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Prognosis of Demand, Output and Supply of Foodstufs and Raw Amaterials for Industry

Visvaldis Pirksts report in Finnish-Baltic Joint Seminar, Saku, Estonia, published in 'Agricultural Development Problems and Possibilities in Baltic Countries in the Future' (1993) Agricultural Economics Research Institute, Finnland, ISBN 952-9538-35-9, ISSN 0788-5393, pages 55-57 Oriģinālajā salikumā lasāms PDF fails pielikumā

PROGNOSIS OF DEMAND, OUTPUT AND SUPPLY OF FOODSTUFFS AND RAW MATERIALS FOR INDUSTRY

VISVALDIS PIRKSTS
Latvian State Institute of Agrarian Economics
Riga, Latvia

In order to determine the total amount of agricultural products to he produced, the point to proceed from is the forecasts as to consumption of agricultural products. This is why we calculate per capita consumption of the primary agricultural. Based on output analysis for the years 1986 to 1989, we can draw a conclusion that the consumption of primary agricultural products has been rather stable. There is a certain decrease in calories balance caused by decline in sugar consumption.
The process of structural change and decline in quantity started in 1990 and is still in progress. It is in close connection with: 
- spontaneous and chaotic transformations in economic activities;
- decline in output both in industry and agriculture;
- ill-considered and insufficiently elaborated recommendation as to stabilization of production the result of which was a considerable lagging behind of the population income level as if compared with the retail price increase level for foodstuffs.

If we compare the average annual per capita consumption of basic foodstuffs in Latvia (1989) with of other countries, we can point out that the population of Latvia consumed: 

- very much - sugar;
- comparatively much - fish and fish products, potatoes, bread and bread products, milk and dairy products; 
- in middling amounts - eggs, meat and meat products;
- little - vegetable oil, vegetables and cucurbitecaea;
- very little - fruit and berries.

In 1992 the polarity in consumption of primary foodstuffs increased in Latvia. In the families with the highest income level, the daily calories balance (2937) was equal to that of previous years and fully covered their demands. However, the calories balance within the lowest income group (1909 cal.) was 1,5 times less and did not correspond to the standards of rational nutrition. The most conspicuous differences were in milk and dairy products consumption - 1,8 times, vegetable and vegetable oil - 1,9 times, sugar - 2,1 times, eggs, meat and meat products - 2,2 times, fruit and berries - 2,3 times.

Considering the consumption of primary foodstuffs in Latvia and other countries, the changes in household income during the last period, the principles of scientifically - based nutrition standards, forecasts have been made for the consumption level: the optimum, the average and the minimum.
The optimum level is vety close to that of 1986-1989. The decrease in calories is caused by reduction in sugar and egg consumption.

For the calculation of the minimum level, the data on consumptionof primary foodstuffs in low income households in 1991 and 1992 and standards of the "crisis minimum" were taken in consideration. It is envisaged to substitute the reduction in consumption meat and dairy products by increasing the consumption of potatoes, bread and bread products. 

In order to include the visiting or temporary residing population in the total foodstuff balance for the country,the calculations were done for the total number of population of 2,7 million.

The forecasts for the production of primary foodstuffs are presented in the following.

Bread and Bread Products

Theoretically, the agriculture of Latvia is capable of supplying the population of Latvia with bread and bread products, with the exception of some crops like rice and corn, which would not grow in Latvia, and some, like buckwheat and heat with high gluten contents, which breading are complicate. In connection with this, we are compelled to purchase 100 thousand tons of bread wheat in 1993. In future, when the Latvian farmers will be able to raise wheat with sufficient gluten contents, it will be possible to reduce import considerably.

Potatoes

The analysis of the trends in potato production give a sufficient ground for the conclusion that there will be enough potatoes to meet the demand for consumption as a foodstuff.

Vegetables

Last year the acreage planted with vegetables noticeably increased in the subsidiary farms and kitchen - gardens, which will improve the foodstuff balance for many families. Some of the vegetables like water-melons and melons will be imported, so the demand on vegetables will be  met.

Fruit and Berries 

Taking in consideration that the large orchards have been privatized and taken better care of which will increase the productivity; and that fruit import will increase in volume (pineapples, oranges,  bananas, tangerines, lemons, grapefruits etc.) the demand will be met.

Sugar

In the last few years only one-third of the sugar consumed in Latvia was made from sugarbeet, the remaining two-thirds were produced from imported Cuban raw sugar. In 1991 the imports reduced and certain difficulties appeared. In 1993 it is planned to harvest 350 to 400 thousand tons of sugar-beet, which will cover only 65% of the minimum (only about 16 kg per capita).

Milk and Dairy Products

The number of dairy cows is continuing to decrease in Latvia, so it should be expected that the milk output in 1993 will be about 1080 thousands tons. After the deduction of the amount required for reproduction of herd, the result will be only 360 kg of milk per capita or 96% of the minimum.

Meat and Meat Products 

Simultaneously with the reduction in the number of dairy cows, also the herd of cattle is reducing. The number of pigs and poultry is decreasing still more rapidly. In 1993 about 134 thousand tons (slaughter weight) of meat will be produced, which will comprise only about 83% of the minimum consumption level, or 50 kg capita annually. 

Eggs

The decrease in poultry production is more than anywhere else in livestock production. The projections are that about 430 million eggs will be produced in 1993. Considering that about 6% are used for incubation in order to reproduce the number of poultry, it can be expected that only 150 eggs per capita will be left for consumption, which is 75% of the minimum.

Oil seeds

Though the conditions in Latvia are favourable for raising arrested and extracting arrested oil, we are still importing ali of vegetable. Only about 700 ha have been planted in the autumn of 1992, and the yield, in the best case, would be about 1000 tons of seed, which will be an insignificant amount.

Fibre Flax

In order to prevent the decrease of flax producing the produces price for flax fibre should be increased to the level of grain price, so that at least the best flax-producing farms (6 centners of flax fibre per ha and more) would continue flax operations. It would require 122 million LVR (in 1992  prices) to cover this price difference for the 4000 tons of flax fibre.