Global wheat output hit by war; cereal trade in 2021/22 revised down

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Global wheat production in 2022 is forecast to be 784 million tonnes, a 1.1 percent increase from 2021, the UN food agency FAO said, adding that the latest estimates took into account the war in Ukraine which is expected to hit output hard.

“That estimate factors in expectations that at least 20 percent of Ukraine’s planted area to winter crops, notably winter wheat, may not be harvested due to direct destruction, constrained access or a lack of resources to harvest crops, reports from Russia of continued conducive weather conditions, as well as prospective production trends in China, the European Union, India, North America and elsewhere, the said in its latest Cereal Supply and Demand Brief.

Coarse grain production prospects remain favorable in Argentina, Brazil and South Africa, it added.

Wrapping up the 2021 crop year, FAO’s estimate points to a worldwide cereal production of 2 799 million tonnes, up slightly from 2020, with rice production reaching an all-time high of 520.3 million tonnes (in milled equivalent).

Global cereal utilization in 2021/22 is projected at 2 789 million tonnes, including a record level for rice, with increases also expected for maize and wheat.

Global cereal stocks ending in 2022 are forecast to rise by 2.4 percent from their opening levels, largely due to higher wheat and maize stocks in Russia and Ukraine on account of lower expected exports. The global cereal stocks-to-use ratio is forecast at 29.7 percent in 2021/22, only marginally below the previous year and “still indicating a relatively comfortable supply level,” according to FAO.

FAO lowered its forecast for world trade in cereals in the current marketing year to 469 million tonnes, marking a contraction from the 2020/21 level, largely due to the war in Ukraine and based on currently available information.

Expectations point to the European Union and India increasing wheat exports, while Argentina, India, and the U.S. shipping more maize, partially compensating for the loss of exports from the Black Sea region.

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