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CORRECTED-FAO says strong rise in wheat output needed to curb prices
November 8, 2012 / 10:42 AM / 5 years ago

CORRECTED-FAO says strong rise in wheat output needed to curb prices

(Corrects quote in paragraph 4 to read “strong demand” not “short demand”)

ROME, Nov 8 (Reuters) - World wheat output could increase in the next crop season but it remains too early to say whether a rebound would be enough to ease pressure on prices, a senior economist at the U.N. Food and Agriculture Organization said on Thursday.

The Rome-based agency said in its latest monthly Food Outlook that early indications pointed to a rebound in wheat production next year but senior FAO economist Abdolreza Abbassian said the forecast was still a tentative one.

“We’re not coming out too strongly on what we think about 2013 production - it’s just too early and speculative,” he told Reuters.

“Conditions were OK up until the time when we were writing the report, which had a cutoff in October but there are dry conditions in the U.S., high quality wheat is in strong demand and there are some concerns,” he said.

“So it’s not a done deal,” he said, noting that conditions in other producer regions like the Black Sea still had to be assessed fully.

However he said that a strong increase in wheat production over 2012/13 levels, which FAO expects to reach 661.2 million tonnes, would be needed if prices were to ease.

“Anything short of a significant increase would mean a further need to draw down stocks, which means getting to critically low levels and therefore higher prices,” he said. (Reporting By James Mackenzie, editing by Antonella Ciancio)

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