The United Nations’ Food and Agriculture Organization (FAO) is forecasting a 2011-2012 global wheat crop of 690 million metric tons, down -1.4%, or 10 million metric tons, from the record crop of 2010-2011. The FAO projection is in-line with the latest US Department of Agriculture prediction of 693 million tons of wheat for 2012.
The not-so-good news is that prices are rising. Global food prices rose 1% in February, following a 2% rise in January. The January price rise was the first in six months. Higher prices for sugar, oils, and cereals (including wheat) are driving the price increases.
The weaker US dollar is also contributing to the price hikes because most food commodities are priced in US dollars. Colder weather in Europe and the former Soviet Union is also a factor in the rising cost of food.
The FAO press release is available here.
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