Significantly, it said that carryover stocks from this year's production would be around 187 million tonne or 20% more from their 30-year low opening levels.
Accounting for a large part of this year's strong growth have been the major producing countries in Europe, where latest estimates now point to a significant (25%) increase in production in 2008, following larger plantings and generally above-average yields, FAO said in its report.
The gains, compared with the previous year, are particularly notable in eastern parts, after drought-reduced crops in 2007.
However, also in North America, favourable weather led to better to yields in the US and Canada, and significantly larger outputs have been estimated in both countries.
By contrast, aggregate 2008 wheat output in Asia could slip back somewhat from last year's record, as persisting dry weather reduced yields, especially in the Near East subregion, in Turkey and the Islamic Republic of Iran. Elsewhere in the northern hemisphere, aggregate output in North Africa recovered significantly from last year's drought-reduced level.
In the southern hemisphere, the bulk of the major 2008 wheat crops will be harvested between October and the end of the year. In South America, unfavourable weather conditions continue to afflict some major producing areas of Argentina, after plantings were already reduced by drought. As a result, the country's wheat crop is now forecast to be 25% smaller than last year's good level.
In Oceania, prospects for the wheat crop in Australia have deteriorated somewhat over the past two months because of dry weather. Nevertheless, this year's output is still set to recover sharply from last year's drought-reduced level.
The agency has also forecasted a record rise in global wheat trade in 2008-09 (June-July). It said international wheat trade (exports) in 2008/09 (July/June) is forecast to reach 119 million tonne, up 7%, or nearly 8 million tonne, from 2007/08.
Behind the global expansion are rising wheat imports by Asia, currently forecast at 57 million tonne, or 10 million tonne up from the previous season.
This anticipated sharp increase in imports is mostly on account of significant crop reductions in several countries on the continent, most notably the Islamic Republic of Iran, where this year's production could shrink by more than one-third because of severe drought. As a result, the country is expected to turn into a leading world importer for the first time, purchasing a decade-high 6 million tonne in 2008/09, after many years of near self-sufficiency.
Other countries in Asia, where wheat imports this season may also increase sharply, include Afghanistan, Bangladesh, Pakistan and the Syrian Arab Republic. In addition, Indonesia is expected to take advantage of the lower world prices to import more, while competitive world prices of feed wheat are likely to boost imports by the Republic of Korea. Saudi Arabia, traditionally self-sufficient in wheat, is forecast to purchase a sizable volume from world markets this season.