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The revision of the forecast for consumption and grain stocks for the 2022-2023 season is due to a decrease in the forecast for grain production

Persistent dry conditions in northern hemisphere countries have led the FAO to forecast the grain production significantly reduced for 2022. Estimated global grain production is estimated at 2022 2 million tonnes in 774, up from a forecast of 17,2 million tonnes previously published in July. A drop of 1,4 percent (38,9 million tons) is now expected compared to the same period last year.

This drop mainly affects feed grains, with global production estimated at 1.483 million tonnes, 17,9 million tonnes less than in July and 1,8 percent (26,8 million tonnes) below 2021 levels. Much of this expected reduction is due to a drop in production in the European Union, where hot and dry weather conditions that have persisted since late spring are expected to result in a crop loss of 16 percent compared to the average over the past five years. The forecasts for corn production in the United States are also slightly lower, mainly due to adverse weather conditions in the Midwest, which resulted in a less than favorable type of harvest.

The rainfall deficit has also had a negative impact on the Gersten- and millet harvest in the European Union and the United States, causing an overall decline in world production forecasts for these cereals. This decline in forecast volumes significantly outperforms revisions to corn production forecasts based on cheaper crops in Argentina and Ukraine, where production is still expected to be 38 percent lower year-on-year.

The forecast for the world wheat production 2022, on the other hand, was increased by 6,7 million tons this month and is now at 777 million tons, slightly lower than in 2021. This forecast increase is mainly due to favorable weather conditions in Canada and the United States (resulting in a more favorable type of crop and increased the likelihood of a recovery in 2022) and in the Russian Federation, where the largest gross production in history is expected as spring wheat crop types were encouraged by sustained favorable weather conditions. According to the recently published official estimates, gross production in China is expected to be higher than previously expected.

The persistent rainfall deficits in wheat countries are having a negative impact on wheat production, the forecast for which was again slightly lowered this month. Compared to the July forecast, the FAO has cut expected production in 2022 by 6,0 million tonnes to 514,5 million tonnes, which is 2,1 percent below the record level set in 2021 but still above average. This revision mainly reflects the impact of uneven precipitation distribution in South Asia. This is particularly acute in India and Bangladesh, where the planting campaign is ongoing, increasing the likelihood that initial losses will be recouped when weather conditions return to normal in the coming weeks.

Based on official estimates of the impact on the crop impact of an acute shortage of production resources on the main crop, the production forecast for Sri Lanka has also been lowered. This, combined with some adjustment to the decline in production forecasts in the European Union, United States and Vietnam, exceeds expected production growth in Brazil and some West African countries.

Compared to the July forecast, the FAO forecast for global grain consumption for the 2022-2023 season has been reduced by 5,1 million tonnes to 2 792 million tonnes, which is 0,1 percent (2,8 million tonnes) below the level of the Season 2021-2022 is. The main reason for the downward forecast for this month is the drop in expectations for feed grains, which have been adjusted by 6,6 million tons from the July forecast, mainly reflecting lower consumption of barley feed (especially in the European Union, Morocco and Morocco). in Saudi Arabia) and sorghum (particularly in China and the United States) than previously expected.

Following this retrospective review, feed consumption for the 2022-2023 season is now estimated to be 0,2 per cent below the level of the 2021-2022 season (2,7 million tonnes), mainly due to forecasts of a decline in feed consumption, particularly in the United States, Morocco, Mexico and the European Union, due to an expected decrease in production compared to last year.

On the other hand, the forecast for wheat consumption for the 2022-2023 season has been increased by 2,2 million tons compared to July, as the expected increase in production is currently expected at a level close to the 2021-2022 season of 773 million tons, currently it is assumed that the annual increase in food consumption will offset the expected decrease in wheat consumption per feed. The FAO lowered the forecast for rice consumption for the 2022-2023 season by 800.000 tonnes, which is expected to remain at a level close to last year's record 522,2 million tonnes, as continued high demand for food grains offset the likely decline of others types of end use of Rice, especially for animal feed, will compensate.

