The World Agricultural Trade Simulation (WATSIM) modelling system is a global, partial equilibrium model for regional and international agricultural commodity markets, designed for medium and long term projections and the analysis of macroeconomic and political variables. This paper presents market projections to the year 2020 as well as simulation results of two sensitivity analyses. It is shown that income prospects in Asian countries, as one of the major macroeconomic variables, have significant impacts on regional and global markets. The paper argues, however, that it is important to properly model the decreasing demand response to income changes that accompanies economic growth so as not to overestimate the influence of income changes. The direct impact of policy changes such as the EU Agenda 2000 reform is particularly strong in the medium term, while long term effects are possible because of changes in research and investment behaviour.
