"Supply is not that short. Also absent are factors such as inflation expectations and the demand resulting from biofuel production as a result of surging oil prices," he said.

The U.S. Agriculture Department revised its U.S. production forecast upward by 49 million bushels (1.3 million tons), although global production was lowered by 15.3 million tons, mostly on reductions for the dry weather-affected former Soviet states and European countries. The report also raised its forecast for U.S. wheat exports by 20 percent to 32.7 million tons.

The ending stocks for the United States, the world's largest wheat exporter, was 952 million bushels (25.9 million tons), lower than the previous forecast but still the highest in a decade.

It adjusted its forecast for Russia's wheat production this year downward to 45 million tons from 53 million tons. The world's total wheat production was forecast to be 646 million tons.

Africa vulnerable to food crisis

There is no doubt that a shortage of food supply and price inflation worldwide would have dire consequences for the poorest as those countries, including some in Africa which are struggling to feed their populations, are particularly vulnerable.

The grain export ban imposed by Russia will have the biggest impact on its traditional importers like Egypt and the Middle East countries.

Egypt is the world's largest wheat importer, importing 5 million tons a year, and other Middle Eastern countries also rely on imports for most of their grain needs.

It is widely believed that there is no need to panic about food supply, but food security should remain a concern.

"A key lesson of 2008 is that volatile global financial markets can result in food commodities price speculation that has dire consequences for the world's poorest," Laurie Garrett, author of a recent report released by the U.S. think tank Council on Foreign Relations, says, citing World Bank estimates that 100 million people had been pushed into subsistence poverty by May 2008 due to food inflation in the first quarter of that year.

Speculation pushed wheat prices to record highs in 2008, and led to an export ban in Southeast Asia and even rice riots in some countries.

"If history is any guide, further episodes of strong price fluctuations cannot be ruled out, nor can future short-lived crises," the FAO and the Organization for Economic Cooperation and Development said in a report in June.

There are signs that the latest round of food grain inflation is feeding through to food prices in some African countries. The cost of a loaf of bread in Johannesburg jumped 20 percent in just a few days while food producers in the wealthy world locked down flour and wheat futures, Garrett says.

Even before the latest round of food commodity price surges came, millions of people in Chad, Sudan, Niger and Mauritania had already been experiencing a food security crisis, with many facing starvation, said non-governmental organizations Save the Children and Medecins Sans Frontiers.