Global wheat production to rise

The latest estimates by the United Nations Food and Agriculture Organisation (FAO) has put this year's global wheat production at 619 million tonnes, about 3.6 per cent higher than last year.

The output of rice and coarse cereals is also reckoned to grow to push the total world cereal production to a record 2,121 million tonnes, some 5.3 per cent more than the last year's harvest.

While the production of rice is anticipated to grow by only 1 per cent, that of coarse grains is projected to surge by a huge 8.3 per cent in response to higher demand from the biofuel industry.

The wheat harvest is forecast to increase in most areas barring some parts of Europe, where it might dip marginally due to unfavourable weather. In Asia and North America, where the wheat harvest is either over or underway, an appreciable increase in output is predicted.

In Asia, while India's wheat production has been well above the trend, Pakistan has had a record harvest. The output in China is also turning out to be larger than in the previous year, says the latest FAO report on global food scenario.

"In North America, a bumper crop is expected in the US, where the harvest is well underway in southern parts, but in Canada, the farmers have sharply reduced the area under wheat, mainly because of better price prospects for competing crops" says the FAO report.

In Europe, wheat output prospects have deteriorated significantly in the past several weeks in the south-eastern parts of the region, notably Bulgaria, Romania and Ukraine.

This is attributed to the drought during the spring and early summer. As a result, the region's aggregate wheat harvest is expected to fall by about 1 per cent from the last year's level which, in any case, was below average.

In the southern hemisphere, the planting of the 2007 wheat crop is underway or already over in some parts. In South America, the aggregate area sown with wheat is likely to remain similar to the previous year's reduced level.

However, with planting still to be completed in some major wheat producing parts of Argentina, where unfavourable dry conditions are reported, the final outcome is still uncertain, the FAO report maintains.

The world production of rice, on the other hand, is reckoned by the FAO at 426 million tonnes, up around 1 per cent from 2006 and just marginally less than the record output of 2005.

"However, this figure remains highly tentative as, so far, only countries situated in the southern hemisphere have harvested their main 2007 crops," the FAO points out.

Coarse cereals output is projected at 1,076 million tonnes, about 8.3 per cent higher than the last year's record harvest. The bulk of the increase, however, is accounted for by maize, whose output is set to reach an all time high of 778 million tonnes.

Significantly, maize production has risen sharply in the major producing countries of Argentina and Brazil, reflecting a perceptible expansion in area in response to strong demand for ethanol production.

Besides, the growing conditions remained favourable in these countries, resulting in higher average yields. The second maize crop in Brazil is also projected to rise to a record level.

The area under maize in the US is also reported to have increased substantially due to good demand for this coarse cereal from the biofuel industry. Similar is the case in Europe, but the harvest there would depend on weather in the remaining part of the crop growing season.