Jan 27, 2010

Cassava New 85

State President hails construction of ethanol plant  (20/3/2010)
Business in brief 24/1 - VietNamNet

Saving The World, 2.0 - Newsweek
Scientists urge swift action to protect cassava crops - Bangkok Post
2 EA firms receive $2m to fight cassava disease - East African
Cassava pest in Latin America, Africa and Asia - Food Crops
Visit regarding cassava pests and diseases
Cassava variety KM 140 was awarded the first-grade prize
Cassava and Vietnam – Now and Then
- CassavaViet
Cassava FAO Food Outlook December 2009 Global Market Analysis



Message for cassava pests and diseases




From Lefroy, Rod
Regional Research Leader, CIAT in Asia
PO Box 783, Vientiane, Lao PDR
email: r.lefroy@cgiar.org www.ciat.cgiar.org/asia


Dear Drs. Bo, Kim, Vien, and Hoat,


Firstly, may I wish you best wishes for 2010.


Following the visit by Tony and Elizabeth last year, to look at the cassava pest and disease issues, I think you are all aware of the visit of Elizabeth’s research assistant, Juan Fernando Mejia. Juan has just left for Bologna, Italy, after collecting plant samples in both Viet Nam and Thailand. He will work with the laboratory in Bologna to try to identify the phytoplasma. So, we are gradually moving forward with some of the steps we outlined during our visit.


We still hope to move forward more rapidly, and ideally with funding for a network to monitor and then work to overcome these problems, but so far we have not generated sufficient interest by donors. As we discussed, part of this process of generating interest is raising awareness, and to this end, the communications people in Cali, specifically Neil Palmer, have prepared a release, and yesterday, the release was posted on the CIAT blog http://ciatlibrary.blogspot.com/. I have attached it as a Word file.


As a result of this news release, we have already been contacted by newspapers from Thailand, the Philippines, Fiji, and Reuters agency seeking more information, so the news is spreading surprisingly quickly. We hope that this will not be a message of panic, but rather a message of caution, especially with regard to selecting and moving planting material and to the incorrect use of insecticides (over-use in the field, compared to use on the stakes during storage, before planting).


(Unfortunately, the press release mentions a link to climate change, which I think is inaccurate. As far as we know, there is no evidence that this is particularly related to climate - although, of course pest and disease incidence do respond to changes in the weather - let alone to climate change. So I would certainly not include such a comment in further information packages.)


The reason I am forwarding this to you is because I think it would be good if we can work out if and how this information can be best used in Viet Nam. In many ways, I think it would be better if this was used as the basis of information to be provided by you to the media in Vietnam (print (Vietnamese  and English), radio, and TV) but with a more specific Vietnamese message andwith quotes from Vietnamese scientists. I do not think there is a direct role for us in such a release, although Tin, Keith, Neil, and I are very happy to work with you if there is anything we can do.


I think a couple of specific issues that may emerge, which were not covered in the blog from CIAT and have been raised in Thailand, I gather, are the threat to exports and to processing. Clearly both will be affected by reduced production, and a flow-on affect on prices, but unlike a pest of disease problem in say fruits, there should be no major impact on the export industry, either as starch or dried roots, in terms of restriction in movement as the main risk is in the transfer of planting material. (I suppose their could be a small risk if infected roots are not dried sufficiently and then come in contact with cassava field, but I assume this risk would be very small.) As for the processors, I assume there would be no affect on starch quality, just the mentioned affect on production and perhaps price.


Another question may be what more can be done. I think we can say that work is underway to identify the main pests and diseases and then develop control measures, but if asked specifically what would happen if funds could be found for a network, then I would suggest something like the following:


§ Quantify the problem.
Initiate surveys to monitor the spread of both the pests and diseases. This would involve quite a degree of capacity building to train people to observe the damage, assess the impact, and identify the causal agents. This would best be linked to a GIS system for monitoring severity and spread – and later the control


§ Refine initial control and quarantine measures.
This would follow the measures outlined at the end of the article, but with greater testing and refinement. One issue will be how to clean up planting material from disease outbreak (which is even harder than controlling the pests). This could eventually lead to simple mass tissue culture techniques to clean up planting material


§ Identify the problems: which insects, what disease, and what are the vectors for the diseases.
Some of this is known (or perhaps just needs confirmation) while some will require very detailed work. In many cases, the life cycles will need to be worked out along with an understanding of the factors that affect the life cycles, and the agents that we would hope to use in biological control. Similarly, there is a lot to be done on the phytoplasma.


§ Identification, mass rearing, and release of biological control agents


§ Look for other cultural measures that may control the pests and diseases


§ Initiate breeding programmes to identify and then incorporate resistance (or at least tolerance) to the pests and the diseases into current well-adapted and high-yielding varieties


I hope this is useful and please get back to us if we can be of any assistance in handling these issues. If any of us are contacted by any Vietnamese media, then I think we should direct them to one of you. Would it be best to suggest they contact Ms. Hop as a starting point?


