|No.4 October 2008|
|Crop Prospects and Food Situation|
World cereal production in 2008 is forecast to increase 4.9 percent to a record 2 232 million tonnes, considerably up from earlier predictions after better than expected results from the major harvests gathered in the past two months.
Based on the latest production forecast, a significant improvement in the global supply and demand balance for cereals in the 2008/09 season can be expected. Even allowing for a larger increase in utilization than was reported in July, an 8 percent increase in world cereal stocks could be possible.
International prices of most cereals have continued to fall in the past two months, largely in response to favourable prospects for 2008 harvests and thus an improvement in the supply outlook for 2008/09, but also reflecting the influence of falling crude oil prices and financial turmoil in world economies.
Despite an improvement in the outlook for global cereal supplies in 2008/09 and the declines already witnessed in international prices, FAO’s latest estimates indicate that 36 countries around the world are in need of external assistance as a result of crop failures, conflict or insecurity, natural disasters, and high domestic food prices. Currently the humanitarian disaster evolving in Somalia gives rise to most concern because of its scale and the speed with which the situation continues to deteriorate.
InEastern Africa, the outlook remains unfavourable for the cereal harvests in several countries, including parts of Ethiopia, Somalia and parts of Kenya and Uganda. Millions of food insecure people throughout the subregion are in need of assistance. In Western Africa, overall early crop prospects are favourable and the current tight food situation is expected to ease somewhat from October onwards. In Southern Africa, the outcome of the recent main season cereal harvest was overall favourable with a recovery in production in South Africa and good crops in several other countries but output fell well below last year and the average in Zimbabwe, already suffering from deep economic crisis. In North Africa, cereal production recovered strongly in most parts affected by drought last year, but Tunisia is facing a smaller harvest.
In Asia, the regional cereal output is set to increase slightly from last year’s good level with bumper crops in China and India more than offsetting reductions expected in Pakistan and the Islamic Republic of Iran. However, serious food insecurity continues to afflict 12 countries in the region.
In South America, record coarse grain crops have been harvested in 2008 following larger plantings, in response to high international prices, and favourable weather. Prospects for the wheat crop are mixed; plantings increased in Brazil but policy and weather factors led to smaller plantings in Argentina.
In many parts of the northern hemisphere the winter wheat crops for harvest in 2009 are already being planted. Although planting conditions are generally favourable, early indications point to reduced wheat areas in both Europe and the United States, reflecting reduced price expectations compared to the outlook last year at this time, combined with the increasing cost of inputs.
|GIEWS||global information and early warning system on food and agriculture|