FAO makes further downward adjustment to world grain supply
The Food and Agriculture Organization of the United Nations (FAO) has lowered its estimate of global grain production (excluding rice) by around 20 million tonnes or -0.9% to 2,303 million tonnes in the latest monthly edition (Dec.-2024). However, global consumption is estimated to be +6 million tons higher at 2,322 million tons. As a result, inventories fell by -1.6% compared to the previous year. The comparatively high price level is causing a slight decline in global grain trade.
At 789 million tons, global wheat production is expected to remain largely unchanged at the previous year's level. Higher wheat harvests in major non-European countries will be offset by cuts in the EU-27, Russia and Ukraine.
At 796 million tons, global wheat consumption is also expected to remain at the same level as the previous year.
Wheat trade is down by almost 10 million tons to 198 million tons.
Closing stocks at the end of the marketing year are calculated at -2.2% to just under 310 million tons. This continues the decline in world supply that has been observed for the past three years.
The result is an above-average wheat price level - compared to the years before the war.
In the coarse grain sector, which focuses on 80 % maize, production is expected to fall by around - 20 million tons or -1.3 % to 1,513 million tons. This is mainly due to the lower harvests in the USA and the EU-27.
Global consumption in this segment is estimated to increase to 1,526 million tons. However, global trade will fall by -5.7 %. At the end of the marketing year, stocks are expected to fall by around 5 million tons, the lowest in around 6 years.
Despite all the ups and downs, the market prices for maize indicate a largely stable mood at an above-average level.
For the upcoming 2025 harvest, the FAO notes that winter wheat sowing in the USA has progressed rapidly with increased acreage and an above-average seed level. Very different estimates are published for cultivation in the EU-27 depending on the region. In Russia, on the other hand, a significant reduction in winter sowings is expected due to unfavorable dry and cold spells. In Ukraine, the armed conflicts are also having a negative impact on grain cultivation.