On a last and separate matter. CIAT will be conducting an External Review of the activities of CIAT in Asia, which will be followed by a visit by our Director General. At present we do not know the dates of the review, but we have a tentative plan that the two reviewers would be in Hanoi on 26 February. As for the DG, I expect he will be in Hanoi around 8 or 9 April. I very much hope that we can arrange a meeting at VAAS for both the reviewers and for the DG.


Kind regards,


Rod Lefroy (D.Phil)

Cassava under threat

Pest and disease outbreaks put SE Asia on high alert

CIAT scientists and their partners in Southeast Asia have issued urgent preliminary guidelines to tackle deadly pest and disease outbreaks that have crippled cassava production in parts of the region.

The move follows a CIAT investigation into reports from Thailand’s eastern and northeastern regions, of damaged and stunted cassava plants with low root yields.

Cassava is an essential pro-poor crop in the region, where it is grown by around 5 million smallholders, mainly to supply the starch processing and animal feed industries. In Thailand alone, the industry is worth US$1.5 billion annually, and the country accounts for three-quarters of the world’s cassava exports.

CIAT entomologist, Dr Tony Bellotti, was part of the investigation team that traveled from CIAT headquarters in Colombia to the region: “When we arrived at the plantations in Thailand, I was stunned. Straight away I realized we’ve got real problems.”

A drive around the Korat region, about three hours from the capital, Bangkok, confirmed the worst: the road was flanked by field-after-field of affected plants.

One troubling discovery was the large number of mealybugs – well-known cassava pests in Latin America and Africa, but rarely a problem for cassava producers in SE Asia. The sap-sucking insects weaken plants, resulting in leaf distortion, and lower root yields.



The Thai fields were also found to be infested by tropical whitefly and red mites, while Cassava Bacterial Blight (CBB) and Brown Leaf Spot disease were also widespread. Although seen before, none of these pest and disease problems had previously caused significant losses in Thailand.

Some analysts now predict a cut in Thai cassava output by at least 30% this season; some farmers face losses as high as 80%. Some have already abandoned their crop.

Dr. Tin Maung Aye, a cassava specialist in CIAT’s Asia office said: “These pests and diseases will place a huge strain on Thailand’s cassava production. Not only will the incomes of smallholder farmers be greatly affected, but so will those of the many laborers employed in the cassava industry. There will be widespread economic and social implications.”

Double-trouble
Then, more bad news as farmers in neighboring Vietnam began to report problems in their cassava crops. The team again found mealybugs, tropical whitefly and red mites, but the main problems were not pests, but diseases.

“The CBB was incredible,” said CIAT pathologist Dr Elizabeth Alvarez. “The disease was just oozing from the stems. I’ve worked with cassava for 30 years and I’d never seen anything like it.”

They also found symptoms known as “Witches’ Broom”, still new to Vietnamese farmers. This is typified by discoloration and distortion of cassava leaves, and shortening of the branches and stems. When the affected cassava is uprooted, the roots are thinner and smaller.

Further investigations are underway, and CIAT is now investigating reports that fields in Cambodia, Laos and the Philippines have also been affected.

“It’s no surprise if these problems are spreading quickly,” continued Tony Bellotti. “If the mealybug, for example, can find its way from its native Latin America, across the Atlantic to Africa, and then to Asia, it can find its way around the Mekong region and beyond.

“We can be fairly sure that China and Myanmar will be hit soon, and in time, Indonesia too,” he said.

“Cassava production in SE Asia has enjoyed an extended honeymoon period. That period is now over.”

Taking control
CIAT Asia is working with national partners to provide cassava management guidelines. “This is a red alert,” said Tin Maung Aye. “We’re still coming to terms with the scale of the problem, but without decisive action, we expect a huge slump in cassava output in SE Asia. That would be devastating for rural livelihoods in the region.

“The spread is almost certainly caused by the movement of infected planting material,” Tin continued. “One of the first responses is for the authorities in affected countries to impose strict quarantine regulations on the movement of cassava, especially the stems used as planting material, and of related species, like jatropha.

“Farmers also need to be trained to select and safely store clean planting material, and to identify pests and diseases. Establishing an effective surveillance and monitoring system with a Geographic Information System (GIS) database is essential.

“We will also need to develop an Integrated Pest and Disease Management (IPDM) strategy, based primarily on biological control. With sufficient and well-focused donor support, the current attempts to develop an effective IPM strategy could be strengthened very quickly, which will help protect next season’s crop. Over the medium to longer term, the biological control and IPDM strategy would be strengthened and include release of natural enemies to control pests and the insects that carry the diseases. Breeding of cassava varieties with greater pest and disease resistance would become a priority.

