World cereal production, utilization, stocks, and trade all likely to contract in 2022/23 – FAO

FAO’s latest estimates indicate a year-on-year 0.9 percent increase in global cereal production in 2021, largely attributed to a higher maize output. Cereal utilization is also estimated to increase in 2021/22, by 1.1 percent, driven by (in order of magnitude) expansions in food consumption (especially of wheat and rice), other uses (largely of maize), and feed use (mostly of maize). Based on world cereal production and utilization estimates, cereal stocks at the end of seasons in 2022 are seen rising above their opening levels, but remaining below the record levels reached in 2018/19. Global trade in cereals in 2021/22 is estimated below the 2020/21 record level, mostly owing to an expected fall in global maize trade and reflecting the impact of disruptions caused by the war in Ukraine.

Looking forward to the 2022/23 season, early prospects for cereal production in 2022 point to a likely decrease, which would mark the first decline in four years. Based on the conditions of crops already in the ground and planting intentions for those yet to be sown, world cereal output is forecast to fall to 2 784 million tonnes (including rice in milled equivalent), which is down 16 million tonnes from the record output estimated for 2021. Among the major cereals, the largest decline is foreseen for maize, followed by wheat and rice. By contrast, global outturns of barley and sorghum will likely increase in 2022, to represent a partial rebound from the reduced level for barley in 2021 and the highest production level of sorghum since 2016.

World cereal utilization is also forecast to decline in 2022/23 by 0.1 percent from the estimated 2021/22 level, to 2 788 million tonnes. The predicted contraction, the first in twenty years, would mainly stem from expected declines in the feed use of wheat, coarse grains and rice, along with a smaller foreseen decrease in industrial uses, mainly of wheat and rice. By contrast, global food consumption of cereals is expected to increase, keeping pace with the continued rise in world population.

Based on FAO’s initial forecasts for global cereal production in 2022 and utilization in 2022/23, cereal output would not be sufficient to meet the expected utilization requirements, leading to a 0.4 percent contraction in global cereal stocks from their opening levels, to 847 million tonnes. At the current levels of utilization and stock forecasts, the world cereal stocks-to-use ratio would drop from 30.5 percent in 2021/22 to 29.6 percent in 2022/23, the lowest level since 2013/14 but still well above the record low of 21.4 percent registered in 2007/08. Among the major cereals, the drawdown in maize inventories is expected to be the largest. Stocks of barley and rice are also forecast to decline, while those of wheat and sorghum will likely increase.

World trade in cereals is expected to fall to a three-year low estimated at 463 million tonnes, 2.6 percent below the 2021/22 level. This anticipated decline reflects a likely contraction in global trade of coarse grains and wheat, while prospects for rice remain positive. The FAO Cereal Price Index averaged 173.4 points in May, reaching a new all-time high and 39.7 points (29.7 percent) above the previous year’s value. Tighter supplies and market uncertainty, especially for wheat, maize and barley, as well as rising energy and input prices, will likely keep world cereal prices elevated, at least through the first half of the 2022/23 season.

Summary Tables

Tags: corn, grain, wheat, FAO