Global cereal production brief

Favourable prospects for 2007 world cereal production

Good prospects for the 2007 wheat crops already in the ground in the northern hemisphere augur well for an overall recovery in global wheat output during the year. In Europe, the winter wheat area has expanded in several major producing countries and crops are generally reported to be developing well throughout the region, favoured by mostly adequate moisture supplies and mild temperatures. Of particular note is the early potential for a strong recovery in the east of the region (the Russian Federation and Ukraine) after below-average harvests last year. The exceptionally advanced state of crop development in many parts (compared to a normal year), and lack of protective snowcover, gives rise to some concern over the resistance of plants should temperatures suddenly drop, but for the moment at least, output prospects are good. In North America, the winter wheat area in the United States has expanded to the largest since 2003, and the condition of the crop is generally good. Improvements have even been reported in previously dry southern parts after the arrival of beneficial rains in December. In Asia, a smaller winter wheat crop is in prospect in China: the planted area decreased somewhat and a return to average yields after last year’s record levels is expected. By contrast, a larger output is expected in India, where the crop is already well developed: plantings increased sharply and conditions have been generally favourable. In North Africa, the wheat crop prospects are good in Egypt, the subregion’s major wheat producer, but less certain in other parts where, following a dry planting season, good rains will be necessary during the remainder of the season to avoid significant yield reductions.

The first of the major 2007 coarse grain crops are already planted in some countries. In South America, early estimates suggest the area planted has remained unchanged from last year but yield prospects are reported to be very good following abundant precipitation in key producing areas of Argentina and Brazil. In southern Africa, outlook is generally favourable at the level of the subregion but uncertain in some countries. Largely contributing to the favourable outlook is a significant increase in the area planted in South Africa, the subregion’s major producer. Recent heavy rainfall has been mostly beneficial for developing crops, after erratic precipitation in the early part of the season, although it caused localized floods and crop damage in some parts.

The 2007 paddy season is well advanced in the southern hemisphere rice producing areas, with the harvest due to commence from March-April. The outlook is still rather mixed. Production forecasts are unfavourable for Australia due to persisting drought, but more promising in Indonesia in view of increased government support to the sector. In Brazil, where harvesting is underway, the 2006 output is forecast about average, below last year’s bumper level due to lower plantings and yields.

Table 1. World cereal production¹ ( million tonnes)

World cereal production down 2.7 percent in 2006

Global cereal output in 2006 is estimated at 1 996 million tonnes (rice in milled terms), up slightly since the previous report, mostly on account of revisions for wheat, but still 2.7 percent down from the previous year. The forecast for world wheat production in 2006 now stands at almost 598 million tonnes, 4.4 percent less than in 2005, largely due to reduced plantings and/or adverse weather in some of the world’s major producing and exporting countries, including the United States, several European countries and Australia. For coarse grains, the estimate of output in 2006 is now put at 978.2 million tonnes, which would be 2.6 percent down from 2005. Reduced plantings and adverse weather in some of the afore-mentioned countries is again the principal cause of the reduction.

FAO’s forecast for global rice production in 2006 has been revised downward marginally since the last report and now stands at 420 million tonnes (in milled terms), 0.4 percent below the 2005 level. As more of the 2006 rice crops reached completion, latest information indicated somewhat smaller than expected crops in some major Asian producing countries, namely Bangladesh, Pakistan, Thailand and Viet Nam. However, these downward revisions were partially offset by higher final official production estimates for Japan and the Republic of Korea.