“As a result of generous, long-term support from the Nippon Foundation, CIAT and partners have had an extremely positive impact on cassava production in SE Asia, and the livelihoods of cassava farmers. We are therefore well-placed to provide solutions to the current pest and disease outbreaks,” he continued.

“But there is no time to lose.”
*

CIAT’s main recommendations at this stage are:
  • Select pest and disease-free plants in the field for collection of stems as planting material
  • Store stems for planting in a cool, dry place, and if necessary dip in a systemic insecticide such as Thiamethoxam
  • Avoid application of foliar pesticides – they can affect beneficial biological control agents
  • Restrict the movement of cassava planting stakes, especially from infected areas and restrict the movement of related species such as jatropha
  • Train extension staff and farmers in the identification of the various pests and diseases and develop a network of trained professionals in the region and a GIS-based system to monitor pests and diseases
  • Initiate research into the identification and control of all observed pests and diseases, and their vectors
  • Initiate a breeding programme to develop resistance to pests and diseases.
For more information, contact Rod Lefroy (r.lefroy@cgiar.org).

Posted by Neil at 8:02 AM 0 comments




BUSINESS IN BRIEF 24/1


CASSAVA NEWS in center point  to follow up Business in brief 24/1 - VietNamNet  The total export value of the cassava industry in year 2009 was estimated to be US$556 million, an increase of 52.8 per cent over 2008. Demand has soared over recent months, largely due to demand from China, which uses the root to produce ethanol.  




VN food firm forms joint venture for rice export in Cambodi Cambodia
The Southern Food Corporation (SFC) has established a joint stock company with two Cambodian firms to produce and export rice, said Chairman of the Vietnam Food Association Truong Thanh Phong.


The new joint venture, called the Vietnam-Cambodia Food Joint Stock Company (Cavifoods), is headquartered in Phnom Penh.The company has a chartered capital of US$8 million, with 37 percent owned by SFC, 30 percent by the Green Trade Company, and 33 percent by the Cambodian Investment and Development Company.Cavifoods’ operations include producing, processing, storing and exporting rice.


The area of paddy farms in Cambodia is equivalent to that in Vietnam. In the past, merchants bought much rice, especially aromatic rice, from Cambodia to export, said Chairman Phong, adding that the joint venture in rice production and export has been approved by both countries’ governments.At present, the company is building a processing factory, a warehouse, an instance noodle mill, a bread mill, and a network for purchasing rice.

Retail market targets 20 pct growth for 2010   

The local retail industry aims to increase total sales by 20 percent this year with experts saying the domestic market remains very attractive.
Retail sales in the country was recorded at nearly VND1,200 trillion (US$65 billion) last year, up 18.6 percent from 2008, the Ministry of Industry and Trade reported at a conference in Hanoi Friday.


The growth was an impressive achievement considering retail sales in large markets like the US, Japan and EU saw contractions last year, the ministry said.


Richard Leech, director of real estate and research firm CB Richard Ellis Vietnam, said at the conference that despite the global economic downturn many new international brands, including UK’s Morgan de Toi and Debenhams, arrived in the country last year.He expected more foreign retailers to enter the local market in 2010.


Dinh Thi My Loan, general secretary of Vietnam Retailers Association, said local businesses always want to cooperate with foreign investors to create a strong retail industry for the country.
US-based market research firm RNCOS has forecast Vietnam’s retail market will expand to $85 billion in 2012.

Coffee prices sink on low demand  

The price of coffee in Central Highland provinces fell by VND1,000 a kilo over the past 10 days to VND23,500 a kilo on January 23 as farmers sold coffee to pay debts and expenditures ahead of the Tet (lunar New Year) holiday, which falls on February 14 this year.

Global prices dropped dramatically to US$1,345 a ton on January 23 after a slight recovery. Coffee prices climbed to $1,400 a ton 10 days ago in London. Prices declined as demand fell while investors favored the greenback over the commodity.

Ha Noi links with Thailand
The Ha Noi Stock Exchange yesterday signed a memorandum of understanding with the Stock Exchange of Thailand in an effort to promote co-operation between the two exchanges. Under the MoU, both exchanges would continue collaborative ties in training and in provision of investment opportunities through networking and business co-ordination efforts designed to increase services and added value for the listed companies.


The two exchanges also planned to promote dual listings once the laws and regulations of their respective markets were to permit them. "The agreement is expected to strengthen the relationship that already exists between our two exchanges, paving the way for closer and more effective co-operation and advance our mutual benefit," said Ha Noi Stock Exchange director Tran Van Dung.


The agreement would allow them to tighten the bonds between the financial markets of Thailand and Viet Nam, contributing to the integration of the ASEAN economic community, Dung said.
Thailand Stock Exchange president Patareeya Benjapolchai said he expected to continue achieving the collaborative framework and the long-term and fruitful development and engagement of the two exchanges."The stronger co-operation and relationship will provide more business and investment opportunities not only for the exchanges, but also for all market participants," he said.


