World production of grain will be reduced by 0.4% in 2017 according to FAO

11:13 | ProAgro

FAO has updated its global forecasts for grain production for 2017, which currently indicate a likely decline in production of 0.4% compared to 2016, even if consumption grows by about 1%.

It has been reported by the press service of FAO.

Thus, the new FAO forecast also indicates that the ratio of reserves to grain consumption in 2017-2018 will drop to 25.8%, which is still at a fairly high level, but slightly below the level of the current season.

It is noted that the new global forecast for the production of cereals has been revised in the direction of improvement compared with the April forecast, as the forecasts for corn yield in Brazil increased compared with earlier estimates to 1,054 MMT. The forecast for world production of rice remained stable at 506 MMT. The forecast for wheat production of 740 MMT also remained unchanged, as the expected decline in production in Australia, Canada, the Russian Federation and the United States will be offset by increased production in the European Union, India and Morocco.

With regard to consumption in 2017-2018, it is expected that a large harvest of corn and other coarse grains will promote their more active use as animal feed in China and South America, while rice consumption is expected to increase by 1,2% as a result of an increase in the share of its consumption in the diet.

According to experts" forecasts, global stocks at the end of the seasons in 2018 will almost equal the level at the time of the opening of the seasons, although their composition will somewhat change. The wheat reserves will increase by 3.3%, reaching a new record level of 247.6 MMT, mainly due to China, which, on the other hand, will reduce the accumulated reserves of feed grain by almost 20.5 MMT.

According to forecasts, international trade in wheat and corn will decrease in physical terms, while commodity turnover of rice will increase, which will contribute to high demand in the Middle East and Africa.