Food Outlook
Global Information and Early Warning System

No. 7/8/9, 1997 - Rome, July/August/September 1997


Export PricesThe world cereal supply/demand balance will remain close in 1997/98. Although, latest information continues to point to another above trend world cereal output in 1997, this would be just sufficient to meet utilization requirements. Replenishment of cereal stocks to a level that would ensure global food security will have to wait at least another year and would depend on another good crop in 1998. However, prospects for next year's crops are already uncertain in some areas where the strongest impact of the El Niño is expected.

Food emergencies persist in 29 countries worldwide, mostly in Africa. The food situation is worsening in several parts of eastern Africa, mainly due to the impact of the unfavourable weather. In Asia, adverse weather in Korea DPR gives rise to concern for the country's already grave food supply situation. The food situation remains particularly grave in Tajikistan and in Iraq where malnutrition remains serious throughout the country, notwithstanding some improvement in the food supply situation with the implementation of the oil-for-food deal.

FAO's latest forecast puts 1997 cereal production at 1 869 million tons, close to the 1996 record crop and above trend for the second year in succession. Wheat output at 600 million tons, is 10 million tons up from 1996, while that of coarse grains is forecast at 888 million tons, 18 million tons down from the previous year. Global rice production is now forecast to remain virtually unchanged at 381 million tons (milled).

FAO forecasts world imports of cereals in 1997/98 at 201 million tons, 2.5 percent up from the previous year's reduced volume. The bulk of the increase is expected in wheat and coarse grains imports by the developing countries. Imports of rice are tentatively forecast to increase slightly in 1998.

Wheat and coarse grains export prices have strengthened in the past few weeks. While wheat markets responded to strong import demand in several countries, particularly in Asia and North Africa, those for coarse grains were influenced by tighter supply prospects. International rice prices eased significantly during the first three weeks of August as harvests drew nearer and output prospects remained favourable.

Global meat production and consumption forecast to grow by 4 percent in 1997. Growth in meat trade may slow down compared with last year, influenced by a subdued import demand in Japan and disease outbreaks which have constrained pig meat export availabilities in major supplying countries.

The world fish catch in 1996 is tentatively estimated to have increased, from the previous year's record. This largely reflects another good catch in China, the world's major producer, and a continued recovery in the Russian Federation.

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