According to a recent survey conducted by the Thailand Stock Exchange, listed companies in Thailand rated Viet Nam among the top three countries for business opportunities.
Sell to smaller Asian nations: Ministry

The Asia-Pacific Department, under the Ministry of Industry and Trade, has recommended that the Ministry should focus on four Southeast Asian countries to boost exports this year. Director of the department, Dao Tran Nhan, said that Laos, Cambodia, Myanmar and East Timor should be considered markets that Vietnamese exporters should concentrate on in 2010. The markets have become important to Viet Nam’s export industry as it is struggling to increase trade to a number of traditional markets such as Japan, China, Singapore and Australia, Nhan said.


The department expects that exports to the four countries will rise, citing surveys showing that Vietnamese products, especially instant noodles, footwear, food and apparel, are preferred in these markets. For example, Nhan said, Vietnamese products, which were showcased at a fair held by the department in Myanmar last July, sold out on the first day of the fair. The four markets are also undemanding so it is easy for Vietnamese products to enter them, Nhan said.


Nhan said that his department targets significantly lifting export turnover from the four markets, of which earnings from Laos  are predicted to be more than double last year’s US$450 million to $1 billion this year. Nhan also recommended that domestic processed goods producers in the southern provinces of Dong Nai and Binh Duong eye the Malaysian market. He said the the demand for Halal food food for Muslim people was expected to rise sharply this year. Many Malaysian importers have recently asked for help from the department to form trade ties with Vietnamese producers to supply food for shipment to Malaysia, Nhan said.


However, Nhan also urged domestic companies to revamp their businesses and improve quality and packaging in order to compete against Chinese products. It will be difficult for Vietnamese exporters to compete with their Chinese counterparts, due to a newly introduced tariff reduction, a result of the ASEAN-China trade agreement that took effect at the start of this year, Nhan said.


Chinese demand pushes Cassava exports up 53%
The total export value of the cassava industry last year was estimated to be US$556 million, an increase of 52.8 per cent over 2008. Demand has soared over recent months, largely due to demand from China, which uses the root to produce ethanol. "The industry exported 158,000 tonnes of cassava and cassava-based products that brought in $36 million of income last December," said Nguyen Viet Chien from the Ministry of Agriculture and Rural Development.


Mainland China remained the biggest importer of Vietnamese cassava and accounted for 90 per cent of the industry’s export income. South Korea and Taiwan were the second and third biggest importers. Prices fell to a low of $135 a tonne at the beginning of last year, but have since risen to between $180 and $195 a tonne.


According to the Ministry of Industry and Trade, Viet Nam has about 508,000ha of cassava under production. In the 2009-crop, 8.6 million tonnes of cassava were harvested.

Metro Cash & Carry to open 12th center in Vietnam

German self-service wholesale chain Metro Cash & Carry will build its 12th center in the central province of Binh Dinh’s Quy Nhon town in 2010.
 
An agreement was signed January 20 between Metro and the provincial People’s Committee at an investment promotion conference in the province.


The new wholesale center will be located on a three-hectare area with 6,000 square meters for selling 25,000 commodities including food and household items. It is expected that the US$15 million store will also come into operation this year. It is the second Metro center in Vietnam’s central region and the 12th nationwide.


Randy Guttery, general director of Metro Cash & Carry in Vietnam, said the new store will contribute to the rapid growth of Binh Dinh Province, which reached 7.96 percent in 2009.

Farmers to get market data
The Institute of Policy and Strategy for Agriculture and Rural Development has established new information channels to better facilitate agricultural enterprises in rural areas, the institute said earlier this week.


The global economic downturn had had exercised exercised significant influence on agricultural enterprises in terms of finding consumer markets and ensuring jobs, said institute director Dang Kim Son.


The institute and various partners would use a wide range of strategies to help these firms overcome difficulties and expand their businesses, Son said.


For instance, the institute has joined with military-run mobile service provider Viettel to provide agricultural enterprises with market information and consultation via instant message or a hotline on 19008062.


The institute would also foster co-operation with the Industry and Trade Information Centre to survey and analyse specific export markets and products in order to offer firms updated information. It also planned to set up conferences to facilitate dialogue between agricultural enterprises and policy planners, Son said.


Ministry project to stabilise rice prices
The Ministry of Finance is drafting a project on State support policies aimed at stabil-ising the domestic rice market, according Minister Vu Van Ninh.


Under the draft project, the ministry recommended that the Government support farmers in many ways, including providing subsidised interest rate loans to farmers to purchase materials and equipment for production.


It also suggested that the Government continuously offer farm ers exemptions and reductions on taxes and fees to partly contribute to cutting input costs for agricultural production. However, Ninh affirmed that all incentive policies under the finance ministry project would be in line with the economic integration pledges that Viet Nam had signed with international institutions.


