According to the Food and Agriculture Organization’s (FAO) latest Food Outlook report, cereal prices, particularly for wheat and maize, have reached record highs as a result of poor harvests in key producing countries and a fast-growing demand for biofuels.  

 

 Global expenditures on imported foodstuffs in 2006 could reach $374 billion, the highest level for the past 10 years, as a result of price increases rather than increases in the volumes of food imports.  

 

 FAO’s latest forecast of world wheat output in 2006 stands at roughly 592 million tonnes, 5.3% down from 2005. However, increased winter plantings and good growing conditions could lead to a rebound in 2007 harvests. World production of coarse grains in 2006 stands at 981m tonnes, down by 2.1% from 2005, but above the average of the past five years.  

 

 Oilseed prices have also gone up, which is likely to trigger a shift away from oilseed cultivation towards more profitable cereal crops in the coming season.   

 

Global sugar production is expected to outpace demand again after three years of deficit. Production is forecast to increase to 155.5m tonnes in 2006/07.