FAO reduces world grain supply by 1.8% yoy On November 4, 2022, the FAO published its latest monthly report on the world grain market. Production including rice is classified as lower by -1.8% yoy . However, global consumption is only expected to decrease by -0.7% . A corresponding reduction in inventories takes place. The reserves amount to only 29.4% based on consumption (previous year 30.9%) or are sufficient for 110 days (previous year 112 days). In the case of the wheat market , slight growth of +0.6% was determined due to above-average harvests in Russia and Australia. However, the increase in consumption is not quite as great, so that a small increase in inventory can be calculated. The FAO estimates global rice production to be -2.4% lower than in the previous year. Since the drop in consumption is only to be half as great, the inventory level is reduced to 37% of consumption. This value is still in the upper multi-year average.Other grain production , with a focus on corn, is estimated to be -2.8% lower than in the previous year. Weak maize harvests in the EU, USA and Argentina due to drought contributed to this. The drop in consumption , which is only half as large, leads to a corresponding drawdown on global inventories , which are expected to shrink by 5%. At 22.4%, the supply ratios fall to the lowest value in 10 years. As the world population grows, production of the staple foods grain and rice is declining. Inventories have not increased in years. High energy and fertilizer prices tend to lead to lower yields per hectare with the consequence of lower harvests in the future. An increasing number of malnourished people will continue for the foreseeable future.