Ninh said that a fund to stabilise rice prices would also be set up soon to benefit farmers and exporters, especially at this time of rising export volumes and falling value. Support from the fund would help farmers and exporters stockpile rice and sell it at the right time, when demand and prices were highest. The ministry had so far met with rice exporters for the establishment of the fund, Ninh said.


He added that the fund would be used to offset losses that rice exporters had to shoulder, as they had to buy rice from farmers for stockpiles when supply exceeded demand, at prices set by the finance ministry, which was often lower than the market price. The fund would also be used to pay interest rates for loans to rice exporting enterprises, which were required by the Government to buy rice for stockpiles.


Ninh said that the incentive policies were aimed to help boost rice production and ensure farmers could make a profit of at least 30 per cent.


Vietnam exports lamps to Holland

The nation’s largest lamp manufacturer Dien Quang Lamp Joint Stock Company recently exported 100,000 dimmable compact lamps to Holland, worth US$140,000.
 
Users can adjust the lamps’ luminosity from high to low, and thus control the amount of energy used.


The company will begin exporting around 200,000 dimmable compact lamps per month to Holland and plans to expand its domestic market, said a representative of the firm.
It also expects to extend exports to Europe, the US and Australia.


Dien Quang is one of the nation’s largest and most respected names in the compact fluorescent lighting industry, and boasts a 65 percent domestic market share.


In addition, the company continues to expand its products, offering many kinds of fluorescent and incandescent lamps, ballasts, and electrical accessories to foreign countries.


PV
 
Scientists urge swift action to protect cassava crops
Bangkok Post, 23/01/2010
Newspaper section: News


Swift action must be taken to prevent severe pest and disease outbreaks in cassava plantations across Thailand and Southeast Asia, international experts say.


The measures include comprehensive research, better regional monitoring and more rigid quarantine procedures.


International Centre for Tropical Agriculture (CIAT) scientists have issued a ''red alert'' urging the region to tackle pest and disease outbreaks in cassava crops, quickly imposing strict quarantine regulations on the movement of cassava.


''Without decisive action and donor support, we expect a huge slump in cassava output in Southeast Asia,'' said Bangkok-based Tin Maung Aye, a cassava expert and soil scientist at CIAT.


''That would be devastating for rural livelihoods in the region.''


Some 5 million small farmers grow cassava in the region, mainly to supply the starch processing and animal feed industries.


In Thailand, the industry is worth US$1.5 billion (about 50 billion baht) and the country makes up about 75% of global cassava exports, CIAT said.


Department of Agriculture officials attributed the rise in tapioca prices, from less than two baht per kilogramme to 2.7 baht now, to the fact that the cassava plantation area surged to 8.4 million rai in 2008 from 6.7 million in 2007.


Tapioca starch is extracted from the cassava plant.


But the uncontrolled expansion of cassava farms led to disease outbreaks in some 100,000 rai across the country _ from the northeastern to eastern provinces, and now to western provinces such as Kanchanaburi and Kamphaeng Phet in Central Thailand _ said a source at the Agriculture and Agricultural Cooperatives Ministry.


The speed and spread of the outbreaks made it difficult to accurately estimate the damage, the source said.


''It's important that we have proper and swift knowledge to inform farmers,'' the source said.


''It's equally necessary to ensure entire communities follow our guidelines, and don't follow traditional beliefs that mealybugs are easily wiped out by rain.''


The Agriculture Ministry has provided more than 60 million baht to address the problem, but concrete action had yet to take place, the source said.


Mr Tin Maung Aye said mealybugs are sap-sucking insects that weaken plants, resulting in leaf distortion and lower root yields.


''Farmers therefore need to select and safely store clean planting material,'' he said. ''Establishing an effective surveil lance and monitoring system


with a GIS [geographical information system] database is also essential.''


Some analysts now predict Thai cassava output will plummet by at least 30% this season, with some farmers facing losses as high as 80%.


Many farmers have already abandoned their crops and official figures show the area of cassava plantations dropped to 8.2 million rai this year.


''These pests and diseases will place a huge strain on Thailand's cassava production, not only on the incomes of 400,000 cassava growers, but also the many labourers employed in the cassava industry,'' said Mr Tin Maung Aye.


Writer: Achara Ashayagachat
Position: Reporter




$2m bid to fight cassava disease
Written by LEAH BROWN
East African Business, 23 January 2010


DAR, TANZANIA- Tanzania and Uganda are set to benefit from a US$2.4 million grant from the Bill & Melinda Gates Foundation to help the two countries fight cassava diseases and improve breeding varies.

Cassava feeds millions of people in sub Saharan Africa and some of its uses are not well tapped.



The money will specifically go towards identifying some cassava diseases and buying molecular markers for faster and more accurate breeding of cassava varieties that are resistant to Cassava Brown Streak Disease (CBSD).


