FAO says global grain stocks to fall for third straight year

by Emily Wilson
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ROME, ITALY — Early prospects indicate that global cereal production in 2002 should increase for the second consecutive year, according to the latest forecasts from the Food and Agriculture Organization of the United Nations.

Based on current crop conditions, planting intentions and assuming normal weather, FAO projects world cereal output this year at 1.905 billion tonnes, up 21 million tonnes from 2001 and about 1% above the average of the past five years.

At this forecast production level, world stocks would decline for the third straight season, as anticipated world cereal utilization in 2002-03, at 1.941 billion tonnes, would exceed production. This development gives rise to a potentially tighter supply situation, FAO said.

However, the exceptionally large exportable supplies in several countries are expected to continue to mitigate the negative impact of lower cereal inventories at the global level, for at least another season, the agency said. As a result, international cereal markets are unlikely to experience any significant upward price pressure also during the upcoming 2002-03 marketing season.

Despite this generally favorable global food outlook, some 34 countries around the world, including Zimbabwe, Afghanistan and North Korea, are experiencing severe food shortages, the report said.