were particularly large in the Soviet Union last year. Short-term outlook World feed grain exports in 1962-63 are not likely to attain the record level of 1961-62. However, the decline is expected to be moderate. Total exports amounted to 27.9 million metric tons in 1961-62 as compared with 23.4 million in the previous year and the previous record of 23.7 million in 1959-60. U.S. feed grain exports were a record 14.7 million metric tons in 1961-62 as compared with 11.5 million tons in 1960-61. Prospects for the immediate future indicate a high import demand for feed grains. The United States is expected to again supply slightly over half of the total world trade in feed grains in 1962–63. Long-term outlook The long-term outlook for world feed grain exports is for continued growth in volume. This is particularly true because of increasing demand in high-growthrate countries. These countries are showing a continued upward trend in livestock numbers, improvement in living standards and diets, and steadily increasing consumption of livestock and poultry products. While U.S. exports of feed grains to the EEC have increased thus far this season compared to the same period last year, the prospects for future sales are in doubt. In the years ahead, our feed grain exports to the EEC are likely to be adversely affected if, as is feared, the Community adopts a high price level for grain. In this case, production in France will be stimulated and the EEC's self-sufficiency increased. Plans for 1964 Plans are made to continue to explore by all means the development and expansion of markets for feed grains throughout the world; to improve the quality of U.S. exports; to provide information on grade and quality of U.S. grains; to improve the freedom of access and competitive status in foreign markets; to strengthen liaison between U.S. and foreign cooperators in market development, and to encourage research in marketing and potentials in all major foreign markets. World situation BEANS The 1962 bean supply in the free world is estimated at 99.9 million bags and 2.4 percent below a year ago. This, coupled with suspected short crops in the unreported Communist areas, has resulted in short supplies and rapidly rising prices in West Europe, the world's largest bean-importing market. Prices have risen 20 to 50 percent in recent months in most countries and for several classes of beans. The international trade situation centers in Europe as the world's major importer and the United States as the major supplier with South America, the Communist Balkans, and Africa supplying smaller quantities. Short-term outlook The United States this year has a large supply of pea beans, preferred by bean canners, but frost reduced the supply of Great Northern beans preferred in the European grocery trade. Exports are not coming from the Balkans this year and the South American supplies harvested last May were exhausted early. Thus, U.S. white beans are moving to Europe in larger quantities and earlier in the season than usual. But high prices of Great Northern beans in the United States are holding exports below what might have occurred had U.S. supplies and prices been normal. Pea bean exports will be held below available U.S. exportable supply by limitations of foreign canning capacity and by preference for larger white beans in the European grocery trade. U.S. colored bean production has been sharply curtailed since loss of the Cuban market and the 1962 pinto crop was cut back by the same frost that reduced Great Northerns. There are moderate surpluses of black beans and red kidney beans in New York State, but these and surplus pea beans will be moved into domestic and foreign relief. Long-term outlook For colored beans, much depends on developments in Cuba and Latin America generally. Economic improvements in Latin American and removal of trade restrictions there would expand outlets for colored beans. Inquiries from Latin America for U.S. beans are becoming more frequent each year and shipments under various U.S. export programs are increasing. For white beans, much depends upon development of the canning industry in Europe. Canning of beans by U.S. companies in the United Kingdom has increased that market by 1 million bags in less than 10 years. Some American companies have recently established canning facilities on the Continent. If the results there are as effective as in the United Kingdom, the long-term export outlook is good, especially for canning-type beans. Plan for 1964 The plan is to encourage and carry out exchanges of bean teams and increase the participation of the U.S. bean industry in market development work abroad. A British bean team is expected to visit the United States this summer. Also the U.S. industry is expected to participate in several trade fairs and trade centers abroad. Efforts will continue toward keeping the U.S. bean industry informed as to foreign market possibilities and competitive situations. World situation BEEF World beef production and consumption in 1962 continued to rise. Prevailing world prosperity and high returns to producers in most countries have been encouraging. Demand for meat in world markets is continuing to rise because of increases in population and consumer incomes. World cattle numbers reached a record high in early 1962, 2 percent higher than in 1961. Numbers were even higher in January 1963. U.S. cattle numbers reached 100 million in January 1962 for a new record and probably have exceeded this level in 1963. World production, consumption, and trade in beef is expected to rise in 1963. The United States maintained its position as the world's second largest importer of beef in 1962 but exports of livestock products were slightly lower than in 1961. 95910-63-pt. 3 -67 Short-term outlook U.S. cattle slaughter and beef production apparently reached new high records in 1962 and is expected to be slightly higher in 1963. Per capita consumption of beef reached a record high of 89 pounds per person and is also expected to go slightly higher in 1963. Cattle slaughter in 1962 exceeded 1961 by about 2 percent, however, total beef production for 1962 was only slightly higher than in 1961 due to lower dressed weights of cattle slaughtered. U.S. imports of beef and veal totaling around 1.4 billion pounds (carcass weight) in 1962 exceeded 1961 imports by a large margin and were the highest of record. Imports were equal to 9 percent of U.S. production in 1962 compared with 6 percent the previous year. U.S. beef exports dropped slightly from the preceding year. Long-term outlook World beef production and cattle numbers have steadily increased since the end of World War II. It is expected that these trends will continue, perhaps at a faster pace with present and future prospects for world prosperity. U.S. exports of beef byproducts-tallow, hides, and casings are not expected to be affected much by the formation of the European Common Market. These products will not be subject to variable import levies which will be in effect for carcass beef products, including canned and processed meats. U.S. beef imports probably will decline from current high levels as domestic production increases. Plans for fiscal year 1964 Competition surveys were completed for Ireland, United Kingdom, Germany, and France in fiscal year 1963. Surveys will be made on Argentina, Uruguay, Italy, Yugoslavia, Denmark, and the Netherlands during the current year. A leather promotional program in Japan is successfully underway. Further expansion in tallow promotion in Western Europe is being conducted with particular emphasis on use of tallow in livestock feeds. Plans are made to reduce and remove trade barriers for livestock, meats, and byproducts by all possible means, and to keep the U.S. cattle industry and other meat interests informed of present and future world competition, problems, and opportunities. World situation PORK World hog numbers apparently reached a new high in early 1963. The 483 million head on farms in January 1962 was 4 percent higher than in January 1961 and 40 percent above the 1951-55 average. The U.S. pig crop in 1962 rose to 94 million head, 1 percent above 1961 and 4 percent over the 1951-60 average. Nevertheless, U.S. imports of pork reached an alltime high of around 210 million pounds (carcass weight) in 1962, while exports accounted for around 63 million pounds. Canada received the largest portion of pork exports. Short-term outlook U.S. production and slaughter for 1963 should be considerably higher than in 1962, since a direct correlation exists between the size of the pig crops and slaughter. The U.S. fall pig crop was up 5 percent. Prices of hogs from late winter through the early summer probably will average considerably below 1961. World pork production is more than 40 percent above the 1951-55 average. World per capita pork consumption has risen considerably. U.S. consumption rose from 62.2 pounds per person in 1961 to 63 pounds in 1962 and may increase slightly in 1963. U.S. exports of pork in 1963 are expected to increase moderately; however, domestic demand for pork and lard will be the chief factor determining prices of hogs and pork. Long-term outlook The increase in world production, slaughter and per capita consumption reflects prosperity. U.S. gains in pork production have resulted primarily from abundant supplies of relatively cheap feed and relatively high prices for pork. U.S. pork production would increase materially if grain price supports were lowered and pork prices would fall to more competitive levels in world markets. |