In light of the revision made this month to lower the 2022 grain production forecast, the forecast for world grain stocks for the end of the 2023 season has also been lowered by 9,3 million tons to 845 million tons compared to the July figure, which is 2,1 percent lower .18,5 percent (30,9 million tons) below the level at the beginning of the season. As a result, the global grain stocks-to-consumption ratio is expected to decline slightly from 2021 percent in the 2022-29,5 season to 2022 percent in the 2023-2013 season, the lowest since the 2014-XNUMX season , but historically still remains relatively high.

The main reason for the downward adjustment in global stocks was the expected fall in European Union maize stocks as a result of the deterioration in crop types since the publication of the previous report in July. After lowering forecasts for global forage grain stocks by 8,3 million tons this month, their volume is now 4,0 percent (14,7 million tons) below the start of the season and could be 355 million tons, with corn stocks falling , barley and sorghum are to be reduced by 3,3, 7,7 and 10,4 percent respectively. Global wheat stocks for the end of the 2023 season, projected at 299 million tonnes, are little changed from the July forecast; it is now thought to be slightly higher (by 0,7 percent or 2,0 million tonnes) compared to the start of the season.

However, much of the expected year-on-year increase is expected in China and the Russian Federation, and to a lesser extent Canada and Ukraine. In contrast, stocks are expected to decrease significantly in the European Union and India, while smaller stock reductions are expected in Australia, the United States and some countries in Asia, the Middle East and North Africa. The FAO's revised forecast for global rice reserves at the end of the 2022-2023 season now stands at 190,9 million tonnes, which is 2,9 percent (5,8 million tonnes) below the revised all-time high for the 2021-2022 season and 800.000 tons less than the previous July forecast.

Much of this revision is due to a decline in forecast and an expected decline in inventories yoy in key exporting countries; however, total rice stocks in these countries are expected to remain at an all-time high of 2022 million tonnes due to estimated high harvests in 54,0 and large early-season stocks, particularly in India.

For the 2022-2023 season, forecast global grain trade is 469,6 million tonnes, which is 2,0 million tonnes higher than the July forecast but still 1,9 percent below the figure for the 2021-2022 season . The forecast for world wheat trade for the 2022-2023 season (July-June) remains almost unchanged compared to the July forecast and continues to point to a 1,8 percent reduction in its volume compared to the level of the 2021-2022 season (July-June ) there.

The expected increase in exports from Canada and the Russian Federation, driven by the increase in projected production levels, will be offset by the expected reduction in supplies from European Union countries as a result of less favorable harvests and from India, where export opportunities are being improved by efforts of the country to curb rising domestic prices by restricting wheat exports.

Ukraine resumed shipments of grain from its Black Sea ports under the Black Sea Grain Initiative in August, but so far shipments have mainly been made of corn, leaving FAO's forecast for wheat exports by Ukraine unchanged, at 10,0 million tons . However, increasing the forecast for corn production in Ukraine has allowed the FAO to increase the forecast for exports of this crop in the 2022-2023 season by 2,0 million tons to 17,0 million tons. Deliveries to Argentina and Brazil are also expected to increase compared to previous forecasts due to a convergence towards record-breaking and record-breaking harvests.

As a result of this review and due to the expected increase in corn purchases by the European Union to compensate for the fall in production, the FAO has increased the forecast for global corn trade for the 2022-2023 season (July-June) by 3,4 million tonnes, which now matches the forecast level for the 2021-2022 season of 181 million tonnes. Nonetheless, in the 2022-2023 sales year (July-June), global trade in feed grain is reduced by 2,6 percent from the level of the 2021-2022 season to 223 million tonnes, as global trade in barley and sorghum is expected to decline.

As for the drop in barley trade, it is mainly due to the expected drop in demand from China and Turkey, as well as reduced supplies from Australia and Ukraine; for sorghum, the decline is solely the result of projected reductions in export capacity in the United States and imports to China. It is believed that in 2022 (January to December), the world rice trade volume may reach 54,4 million tons, in 2023 55,0 million tons. India is expected to retain its position as the top rice exporter, shipping more than 20,0 million tons per year.

Source: FAO UN

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