Global Cereal Output Set to Hit Record in 2025, But Risks Remain: FAO

The Food and Agriculture Organization (FAO) of the United Nations has revised its global cereal production forecast for 2025 upward by nearly 14 million tonnes, projecting an all-time high of 2,925 million tonnes. This marks a 2.3 percent increase over the previous year and is primarily attributed to improved prospects for wheat, maize, and rice - in that order.

The July update reflects stronger-than-expected yields in major producing countries, especially India and Pakistan, as well as positive adjustments to crop prospects in Brazil and parts of Southeast Asia. However, the FAO also cautioned that climate-related risks and ongoing geopolitical tensions continue to pose uncertainty for both production and trade in the coming year.

Wheat, Maize, and Rice Drive Gains
Global wheat production is now forecast at 805.3 million tonnes for 2025, representing a 0.7 percent increase from the previous monthly estimate and a 0.9 percent rise over 2024 levels. The increase is largely due to official data from India and Pakistan showing better yields and record production in India.

The outlook for coarse grains, including maize, has also been raised slightly to 1,262 million tonnes, which is 3.5 percent higher than last year. This category remains the main driver of overall cereal growth in 2025. The gains are led by strong maize yields in Brazil, alongside upgraded maize planting estimates in India, where rising domestic demand for animal feed and industrial uses is encouraging farmers to expand cultivation.

However, these improvements have been partially offset by production downgrades in Ukraine and the European Union. In Ukraine, the ongoing conflict and dry-weather conditions are affecting yields, while the EU faced a minor downward revision due to a reduced planted area.

Meanwhile, global rice production for 2025/26 is projected at 555.6 million tonnes (milled basis) - a new record and 1 percent higher year-on-year. The increase is driven by higher area estimates in India, Bangladesh, Pakistan, and Viet Nam. Conversely, rice production forecasts were lowered for Iraq and the United States.

Cereal Use, Stocks, and Trade Also Expected to Rise
Alongside record output, global cereal utilization in 2025/26 is expected to reach 2,900 million tonnes, up 0.8 percent over 2024/25 and 2 million tonnes higher than the previous month’s forecast. Notably, coarse grain use is projected at 1,548 million tonnes, reflecting higher consumption of barley, maize, and sorghum.

However, the FAO lowered its wheat utilization forecast by 4 million tonnes due to reduced demand expectations in China, Morocco, and the U.S. Despite this adjustment, wheat use is still projected to grow by 0.8 percent from 2024/25.

Global rice utilization is projected to reach 550.4 million tonnes, up 1.8 percent, thanks to rising food demand and increasing ethanol production in India.

In terms of global cereal stocks, the FAO expects them to rise to 889.1 million tonnes by the end of the 2025/26 season—a 2.2 percent increase compared to opening levels. The upward revision is primarily due to wheat stocks, which are now forecast at 321 million tonnes, thanks to higher reserves in Australia, China, Pakistan, Russia, and the U.S.

Coarse grain stocks are marginally revised down due to lower barley stocks in key producing countries, but overall they are still expected to rise by 3.6 percent to 353.6 million tonnes. Rice stocks are forecast at a record 214.4 million tonnes, reflecting improved production and stockpiling in India, Bangladesh, Ecuador, and Pakistan.

Trade Outlook Mixed
The FAO projects global cereal trade in 2025/26 to rise by 1.2 percent to 486.9 million tonnes. However, trends vary across crops. Coarse grain trade, estimated at 226.6 million tonnes, is likely to decline slightly by 0.6 percent, with maize exports expected to drop by 1.9 percent. This is due to lower supply from Ukraine, although this is partially balanced by rising exports from Uganda. In contrast, barley and sorghum trade are expected to grow by 2.8 percent and 15.3 percent, respectively.

Wheat trade is projected to increase by 4.0 percent over the previous season but has been revised downward by 0.6 million tonnes this month due to reduced export prospects from Russia, despite gains in Australia and Ukraine. International rice trade is set to hit a record 60.8 million tonnes in 2025, up 2 percent year-on-year, with Cambodia and Vietnam raising their export outlooks.