World output of wheat and other major grains fell in 2006, in some cases below expectations, hit by bad weather, with tight supply driving up prices and eroding global stocks, the United Nations food body said on Thursday.
"The most prominent feature of the food and feed markets in 2006 has been the surge in the prices of cereals, in particular wheat and maize, which, by November, had reached levels not seen for a decade," Food and Agriculture Organisation (FAO) said in its semi-annual Food Outlook.
The FAO cut its 2006 global wheat output estimate to 591.8 million tonnes from a previous forecast of 596.3 million tonnes a 5.3 percent fall compared to 2005 and below the average of the past five years.
FAO said it was the biggest fall in wheat output since 1994 and was due mostly to smaller harvests in major Northern Hemisphere producer's Russia, Ukraine and the United States.
FAO said world wheat output should recover in 2007, helped by a reported rise in winter plantings areas and favourable growing conditions to date and it expected prices to return to "moderate levels" after hitting highs unseen since mid-1990s.
Total wheat consumption is seen at 622 million tonnes in 2006/2007, down 1.5 million tonnes from the previous marketing season due to smaller output and higher prices, but food use edged up roughly 1 percent to 446 million tonnes.
Global wheat inventories have fallen to their lowest level since the 1980s, with stocks for crop years ending in 2007 seen falling 16 percent below their levels to around 147 million tonnes.
Global wheat trade in 2006/07 was seen at 110 million tonnes, unchanged from the previous season and just 1 million tonne short of the record in 2004/05, with a sudden surge in imports by Brazil and India offsetting declining imports by many other countries, notably Nigeria and Iraq.
SMALLER MAIZE OUTPUT FAO cut its global coarse gains output forecast to 981.2 million tonnes from a previous estimate of 992.3 million tonnes, down 2.1 percent from 2005 but above the past 5 years' average.
World maize output is seen falling 2.2 percent to 694 million tonnes as crops declined in the United States, Argentina and South Africa mostly due to reduced incentives to plant maize because of high costs and also hit by hot and dry weather.
With maize sowing under way in the Southern Hemisphere, increases in planted areas are seen in South America and South Africa, FAO said. Global barley output was seen at 139 million tonnes, little changed from 2005, with large crops in Russia and Ukraine offsetting falls in Canada, the United States and Australia.
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