FAO expects winter crops in the northern hemisphere to be generally favorable and forecasts global wheat production to increase by around 3 percent in 2011.This assumes a recovery in wheat production in major producing countries of the Commonwealth of Independent States. So far, conditions of winter crops in those countries are generally favorable.

The latest estimate for the world cereal production in 2010 is 8 million tons more than was anticipated in December but still slightly below 2009. This month's upward revision reflects mostly higher estimates for production in Argentina, China and Ethiopia.

The forecast for world cereal utilization in 2010/11 has been revised up by 18 million tons since December. The bulk of the revision reflects adjustments to the feed and industrial utilization of coarse grains. Larger use of maize for ethanol production in the United States and statistical adjustments to China's historical (since 2006/07) supply and demand balance for maize are the main reasons for the revision, FAO said.