The UN's Food and Agriculture Organization (FAO) has said the world's wheat and rice producers are heading for a record harvest this year. But not everyone stands to profit from the resulting drop in prices.
Wheat and rice producers the world over were bound to boast a record harvest in 2016, FAO's fresh food outlook suggested Thursday. This would drastically reduce the global food bill as prices fall.
Overall cereal production was projected to rise by 1.5 percent this year from 2015. Such a bumper output would boost food inventories and push down the value of total food imports by 11 percent in US dollar terms as "lower bills for livestock products and cereal-based foodstuffs would more than offset higher bills for fish, fruit and vegetables, oils and particularly sugar," the report argued.
Global wheat production increases are currently being led by India, the US and Russia, which is "poised to overtake the European Union as the largest exporter of that grain."
Worse exchange rates
Rice production has received a great boost from abundant monsoon rains in Asia and output rises in Africa, adding record crops for coarse grain in the US, Argentina and India.
Soybeans and other oil crops could reach a production record in 2016, although supply was being outstripped by surging demand, FAO officials noted.
Nonetheless, many poorer nations will not directly benefit from the windfall, because their currencies have weakened, eliminating the advantages of cheaper food through worsening exchange rates.
hg/jd (dpa, AFP)