Cereal Production Poised to Shatter Records in 2023/24, Predicts FAO

The Food and Agriculture Organization of the United Nations (FAO) released its latest Cereal Supply and Demand Brief, predicting a record-breaking global cereal production for the year 2023/24. The report indicates that cereal production is projected to reach 2,819 million tonnes, representing a 1.1 percent increase from the previous year.

The improved forecast primarily stems from a positive outlook for global wheat production, which is now estimated at 783.3 million tonnes. Several countries, including Canada, Kazakhstan, and Turkiye, are expected to contribute to this boost in production. However, it is worth noting that global wheat production is still anticipated to be 2.3 percent lower than the previous season's output.

The forecast also reveals a growth of 2.9 percent in global coarse grain output, expected to reach 1,512 million tonnes in 2023/24 compared to 2022. Additionally, world rice production is predicted to rise by 1.2 percent, reaching 523.7 million tonnes, surpassing the reduced level of the previous year. The upcoming season is expected to witness a 0.9 percent expansion in world cereal utilization, reaching 2,805 million tonnes. This increase is primarily driven by the anticipated higher consumption of coarse grains, especially maize, for animal feed.

FAO has revised its forecast for global cereal stocks at the end of the 2023/24 seasons, estimating them to be 878 million tonnes, a 2.3 percent increase from the previous season. With this level of stocks, the global cereal stocks-to-use ratio is expected to remain steady at 30.6 percent, indicating comfortable supply prospects for the new season.

Regarding world trade in cereals, FAO's forecast for 2023/24 suggests a potential 0.9 percent contraction compared to 2022/23, with wheat volumes expected to decline from the record levels previously witnessed. The global situation is not without challenges, as high food prices, economic downturns, conflicts, droughts, and the looming threat of El Niño weather patterns in various regions continue to worsen food security concerns. The latest Crop Prospects and Food Situation report, a quarterly publication by FAO's Global Information and Early Warning System (GIEWS), reveals that a total of 45 countries require external assistance for food.

The report highlights that high domestic food prices, which deviate from the FAO Food Price Index, are contributing to alarming levels of hunger in most of these 45 countries. Among them, 33 are located in Africa, 9 in Asia, and Haiti, Ukraine, and Venezuela.

Although global cereal production is projected to expand by 1.1 percent in 2023 compared to the previous year, the report warns of a contraction in the group of 44 Low-Income Food-Deficit Countries (LIFDCs). This contraction will increase their import needs to meet domestic food requirements.

The quarterly report by FAO not only offers detailed information about food insecurity and price trends on the ground in affected countries but also provides an in-depth assessment of regional production and trade prospects worldwide.