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Maize output to rise

Milan, June 9, 2007

World output of wheat and other major grains is expected to rise to record highs this year led by maize which expanded on the back of growing energy sector demand, the UN food body, FAO, said.

'FAO's latest forecast for world cereals production in 2007 continues to point to a record output...the bulk of increase in expected in maize,' the UN's Food and Agriculture Organisation said in its semi-annual Food Outlook.

FAO has raised its 2007 global cereals output forecast to 2,125 million tonnes, including milled rice, up 6.2 per cent from 2006 and outpacing a 2 per cent growth in global demand seen at 2,114 million tonnes.

The agency said prices for most cereals would remain high and volatile in 2007/08 marketing season because total supplies would just barely match a rising demand, particularly strong from the fast-growing biofuels industry.

World output of maize -- which is used for food, feed and bioethanol making -- is set to hit a record high of 770 million tonnes in 2007 after bumper crops have been gathered in South America and the biggest areas since 1944 have been planted in the US.

In the US, some 86 million tonnes of maize would be used for bioethanol production in 2007/08, up 60 per cent from already record use in a previous season, FAO said quoting the US Agriculture Department.

World output of barley, the second most important coarse grain, is expected to rise nearly 6 per cent to 148 million tonnes in 2007, and total coarse grains output would jump 9 per cent to a record high of 1,073 million tonnes.

FAO said maize areas expansion would be partly done at the expense of soybeans, whose output is expected to fall, dragging down the entire oilseeds output and boosting prices.

'Aggregate oilseeds production in 2007/08 could fall short of the two preceding seasons' levels as the anticipated rise in rapeseed production may not be sufficient to offset the prospective soybean decline,' the agency said.

FAO raised its forecast of world wheat output to just under 630 million tonnes, up 5.2 per cent from 2006 as bigger harvests were expected in Europe, North America and Asia.

In Europe, total wheat crops are expected to rise six per cent, despite hot and dry weather much of the spring.

In the US, the 2007 harvest may be the biggest since the record in 2003, after crop damage from a cold spell in April turned out to be less than feared and the bulk of crops were in good to excellent conditions, FAO said.

In Canada, a smaller wheat output is expected because farmers planned to switch to more profitable crops.

In Australia, outlook for winter wheat plantings was favourable after timely rains and exports were expected to recover after last year's drought.

World total wheat consumption is seen rising to 632 million tonnes in 2007/08 with food use accounting for more than 70 per cent of the total, but wheat use for biofuels has been growing in Canada and the European Union, FAO said.

Total wheat inventories by the close of the crop season in 2008 are seen at 147.5 million tonnes, down 1.5 million tonnes from already low opening levels, and thin stocks would contribute to wheat price volatility.

Sugar output in the European Union, not including recently joined Bulgaria and Romania, is expected to fall by 16 per cent to 17.1 million tonnes in 2006/07, hit by the bloc's price-slashing sugar policy reform, FAO said revising up its earlier estimate.

World sugar output in 2006/07 rose by a bigger-than-expected 4.8 per cent to 159.2 million tonnes, driven by record production in Brazil and India.

World meat output is set to rise 2.3 per cent to 283 million tonnes in 2007 as the sector recovers after animal disease outbreaks that have plagued it for the past few years and demand has been grwoing in developing countries.

World milk output is set to rise 2.7 per cent to 675 million tonnes<


Tags: Maize | FAO |

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