Global cereals production may fall short of demand

In its initial forecasts for 1999, FAO put overall production at 1.850 billion tonnes, down from last year8217;s 1.877 billion.

8220;If current forecasts materialise, cereal output would not be sufficient to meet expected consumption requirements in 1999-2000 and global cereal stocks accumulated in the last two seasons would have to be drawn down to below safe levels,8221; the FAO said.

Production forecasts were very tentative as many of the crops had yet to be be sown and others were in the early stages of development,the Rome-based agency said in its report.

World wheat output was estimated at 580 million tonnes, down three per cent from 1998, and coarse grains were forecast at 890 million tonnes, down around two per cent.

But rice output was seen increasing marginally to 380 million tonnes from 375 million in 1998. 8220;FAO is tentatively anticipating a recovery in global rice production8230;based on favourable early indications for the first 1999 crops already planted in the southern hemisphere and along the equatorial belt, and the planting intentions in some of the major producing countries in the northern hemisphere,8221; FAO said.

Global food consumption of cereals was forecast to expand by 1.7 per cent, maintaining last year8217;s level of 162 kg per head. The FAO raised its forecast for world cereals trade in 1998-1999 by 1.6 million tonnes to 205.6 million tonnes, some seven million tonnes below the previous year.

8220;All of the revision8230;regards coarse grains and rice,8221; the report said. The international wheatmarket remained characterised by sluggish global import demand and large inventories, which caused prices to weaken further during February and early March.

International rice prices remained under downward pressure from large exportable supplies and relatively limited import demand.

The organisation said serious food supply problems persisted in Africa, Asia, Latin America and the Commonwealth of Independent States.

The report highlighted eastern Africa, where 8220;the number of people in need of food assistance has increased due to poor cereal harvests caused by dry weather and civil strife in several parts.8221;

The FAO revised down its estimate of world cassava output in 1998 to 162 million tonnes from 165 million the year before. It said the decline reflected a fall in Asian output largely as a result of drought related to the El Nino phenomenon, which depressed plantings and yields.

The FAO also expected a small increase in global milk outputfor 1999, with production edging up in most majorproducing countries.