However, the grant has been directed to the International Institute of Tropical Agriculture (IITA) and its partners, the Agricultural Research Institute (ARI), Tanzania, and the National Agricultural Research Organization (NARO), Uganda, have received the grant that may see cassava production increase.


The disease that is caused by the Cassava Brown Streak Virus (CBSV) and results in a dry rot in the tuberous roots rendering them inedible, is one of greatest threats to food security in sub-Saharan Africa, as cassava is an important staple food from which over 200 million people derive over 50% of their carbohydrate intake.


IITA and ARI have identified a few varieties with some level of resistance to the disease. The four-year project aims to identify the DNA markers associated with the resistance genes in these varieties and integrate marker-assisted selection into cassava breeding programs.


Marker-assisted breeding will enable the breeders to determine whether or not the desired genes of CBSD resistance have been successfully transferred from the parents to the offspring at the seedling stage using DNA testing. This will dramatically reduce the size of the working populations and the time taken to develop improved varieties. According to Dr. Morag Ferguson, an IITA scientist and team project leader, breeding for disease-resistant cassava is the most cost-effective and sustainable way to control the effects of the virus.

CASSAVA: FAO FOOD OUTLOOK DECEMBER 2009

Cassava News in center point to follow up
FAO Food Outlook December 2009 Global Market Analysis  

PRICES


International quotations on the rise

After falling to 30-month lows at the beginning of 2009, prices of internationally traded cassava products have since staged a sharp rally. The most pronounced increase has been registered in quotations for Thai cassava chips (destined for China), which have risen by 53 percent since January 2009, reaching USD 168/per tonne in November 2009. Over the same period, prices of Thai cassava flour and starch (f.o.b. Bangkok) rose by 35 percent and are currently at some USD 338 per tonne. Such has been the strengthening in quotations, that they are, on average, less than 20 percent below the historic highs of mid-2008.

Some of the strength of the Thai reference export prices has to do with the value of the Thai currency, which over the past six months has risen by 7 percent against the United States Dollar. However, a multitude of other developments have assisted. Among domestic factors, the Ministry of Commerce of Thailand intervened by purchasing 13 million tonnes of fresh roots (approaching half the entire crop), in the wake of a record cassava harvest. Beyond Thailand's borders, a shift in cereal policy in China - the world's principal buyer of cassava products, has led to an escalation in domestic maize prices, boosting the competitiveness of Thai cassava starch and chips. The demand-led rally in international prices also reflects a resurgence in the use of cassava chips as a feedstock for ethanol distilleries in Asia. Promising ethanol returns, combined with higher crude oil prices throughout much of the year, have buoyed the demand for cassava in energy and alcohol production.

The upturn in quotations could have been even more pronounced were it not for the continued slump of demand for feed pellets in traditional import markets. Cassava blended with protein rich-meals is an effective substitute for coarse grains and wheat, but ample feed grain supplies and falling grain prices in the European Union, the traditional destination of cassava feed products, has strained the local competitiveness of imported cassava pellets in European Union member countries.

The upward trend in cassava product prices is expected to continue in the near term, though much will rest on the recent reform of the support regime to Thailand's cassava sector and also of policies in China to sustain domestic grain prices. Large stockpiles of exportable cassava products in Thailand as well as in Viet Nam will bear down on prices, but ultimately the prospect of a smaller cassava crop in Thailand in the following season should provide support to prices. So too will a revival in the demand for cassava as a feedstuff in rising livestock production and as a feedstock in energy production, which are both being realized on the back of improving economic environments.
 

PRODUCTION

Food and energy security endeavours propel global production

Global cassava production in 2009 is forecast at 242 million tonnes, 4 percent above the record of the previous year. The high price episode of 2007/2008 for traded food staples reminded policy-makers in many vulnerable countries, as well as the international community, to look toward indigenous crops as an alternative source to potentially expensive and volatile cereals. Among these crops, cassava has been at the forefront. As a 'crisis crop', cassava roots require few inputs, can be left in the ground for well over one year and harvested when food shortages arise or when prices of preferred cereals become prohibitive. These attributes are behind an anticipated expansion of output in Africa, of about 3 percent, to some 121.5 million tonnes in 2009.

Government food-security initiatives with the support of international donors could see production reach new heights throughout the continent. Support often takes the form of distribution of high yielding and disease resistant planting material, extension of 'good agricultural practices', as well as measures to strengthen the value chain, notably food processing into value-added cassava products. However, ongoing long-term programmes for the commercialization of cassava as a food crop constitute the major factor behind Africa's positive prospects. At the country level, Nigeria, the world's leading producer, could produce 45 million tonnes, up 5 percent from 2008, while Ghana is expected to reach an output of 10 million tonnes for the first time since 2003. Investment in the sector could yield strong gains in Malawi and Mozambique. Foreign investment is also set to play a role in boosting production in the region. For instance, China is reported to have provided substantial financial support to the cassava sector in Angola, a new entrant to its existing investment portfolio in the region. However, drought conditions prevailing throughout much of 2009 are likely to have led to output contractions in Madagascar alongside several important cassava producing countries in East Africa, such as Kenya, Uganda and the United Republic of Tanzania.

