Global Information and Early Warning System on Food and Agriculture
Latest indications continue to point to increased cereal output in 2000, although the growth will be lower than expected earlier. This reaffirms earlier forecasts that total cereal production will not be sufficient to meet expected utilization requirements in 2000/01, causing global cereal reserves to be drawn down.
FAO's latest forecast for cereal production in 2000 is 1 881 million tonnes, up 0.3 percent on last year. Output of wheat is forecast at 587 million tonnes, down by 0.4 percent from the previous year, while that of coarse grains is seen to rise by 1.6 percent to 896 million tonnes. The forecast for the global rice crop in 2000 remains unchanged, at 398 million tonnes (milled basis), 1.3 percent less than the record crop last year.
Food supply difficulties persist in many developing countries. As of end-August, the number of developing countries facing serious food difficulties worldwide stands at 36, unchanged from June. Additionally, however, there are several other countries affected by serious but localized disasters, mainly floods and droughts.
World trade in cereals is expected to expand further in 2000/01, to 232 million tonnes, 2 million tonnes above the estimated volume in 1999/2000. Global trade in coarse grains is forecast to increase while trade in wheat may decline marginally.
Cereal export prices remained weak during most of the past three months. However, wheat and coarse grain prices began to recover in late August mostly in response to less favourable crop prospects in some countries and strong import demand.
A gradual tightening of world meat supplies is pushing up prices in 2000. Limited use of export programmes will likely constrain trade growth to only 1 percent with developing countries set to capture all of the growth in meat exports.
During 1999/2000, prices for oils and fats declined further due to record global supplies, while oilmeal prices started to strengthen again due to a tightening supply/demand situation. The 2000/01 season is likely to be characterized by expanding meal production and contracting oils and fats output.