According to FAO's latest bi-monthly report, world cereal output is expected to be in the region of 1.872 billion tonnes in 1998 against the record volume of 1.912 billion tonnes in 1997.

"At the forecast level, world cereal production in 1998 would be 2.0 percent below the 1997 record, but still above the average of the past five years and close to trend," FAO said.

The Rome-based agency said the reduction was due mainly to sharp reductions in wheat and coarse grain output in countries of the former Soviet Union.

"Yields have been well below normal in several of the major producing areas because of the drought during the summer," FAO said. "The forecast of the rice crop in Asia has also been revised downward since the last report, contributing to the overall reduction," the agency said.

FAO also revised downwards its global cerealstock forecast for the end of 1999 to 323 million tonnes against its end-1998 level of 329 million tonnes.

The agency said, however, that immediate stocks remained at a satisfactory level to secure world food security.

"Assuming that current forecasts of production and utilisation materialise, the global stock-to-utilisation ratio in 1998/99 is now forecast at 17 per cent," FAO said.

The organisation considers the 17-18 per cent range as the minimum level necessary to safeguard global food security.

FAO said a number of countries were facing local food emergencies, with East Africa one of the worst hit regions.

A number of Asian countries were still suffering from food shortages following heavy rains and flooding linked to the La Nina phenomenon.

"In Indonesia, a recent FAO/WFP mission found that food security has worsened as production fell further and the economic crisis deepened," FAO said in its report.

The agency said it was too early to assess the full impact on food supply of HurricaneMitch, which ripped a trail of death and destruction through Central America at the beginning of November.

"An assessment of damage has not yet been made but hopes of recovery from last year's drought-affected crops, following the good results obtained from this year's first season crops, have vanished," FAO added.