Cassava production is anticipated to record strong growth in Asia, much on account of Thailand, where, according to officials, a 20 percent rise in production is foreseen in 2009, exceeding 30 million tonnes for the first time. The international market for Thai cassava products has traditionally been the main growth driver for the country's crop, but concerns over subdued demand abroad prompted the Government to intercede heavily in the sector, through reinstating its usual price insurance and intervention purchase scheme, as well as granting preferential credit to farmers. However, the fiscal strain of supporting the agricultural sector has led the Government to launch in November an 'agricultural options programme', in place of the price pledging or insurance scheme. The programme seeks to remove some of the distortionary effects of price supports and will encourage quality over quantity. It will also minimize a longstanding problem of cross-border subsidization of agricultural production, whereby roots from neighbouring countries have been able to benefit from minimum prices. Against the backdrop of falling domestic root prices during the planting period, these incentives (or at least the expectations of continued strong support) were largely behind the record cassava area in 2009, but expectations of robust demand for the crop as a feedstock for ethanol in domestic and neighbouring distilleries have also played a role.

Indeed, biofuel initiatives and policy support, including subsidies and mandatory ethanol-gasoline blending requirements throughout the region have benefited from the allocation of additional land for cassava. Over the past few years, China has initiated large-scale investments within and outside of its borders to expand cassava output for ethanol production. Renewed food security concerns have compelled the Government to extend the moratorium on new grain-based ethanol plants. This has led to roughly over half of China's fuel ethanol and alcohol output now being derived from root crops in the form of cassava and sweet potatoes. Expectations now point to a record for China's cassava output of some 8.7 million tonnes this year.

While promising ethanol prospects are behind record cassava crops in Indonesia and Viet Nam, (the region's other principal producing countries), falling cotton and coffee returns in those countries have also prompted more farmers to switch to cassava cultivation. Officials in Viet Nam put the 2009 harvest at around 8.6 million tonnes. In less than one decade, cassava output in the country has more than quadrupled, reflecting a strategy to gear the sector towards predominantly supplying the international market. However, future progress is likely to be moderated by policy measures to limit the cassava area to no more than 400 000 ha. In the Philippines, public-private sector efforts to develop competitive domestic animal feed and ethanol industries through the commercialization of cassava could pave the way for a record cassava output of well over 2 million tonnes. The country has earmarked a doubling of the cassava area by 2014 from current levels. Smaller cassava producing countries in the region, such as Cambodia and the Lao People's Democratic Republic have also attracted foreign direct investment from mainland China and the Republic of Korea to expand their cassava energy feedstock and starch production, through land lease initiatives and capital outlays towards processing. This initiative contributed to a surge in cassava plantings in Cambodia in 2008 by around 60 percent giving rise to an official production record of 3.6 million tonnes. Prospects for 2009, however, have been marred by adverse weather conditions, which could see production fall by 10 percent.

The 2009 production outlook for Latin America and the Caribbean points to a marginal contraction reflecting an anticipated decrease in the harvested area in Brazil, the region's largest producer. Producer prices trended sharply downwards at the beginning of the year, and while they have rebounded strongly in the past five months, the recovery was too late to affect planting decisions. As for Colombia and Paraguay, the region's other major cassava producing countries, little is known about the current situation, but both countries have experienced firm growth in cassava production in recent years.Production outlook for 2010

Prospects for global production in 2010 appear somewhat mixed. On the one hand, more attractive prices of competing crops, especially sugar cane, could slow the expansion in global cassava production. For instance, Thailand's recent annual planting survey for the 2010 season points to an expected 7 percent fall in cassava area. But, on the other hand, ongoing public and private support in the scaling-up of cassava crops to meet the needs of the food, energy and industrial sectors could provide an impetus for continued growth.TRADE
Global cassava trade set to recover in 2009, but increasingly confined to regional and cross-border transactions

After experiencing a near 15 percent contraction in 2008, world trade in cassava products in the current year is expected to rise by 32 percent to a record 12.5 million tonnes (chip and pellet weight equivalent).

This forecast is based on the improved competitiveness of cassava starch relative to grain based products, combined with soaring international demand for cassava as a feedstock for ethanol production, which have resulted in a stronger pace of cassava shipments to date by Thailand, by far the world's largest international supplier. Overall, the country is anticipated to ship around 7.8 million tonnes of cassava chips, pellets and starch in 2009, up by 14 percent in volume from the previous year. But the arrival of Viet Nam on the arena to fulfil rising industrial requirements in Southeast Asia represents the main reason behind the prospect of record trade in the year. China (mainland) looks set to consolidate its position as the most important buyer on the global stage, accounting for over 70 percent of all inflows in 2009.

