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FAO sees steep decline in global cereal stocks

Our Bureau

MUMBAI, Nov. 22

PERSISTING drought in several cereal producing countries has led to a deterioration in the outlook for the 2000 output, according to the latest forecast published by the Food and Agriculture Organisation (FAO).

In the November edition of Food Outlook released on Wednesday, FAO said world production would be well below anticipated utilisation in 2000-01 and there would be a significant decline in stocks.

FAO's forecast for cereal production in 2000 is 1,848 million tonnes, down 1.7 per cent from last year. In particular, output of wheat is forecast at 582 million tonnes (m.t.), down 1.4 per cent from the previous year. Coarse grains production at 870 m.t . would be 1.5 per cent lower. The forecast for global rice crop in 2000 stands at 397 m.t. (milled basis), down 2.3 per cent from last year's record.

Global cereal trade in 2000-01, the report forecast, would reach 238 m.t., one per cent above the previous year's volume, reflecting a stronger demand for coarse grains and rice in several countries. Wheat imports are expected to remain virtually unchang ed from the previous year.

International cereal prices made some small gains since August, mostly reflecting strong import demand amid indications of lower production and prospects for a larger draw down of stocks. For wheat, the increase in higher quality categories was most pron ounced.

On dairy products, Food Outlook said, international prices for most products were well above last year's levels and strong prices are expected to be maintained well into 2001. Although global milk output was expected to rise by 2 per cent in 2000, surplu ses in the major milk exporters were limited and import demand was strong, FAO pointed out.

World sugar production has been forecast to decline in 2000-01, and would be overtaken by consumption for the first time in seven years. International sugar prices have recovered sharply since falling to 14-year lows in February this year, supported by i ncreased demand in the recovering economies of the Far East and the Russian Federation, amid prospects of tighter supplies.

Global cassava production and consumption are forecast to rise by 2 per cent in 2000. Despite growing imports by non-EC countries, global trade in cassava products is anticipated to stagnate, reflecting a depressed demand in the EC. At the same time, wor ld prices have fallen to record low levels.

The number of people facing serious food shortages had increased, despite a decline in the number of countries affected, FAO said.