FAO forecasts plummeting world grain production in 2009

A smaller global cereal crop this year is foreseen due to fall in planting and adverse weather conditions in the world's major grain producers, according to the United Nations' Food and Agriculture Organization (FAO).

Despite favourable weather conditions for winter wheat throughout Europe and the US, the area planted has still declined, reflecting the possibility of sharply reduced returns compared to last year, combined with persisting high input costs, FAO said.

Southern Africa's corn crop will be lower, while prolonged drought is severely affecting wheat prospects in Asia, including almost half of China's winter wheat area. Severe drought and precipitation is also inadequate in India.

Prospects for coarse grains in South America will be adversely affected by persistent dry weather that is affecting the region.

Nevertheless, last year's record grain harvest globally has replenished stocks.

The FAO estimates total stocks at 496 million tonnes, the highest level since 2002.