The Food and Agricultural Organization (FAO) of the United Nations says despite a 3 MMT downward adjustments to its 2013-14 global cereal production forecast, the outlook remains favorable as it expects the crop to surpass last year by nearly 8% at 2,489 MMT.
FAO lowered its South American wheat crop forecast, but said the U.S. maize crop (corn) accounts for the bulk of the increase from year-ago as it sees the crop at 348 MMT, up 27% from last year.
The FAO forecast for world cereal stocks by the close of seasons in 2014 has been revised downward by almost 2% since September, to 559 MMT -- still the highest level since 2001-02. International trade in cereals in 2013-14 is forecast to reach 312.4 MMT, 1.6% higher than in 2012-13 and slightly above the level expected in September. Trade in 2013-14 is expected to benefit from larger export availabilities of coarse grains in particular, it says.
Meanwhile, FAO says its Food Price Index dropped for the fifth straight month, driven by a sharp fall in international cereal prices. Meanwhile, the prices for dairy, oils, meat and sugar rose slightly. The index declined by 2.3 points to 199.1 points last month and is down 11 points since the beginning of the year.