From the U.N.'s Food and Agriculture Organization, October 8:
The Cereal Supply and Demand Brief provides an up-to-date perspective of the world cereal market. The monthly brief is supplemented by a detailed assessment of cereal production as well as supply and demand conditions by country/region in the quarterly Crop Prospects and Food Situation. More in-depth analyses of world markets for cereals, as well as other major food commodities, are published biannually in Food Outlook.
Cereal markets to remain well supplied in 2020/21
Release date: 08/10/2020
Global cereal markets are expected to remain adequately supplied in 2020/21 despite this month’s downward revisions to production and inventories. With trade in cereals seen expanding in 2020/21, global cereal markets continue to demonstrate their resilience amidst the challenges and uncertainty caused by COVID-19.
FAO’s latest forecast for world cereal production in 2020 has been trimmed 2.5 million tonnes since the previous report in September and now stands at 2 762 million tonnes. At this level, the global cereal output would remain at an all-time high, exceeding the previous year’s outturn by as much as 2.1 percent (55.7 million tonnes). This month’s downward revision reflects lower expectations for the global coarse grains output, with production now pegged at 1 488 million tonnes, down 0.5 percent (7.2 million tonnes) from the previous report. The bulk of the cutback reflects smaller projected maize crops in the European Union (EU), the Russian Federation and Ukraine, due to recent dry weather conditions that adversely impacted crops. Forecasts of maize production in China and the United States of America (USA) have also been lowered due to damage caused by extreme weather events; nevertheless, this year’s maize output in the USA is still seen to surpass last year’s harvest by a significant margin. An upturn in prospects for world barley production, raised by 1.6 percent to 156.6 million tonnes this month, has prevented a larger cut to the global coarse grains production forecast. The improved outlook for barley production is mainly associated with better yield prospects in the EU and the Russian Federation. FAO’s forecast for world wheat production in 2020 has been revised upward by nearly 5.0 million tonnes (0.6 percent) to a record high level of around 765 million tonnes. The bulk of the upward revision concerns Australia, where continued conducive weather has led to better yield prospects and reaffirmed earlier expectations of a substantial rebound in production following two consecutive drought-affected harvests. Higher than previously anticipated yields in the EU and the Russian Federation also contributed to increases in wheat production forecasts, further propping up global production prospects. As for rice, larger than earlier anticipated plantings have boosted the production outlook for Mali, Sri Lanka, the USA and, in particular, India. However, upgrades for these countries were offset by lower forecasts for Egypt, Pakistan and, especially Thailand, which could see tight water availabilities for irrigation precluding a marked offseason production recovery this season. As a result, FAO’s forecast of world rice production in 2020 remains essentially unchanged since September at 509.1 million tonnes, up 1.6 percent year-on-year and setting a new record.
The forecast for world cereal utilization in 2020/21 stands at 2 744 million tonnes, down 2.8 million tonnes since September but still 54.5 million tonnes (2 percent) above the estimate for 2019/20. Total utilization of coarse grains is forecast at 1 477 million tonnes, representing a 41 million tonne (2.9 percent) increase over the previous season’s level despite a cut of 2.7 million tonnes since September. Making up the bulk of the downward revision, the forecast for maize utilization has been reduced on less robust demand growth for industrial and feed uses, especially in the EU and USA. In tandem with reduced feed use expectations for maize, greater anticipated feed use of barley has pushed up the barley utilization forecast to some 6 million tonnes (4.1 percent) above last year’s level, as higher maize prices are seen to increase barley’s competitiveness in feed rations. At 757 million tonnes, the forecast for total wheat utilization is nearly unchanged from September and 5.8 million tonnes higher than in 2019/20, driven by a rise in consumption in Asia, especially China and India. Despite a slight downward revision since September, expanding food intake is predicted to drive a 1.5 percent annual increase in world rice utilization in 2020/21 to a new record level of 510.5 million tonnes....
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