FAO lowers world grain production estimates

31 December 20203 min reading

wheat production

The Food and Agriculture Organization of the United Nations (FAO) has again downgraded its forecast for world grain production in 2020.

FAO’s forecast for global cereal production in 2020 has been lowered for the third consecutive month, with downward revisions for all the major cereals.

“Nonetheless, global cereal production is still expected to reach a record high level of 2.742 million tonnes, 1.3 percent above the previous year’s outturn,” the United Nations agency said in its latest Cereal Supply and Demand Brief.

Forecast at 1.472 million tonnes in 2020, world coarse grains production has been cut by 6.8 million tonnes month on month.

The bulk of the revision reflects reduced yield prospects for maize in the United States of America (USA), which, however, is still on course to harvest its third largest crop on record, and in Ukraine.

These reductions more than outweigh a lifting of Serbia’s maize production forecast, which is now seen to reach an all-time high in 2020.

The forecast for world wheat production in 2020 has been trimmed marginally since last month to 761.7 million tonnes, putting this year’s output at a comparable level with the 2019 outturn. The downward revision reflects reduced forecasts for Argentina and Brazil.

rice production

As for rice, production prospects have deteriorated in Bangladesh and Viet Nam, in both cases reflecting the adverse impact of weather on secondary crops.

However, the foreseen lower output in both countries, alongside other smaller downward revisions, are partly compensated by an upgrade for Pakistan, where preliminary official assessments indicate that another robust area expansion should lead to a record 2020 harvest.

As a result, world rice production in 2020 is now predicted to reach an all-time high of 508.4 million tonnes, 1.5 percent above the 2019 reduced level but marginally down from the previous month’s expectations.

World trade in cereals in 2020/21 is forecast at 454.6 million tonnes, up 3.2 million tonnes from last month and now 3.4 percent higher than the 2019/20 level.

The forecast for world trade in coarse grains in 2020/21 (July/June) is up 2.7 million tonnes month-on-month and is now pegged at nearly 223 million tonnes and surpassing the previous season’s record by 5.7 percent.

This month’s upward revision primarily stems from a faster than expected pace in maize sales by the USA, driven by continued strong purchases by China.

At 184.5 million tonnes, world wheat trade in 2020/21 (July/June) is forecast to remain near the 2019/20 level, unchanged since last month as greater expected sales from the Russian Federation balance a downward revision to Argentina’s exports as a result of lower crop prospects.

World trade in rice in 2021 (January-December) is now forecast at 47.6 million tonnes, 6.9 percent above the revised 2020 forecast of 44.5 million tonnes.

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