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World cereal production in 2023/24 seen on par with the 2021 record

World cereal production in 2023/24 seen on par with the 2021 record

(Posted on 12/09/23)

The Food and Agricultural Organisation of the United Nations (FAO) forecast for global cereal production in 2023 has been revised down by 4 million tonnes compared to the previous figure released in July.

Nevertheless, despite this month’s downgrade, world cereal production is seen increasing by 0.9 percent year on year, reaching 2 815 million tonnes, on par with the 2021 record outturn. Most of the reduction this month relates to a downturn in global wheat prospects, with the world output now pegged at 781.1 million tonnes, 2.2 million tonnes lower than expectations in July. At this level, the world output is set to decline by 2.6 percent year on year but would still be the second largest outturn on record.

Downward revisions that have been made to production forecasts for Canada and the European Union, due to continuing dry-weather conditions that curtailed yields, accounted for much of this month’s decrease. The wheat production forecast for China was also scaled down, albeit by a smaller margin, as heavy rains in key producing regions downgraded yield prospects. Offsetting some of these reductions, production forecasts were raised for the United States of America, where updated survey data indicated a larger spring wheat area, as well as for India and Ukraine, reflecting recent government data indicating higher than previously anticipated yields.

The forecast for global coarse grains production in 2023 is down 1.3 million tonnes compared to July’s outlook and now stands at 1 511 million tonnes, still up 2.7 percent on a yearly basis, with the bulk of the new cuts stemming from barley and oat crops. The forecast for world barley production was reduced by 2.9 million tonnes to 143.8 million tonnes, down 5.6 percent year on year. The lower production outlook reflects a deterioration of crop conditions and yield prospects in the European Union and Canada. The diminished outlook for global oat production largely concerns lower crop prospects in Canada, the European Union and the United States of America, driven by lower-than-expected planted areas as well as yields. This is expected to result in the global oat outturn in 2023 decreasing to an 11-year low estimated at 23.1 million tonnes. Partly compensating for these declines, world maize production has been raised by 3.6 million tonnes and is now forecast to reach a record high of 1 215 million tonnes.

The upturn in prospects is linked to better crops in Brazil and Ukraine, where maize yields are exceeding earlier expectations, more than offsetting production cuts made for the United States of America and the European Union. As for rice, FAO’s global production forecast for 2023/24 has also been lowered since July by 500 000 tonnes, down to 523.2 million tonnes, which is still 1.1 percent above the 2022/23 reduced level. The revision primarily mirrors lower area estimates for Indonesia’s April-concluded main-crop harvest as well as reduced expectations for Thailand, where main-crop plantings have lagged behind year-earlier levels due to irregular rains and reduced water supplies for irrigation. Excess rains and flooding in north-eastern provinces also reduced harvest expectations for China somewhat. These revisions were partly offset by forecast upgrades for various other countries, in particular Cambodia, Colombia, the Islamic Republic of Iran, Nigeria and the United States of America, in all cases largely due to higher plantings than previously envisaged.

World cereal utilization in 2023/24 is forecast at 2 807 million tonnes, up 1.5 million tonnes since July and 22.1 million tonnes (0.8 percent) above the 2022/23 level. Higher wheat utilization in India, stemming from larger anticipated domestic production and availability, is mostly behind a 2.3-million-tonne upward revision in the global wheat utilization forecast for 2023/24, now pegged at 785 million tonnes, up 0.6 percent above its 2022/23 level. The forecast for total utilization of coarse grains in 2023/24 is pegged at 1 501 million tonnes, down 1.6 million tonnes from the July forecast but still up 1.2 percent from the 2022/23 estimated level. Lower anticipated utilizations of barley for feed in Canada and the European Union are behind this month’s downward revision, reducing the total barley utilization forecast for 2023/24 down to 0.8 percent below last season’s level. World rice utilization in 2023/24 is now pegged at 520.9 million tonnes, up 800 000 tonnes from July expectations and broadly stable year-on-year. Although a tighter overall supply outlook led to downgraded forecasts for a host of Asian and African countries, these revisions were outweighed by an upward adjustment made for India, where another comparatively large harvest on the backdrop of reduced exports could keep food intake above pre-pandemic levels for another season, while volumes destined to ethanol production remain on an expansionary trend.

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