The latest forecast by the Food and Agriculture Organization of the United Nations for global grain production in 2022 is 2.768 billion tons, a downward revision for the second consecutive month, a decrease of 5.9 million tons month-on-month and a year-on-year decrease of 1.7%. Lower coarse grain production is the main reason for this month's lower cereal production forecast. As severe weather continues to dampen yield prospects in major producing countries, the forecast for world coarse grain production in 2022 is 1.468 billion tons, a decrease of 14.3 million tons month-on-month and a year-on-year decrease of 2.8%. The quarter-on-quarter reduction is mainly driven by the expected decline in corn production in the United States. On the one hand, insufficient rainfall has led to a contraction in corn yield forecasts; on the other hand, the country`s corn planting area has also been slightly revised downward.
Corn production forecasts are also lowered for the EU and the Republic of Moldova, but to a lesser extent, as drier-than-average weather further dampens yield expectations. According to the latest official data from Brazil, the corn production forecast was revised down slightly, but production remains at an all-time high for the country. Global barley production is raised 2.5 million tons, partly offset by lower corn production, mostly reflecting better prospects for Russian barley production, now forecast at 147.9 million tons, up 1.7 percent year-over-year. Ukraine's coarse grains production forecast is unchanged from last month at 33.1 million tons, down 38 percent from a year ago. The 2022 world rice production forecast is down 1.7 million tonnes month-on-month to 512.8 million milled tonnes, down 2.4% from the record high in 2021 but still above average. The quarter-on-quarter reduction is mainly due to a further contraction in China's production forecast, as persistent summer drought and high temperatures have affected crop development in the Yangtze River basin; on the other hand, recent severe floods have curbed production in Pakistan. Rice production forecasts have also been lowered slightly for several other countries.
Despite upward revisions to production forecasts in the Islamic Republic of Iran, Thailand and some West African countries, the overall downward trend in rice production has not been reversed. Contrary to the trend of coarse grains and rice production, the forecast for global wheat production in 2022 was revised up by 10.2 million tons month-on-month to 787.2 million tons, a year-on-year increase of 1.0%, a record high. Of these, better-than-expected yields for soft wheat crops in the European Union led to better-than-expected yields, while Russia contributed the lion's share of this month's increase, supported by favorable weather conditions.
In Australia, good soil moisture at planting and favorable rainfall forecasts have boosted production prospects, with the country's wheat production expected to be the second-highest on record in 2022 after 2021. Therefore, despite a slight deterioration in crop conditions due to poor rainfall in Argentina, the slight downward revision to the Argentine wheat yield forecast will not affect the overall trend for the month. In addition, Ukraine's wheat production forecast for this month remains stuck at 20 million tons, down 38% from a year earlier.
The forecast for world cereal consumption in 2022/23 is 2.784 billion tons, down 8.7 million tons, down 0.5% from 2021/22. Consistent with the production forecast, the main factor behind this month's reduction is also driven by coarse grains. This month's coarse grain consumption forecast is lowered 6.4 million tons to 1.491 billion tons, down 0.6 percent from last year, almost entirely due to lower feed use, but also expected.
Maize feed use has declined markedly, particularly in the EU and the United States, where smaller domestic harvests have led to tighter supplies, and in Canada, where corn feed use was too high in the previous season due to tighter supplies of other grains, and has declined this season. In addition, the 2022/23 barley feed use forecast is also down, largely due to a contraction in feed use due to lower production in Morocco. In sorghum, an expected decline in feed use in China has led to a downward revision to the forecast for global sorghum feed use.
FAO's forecast for world rice consumption in 2022/23 is revised by 3.6 million tonnes from September to 518.6 million tonnes, down 0.7% from the peak in 2021/22, implying that the non-food consumption of rice is lower than in the previous season. Compared with the excessively high level of consumption, food consumption has roughly kept pace with the population growth rate. Wheat consumption in 2022/23 is forecast at 774 million tons, close to 2021/22 levels, up 1.3 million tons month-on-month as feed demand shifts to wheat due to tighter corn supplies and higher prices in the EU, so wheat feed in the region usage was higher than previously expected.
The forecast for world cereal stocks at the end of the 2023 season is 848 million tons, which is still down 1.6% from the beginning of the period despite an increase of 2.9 million tons from the previous month. Based on the latest stocks and consumption calculations, the global cereal stocks-to-consumption ratio in 2022/23 is 29.7%, down from 31.0% in 2021/22, but still at historically high levels. The downward revision to the forecast for world cereal stocks is mainly due to global coarse grain stocks expected to fall by 5.4 percent from initial levels to 352 million tons, down 2.9 million tons from the previous month. Global corn stocks in 2022/23 are expected to contract sharply by 5.3%, due to lower production in the EU and the United States, which is expected to lead to a sharp reduction in corn stocks; at the same time, an expected increase in China's domestic corn feed use also affects the country's corn stocks.
Since September, FAO has raised its forecast for world rice stocks at the end of the 2022/23 marketing season by 2.1 million tonnes to 193.1 million tonnes, down 1.8% from the record high in 2021/22 but still on record the third highest level ever. Rice inventories in China and India are expected to increase, supporting global rice inventories to remain high. The outlook was less rosy in other regions, with total rice inventories in all other countries down 8.2 percent from the previous season to 50.1 million tonnes, the lowest in nearly three years. In contrast to coarse grains and rice, global wheat stocks are projected to increase by 3.2 percent from the beginning of the period to 303 million tons, up 3.6 million tons from the previous month. Among them, Russia will benefit from the good wheat production prospects, and its wheat inventory will increase; together with Canada, China, and Ukraine, most of the increase in global wheat inventory will be concentrated in these countries.
The FAO's forecast for world grain trade in 2022/23 is 467 million tons, down 2.3 million tons month-on-month and 2.4% lower than in 2021/22. All major grain trade volumes are expected to contract. Coarse grains trade in 2022/23 (July/June) is forecast at 222 million tons, down 3.0 percent from 2021/22 and largely unchanged from last month's forecast. Global corn trade is projected to decline slightly (0.5 percent) from 2021/22 levels, mostly reflecting lower import demand in China and lower exports from Argentina, Ukraine, and the United States. Lower corn harvests are partly responsible for lower export forecasts from the three major exporters, with inflation-control measures in Argentina, disruption from the war in Ukraine, and price disadvantages from a strong dollar also holding back exports in each country, respectively.
For barley and sorghum, lower import demand by China and reduced barley purchases by Turkey due to higher production drive the 2022/23 global barley and sorghum trade forecasts lower than in 2021/22, respectively. Decreased by 13.5% and 14.0%. In terms of exports, lower production is expected to lead to contraction of sorghum exports from the United States and barley exports from Argentina and Ukraine, while Ukraine's export capacity is limited due to the impact of the war.
The latest forecast for world wheat trade in 2022/23 (July/June) stands at 192 million tonnes, little changed from the previous month and down 1.9% from the record level in 2021/22. Among them, wheat exports from Argentina, India, and especially Ukraine fell from the previous season's level. Although exports from Canada, the European Union, and Russia increased due to ample supplies, it was still not enough to reverse the decline. In terms of importing countries, higher production will lead to lower purchases by China, Iran, and Kazakhstan. The forecast for international rice trade in 2023 (January/December) is slightly lower at 53 million tons, down 1.4% from the forecast level in 2022, mainly reflecting tighter export supplies, while importing countries' trade policies and currency movements also have uncertain effects.
