Challenging weather conditions in various countries, coupled with continuing political tensions in the Black Sea region have made food markets more volatile, according to the FAO's first major forecast for 2014.
The report published by the United Nations Food and Agriculture Organisation (FAO), reveals a fall of 2.4% since 2013 in global cereal production - but noted that global output is still expected to be the second largest ever
The biannual Food Outlook report - which provides information on the short-term market situation and outlook for major food stuffs - puts cereal production at 2 458 million tonnes (including milled rice), with declines likely to be more pronounced for coarse grains.
However, analysts have also suggested that there is no cause for concern at the current time, and before the main 2014/2015 seasons get underway - assuming trade flows are not negatively affected by tensions in the Black Sea region.
"Overall, world cereal stocks are expected to remain at relatively comfortable levels," said the FAO in an associated release.
Meanwhile, lower pricing and El Niño weather conditions could mean that global rice production is lower in 2014, especially in Asia.
"In Thailand, a softening of producer prices could be the main factor leading to a contraction in rice planting and production," said FAO. "While production may be lower, international trade could expand to record levels in 2014, sustained by ample supplies in exporting countries and increased purchases by traditional importers like Bangladesh, Indonesia and the Philippines."
Meat and dairy
The FAO report projects meat and milk production to increase in 2014, with global meat production expected to grow by around 1.1% to 311.8 million tonnes - reflecting growth in the developing countries, which are mainly behind the rising global demand.
"There are marked differences in projected trade among meat varieties, with bovine and poultry meat on the upswing and ovine products and pork on the decline," said the FAO. "Poultry remains the main product traded, claiming 43% of the total market, followed by beef, pork and mutton, respectively."
While international prices for meats have remained at historically high levels since the beginning of 2011, with no sign of an overall decrease, international dairy prices declined in March and April, registering levels close to those of a year ago.
Milk trade is, however, forecast to rise 1.8% in 2014 - reaching 69 million tonnes - driven primarily by increasing demand from Asia.