Agri input costs to go up.

ISLAMABAD -- Over the next decade, global agricultural production is projected to increase by 1.1 per cent per year, with the additional output to be mainly produced in middle- and low-income countries, according to a report released by the Food and Agriculture Organisation (FAO) of the United Nations and the OrganiAsation for Economic Co-operation and Development (OECD).

The 'OECD-FAO Agricultural Outlook 2022-2031', released on Thursday, says a prolonged increase in energy and agricultural input prices, such as fertilisers, will raise production costs and may constrain productivity and output growth in the coming years.

The outlook assumes wider access to inputs and shows that increased productivity-enhancing investment in technology, infrastructure, and training will be critical drivers of agricultural growth.

The report says the global agri-food sector faces fundamental challenges over the coming decade, particularly the need to feed an ever-increasing population in a sustainable manner, the impacts of the climate crisis, and the economic consequences and disruptions to food supply linked to the war in Ukraine.

Global wheat production expected to increase by 70m tonnes

The outlook focuses on assessing the medium-term prospects for agricultural commodity markets. The findings of the report underscore the crucial role of additional public spending and private investment in production, information technology and infrastructure as well as human capital in raising agricultural productivity.

Prices of agricultural products have been driven upward by a host of factors, including the recovery in demand following the outbreak of the Covid-19 pandemic and the resulting supply and trade disruptions; poor weather in key suppliers; and rising production and transportation costs, which have been further exacerbated recently by uncertainties regarding agricultural exports from Ukraine and Russia, both key suppliers of cereals. Russia's role in fertiliser markets has also compounded already existing concerns about fertiliser prices and near-term productivity.

The report provides a short-term assessment of how the war may affect both global agricultural markets and food...