UN food agency ups cereal forecasts as supply outlook improves

decrease font size  Resize text   increase font size       Printer-friendly version of this article Printer-friendly version of this article

The United Nations food agency raised its outlook for world cereal production and stocks on Thursday as expectations that ample supply of most food commodities would continue dragged prices down for the second month in a row.

The Food and Agriculture Organization's (FAO) price index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 207.9 points in May.

That was a fall of 2.5 points or 1.2 percent from April, when a sharp drop in dairy prices pulled the index down 3.5 points or 1.6 percent from the previous month.

The agency raised its world cereal production forecast to nearly 2.48 billion tonnes, almost 1 percent higher than it reported the month before. It predicted world cereal stocks at the end of crop seasons in 2015 would be 576 million tonnes, an increase of almost 10 million tonnes from last month's forecast.

"Markets are experiencing a rather ample supply situation and expect good supply prospects," FAO senior economist Abdolreza Abassian said. "This is the driving factor behind the downward pressure on prices."

Dairy prices fell sharply again in May, registering a 5 percent slide, following a period of exceptionally high prices in 2013 and early 2014 due to limited export supplies.

Cereal prices fell 1.2 percent in the month, mostly due to good maize supply prospects in 2014-2015. Vegetable oil prices also declined.

Wheat prices, which had contributed to price rises in recent months partly due to fears of disrupted trade from Ukraine, fell in the second half of May as shipping patterns from the country remained regular and U.S. weather improved, the FAO said.

Concerns over a possible sugar production deficit exacerbated by El Nino weather boosted prices by 3.7 percent in May, but indications of large inventories in India and Thailand subdued the rally in the second half of the month.

Meat prices changed little from April as the ovine meat production year drew to a close in Oceania and concerns about Porcine Epidemic Diarrhea constraining pigmeat supplies from the United States appeared to have calmed.

Buyers Guide

Doyle Equipment Manufacturing Co.
Doyle Equipment Manufacturing prides themselves as being “The King of the Rotary’s” with their Direct Drive Rotary Blend Systems. With numerous setup possibilities and sizes, ranging from a  more...
A.J. Sackett Sons & Company
Sackett Blend Towers feature the H.I.M, High Intensity Mixer, the next generation of blending and coating technology which supports Precision Fertilizer Blending®. Its unique design allows  more...
R&R Manufacturing Inc.
The R&R Minuteman Blend System is the original proven performer. Fast, precise blending with a compact foot print. Significantly lower horsepower requirement. Low inload height with large  more...
Junge Control Inc.
Junge Control Inc. creates state-of-the-art product blending and measuring solutions that allow you to totally maximize operating efficiency with amazing accuracy and repeatability, superior  more...
Yargus Manufacturing
The flagship blending system for the Layco product line is the fully automated Layco DW System™. The advanced technology of the Layco DW (Declining Weight) system results in a blending  more...
Yargus Manufacturing
The LAYCOTE™ Automated Coating System provides a new level of coating accuracy for a stand-alone coating system or for coating (impregnating) in an automated blending system. The unique  more...
John Deere
The DN345 Drawn Dry Spreader can carry more than 12 tons of fertilizer and 17.5 tons of lime. Designed to operate at field speeds up to 20 MPH with full loads and the G4 spreader uniformly  more...
Force Unlimited
The Pro-Force is a multi-purpose spreader with a wider apron and steeper sides. Our Pro-Force has the most aggressive 30” spinner on the market, and is capable of spreading higher rates of  more...
BBI Spreaders
MagnaSpread 2 & MagnaSpread 3 — With BBI’s patented multi-bin technology, these spreaders operate multiple hoppers guided by independent, variable-rate technology. These models are built on  more...

Comments (0) Leave a comment 

e-Mail (required)


characters left

Pacesetter Grain Hopper

The Pacesetter Gain Hopper features original and innovative ideas like the patented RollerTrap™, the industry’s easiest to open and maintain trap ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Feedback Form