|No. 2||Rome, April 2003|
World cereal utilization is estimated to have reached 1 950 million tonnes in 2001/02 1/, up by about 2 percent compared to the previous season, but below trend. Somewhat more than one-half of the 33-million tonne increase in total utilization is attributed to the developed countries, mostly for feed and other uses. The growth in cereal food consumption, to 973 million tonnes, reflected a modest growth in annual per caput food consumption by 1 kilogram to 160 kilograms. Global feed use also expanded by 2 percent to reach 710 million tonnes, while other uses of cereals are estimated to have grown by 3 percent.
World Cereal Utilization
Source: FAO Note: Total computed from unrounded data.
1/ For direct human consumption. 2/ Other uses include seed, industrial uses and post harvest losses.
As usual, the developing countries accounted for most of the increase in cereal food consumption, their total consumption estimated to have risen to 798 million tonnes in 2001/02, some 12 million tonnes above the previous season. At this level, their per caput food consumption would be 167 kilograms, 1 kilogram higher than the previous season. Annual per caput food consumption of cereals among the low-income, food-deficit countries (LIFDCs), considered by FAO to be the group of countries most vulnerable to food insecurity, is estimated to have stabilized at 168 kilograms. However, for this same group of countries without China (mainland) and India, which overly bias the aggregate numbers, annual per caput cereal food consumption actually improved by 1 kilogram to 158 kilograms.
Per Caput Food Consumption of Cereals
Larger supplies, due to improved crops in 2001, accounted for the estimated increase in cereal food consumption among developing countries in Africa and Asia during the 2001/02 season. In Africa, about a 3 percent increase in consumption was due to generally better crop conditions in sub-Saharan countries and most of North Africa. As for Asia, there was only an estimated increase of 1 percent in cereal food intake last season. In China (mainland), the direct consumption of cereals continued to be weak as the population shifts from rural to urban centres and as rising incomes encourage the demand for alternative foods. However, significant improvements in cereal food consumption were estimated for Bangladesh, India, Indonesia, Pakistan and Viet Nam. The use of cereals as food in the Latin American and Caribbean (LAC) region is estimated to have increased by around 2 percent in 2001/2002, primarily in Brazil and Mexico, the two largest cereal consuming countries in the region.
In 2001/02 world feed use is estimated to have risen by 2 percent, or about 14 million tonnes. Most of the gain is the result of greater demand in Asia, the CIS and eastern Europe. A combination of low international prices and bumper crops in several countries are likely to have encouraged larger domestic cereal feed use in the CIS and eastern Europe. Three-fourths of the global increase is accounted for by the CIS, where Kazakhstan, the Russian Federation and Ukraine, in particular, benefited from bumper cereal crops in 2001. Larger coarse grain crops in Brazil, India, the Islamic Republic of Iran, Mexico, Romania and the Federal Republic of Yugoslavia (Serbia and Montenegro) encouraged feed use in those countries. In the case of Brazil, strong domestic and export demand for meats also contributed to growing feed demand. Lower prices promoted greater feed demand in the Republic of Korea and Saudi Arabia in 2001/02.
In contrast, some of the major cereal producing countries experienced downturns in cereal feed usage for various reasons. Cereal feed use in the United States is reported to be down by 2 percent and in the EU by 1 percent compared to the previous season. In the United States, grain feeding was reported to have fallen due largely to smaller livestock inventories. Although EU domestic feed supplies were augmented by large imports of feed quality wheat from eastern European and the CIS countries, these were not sufficient to offset the sharp drop in wheat production in 2001 and short supplies of alternative feeds, such as cassava and corn (maize) gluten. China’s cereal feed use is estimated to have declined by 1 percent, but the drop would have been greater if wheat had not been substituted for much of the 2 million-tonne decrease in the use of maize for feed.
The industrial use of maize continued to grow steadily in some countries in response to rising demand for alternative food, feed and fuel. In the United States, according to official sources, maize used to produce HFCS is reported to have increased by 2 percent in 2001/02, while maize-based fuel additives (primarily ethanol), the largest industrial use of cereals in the United States, jumped by almost 14 percent. The latter increase is attributed to higher use of capacity and the addition of new plants supported by federal programmes to promote alternative fuel. Rising petroleum prices may also have encouraged suppliers to shift towards lower-cost alternative fuel. In China, the industrial use of cereals continued to expand in 2001/02, but seed use and post-harvest losses were down due to smaller crops.
World cereal utilization in 2002/03 is forecast at 1 947 million tonnes, which would be marginally below the previous season’s level and slightly below trend. The volume of cereals used for human food is forecast to rise only modestly, while world feed and other uses could contract. However, among the major cereals, an emerging feature has been the sudden increase in feed wheat use given its large supplies and more competitive prices relative to maize in international markets.
For the developing countries in aggregate, cereal food consumption is forecast to rise only about one-half percent to 803 million tonnes, resulting in a decline of 1 kilogram in per caput cereal food consumption compared to 2001/02. However, cereal food consumption in the LIFDCs (excluding China and India) could be expected to improve, increasing their average per caput food consumption to 159 kilograms. Most of the total increase in food consumption is expected in the developing countries of Asia, reaching some 616 million tonnes, in particular in the south and southeast subregions. India is the one major exception because cereal food consumption is forecast to be down due to poor rice and coarse grain crops in 2002. In Africa, cereal food consumption could increase by 2 percent to reach 116 million tonnes, with much of the gains expected in southern Africa following a season of wide-spread production shortfalls and civil strife in the subregion. Consumption levels in the subregion will also depend on the amount of cereal food aid received during the year. The food consumption of cereals in the LAC region may increase marginally to 71 million tonnes.
After rising in 2001/02, world feed utilization of cereals is likely to be the hardest hit area of global utilization in 2002/03, falling by 5 million tonnes to 705 million tonnes. The entire decline is expected among the developed countries and countries in economic transition. In the United States, cereal feeding is expected to be down by 5 percent because of shrinking animal inventories and lower feed use per animal unit, due in part to higher feed grain prices compared to the previous season. As reported in March, Canadian grain feeding could be down by 8 percent this season, in large part due to the severe drought that hit the country in 2002. Larger maize and wheat feeding are forecast to help offset the sharp drops in other grain feeds, in particular barley. Australia is also facing smaller availabilities of grains because of poor crops, which could reduce feed use, in particular for wheat. Higher coarse grain feeding is forecast to only partially offset the 13 percent fall in wheat feeding.
The EU is forecast to increase its overall feed use of cereals in 2002/03 by about 2 percent, despite a reduction in coarse grain usage. Favourable prices and higher demand for protein substitutes, in response to a ban on meat and bone meals in livestock rations, are expected to boost the demand for feed wheat this season. Larger crops harvested in 2002 and restrictions on meat imports are expected to boost domestic grain feed use in many countries of the CIS, especially in Belarus, Kazakhstan, the Russian Federation and Uzbekistan. Improved crops are also expected to raise cereal feed use in some Asian countries, especially in the Islamic Republic of Iran and Viet Nam. In spite of an expected decline in maize output in Brazil, feed demand is expected to continue to grow to support the expanding poultry industry.
Global utilization in 2001/2002 is the aggregation of individual country marketing years ending in 2002.
2. “Other uses” for cereals includes seed use, post-harvest losses and industrial uses. Post-harvest losses tend to fluctuate in proportion to production changes, in particular in developing countries. Demand for non-food products made from cereals is largely determined by factors outside the agricultural sector.