Accordingly, the ratio of global end-of season stocks to expected utilization in 1998/99 is now expected to reach 16.9 percent, one percentage point higher than anticipated in the previous report. At the current forecast level, total cereal carryovers held by major exporters would rise for the second consecutive year, approaching 39 percent of the world total, as compared to 34 percent at the beginning of the season and only 28 percent in 1996. By contrast, cereal stocks held by other countries, particularly the developing countries, are expected to remain unchanged from the previous year.
The forecast for wheat stocks for crop years ending in 1998 has been revised upwards by 8 million tonnes to 134 million tonnes, 19 million tonnes, or 17 percent higher than their opening level. Most of this month's revisions reflect the adjustments to carryovers in China where lower domestic utilization combined with a slight upward revision of production would result in bigger carryovers than estimated previously. Among the major exporters, wheat stocks are anticipated to rise despite a decline in their aggregate production. Most of the increase would be on account of the anticipated decline in wheat utilization, especially for feed, and lower exports. The forecast for world coarse grains stocks for crop years ending in 1998 has also been raised, by over 11 million tonnes, to 134 million tonnes, some 8 million tonnes, or 7 percent, above their opening levels. This month's significant increase in the size of carryovers mainly reflects an unexpected downward revision in the estimates of maize export estimates and domestic utilization in the United States, which, according to the latest official reports, are smaller than earlier anticipated. In the EC, the estimate of total coarse grain stocks at the end of the season is almost unchanged at 25 million tonnes, up 10 million tonnes from their opening levels. Large quantities of EC barley are expected to be held in intervention stocks for the first time in almost five years.
Early indications suggest that world cereal carryovers could rise for
the third consecutive year in 1999 and reach 328 million tonnes, up about
6 million tonnes, or 2 percent, from the current season. Thus, for the
first time in four years, the global stock-to-utilization ratio could return
within the 17-18 percent range considered by the FAO Secretariat as the
minimum necessary to safeguard world food security. This assumes that current
forecast levels of 1998 cereal production and 1998/99 utilization materialize.
At present these indicate that world cereal production would exceed global
utilization in 1998/99, thus allowing for some further increase in stocks,
especially among the major exporters.