Economic and Social Department

 global information and early warning system on food and agriculture

 food outlook
No. 5 Rome, November 2003

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Cereals: Supply/Demand Roundup

Cereals: Current Production and Crop Prospects

Cereals: Trade

Cereals : Carryover Stocks

Cereals: Export prices

Ocean Freight Rates

Meat and Meat Products

Milk and Milk Products

Oilseeds, Oils and Oilmeals





Cereals : Carryover Stocks

World cereal stocks to decline in 2004


The forecast for global cereal stocks in 2004 has been raised to 382 million tonnes, up 10 million tonnes from the previous report but still down 94 million tonnes or 20 percent compared with opening levels.1/ This month’s upward adjustments mostly reflect minor revisions to the forecasts for wheat and coarse grain carryovers in a number of major exporting countries. The anticipated large decline in global cereal stocks in 2004 is mostly driven by large reductions in China, India and several countries in Europe, mainly as the result of reduced production. At the current forecast levels, the total cereal stocks-to-use ratio in 2003/04 would drop to 19 percent, the lowest in two decades. The forecast drop of around 53 million tonnes in wheat inventories would account for the bulk of the anticipated contraction in world cereal stocks in 2003/04, followed by an expected reduction of around 21 million tonnes in global coarse grain stocks and 20 million tonnes in rice inventories.

food outlook

Global wheat carryover stocks in 2004 are currently forecast to reach 128 million tonnes, 2 million tonnes more than were forecast in the previous report but still 29 percent less than their opening levels. Aggregate wheat stocks held by major exporters are forecast to reach 36 million tonnes, up 3 million tonnes from the previous forecast, still below their already sharply reduced opening levels. The decline in this season’s wheat inventories among major exporters has been caused mainly by a sharp anticipated contraction in wheat stocks in the EU, where production fell by 11 million tonnes this year. Overall the ratio of major exporters’ wheat carryover stocks to their total disappearance (the sum of their domestic consumption and exports) is thus now expected to fall to 16 percent, down from 18.6 percent in 2002/03 and 4 percentage points below the five-year average.

World Carryover Stocks of Cereals

 Crop year ending in:
 ( million tonnes )
Coarse grains211.6172.6151.7
of which:   
Rice (milled)150.6122.4102.2
TOTAL 588.3 476.0 382.3

Source: FAO.

Along with this situation among major exporters, wheat stocks in China are also forecast to decline drastically again this season. China’s wheat carryovers are forecast to fall to 28 million tonnes, down by one-half from the previous season. With production falling for the fourth consecutive year and imports at a minimum, China has been drawing mostly on its own stocks to meet demand. In India, continuing exports and rising consumption, coupled with a small decline in production, would also result in a decline of some 6 million tonnes in wheat inventories to 21 million tonnes. Wheat carryovers in most CIS countries are also forecast to decline, mainly in response to sharply reduced output this year.

food outlook

World coarse grain stocks for crop years ending in 2004 are currently put at around 152 million tonnes, down 12 percent. Stocks held by major exporters are likely to remain unchanged from their opening levels as larger anticipated maize inventories in the United States would make up for falling maize and barley stocks in the EU. As a result, the ratio of major exporters’ total coarse grain carryover stocks to their total disappearance is put at just over 12 percent, slightly lower than in 2002/03, although still 4 percentage points below the five-year average.

food outlook

As in the past few years, smaller maize stocks in China would again account for most of the anticipated decline in coarse grain carryovers in 2004. Following this year’s decline in coarse grain production coupled with continuing large exports, carryover stocks in China are expected to drop to 47 million tonnes, down 22 million tonnes or 32 percent. Among other significant developments this season, maize stocks in Brazil are likely to more than triple in size to reach 6 million tonnes, as a result of record crops and in spite of a surge in exports.

Fourth consecutive fall in global rice carryover stocks


For the fourth consecutive year, global rice stocks are forecast to fall as consumption is again foreseen to outpace production worldwide. World rice inventories at the close of the crop seasons ending in 2004 are now forecast at 102 million tonnes, down 20 million tonnes from their opening level and 2.5 million tonnes lower than the previous FAO forecast.

Developments in China and India continue to be the major factor behind the worsening of the global stock situation. The deterioration of the production outlook for China in 2003 meant that larger supplies than had been anticipated in the last report would need to be released from inventories to meet domestic demand. As a result, China is now anticipated to draw 17 million tonnes from its rice reserves, 3 million tonnes more than were earlier anticipated, which would bring the estimated size of its stocks down from 78 million to 61 million tonnes. Despite the recovery in production and the expected fall in exports next year, India might also sustain a 2 million tonne drop in stocks to 12 million tonnes, the lowest level in the decade. Sizeable reductions are also attributed to Japan and the Republic of Korea, where the poor crops this season will need to be supplemented by supplies from their stockpile. In both countries, the governments have already started releasing rice from inventories to check a surge in prices. Large exports could also result in falling rice inventories in the United States. Some major importers are also expected to face a decline in their reserves, especially Indonesia and the Philippines. By contrast, carryover stocks could increase from their opening level in Bangladesh, Myanmar, Thailand and Viet Nam, a reflection of the good 2003 crops they are expected to harvest.

1.  World stock data are based on aggregate of carryovers at the end of individual countries’ national crop years.

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