The composition of cassava trade has undergone major changes. Trade in pellets (mainly for animal feed), once the bedrock of international cassava demand, has collapsed. In 2009, the share of pellets in the total volume of trade amounted to just over 2 percent, compared with over 84 percent at the beginning of the decade. Asian countries, especially China and the Republic of Korea, have taken over the European Union as the major destination for cassava feed ingredients, and look set to import around 275 000 tonnes in 2009. Concerns about a permanent retreat of the European Union from the import market are resurfacing again. Despite some activity in 2008, the European Union purchased just 17 000 tonnes in 2009 so far and is unlikely to engage in any major purchase in the foreseeable future. Increased availability of cheap feedstuffs in Member States has minimized demand for cassava, to close to disappearance.

Global trade in chips is again expected to be centred in Asia, with China established as the world's leading importer, principally to meet capacity of the burgeoning cassava-based ethanol sector. Indeed, demand for chips by the country is set to underpin aggregate cassava trade in 2009 and imports of the feedstock could rise by as much as 50 percent from the previous year, to 7.7 million tonnes. In the past, Thailand has met this demand, but in the current year, Viet Nam is likely to emerge as the chief supplier, with around 4 million tonnes of cassava chip exports, around double the level of last year. As members of the ASEAN community, imports to China from both Thailand and Viet Nam attract zero duty, which, by boosting the competitiveness of cassava, has constituted an important driver for the expansion of the regional market.

As for cassava starch and flour, world trade is expected to rebound, but not to the same degree foreseen in the global chips market. Thailand is expected to dominate international shipments, with China again anticipated to be the leading starch buyer, reflecting the policy-induced price advantage that cassava based starch has maintained over grain products in that market. The Chinese Province of Taiwan has engaged in significant international purchases during the course of the year, following the liberalization of alternative markets for maize starch.Trade outlook for 2010

Prospects for trade in 2010 are shrouded with uncertainty. Much will depend on the continued presence of China in the global marketplace, which in turn will rest on the country's policy that has given cassava a competitive edge over grain-based substitutes. Indeed, a continued rise of cassava prices in the world market would alter the price relative and undermine the potential for further trade growth, especially when current indications point to a sustained increase in international grain supplies.

Another factor concerns the degree of capacity utilization and expansion in cassava-based ethanol industries in Asia, especially China, which in turn will depend on the margin of ethanol returns, the competitiveness of other feedstocks and the ethanol price relative to petroleum. In this regard, the surge in global sugar and molasses prices may well prompt Asian countries to rely more on cassava to fulfil ethanol mandates and industrial alcohol demand.

UTILIZATION

Food and ethanol drive cassava utilization in 2009

Regarding food utilization, widespread initiatives have been undertaken in many vulnerable countries that target cassava to meet more of the dietary staple needs. This is particularly evident in sub-Saharan Africa, where consumption of cassava (mostly in the form of fresh roots and basic processed products) is on the rise. However, the overall production gain in the region is expected to barely match growth in population, bringing about little change in per caput food availability. Measures to promote domestic cassava flour over imported cereals, either through direct consumption or through blending remain active throughout the world and constitute an important driver for higher cassava food consumption. Brazil mandates the inclusion of 10 percent cassava flour in wheat flour and it is estimated that 50 percent of the country's cassava crop is utilized in such blending. Though several major producing countries in West Africa have also promoted this initiative, especially Nigeria, many have fallen short of enforcement, owing to the limited availability of cassava flour.

The demand for cassava by ethanol sectors will again emerge as the most significant driver in the expansion of cassava utilization. A typical production system can produce about 280 litres (222 kg) of 96 percent pure ethanol from one tonne of cassava roots with 30 percent starch content. China is forecast to produce around 5 million tonnes of ethanol from cassava in 2009, requiring around 7 million tonnes of dried cassava. The country has also secured agreements with several neighbouring countries to supply its ethanol industry with the feedstock. In Thailand, an ethanol plant with a capacity to produce up to 0.5 million litres of ethanol per day was due to go on-line in 2008, but, owing to rising costs during that year, construction was suspended. However, the ethanol facility is expected to start production late in 2009. Thailand requires around 2 million litres of ethanol to meet its 10 percent fuel substitution plan. Likewise in Indonesia, cassava is set to be used in 5 percent ethanol mandatory gasoline blends. With soaring prices of competing feedstocks, sugar and molasses, cassava-based ethanol distilleries in both countries are expected to operate at full capacity.

Utilization of cassava as animal feed, in the form of dried chips and pellets, is mostly concentrated in Brazil and Colombia in Latin America and the Caribbean, Nigeria in Africa, China and the Republic of Korea in Asia. Little is known how feed usage has faired in the former two regions, but the demand for cassava feed ingredients in Asia has plummeted. Similarly, in Europe, cassava applications in the manufacture of feed ingredients have been virtually non-existent in 2009.

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