* Wheat production seen falling 5.5 pct to 661 mln T
* World cereals production seen down 2.7 pct 2.284 bln T
* World food prices eased slightly in October
(Adds comments from FAO economist, details)
By James Mackenzie
ROME, Nov 8 Global supply of key cereal staples
including wheat is to tighten sharply in the 2012/13 crop season
as wheat and maize output feels the pinch of the worst U.S.
drought in more than half a century, data from the United
Nations food agency showed.
Separate figures indicated a slight easing of pressure on
overall food prices on Thursday, but the Food and Agriculture
Organisation's (FAO) global index stayed close to levels seen in
the 2008 crisis when food riots broke out in some countries.
The FAO's November Food Outlook report pointed to continuing
pressure on grains output in the current season following this
year's droughts in key producer regions from the Black Sea to
the U.S. cornbelt.
Wheat production, which has also suffered heavily in the
droughts in eastern Europe and central Asia, was seen falling
5.5 percent to 661 million tonnes, the agency said.
World cereals production is expected to fall 2.7 percent to
2.284 billion tonnes in the 2012/13 season, it said, trimming
slightly its previous output forecast of 2.286 billion tonnes.
"This season's world cereal supply and demand balance is
proving much tighter than in 2011/12 with global production
falling short of the projected demand and cereal stocks
declining sharply," the FAO said.
The Black Sea drought is set to cut wheat output in Russia
and Ukraine by some 30 percent, while Kazakhstan will see its
crop down by more than half.
Wheat production is set to rise in the United States but
U.S. maize output was decimated by a drought which caught
farmers by surprise and slashed the corn crop.
On wheat, FAO noted that levels were close to the average of
the past five years and it said plantings in major producing
regions next year would match or even increase over levels seen
in 2012, pointing to a rise in production next season.
However senior FAO economist Abdolreza Abbassian said the
forecast was still very tentative and it would require a strong
rise in production next year to ease pressure on prices.
"Anything short of a significant increase would mean a
further need to draw down stocks, which means getting to
critically low levels and therefore higher prices," he said.
"We need very strong production for wheat, corn and
soybeans, certainly these three important crops," he said.
FAO's monthly reading of world food prices showed some
easing in October, largely because of a dip in cereals and oils
prices in the month but the wider outlook remains volatile and
uncertain, Abbassian said.
"It's a very mixed picture," he said. "The uncertainty we
are dealing with is not just limited to supply, it's also to do
with demand," he said.
The Rome-based agency said its monthly Food Price Index,
fell to 213.5 points from 215.5 points the previous month, but
stayed near 2008 levels.
It said reduced wheat trade activity and slowing demand for
maize by livestock and industrial consumers during the month had
cut grains prices, while higher palm oil output in Southeast
Asia and weak import demand had reduced edible oil prices.
The FAO lifted its estimate of rice production but cut its
forecast for coarse grains output and slightly lowered its
estimate of global grains stocks at the end of the 2012/13
season to 497.4 million tonnes.
It said global cereal utilization in 2012/13 would decline
slightly from the previous season but would still exceed
Declines in animal feed use and industrial maize for ethanol
production in the United States would cut utilization of wheat
and coarse grains but would be balanced by a 1.5 percent
increase in rice consumption.
(Reporting By James Mackenzie; editing by Veronica Brown and