Japanese government breaks with World Bank food forecast.

• Author: Brown, Lester R.

In a new assessment of the world food situation, the Japanese Ministry of Agriculture released projections in late December which show a doubling of world grain prices by 2010. The Ministry forecasts that by 2010, the world price for wheat will be 2.12 times that of the base year of 1992, while the price for rice will be 2.05 times the base. The Japanese analysis differs sharply from the projections of the World Bank, which has stuck with its projection of continuously declining grain prices during the same period.

For years, the economists responsible for projecting the supply and demand of agricultural commodities at the World Bank and at the U.N. Food and Agriculture Organization (FAO) have been projecting a continuation of grain surpluses and declining grain prices through 2010. As recently as January 1996, Don Mitchell, head of the World Bank team, confirmed this view - the rationale being that the past is the only guide to the future and that, therefore, the use of linear extrapolations to project future yields and production is the only reliable method.

Few analysts would dispute that the past is the only guide to the future, but what the Japanese forecast takes into account is that past experience with biological growth in finite environments - whether of newly introduced algae in a petri dish or caged rats with ample food but limited space -has repeatedly shown that straight-line extrapolations do not describe what ultimately happens. Growth eventually tapers, as one natural constraint or another comes into play. With algae, it is the accumulation of waste that slows growth; with rats, stresses associated with crowding lead to aberrant sexual behavior and reproductive failure, which in turn checks population growth. The historical rise of grain yield per hectare, which is also a biological growth process in a finite environment, is subject to its own biologically imposed limits. Even when fertilizer supplies are unlimited, other constraints operate to limit the rise in grain yield.

In recognizing the likely effects of those constraints, the Japanese forecast falls closely...